Positive views of the International Monetary Fund Essay

Is in that respect any harder job than regulating solely of the global commercialises m unmatchedy? Probably not, the topic being discussed through with(predicate)out this essay leave behind be the international financial fund and its involvement in the international market. Much has been said active the I. M. F whether it is tyrannical or negative, neo-Marxist Che Guevara said The interests of the IMF represent the big international interests that take inm to be established and concent gaitd in Wall Street. here(predicate) he criticizes how the IMF is considered to be run by the United States which occupies a blackball power in the decision making at the IMF, this is important to see because it brings up the other side to the IMF, the side that is not so collateral and the one that people feel rattling critical of. Even though people like Che and Stieglitz bring up the negative characteristics of the IMF it is not the further qualities that the fund has.The IMF has a lso has many positive qualities, this essay will go over these qualities by looking at the IMFs debt restructuring cases, looking at how the decisions are made in the fund and finally the long consideration positive effect that the IMF has on promoting democracy. As mentioned before the IMF has gone through practically criticism in past years, yet the work they agree done on debt relief has done much to boost up their re readyation. Cases like Argentina, the Dominican Republic and much more show that the IMF is very capable of improving conditions within a earth by debt restructuring programs.In 2005 the IMF incisioned debt reconstruction in Argentina, the process was held back more that they would have desire due to court proceedings in New York. After this detention the IMF was able to do roughly real work in debt replacement with Argentina. The country participated 76% in the debt exchange and since then they have seen much improvements in their debt structure and debt- indite. In early whitethorn the Argentinean authorities regained market access for the first time since the year 2001.Also as a result of rebalancing of the countries credit rating, spreads of Argentinas external debt fell hugely from 6000 basis points to 462 basis points. ( ) The Dominican Republic is another country which was support by the IMF for debt reconstruction, which ended in success. The Dominican Republic started on an stinting recovery route by utilizing stand-by arrangements, which are. The plan of this program was to pop off the financial needs during 2005-06 through a debt exchange process and more, all of which being supported by IDB and the World Bank.The debt exchange ended on May 15th 2005, and had a very gamey participation rate by the Dominican Republic and this allowed for a large relief of general cash flow (576 million US) for the government, an increase in the maturity profile of the debt and a decline in over 130 basis points which understandably out performed the rest of the market ( ). These are great examples to how the IMF can have a positive influence on the economic conditions of a certain country. away from these cases thither are many people who still oppose the IMF and its slipway of intervening, like Joseph Stieglitz wrote in his book that the IMF set the bar so high for debt relief that few qualified (Stieglitz, 227), yet cases like Argentina and the Dominican do prove their potential for aid. Decisions can be crucial to ones life, drawing the line amid failures or success, similar goes for the internationalist monetary fund except their decisions could be the difference between redemptive a country and having that countrys economic system fail.When a person invests into a company or corporation and holds the majority of shares in it, that person can pretty much make all the decisions he wants. It is very similar in the IMF the country becoming member bump offs a certain number of ballots and then receives more vote power when that country invests more money.This is stated in further detail in the coin article XII, section 5 Each member shall have two hundred fifty vote plus one additional vote for each part of its quota equivalent to one hundred thousand U.S dollars (Gold, 18). The two hundred fifty basic votes were meant to give a misadventure to the countries who have just became members or were not largely developed, it was also mean so that countries were not entirely able to buy their voting power, as do most people perceive the United States did to gain its supposed Veto power. Gold (1972) brings a quote from an unstated source that brings up the command of why all countries do not have the same amount of voting power.It is said that it would be unwise to have short countries have the same voting power as the larger ones, since it is for surely that there will be more small country members than there are large. Contrary to that point, he says that it would be un intermedi ate to give voting power on the solemn basis of how much money they put in. Although the exact figures of recent years are unavailable, the effect of the basic votes were kind of visible in the 70s, where 37 countries of the 137 members of the fund had basic votes that accounted for half or more of their total voting power (Gold, 19).The counter argument this type of voting formula could be that it resembles to much a hush-hush corporation, yet evidence shows that it has help the small countries to at least attain a sufficient amount of votes. People are very in all likelihood to pre-judge the outcome of a certain event, even without waiting to see what will happen in the end. This can also be the case for views against the IMF, settle its intervention or programs on the basis of the results produced in the first year. A field of operations was done by Nelson and Wallace to see what type of influence the IMF bring plans had on democracy inside the country obtaining the loan.W hat they found in their study was that the impact of the IMF loans did not have very much effect on democracy within the given country in the time dust of one year, but the impact of IMF impart only took place between three and five years ( Nelson & Wallace, 24-25). Again this hints to the fact that anti-IMF people may be quick to judge the impact that the Fund has on some(prenominal) country being helped.Other results from the Nelson and Wallace research was that the impact of the IMFs lending could vary from one region to another such as in Eastern Europe where one could see a 3. increase in polity1 label over a period of 5-years and then in East-Asia there was a negative change of 1. 5 in the polity score (Nelson & Wallace, 27-28). Again these results presented shows that the IMFs implication can have many diametric levels of influence depending on the region that is being lent the money. One affaire is for sure, it is that there are more cases of improved polity 31 and hav ing two regions that were not significant results (Nelson & Wallace, 27-28). Yet, anti-IMF people may say that it is unfair that that one country has a negative outcome and the IMF is unfair and bend towards the other countries.In conclusion, the IMF shows many positive characteristics to their involvement in the world. Their positive ranges from helping developing countries to reconstruct and eliminate their debt by means of a debt exchange with the IMF to the IMF having a positive influence on democracy when lending money to a country. Also, the way that the IMF voting power is distributed shows a fair way to doing it by awarding all members of the fund with a start up amount of basis points to be able to have some power.