Question

The International Monetary Fund has been in the news lately and so has the Export-Import Bank of the United States. Define the purpose of both and discuss their impact on global business. Why are they so controversial?

Answer 1

The International Monetary Fund is an international organisation with its headquarters at Washington, it emerged as a result of Bretton Woods Conference of 1944, it has an objective to promote international trade, international cooperation, to stabilize international exchange rate and to avail financial resources to the member countries to meet there balance of payment needs.

Export - Import Bank of US, is a financial institution, that aim to promote cross border or international trade, it assist in grating loans to importers and the exporters through proper channels.

Now, they both are important with respect to promotion of free and fare international trade by suggesting tax reforms, FDI easing policies, privatisation, fiscal discipline, market determined interest rates, easy loans, e governence, transparency etc, they are controvercial due to current trends of protectionism and anti globalisation drives by many developed countries, countries are now focusing more on bilateral trades, restricting free trades by imposing various tariffs, countervailing duties, thus hurting trade and economies world wide.