International Financial Institutions (IFIs)

International Financial Institutions (IFIs) are financial institutions established by two or more countries. They are subject to international law and are owned and managed by national governments. Other international institutions and organizations may also act as shareholders.

List of International Financial Institutions

The most prominent IFIs were established after World War II to aid in the reconstruction of Europe and foster international cooperation in managing the global financial system.

International Financial Institutions

• International Monetary Fund (IMF)
• World Economic Forum (WEF)
• World Bank
• World Trade Organization (WTO)
• Asian Development Bank (ADB)
• Asia-Pacific Economic Cooperation (APEC)

International Financial Institutions (IFIs)

Asia Pacific Trade Agreement (APTA)

• APTA is a trade agreement between Bangladesh, China, India, Laos, Mongolia, South Korea, and Sri Lanka.
• It aims to promote trade and economic cooperation among member countries.

BRICS (Brazil/Russia/India/China/South Africa)

• BRICS is a group of five emerging economies: Brazil, Russia, India, China, and South Africa.
• It aims to promote economic cooperation and development among member countries.

International Monetary Fund (IMF)

• The IMF is an international organization that promotes financial stability and monetary cooperation among its member countries.
• It provides loans to countries facing financial difficulties and helps them develop economic policies.

Mission & Establishment

• The IMF was established in 1944 at the United Nations Bretton Woods Conference.
• Its primary mission is to ensure the stability of the international monetary system.

Reports Released by the IMF

• World Economic Outlook
• Global Financial Stability Report
• Regional Economic Reports
• Fiscal Monitor

World Economic Forum (WEF)

• The WEF is an international organization that engages leaders from business, politics, academia, and other fields to discuss global issues.
• It hosts the annual meeting in Davos, Switzerland.

Reports released by the WEF

• Global Gender Gap Report
• Outlook on Global Agenda
• Global Competitive Index
• Global Information Technology Report
• Environmental Performance Index
• Inclusive Growth & Development Report
• Travel & Tourism Competitiveness Report
• Energy Transition Index
• The Global Risk Report

World Bank

• The World Bank is an international organization that provides financial assistance to developing countries.
• It also provides technical assistance and advice on economic development.

• Established in 1944 at the Bretton Woods Conference, alongside the IMF.
• Headquartered in Washington D.C.
• An international financial institution providing loans to countries for developmental programs.
• Comprises 189 member countries, represented by a Board of Governors who are the ultimate policymakers.

Reports Released by World Bank:

• Global Economics Prospects
• World Development Report
• Ease of Doing Business Report
• Logistics Performance Index

World Trade Organization (WTO)

• The only global international organization dealing with trade rules between nations.
• Agreements are negotiated and signed by most trading nations and ratified in their parliaments.
• Aims to ensure smooth, predictable, and free trade.

WTO Important Facts:

• Headquarters: Geneva, Switzerland
• Established: January 1, 1995
• Established by: Uruguay Round Negotiations (1986-94)
• Membership: 164 members representing 98% of world trade
• Budget: 197 million Swiss Francs (2020)
• Secretariat Staff: 623

Asian Development Bank (ADB)

• A multilateral development finance institution founded in 1966 by 31 member governments.
• Promotes social and economic progress in the Asian and Pacific region.
• Membership has grown to 57 countries, with 41 from the region and 16 from outside.
• Focuses on the needs of smaller or underdeveloped countries.
• Prioritizes regional, sub-regional, and national projects and programs.

ADB’s Main Objectives:

• Extend loans and equity investments for economic and social development of developing member countries (DMCs).
• Provide technical assistance for development projects, programs, and advisory services.
• Promote and facilitate investment of public and private capital for development purposes.
• Respond to requests for assistance in coordinating development policies and plans of DMCs.

Asia Development Bank (ADB)

Goals of ADB:

• Promoting economic growth
• Reducing poverty
• Developing human capital
• Improving the status of women
• Protecting the environment

Asia-Pacific Economic Cooperation (APEC)

• APEC is a regional economic forum established in 1989 to leverage the growing interdependence of the Asia-Pacific region.
• It consists of 21 members.
• APEC aims to create greater prosperity for the people of the region by promoting balanced, inclusive, sustainable, innovative, and secure growth by accelerating regional economic integration.
• The term “economies” is used to describe APEC members because the APEC cooperative process is predominantly concerned with trade and economic issues with members engaging with one another as economic entities.

Sustainable & Inclusive Asia-Pacific

• APEC works to help all members of the Asia-Pacific region participate in economic growth.
• APEC projects provide digital skills training for rural communities and help indigenous women export their products overseas.
• Recognizing the impacts of climate change, APEC members also implement initiatives to increase energy efficiency and promote sustainable management of forest and marine resources.
• The APEC forum adapts to allow members to deal with important new challenges to the region’s economic well-being, including ensuring disaster resilience, planning for pandemics, addressing terrorism, and so on.

Asia-Pacific Trade Agreement (APTA)

• APTA, formerly known as the Bangkok Agreement, is a preferential tariff arrangement that aims at promoting intra-regional trade through the exchange of mutually agreed concessions by member countries.
• APTA members are Bangladesh, China, India, Republic of Korea, Lao PDR, and Sri Lanka. Mongolia is to become the seventh member.
• APTA recognizes the special needs of the Least Developed Countries (LDCs) and calls for concrete preferential measures in their favor.
• Rules of origin conditions are also more flexible for the LDCs.

BRICS

• Brazil, Russia, India, China, and South Africa (BRICS) are leading emerging economies and political powers at the regional and international level.
• The acronym was coined in 2001 to highlight the exceptional role of important emerging economies.
• The four countries themselves started to meet as a group in 2006, and South Africa joined in 2010, forming BRICS.

Objectives of BRICS:

• Build a credible repository of data and information for members’ use.
• Build a database of credible business partners across different geographies and industry verticals.
• Provide advisory services to members on legal and other business-critical services.
• Build social and cultural exchange between interested nations by promoting business around local art and culture.

Focus Areas of BRICS:

• Strengthening economic cooperation
• Enhancing political and security cooperation
• Promoting cultural and people-to-people exchanges
• Addressing global challenges

International Financial Institutions

International Financial Institutions (IFIs) are financial institutions established by two or more countries and are subject to international law. They play a crucial role in promoting economic development and cooperation among nations.

Key IFIs

Some of the leading IFIs in the world include:

• International Monetary Fund (IMF): Established in 1944, the IMF is headquartered in Washington, D.C., and works to promote global monetary cooperation, facilitate international trade, and provide financial assistance to member countries facing economic difficulties.

• World Economic Forum (WEF): Based in Geneva, Switzerland, the WEF is an international non-governmental organization that engages leaders from business, politics, academia, and civil society to shape global, regional, and industry agendas.

• World Trade Organization (WTO): The WTO is an intergovernmental organization that regulates international trade. It was established in 1995 and is headquartered in Geneva, Switzerland.

• World Bank: The World Bank is a group of five international organizations that provide financial assistance to developing countries. It was established in 1944 and is headquartered in Washington, D.C.

• Asian Development Bank (ADB): The ADB is a regional development bank that provides loans and technical assistance to Asian countries. It was established in 1966 and is headquartered in Manila, Philippines.

• Asia-Pacific Economic Cooperation (APEC): APEC is a regional economic forum that promotes trade and economic cooperation among its member economies in the Asia-Pacific region. It was established in 1989 and is headquartered in Singapore.

• Asia Pacific Trade Agreement (APTA): APTA is a trade agreement among six developing countries in the Asia-Pacific region. It was established in 1975 and is headquartered in Dhaka, Bangladesh.

Significance of IFIs

IFIs play a vital role in the global economy by:

• Promoting economic development and cooperation among nations.
• Providing financial assistance to countries facing economic challenges.
• Facilitating international trade and investment.
• Setting standards and regulations for international financial transactions.
• Promoting sustainable development and addressing global issues such as poverty, climate change, and inequality.

International Financial Institutions are key players in the global economy, facilitating cooperation, providing financial assistance, and promoting economic development. Their work impacts the lives of people around the world and contributes to a more stable and prosperous global financial system.

International Monetary Fund (IMF)

• The IMF was established in July 1944 at the United Nations Bretton Woods Conference in New Hampshire, United States.

World Trade Organization (WTO)

• The WTO is headquartered in Geneva, Switzerland.

World Bank

• The World Bank is headquartered in Washington D.C.