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Flashcards in Global systems Deck (44)
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how many countries are in the world bank



what does the world bank aim to do

promote financial cooperation between countries to reduce poverty - normally through the promotion of trade and high employment


what does the United Nations promote

the development of poorer nations through work with the IMF and world bank


what does the world trade organisation (WTO) do

deals in the rules of trade between countries ensuring trade flows freely


what is the international monetary fund (IMF)

it is an important source of financial and technical assistance to developing countries. its main aim is to reduce poverty


what is a transnational corporation (TNC)

a global company which operates in more than one country


where are the headquarters and where are the factories for TNCs

headquarters are usually in MEDCs with factories in LEDCs where labour is cheaper


what is the main difference between the IMF and the World Bank

world bank focusses on development projects (specific eg building schools) whereas the IMF seeks to maintain the global economy


what does the IMF promote

international monetary cooperation and provides policy advice to help countries build and maintain strong economies


what does the IMF provide compared to the world bank

IMF gives actual money and loans
world bank provides skills and assistance (has the goal to reduce poverty)


negatives of the IMF for poorer countries

decisions about which countries may borrow money are made by rich countries. poor countries have little say about loans and the conditions attached to them


conditions attached to borrowing money from the IMF

reduce government borrowing - higher taxes and lower spending
higher interest rates to stabilise the currency
allow failing firms to go bankrupt
privatisation, deregulation, reduce corruption


example of the IMF

in the Asian crisis of 1997 many countries such as Thailand were forced by the IMF to put in high interest rates and tight policy to strengthen exchange rates. but these changes caused a recession and high unemployment levels


benefits of IMF assistance

if a country has a balance of payments deficit the IMF steps in and fills the gap
serves as a council and advisor to countries attempting a new economic policy
publishes papers on new economic policies


where does the IMF get its money from

the quota system
bilateral borrowing
lending capacity
gold holdings


what is the aim of the WTO

to ensure that trade flows as smoothly as possible. want to remove as many barriers to trade as possible but have to ensure the highest levels of security


where does the WTO get its money from

the WTO's regular budget
voluntary contributions from WTO members
cost-sharing either by countries involved in an event or by international organisations


positives of WTO involvement

cut living costs and raise living standards
stimulate economic growth and employment
help countries develop
contribute to peace and stability


negatives of WTO involvement for poorer nations

benefits the wealthy nations as they have more of a say (more negotiation power as they have more TNCs) eg developed countries were forced to open their agricultural markets which damaged their economy)


who controls the WTO

the WTO is controlled by its members - the countries make their decisions through various councils and committees whose membership consists of WTO members


how many members does the world bank have

188 member countries


where does the world bank get its money

interest from the loans they hand out


what does the world bank promote

financial cooperation between countries to reduce poverty. normally done through the promotion of trade and high employment


examples of the aims of the world bank

eradicate extreme poverty and hunger
gender equality
universal primary education
environmental sustainability
combat diseases such as AIDS


how many staff in how many countries does the world bank have

7000 staff from 185 countries


name 3 positives of the world bank

provides qualifying governments with low interest loans, zero-interest credits and grants
debt borrowings and cash infusions help with global education, healthcare, infrastructure and development
shares information with world governments through advice, research and analysis


name 3 negatives of world bank involvement

some criticism over ethical issues (eg hydroelectric damns financed by WB displaced people downstream)
loan conditions mean countries can end up in more debt than before
WB works with private sector can cause role of state to be undermined- may result in a shortfall of necessary services (eg healthcare)


who controls the world bank

is run by its members


why does the voting system for the WB and IMF cause inequality

governments get votes based on the amount of money they put into the organisation


which country has the largest share of votes in the IMF and WB

the USA