Roles of International Financial Institutions

Companies all over the world utilize the ability of international finance options to invest and expand new and existing business ventures. International finance also provides some developing countries the option to enter a rapidly growing market with investments and high return percentages to attract investing companies. Although intimidating to some, the term holds an abundance of power and knowledge that is valuable to all.

One major organization that positively impacts is known as the IMF. The International Monetary Fund does works all over the world and performs many duties and tasks. The strength and power of the IMF is divided up into several different parts. The first duty of the IMF is surveillance of economic and financial developments of countries in need. The IMF gives advice on certain decisions and assists when difficult situations arise. Next the IMF will lend money to countries with financial crises. Low interest loans are also made to underdeveloped countries to aid in lowering poverty percentages. And last, the IMF gives technical assistance and training to those who need it and can benefit from the knowledge the organization has built over the years from helping others in need. 

Another important organization to the world’s economic development and success is The World Bank. The term sounds intimidating and the cartoon illustration would likely be a huge building with large powerful people looking down on the people that need money with contempt. Actually, it’s not like that at all. In fact, the total opposite is true. The World Bank focuses on strengthening banks in emerging countries and fighting the global crisis of poverty. Made up of two major institutions owned by 185 member countries, the World Bank supports the vision of sustainable globalization. With investments in education, infrastructure, and health, the World Bank uses its power to give low interest loans to aid and empower underdeveloped countries to success.

ADB is the abbreviation for the Asian Development Bank which is another organization that provides relief and assistance to the world trade market and communities within it. The logo or mission of the ADB states its true purpose “Fighting Poverty in Asia and the Pacific”. Established in 1966, the ADB has had dominating economic growth in the region alongside abiding development challenges throughout the Pacific. Poverty is a plague that affects the whole world, and with Asia containing such a large portion of the world’s total population, the ADB is one of the most important organizations in the world.

To truly define international finance one must understand the basic terms. Dictionary.com defines international as; between or among nations; involving two or more nations. This term can mean many things but when combined with finance the true meaning of International Finance can be understood. Dictionary.com defines finance as; the management of revenues; the conduct or transaction of money matters, generally those affecting the public. Combined together international finance is a term and concept that empowers the world to fund projects and businesses to stimulate growth and the demise of poverty. (Dictionary.com)

International finance and its institutions are used in global financing operations all over the world to finance projects and fund countries that are on the verge of economic failure. Asia and other parts of the world benefit from institutions like the IMF, World Bank, and the ADB. With low interest loans made to underdeveloped countries and anti poverty programs in place, international finance is a model of humanitarian business that sets a positive example to businesses and countries all over the world. 

International finance has an importance in managing risks in countries that need the financial support and advice in areas where local investors do not have the expertise or experience in the world economic market. Companies all over the world utilize the ability of international finance options to invest and expand new and existing business ventures. Many countries that are underdeveloped do not have the knowledge and or experience to make the important decisions needed when financial investments come to fruition. Leaders of governments all over the world rely on institutions that assist in financial matters the affect their countries. The humanitarian aspect of the institutions mostly goes unrewarded and sadly doesn’t get the recognition it truly deserves. Though the term international financing can be intimidating to some people, its importance to the growth and inevitable overpopulation of the world is immeasurable. Although intimidating to some, the term holds an abundance of power and knowledge that is valuable to all. This author believes that international finance should be a required area of study in general education all over the world to prepare for the future of the world.

References
international. (n.d.). Dictionary.com Unabridged (v 1.1). Retrieved March 26, 2011, from Dictionary.com

finance. (n.d.). Dictionary.com Unabridged (v 1.1). Retrieved March 26, 2011, from Dictionary.com

http://www.imf.org/external/work.htm

http://www.worldbank.org/

http://www.adb.org/