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About the IMF

The International Monetary Fund (IMF) is an organization of 186 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

Overview
The IMF works to foster global growth and economic stability. It provides policy advice and financing to members in economic difficulties and also works with developing nations to help them achieve macroeconomic stability and reduce poverty.

What they do
With its near-global membership of 186 countries, the IMF is uniquely placed to help member governments take advantage of the opportunitiesand manage the challenges posed by globalization and economic development more generally. Key IMF activities policy advice to governments and central banks based on analysis of economic trends and cross-country experiences; research, statistics, forecasts, and analysis based on tracking of global, regional, and individual economies and markets; Loans to help countries overcome economic difficulties; confessional loans to help fight poverty in developing countries; and Technical assistance and training to help countries improve the management of their economies.

IMF and the global financial crisis

Original aims provide a forum for cooperation on international monetary problems facilitate the growth of international trade, thus promoting job creation, economic growth, and poverty reduction; promote exchange rate stability and an open system of international payments; and Lend countries foreign exchange when needed, on a temporary basis and under adequate safeguards, to help them address balance of payments problems. An adapting IMF Enhancing IMF lending facilities. Improving IMF governance Strengthening the monitoring of global, regional, and country economies. Helping resolve global economic imbalances. Analyzing capital market developments. Assessing financial sector vulnerabilities.

2 Working to cut poverty. Greater accountability and transparency.

How to do it
The IMF's main goal is to ensure the stability of the international monetary and financial system. It helps resolve crises, and works with its member countries to promote growth and alleviate poverty. It has three main tools at its disposal to carry out its mandated: surveillance, technical assistance and training, and lending.

Surveillance
This process of monitoring and discussing countries economic and financial policies is known as bilateral surveillance. On a regular basisusually once each yearthe IMF conducts in depth appraisals of each member country's economic situation. It discusses with the country's authorities the policies that are most conducive to a stable and prosperous economy.

Country surveillance
Country surveillance is an ongoing process that culminates in regular (usually annual) comprehensive consultations with individual member countries, with discussions in between as needed. The consultations are known as "Article IV consultations" because they are required by Article IV of the IMF's Articles of Agreement. During an Article IV consultation, an IMF team of economists visits a country to assess economic and financial developments and discuss the country's economic and financial policies with government and central bank officials.

Regional surveillance
Regional surveillance involves examination by the IMF of policies pursued under currency unionsi ncluding the euro area, the West African Economic and Monetary Union, the Central African Economic and Monetary Community, and the Eastern Caribbean Currency Union. Regional economic outlook reports are also prepared to discuss economic developments and key policy issues in Asia Pacific, Europe, Middle East and Central Asia, Sub-Saharan Africa, and the Western Hemisphere.

Global surveillance
Global surveillance entails reviews by the IMF's Executive Board of global economic trends and developments. The main reviews are based on the World Economic Outlook reports and the Global Financial Stability Report, which covers developments, prospects, and policy issues in international financial markets. Both reports are published twice a year, with updates being provided on a quarterly basis

Technical assistance and training

The IMF shares its expertise with member countries by providing technical assistance and training in a wide range of areas, such as central banking, monetary and exchange rate policy, tax policy and administration, and official statistics The IMF provides technical assistance and training mainly in four areas: Monetary and financial policies Fiscal policy and management

3 Compilation, management, dissemination, and improvement of statistical data Economic and financial legislation.

Research and data

Supporting all three of these activities is the IMF's economic and financial research and statistics. In recent years, the IMF has applied both its surveillance and technical assistance work to the development of standards and codes of good practice in its areas of responsibility, and to the strengthening of financial sectors. These are part of the IMF's continuing efforts to strengthen the international financial system and improve its ability to prevent and resolve crises.

Membership
The IMF currently has a near-global membership of 186 countries. To become a member, a country must apply and then be accepted by a majority of the existing members. In June 2009, the former Yugoslav republic of Kosovo joined the IMF, becoming the institution's 186th member.

Subscriptions
A member's quota subscription determines the maximum amount of financial resources the member is obliged to provide to the IMF. A member must pay its subscription in full upon joining the IMF: up to 25 percent must be paid in the IMF's own currency, called Special Drawing Rights (SDRs) or widely accepted currencies (such as the dollar, the euro, the yen, or pound sterling), while the rest is paid in the member's own currency.

Voting power
The quota largely determines a member's voting power in IMF decisions. Each IMF member has 250 basic votes plus one additional vote for each SDR 100,000 of quota. Accordingly, the United States has 371,743 votes (16.77 percent of the total), and Palau has 281 votes (0.01 percent of the total).

Collaborating with others

The IMF collaborates with the World Bank, the regional development banks, the World Trade Organization (WTO), UN agencies, and other international bodies. While all of these organizations are involved in global economic issues, each has its own unique areas of responsibility and specialization. The IMF also interacts with think tanks, civil society, and the media on a daily basis.

Working with the World Bank

The IMF collaborates with the World Trade Organization (WTO) both formally and informally. The IMF has observer status at WTO meetings and IMF staff contribute to the work of the WTO Working Group on Trade, Debt, and Finance. And the IMF is involved in the WTO-led Integrated Framework for Trade-Related Technical Assistance to Least Developed Countries, whose other members are the International Trade Commission, UNCTAD, UNDP, and the World Bank.

Debt relief for poor countries

4 During the 1990s, the IMF worked closely with the World Bank to alleviate the debt burdens of poor countries. The Initiative for Heavily Indebted Poor Countries was launched in 1996, with the aim of ensuring that no poor country faces a debt burden it cannot manage. In 2005, to help accelerate progress toward the United Nations Millennium Development Goals (MDGs), the HIPC Initiative was supplemented by the Multilateral Debt Relief Initiative (MDRI).

Beneficiaries of technical assistance

Technical assistance is one of the IMF's core activities. It is concentrated in critical areas of macroeconomic policy where the Fund has the greatest comparative advantage. Thanks to its near-universal membership, the IMF's technical assistance program is informed by experience and knowledge gained across diverse regions and countries at different levels of development.

Types of technical assistance

The IMF's technical assistance takes different forms, according to needs, ranging from long-term hands-on capacity building to short-notice policy support in a financial crisis. Technical assistance is delivered in a variety of ways. IMF staff may visit member countries to advise government and central bank officials on specific issues, or the IMF may provide resident specialists on a short- or a long-term basis. Technical assistance is integrated with country reform agendas as well as the IMF's surveillance and lending operations.

Partnership with donors

Contributions from bilateral and multilateral donors are playing an increasingly important role in enabling the IMF to meet country needs in this area, now financing about two thirds of the IMF's field delivery of technical assistance. Strong partnerships between recipient countries and donors enable IMF technical assistance to be developed on the basis of a more inclusive dialogue and within the context of a coherent development framework. The benefits of donor contributions thus go beyond the financial aspect. The IMF is currently seeking to leverage the comparative advantages of its technical assistance to expand donor financing to meet the needs of recipient countries.

Lending by the IMF

A country in severe financial trouble, unable to pay its international bills, poses potential problems for the international financial system, which the IMF was created to protect. Any member country, whether rich, middle-income, or poor, can turn to the IMF for financing if it has a balance of payments needthat is, if it cannot find sufficient financing on affordable terms in the capital markets to make its international payments and maintain a safe level of reserves.

The changing nature of lending

About four out of five member countries have used IMF credit at least once. But the amount of loans outstanding and the number of borrowers have fluctuated significantly over time. (See chart below).

IMF lending serves three main purposes.

First, it can smooth adjustment to various shocks, helping a member country avoid disruptive economic adjustment or sovereign default, something that would be extremely costly, both for the country itself and possibly for other countries through economic and financial ripple effects (known as contagion). Second, IMF programs can help unlock other financing, acting as a catalyst for other lenders. This is because the program can serve as a signal that the country has adopted sound policies, reinforcing policy credibility and increasing investors' confidence. Third, IMF lending can help prevent crisis. The experience is clear: capital account crises typically inflict substantial costs on countries themselves and on other countries through contagion. The best way to deal with capital account problems is to nip them in the bud before they develop into a full-blown crisis.

Conditions for lending

The IMF aims to ensure that conditions linked to IMF loan disbursements are focused and adequately tailored to the varying strengths of members' policies and fundamentals. The IMF and the government agree on a program of policies aimed at achieving specific, quantified goals in support of the overall objectives of the authorities' economic program. Loans are typically disbursed in a number of installments over the life of the program, For countries in crisis, IMF loans usually provide only a small portion of the resources needed to finance their balance of payments.

6 The IMF has introduced a new Flexible Credit Line (FCL) for countries with very strong fundamentals, policies, and track record of policy implementation. Assuring qualified countries of automatic and upfront access to Fund resources with no ongoing (ex post) conditions; Lack of restrictions in renewing the credit line, which at the countrys discretion could be for either a six-month period, or a 12-month period with a review of eligibility after six months.

Lending to low-income countries

Low-income countries can borrow from the IMF at a very low, or confessional, interest rate. They can use the Poverty Reduction and Growth Facility, which is the main vehicle by which the IMF provides financial support to countries' poverty-reduction strategies. The facility's core objectives are to promote sustainable balance of payments positions and to foster sustainable growth, leading to higher living standards and a reduction in poverty. In recent years, the largest number of IMF loans has been made through the PRGF. Member countries can also access the Exogenous Shocks Facility, which helps deal with economic shocks, such as food and fuel price hikes or a natural disaster, that are beyond the control of a government but have a significant negative impacts on the economies. The interest rate levied on PRGF and ESF loans is only 0.5 percent, and loans are to be repaid over a period of 5-10 years.

Organization & Finances

The IMF has a management team and 17 departments that carry out its country, policy, analytical, and technical work. One department is charged with managing the IMF's resources. This section also explains where the IMF gets its resources and how they are used.

Management
The IMF is led by a Managing Director, who is head of the staff and Chairman of the Executive Board. He is assisted by a First Deputy Managing Director and two other Deputy Managing Directors. The Management team oversees the work of the staff, and maintains high-level contacts with member governments, the media, non-governmental organizations, think tanks, and other institutions.

Managing Director: Duties and selection

The IMF's Executive Board is responsible for selecting the Managing Director. Any Executive Director may submit a nomination for the position, consistent with past practice. When more than one candidate is nominated, as has been the case in recent years, the Executive Board aims to reach a decision by consensus. The current management team

Quotas
Quotas broadly reflect the size of each member's economy: the larger a country's economy in terms of output and the larger and more variable its trade, the larger its quota tends to be. For example, the world's biggest economy, the United States, has the largest quota in the IMF. Quotas, together with the equal number of basic votes each member has, determine countries' voting power.

Special Drawing Rights

The Special Drawing Right (SDR) is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries. The SDR is neither a currency, nor a claim on the IMF. Rather, it is a potential claim on the freely usable currencies of IMF members.

Borrowing Arrangements
If the IMF believes that its resources might fall short of members' needsfor example, in the event of a major financial crisisit can supplement its own resources by borrowing. It has had a range of bilateral borrowing arrangements in the 1970s and 1980s. Currently it has two standing multilateral borrowing arrangements and one bilateral borrowing agreement.

Income model reform

The business model that the IMF has followed since it was established relies primarily on income from its lending operations to finance its work.

Accountability
The IMF is accountable to its 186 member governments, and is also scrutinized by multiple stakeholders, from political leaders and officials to, the media, civil society, academia, and its own internal watchdog. The IMF, in turn, encourages its own members to be as open as possible about their economic policies to encourage their accountability and transparency. Engagement with intergovernmental groups

Governance
The Board of Governors is the highest decision-making body of the IMF. It consists of one governor and one alternate governor for each member country. The governor is appointed by the member country and is usually the minister of finance or the head of the central bank.

Ministerial Committees
The IMF Board of Governors is advised by two ministerial committees, the International Monetary and Financial Committee (IMFC) and the Development Committee. The IMFC has 24 members, drawn from the pool of 186 governors. Its structure mirrors that of the Executive Board and its 24 constituencies. As such, the IMFC represents all the member countries of the Fund.

Governance Reform
Important progress was made in the reform of the Fund's governance in 2006-08, including the initiation of a process to realign members' voting power (see Country Representation). However, enhancing the Fund's legitimacy and effectiveness must also deal with the question of whether the significant changes since the establishment of the Fund require reform of the institutional framework through which members' voting power is actually exercised

Country Representation
How countries are represented is key to the IMF's legitimacy as an international organization representing the interests of its 186 member countries. Upon joining the IMF, each country is allocated a quota based approximately on the relative size of its economy. The quota determines the country's financial contribution to the IMF, its voting power, and ability to access IMF financing.

Protecting voice of low-income countries

Enhancing the voice of low-income countries was another central element of the reform package. A key mechanism for achieving this goal is through an increase in basic votes. Basic votes reflect the principle of equality of states and give the smallest members of the IMF (many of which are low-income countries), a greater voice in the organization's deliberations.

Internal watchdog
The IMF's work is reviewed on a regular basis by an internal watchdog, the Independent Evaluation Office, established in 2001. The IEO is fully independent from IMF management and operates at arm's length from the Executive Board, although the Board appoints its director.

Transparency
The IMF also encourages its member countries to be as open as possible about their economic policies. Greater openness encourages public discussion of economic policy, enhances the accountability of policymakers, and facilitates the functioning of financial markets.

Tackling current challenges

The IMF is helping many emerging market countries tackle the problems brought on by the devastating global economic crisis. Its lending to low-income countries has also been stepped up, as these countries start to feel the effects of the crisis. And it is providing policy advice to advanced countries, for instance on how to address problems in their financing and banking sectors, and how to design effective stimulus packages.

Emergency lending to emerging markets

Emerging market countries are facing increasing difficulties around the world because of the spreading global economic crisis, with demand falling for their exports, investment slumping, and cross-border lending drying up. A growing number of emerging economies have found room for policy maneuver becoming increasingly limited, and large-scale official support has been needed from bilateral and multilateral sources.

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Helping low-income countries fight the crisis

The global economic crisis is threatening to undermine recent economic gains and to create a humanitarian crisis in the worlds poorest countries. In response, the IMF has stepped up lending to low-income countries to combat the impact of the global recession with a new framework for loans to the worlds poorest nations, including increased resources, a doubling of borrowing limits, zero interest rates until the end of 2011, and new lending instruments that offer more flexible terms.

Advocating global fiscal stimulus

The IMF is also providing policy advice to advanced countries, for instance on how to address problems in their financing and banking sectors, and how to design effective stimulus packages.

Reforming the international financial system

The global economic crisis has sparked a rethinking of how the international financial system is structured. The IMF is assisting the G-20 industrialized and emerging economies with recommendations to reshape the system of international regulation and governance. To a large extent, global efforts thus far have been focused on the crisis at hand, but reforms are in progress with a view toward the post-crisis world.

How to Contact the IMF

For more information about access and directions to the IMF headquarters buildings, please Contact to Directions and Access to IMF Headquarters. Headquarters 1 (HQ1) International Monetary Fund, 700 19th Street, N.W., Washington, D.C. 20431 Headquarters 2 (HQ2) International Monetary Fund, 1900 Pennsylvania Ave NW, Washington, DC, 20431 Telephone Operator: + 1 (202) 623-7000 Fax: + 1 (202) 623-4661 SWIFT: IMFDUS3WXXX Business Hours MondayFriday: 8:30 a.m. to 6:00 p.m. (ET). Saturdays, Sundays, and holidays*: closed. *For holiday schedule, please see the IMF Business Hours, Holidays, and Emergency Closures page. Comments or questions about the IMF's website: webmaster@imf.org