The International Monetary Fund Vs. The World Bank

The International Monetary Fund Vs. The World Bank

The International Monetary Fund Vs. The World Bank

The International Monetary Fund Vs. The World Bank

MBNY Media Inc.

The IMF's Role in Globalization

The difference between the International Monetary Fund and the World Bank as institutions facilitating globalization are in the needs, problems, and global circumstances that each institution addresses.

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The IMF was created with the intent of helping the governments in its interest to leverage and aide opportunities for globalization.

The IMF analyzes global market trends, economic performance, and notifies the governments on its board of global problems that they can address. The IMF also oversees the international monetary system, which is the system of exchange rates and global payments that allow countries to buy and sell goods with one another.

The IMF was founded in Bretton Woods, New Hampshire, where it’s founders signed its Articles of Agreement in July of 1944.

This would allow the founders of the IMF to create an infrastructure for global trade that would bolster international exchange rates through an open system of value exchanges.

The World Bank's Role in Globalization

The World Bank

In contrast to the way the International Monetary Fund approaches globalization, the World Bank approaches globalization as an opening to “reach global solutions to national challenges (Cengage Learning, 2017).”

The World Bank accomplishes its process of globalization using five areas of focus.

  1. First, the World Bank uses trade expansion as a means to global integration.

  2. Second, the World Bank uses it’s analytical and advisory roles to create potentials for significant gains from global trade.

  3. Third, the World Bank initiates general agreements between participating governments to strengthen financial sectors globally.

  4. Fourth, the World Bank acts as a conduit to information technology and knowledge to facilitate growth in developing countries.

  5. Finally, the World Bank places emphases on fighting transmittable diseases while also prioritizing the necessity to preserve cultural traditions in a dwindling globalized world.

The World Trade Organization's Role in Globalization

The World Trade Organization does have a role in facilitating globalization.

The WTO acts as a mediator or independent third party who is in charge of administering trade agreements, settling trade disputes, and assisting developing countries in creating foreign trade policies that are equitable to all countries involved and not just the lender.

It is imperative to the integrity of global trade, that an independent organization moderate and reviews national trade policies and how they relate to current and trending global economic issues.

The liberalization of the trading system ties to the effectiveness of globalization.