Advantages And Disadvantages Of Imf

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International Monetary Fund
The foundation of IMF (International Monetary Fund) was laid in 1944 in the Bretton woods conference and was established in 1945 with the membership of 29 countries. IMF was established to help countries in rebuilding of their economies which were badly affected due to World War 2. The purpose for the establishment of IMF was to make sure that the international monetary system runs smoothly.
World Bank
World Bank is a financial institution of United States which was formed in July 1944 in Washington D.C. Like IMF it also provides loans to developing countries. The goal of World Bank is to reduce poverty and promote foreign investment and international trade. Its loans also help to improve the standard of living of
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IMF and World Bank are both criticized for the harsh conditions attached with their loans. Conditions are basically the commitments that IMF and World Bank take from the developing countries each time they lend or grant something. The borrower countries are bound to fulfil these conditions if they need funds. Mostly the strict conditions by these lending institutions include privatization, liberalization of tade, investment and financial sector, devaluation of currency, increase in taxes, and increasing unemployment and inflation…show more content…
The purpose of their existence should have been the development of the economies of low wage nations but their loans and conditions clearly shows that they lended to Pakistan because they wanted to make Pakistan their permanent slave and so that the country always remain dependent on their dictation.IMF and World Bank loans hinder development and put burden on the masses. The authorities think that the problem of Pakistan increased because of non-cooperation with the IMF and World Bank programs. But it is not true. Their programs have led to increase in the charges of gas, electricity, petrol etc. The imposition of taxes and cut in tariff rates on the advice of IMF has greatly affected the incomes of the poor and middle class earners. The absolute poverty has increased which has promoted unsocial activities in the country. This shows that IMF and World Bank’s lending is not a blessing at all rather it is taken as a measure to cripple Pakistan’s economy and make the country a toy in the hands of international financial
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