Question

Recently a meeting was organized by the IMF and the World Bank with International financial institutions (IFI) members, everyone discussed the unexpected nature of COVID-19, its consequences and how it will affect the economic development of the countries. How to mitigate this pandemic problem and its impact on various countries development progress. The International financial institutions (IFIs) took encouraging steps to increase their financial contribution and they are ready to help for the needed countries. No country is safe if the pandemic affected everywhere in the world.

Answer the following questions:

(a). In your opinion evaluate the nature of international financial institutions and how it will be helpful to the various nations, and Give your comments on that? )

(b). Suggest the major types of international financial institutions and its contributions towards various country’s economic development, Justify the answers with suitable example

Answer 1

a. Nature of International Financial Institutions:

During this hour of crisis, many of the industries need a sound and experienced advise to rebuild the businesses. Non-Banking Financial Companies play a vital role in doing so. Now that, the world is opened up for many countries, and expertice companies can enter into the markets of other countries and help them with their specialist services and thereby earn benefits for themselves too. Only concern the the home country in inviting foreign funding in NBFCs would the security of the data. If this point is taken care with the appropriate measures, it would definitely help in rebuilding many of the businesses.

b. Asset finance company and Investment companies are the major types of International financial institutions which may contribute country's economic development. Ex. Fullerton is wholly owned by a Singapore based Tesamek in India, which is contributing inproviding financial services. If there are restrictions in foreign funding in some of the countries, they may opt to hire foreign expertise in their companies to get the services, and thereby come out of the crisis.