Boomers don't have a memory of a world without the World Bank (WB) or the International Monetary Fund (IMF). Those institutions grew out of post-WW2 United Nations planning. Currently, they are meeting about the global economic crisis, along with the G7, hoping to bring stability primarily through coordinating individual nations' strategies and by encouraging inter-bank lending.
Here's a short-hand profile of each:
WB is known for long-term development projects, often with humanitarian reputation. WB really is a bank, funded by its member nations, and guided by "directors" based on "shares." While the bulk of directors are selected by several countries to serve as their representatives, 5 nations have their own directors: US, UK, France, Germany, and Japan. See the blue graphic at bottom of this entry; these 5 are in the inner circle of the WB, the G7, and the IMF.
IMF is also a bank serving member nations. See graphic at top; all that green reflects nearly every country in the world having joined the IMF. The reputation of the organization is not as warm and fuzzy as the WB. Think of the IMF as the uncles you don't want to have to ask for money when your farm suffers a drought. These are the relatives who will help you out but with strings attached—they'll dictate conditions for the use of the money. Sometimes called a Lender of Last Resort and associated with countries in crisis, the IMF influences the global economy. Votes are cast according to percentage of shares held. My list of 9 countries (see graphic at bottom) just lops off the top percentages, starting at close to 3%. What's pertinent is the US percentage at more than 16%. Next are Japan and Germany at about 6% each.
G7 (AKA Group of 7) is not the G8. We hear more about G8 because it brings together heads of state for an annual summit. The G7 meets more frequently and is formed by the finance ministers of the US, UK, France, Germany, Japan, Canada, and Italy.
The G7 is the least official of the groups but it is emerging as the leader in calling for strong and fast action by all nations. It has released a five-point action plan that brings focus to priorities, such as recapitalizing banks. The action plan may not be followed completely by all nations but it appears to be the bullet list for discussion.
13 October 2008
Financial Crisis: Looking for the Bullet List
Labels:
baby boomer,
financial crisis,
G7 action plan,
IMF,
World Bank
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