Motivation Behind the Creation and Relevance of the IMF in a Globalized World

The IMF is one of the Bretton Woods Institutions charged with the oversight responsibility to enforce policies and enable countries to manage their macro-economic challenges efficiently. The purpose of this paper is to articulate the mandate of the International Monetary Fund (IMF) not least in promoting a sound legal regulatory environment for markets to operate globally and its inherent challenges. While acknowledging the plausible work done by the IMF in supporting countries to achieve their macro-economic stability, the paper articulates some of its shortcomings as a global institution.

It is evident that the post-war climate in which the World Bank and IMF were created has drastically changed - which presupposes that these institutions now need to reposition themselves to reflect on contemporary global challenges accordingly. The author has argued in the past that a robust regulatory system should be devised taking into account the dynamic challenges in the market environment but also to prevent them from happening again.

The paper has utilized empirical evidence and relevant theories to evaluate the mandate of the IMF in addressing its dynamic challenges such as the global financial and debt crises in Europe (Ireland and Iceland) and Asia (Vietnam) and prevention of financial sector abuse globally.