The United States and the International Financial Institutions: Power and Influence Within the World Bank and the IMF (2024)

FAQs

How does the US influence the IMF? ›

As the largest financial contributor to the IMF, the U.S. receives the most voting power amongst all participating countries at around 17%. This gives the U.S. the ability to veto any major proposal as 85% of votes must concur in order for any motion to pass.

In the IMF, the United States contributes 17.67 per cent of the capital subscriptions which are the institution's primary source of financing. This gives the United States 17.33 per cent of votes on the Executive Board.

Member countries govern the World Bank Group through the Boards of Governors and the Boards of Executive Directors. These bodies make all major decisions for the organizations. To become a member of the Bank, under the IBRD Articles of Agreement, a country must first join the International Monetary Fund (IMF).

The main difference between the International Monetary Fund (IMF) and the World Bank lies in their respective purposes and functions. The IMF oversees the stability of the world's monetary system, while the World Bank's goal is to reduce poverty by offering assistance to middle-income and low-income countries.

The United States was a leading force in the establishment of the International Bank for Reconstruction and Development (IBRD) in 1944 and remains the largest shareholder of the World Bank Group today.

The IMF is governed by and accountable to its member countries.

The Board of Governors, the highest decision-making body of the IMF, 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 governor of the central bank.

Today, the United States' financial commitment to the IMF totals approximately $164 billion; that is the maximum amount that the IMF can draw from the United States to make loans to other IMF members. The budgetary cost of participation in the IMF is, however, significantly smaller than the amount of that commitment.

While the Board of Governors has delegated most of its powers to the IMF's Executive Board, it retains the right to, among other things, approve quota increases, allocate or cancel special drawing right (SDR), the admittance of new members, compulsory withdrawal of members, and amendments to the Articles of Agreement ...

Where does IMF get its money? ›

IMF funds come from three sources: member quotas, multilateral and bilateral borrowing agreements. Member quotas are the primary source of IMF funding. A member country's quota reflects its size and position in the world economy. Read more on how the IMF regularly reviews quotas.

THE WORLD BANK MANDATE

World Bank assistance is generally long-term and is funded by member country contributions and by issuing bonds.

The World Bank Group works with developing countries to reduce poverty and increase shared prosperity, while the International Monetary Fund serves to stabilize the international monetary system and acts as a monitor of the world's currencies.

The World Bank is an international development organization owned by 187 countries. Its role is to reduce poverty by lending money to the governments of its poorer members to improve their economies and to improve the standard of living of their people.

The International Monetary Fund aims to reduce global poverty, encourage international trade, and promote financial stability and economic growth. The IMF has three main functions: overseeing economic development, lending, and capacity development.

The IMF's largest member is the United States, with a quota (as of April 30, 2016) of SDR 83 billion (about $118 billion), and the smallest member is Tuvalu, with a quota of SDR 2.5 million (about $3.5 million).

The Board of Governors is the IMF's highest decision-making body. 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.

The role of the United States as a global trading partner could, however, encompass several effects on other countries' growth, including both a direct effect through bilateral trade and indirect effects such as a greater impact of U.S. developments on business and consumer confidence in other countries and closer ...

The United States has the largest financial commitment to the IBRD, accounting for 16.69% of total IBRD resources. U.S. paid-in capital is $3.5 billion and U.S. callable capital is $47.8 billion.