Objectives of International Monetary Fund (IMF):
The first Article of the Fund’s charter laid down six objectives for the International Monetary Fund. These are:
- To promote international cooperation by providing the machinery for consultation and collaboration by members on international monetary issues.
- To facilitate the balanced growth of international trade and through this, contribute to high levels of employment and real income and the development of productive capacity.
- To promote exchange stability and orderly exchange arrangements and facilitate the avoidance of competitive currency depreciation;
- to foster a multilateral system of payments and transfers for current transactions and seek the elimination of exchange restrictions which hamper the growth of world trade;
- To make financial resources available to members, on a temporary basis and with adequate safeguard to permit them to correct payment in balances without resorting to measures destruction of national or international prosperity and;
- To seek a reduction of both the duration and magnitude of payments imbalances.
Functions of International Monetary Fund (IMF):
IMFs functions can be broadly classified into three categories. These are
- To formulate and administer a code of conduct regarding exchange rate policies and restrictions on payments for current account transactions.
- To provide members with financial resources to enable them to observe the code of conduct while they were correcting or avoiding payment imbalances.
- To provide a forum in which the IMF could consult with one another and collaborate on international monetary matters.