Inter Organization
Inter Organization
ORGANIZATIONS
WHY
• The IMF, also known as the Fund, was conceived at a UN conference in Bretton
Woods, New Hampshire, United States, in July 1944.
• The 44 countries at that conference sought to build a framework for economic
cooperation to avoid a repetition of the competitive devaluations that had
contributed to the Great Depression of the 1930s.
• The IMF has played a part in shaping the global economy since the end of World War
II.
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• Finances of IMF - Most resources for IMF loans are provided by member countries,
primarily through their payment of quotas. Each member country of the IMF is
assigned a quota, based broadly on its relative position in the world economy. Each
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o Access to Financing - The amount of financing a member can obtain from the
IMF (its access limit) is based on its quota.
▪ For example, under Stand-By and Extended Arrangements, a member
can borrow up to 145 percent of its quota annually and 435 percent
cumulatively.
• Reports published by IMF –
o World Economic Outlook
o Regional Economic Report
o Global Financial Stability Report
• Functioning of IMF-
o IMF is controlled and managed by a board of governors. Each member country
nominates a Governor and all nominated governors make the board of
governors. Each governor is allotted a number of votes, which is determined by
the quota allotted to the respective country in IMF.
o Thus, voting right depends on the quantum of quota of a particular country with
IMF. That is the reason why the rich and industrialized countries have a higher
voting right due to higher quotas with the IMF.
o Before 1971, all quotas and assistance of IMF were denominated in US dollars.
Since 1971, all quotas and transactions are expressed in SDR or Paper gold.
IMF Reforms:
• India’s voting rights and quota share have increased to 2.65% and 2.77%
respectively.
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• For the first time, four emerging market countries of the Bric bloc —Brazil, China,
India, and Russia —will be among the 10 largest members of IMF.
• The reforms also increase the financial strength of IMF, by doubling its permanent
capital resources to 477 billion special drawing rights ($659 billion).
• U.S’ voting share will marginally drop, from 16.7% to 16.5%.
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World Bank:
WHAT
The World Bank is a United Nations International Financial Institution that provides loans to
developing countries for capital programs.
• It was created in 1945 after the Bretton Woods conference.
• Headquarters – Washington DC (United States)
• President – Jim Yong Kim
• IMF and WB are called Bretton Woods Twins
• Two ambitious goals
o To push extreme poverty to no more 3 percent by 2030
o To promote shared prosperity and greater equity in the developing world
WHY
• The 1944 Bretton Woods Conference established the World Bank. Its loans helped
European countries rebuild after World War II. That made it the world's first
multilateral development bank.
• It was funded through the sale of World Bonds.
• Its first loans were to France and other European countries.
• In the 1970s, it lent money to Chile, Mexico, and India to build power plants and
railways. By 1975, its loans had helped with a wide variety of issues. They included
family planning, pollution control, and environmental protections.
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World Bank Group comprises of 5 organizations-
a) International Bank for Reconstruction and Development (IBRD)- established in
1944, it generates money through debt financing and provides developmental
finance to member countries.
b) International Development Association (IDA)- established in 1960, it provides
concessional financing (interest-free loans or grants), usually with sovereign
guarantees.
• World Bank Group is a part of United Nations System. The World Bank's (IBRD and
IDA) activities are focused on developing countries, in fields such as human
development (e.g. education, health), agriculture and rural development,
environmental protection, infrastructure etc.
• IBRD and IDA provide loans at preferential rates to member countries, as well as
grants to the poorest countries.
• India is a member of 4 institutions under world bank group. It is not a member of
ICSID.
• Reports published by World Bank
o Global Economic Prospects
o Ease of Doing Business
o World Development Report
o Global Economic Prospects Report
o India Development Update
o Universal Health Coverage Index
(CHART)
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WHY
• The International Bank for Reconstruction and Development (IBRD) and
International Monetary Fund (IMF) were established by delegates at the Bretton
Woods Conference in 1944 and became operational in 1946.
• The IBRD was established with the original mission of financing the reconstruction
efforts of war-torn European nations following World War II.
• Following the reconstruction of Europe, the Bank's mandate has transitioned to
eradicating poverty around the world.
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• IBRD joins with IDA to work closely with all institutions of the World Bank Group and
the public and private sectors in developing countries to reduce poverty and build
shared prosperity.
The International Development Association (IDA) is the part of the World Bank that helps
the world’s poorest countries.
IDA aims to reduce poverty by providing loans (called “credits”) and grants for programs
that boost economic growth, reduce inequalities, and improve people’s living conditions.
• Year of Establishment - 1960
• Headquarters - Washington, D.C., United States
• Member Countries – 173 countries
WHY
• IDA is one of the largest sources of assistance for the world’s 75 poorest countries,
39 of which are in Africa, and is the single largest source of donor funds for basic
social services in these countries.
• Resources from IDA bring positive change to the 1.3 billion people who live in IDA
countries.
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• IDA lends money on concessional terms.
• This means that IDA credits have a zero or very low interest charge and repayments
are stretched over 30 to 38 years, including a 5 to 10-year grace period.
• IDA also provides grants to countries at risk of Debt Distress (Distressed debt refers
to the securities of a government or company which has either defaulted, is under
bankruptcy protection, or is under distress and moving towards the aforementioned
situations in the near future).
WHY
• IFC was founded on a bold idea that the private sector is essential to development.
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• IFC raises virtually all funds for lending activities through the issuance of debt
obligations in international capital markets.
• The borrowings are diversified by country, currency, source, and maturity in order to
provide flexibility and cost effectiveness.
• IFC is the only multilateral source of debt and equity financing for the private sector
with global reach.
WHY
• MIGA was established as an effort to complement existing sources of non-
commercial risk insurance for investments in developing countries
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Miga can help investors and lenders deal with these risks by insuring eligible projects against
losses relating to:
• Currency Invertibility and Transfer Restriction - Protection against losses arising
from an inability to legally convert local currency into hard currency
• Expropriation - Protection against losses arising from certain government actions
that may reduce ownership of the insured investment
• War, Terrorism and Civil Disturbance - Protection against loss from, damage to, or
disappearance of tangible assets caused by political acts of war or civil disturbance.
• Breach of Contract - Protection against losses arising from government’s breach or
repudiation of a contract.
• Non-Honoring of Financial Obligations – provides coverage for credit enhancement
in transactions involving sovereign and sub-sovereign entities, as well as state-
owned enterprises. Protects the lender against losses resulting from a failure to
make a payment when due under an unconditional financial payment obligation or
guarantee.
WHY
• Several attempts were made to create a framework to protect international
investments, but efforts revealed conflicting views on how to provide compensation
for the expropriation of foreign direct investment.
• Thus, in 1961, then-General Counsel of the International Bank for Reconstruction
and Development (IBRD), Aron Broches developed the idea for a multilateral
agreement on a process for resolving individual investment disputes on a case by
case basis as opposed to imposing outcomes based on standards.
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It is an autonomous, multilateral specialized institution to encourage international flow of
investment and mitigate non-commercial risks by a treaty drafted by the International Bank
for Reconstruction and Development's executive directors and signed by member countries
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WHY
• During great depression of 1930s, international trade was badly affected as various
countries imposed import restrictions for safeguarding their economies. This
resulted in a sharp decline in world trade.
• In 1945, USA put forward proposals for improving international trade.
• An agreement was signed in 1947 related to tariffs imposed on trade. This
agreement was known as General Agreement on Tariffs and Trade.
• GATT remained in force as an agreement till 1995, when it was abolished and
replaced by WTO on 1st January 1995.
• The Uruguay round of GATT (1986-93) gave birth to WTO. Members of GATT signed
an agreement in Uruguay round to establish a new organization called WTO.
• Unlike GATT, WTO was set-up as a permanent organization. It achieved international
status like IMF and WB but it is not an agency of UNO.
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• The current body of trade agreements comprising the WTO consists of 16 different
Multilateral Agreements (to which all WTO members are parties) and two different
Plurilateral Agreements (to which only some WTO members are parties).
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• The highest institutional body is the Ministerial Conference, which meets roughly
every two years.
• A General Council conducts the organization's business in the intervals between
Ministerial Conferences.
• Main activities of WTO –
o Negotiating the reduction or elimination of obstacles to trade (import tariffs,
other barriers to trade) and agreeing on rules governing the conduct of
international trade (e.g. antidumping, subsidies, product standards, etc.)
o Administering and monitoring the application of the WTO's agreed rules for
trade in goods, trade in services, and trade-related intellectual property
rights.
o monitoring and reviewing the trade policies of our members, as well as
ensuring transparency of regional and bilateral trade agreements.
o settling disputes among our members regarding the interpretation and
application of the agreements
o building capacity of developing country government officials in international
trade matters.
WHY
• The United Nations was born of perceived necessity, as a means of better arbitrating
international conflict and negotiating peace than was provided for by the old League
of Nations.
• The growing Second World War became the real impetus for the United States,
Britain, and the Soviet Union to begin formulating the original U.N. Declaration,
signed by 26 nations in January 1942.
• The principles of the U.N. Charter were first formulated at the San Francisco
Conference, which convened on April 25, 1945.
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UN has 6 principal organs-
a) The General Assembly - the main deliberative assembly under which all members
and secretary general meet to address standing issues.
b) The Security Council - establishment of peacekeeping operations, the establishment
of international sanctions, and the authorization of military action through Security
Council resolutions. There are 5 permanent members in security council namely
China, France, UK, US and Russia. 10 other countries have temporary membership
on a Rotation basis.
c) The Economic and Social Council (ECOSOC) - for promoting international economic
and social co-operation and development.
d) The Secretariat - it is the executive arm of UN. It implements decisions taken by
above- mentioned bodies. Secretary general is the head of secretariat.
e) The International Court of Justice - Seated in the Peace Palace in The Hague,
Netherlands, the court settles legal disputes submitted to it by states and provides
advisory opinions on legal questions submitted to it by duly authorized international
branches, agencies, and the UN General Assembly. Decisions of Cases taken to ICJ
are not always binding.
o There are two types of cases- contentious issues and advisory opinions.
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UN Specialized agencies are autonomous organizations working with the UN. Below is a list
of 15 specialized agencies of the UN:
WHAT
The International Labour Organization (ILO) is a United Nations agency dealing with labour
problems, particularly international labour standards, social protection, and work
opportunities for all.
Year of Establishment – 1919
Headquarters – Geneva, Switzerland
Head – Guy Ryder
Member - 187
WHY
• The ILO was founded in 1919, in the wake of a destructive war, to pursue a vision
based on the premise that universal, lasting peace can be established only if it is
based on social justice.
• The ILO became the first specialized agency of the UN in 1946.
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The main aims of the ILO are to promote rights at work, encourage decent employment
opportunities, enhance social protection and strengthen dialogue on work-related issues.
ILO serves the society as a whole in the following ways-
WHAT
The Food and Agriculture Organization (FAO) is specialized agency of the United Nations
that leads international efforts to defeat hunger.
The goal is to achieve food security for all and make sure that people have regular access to
enough high-quality food to lead active, healthy lives.
Year of Establishment – 1945
Headquarters – Rome, Italy
Head – José Graziano da Silva
Member - 194
WHY
• The idea of an International Organization for Food and Agriculture emerged in the
late 19th and early 20th century advanced primarily by the US agriculturalist and
activist David Lubin.
• In May–June 1905, an international conference was held in Rome, Italy, which led to
the creation of the International Institute of Agriculture.
• After the World War II, International Institute of Agriculture was effectively ended
and its functions were then transferred to the established FAO.
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FAO's activities comprise five main areas:
WHAT
The World Health Organization (WHO) is a specialized agency of the United Nations that is
concerned with international public health.
Year of Establishment – 1948
Headquarters – Geneva, Switzerland
Director General – Tedros Adhanom
Member - 194
WHY
• After the World War II, all the health organizations were absorbed by United Nations
to form WHO.
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WHO began when its Constitution came into force on 7 April 1948 – a date when we
celebrate every year as World Health Day.
• The World Health Assembly is the decision-making body of WHO - to determine the
policies of the Organization, appoint the Director-General, supervise financial
policies, and review and approve the proposed programme budget
• WHO performs these functions-
o providing leadership on matters critical to health and engaging in
partnerships where joint action is needed;
o shaping the research agenda and stimulating the generation, translation and
dissemination of valuable knowledge;
o setting norms and standards and promoting and monitoring their
implementation;
o articulating ethical and evidence-based policy options;
o providing technical support, catalysing change, and building sustainable
institutional capacity;
o monitoring the health situation and assessing health trends
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WHAT
It seeks to build peace through international cooperation in Education, the Sciences and
Culture.
Year of Establishment – 1945
Headquarters – Paris, France
Director General – Audrey Azoulay
Member - 195 Members and 8 Associate Members
WHY
• Soon after World War II, 44 participating countries whose delegates decided to
create an organization that would promote a culture of peace, establish an
"intellectual and moral solidarity of mankind," and prevent another world war.
• When the conference ended on November 16, 1945, 37 of the participating
countries founded UNESCO with the Constitution of UNESCO.
• After ratification, the Constitution of UNESCO came into effect on November 4,
1946.
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It is governed by the General Conference and the Executive Board. The Secretariat, headed
by the Director-General, implements the decisions of these two bodies. Objectives of
UNESCO-
WHAT
The International Civil Aviation Organization (ICAO) is a UN specialized agency, established
to manage the administration and governance of the Convention on International Civil
Aviation (Chicago Convention).
Headquarters – Montreal, Quebec, Canada
Secretary General – Fang Liu
Member – 192
WHY
• The Convention on International Civil Aviation, drafted in 1944 by 54 nations, was
established to promote cooperation and “create and preserve friendship and
understanding among the nations and peoples of the world.”
• Known more commonly today as the ‘Chicago Convention’, this landmark
agreement established the core principles permitting international transport by air,
and led to the creation of the specialized agency which has overseen it ever since –
the International Civil Aviation Organization (ICAO).
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• It codifies the principles and techniques of international air navigation and fosters
the planning and development of international air transport to ensure safe and
orderly growth.
• The ICAO Council adopts standards and recommended practices concerning air
navigation, its infrastructure, flight inspection, prevention of unlawful interference,
and facilitation of border-crossing procedures for international civil aviation.
• ICAO defines the protocols for air accident investigation followed by transport safety
authorities in countries signatory to the Chicago Convention on International Civil
Aviation.
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WHAT
It is UN’s specialized agency for information and communication technologies. They
allocate global radio spectrum and satellite orbits, develop the technical standards that
ensure networks and technologies seamlessly interconnect, and strive to improve access to
ICTs to underserved communities worldwide.
They are committed to connect all the world’s people.
WHY
• ITU was formed in 1865, in Paris, at the International Telegraph Convention; this
makes it one of the oldest intergovernmental organizations in the world.
• The International Radiotelegraph Union was unofficially established at first
International Radiotelegraph Convention in 1906.
• Both were merged into the International Telecommunication Union in 1932.
• ITU became a United Nations specialized agency in 1947.
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ITU has three main areas of activity organized in ‘Sectors’ which work through conferences
and meetings-
i. Radiocommunications
ii. Standardization
iii. Development
WHAT
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Established in 1874, the Universal Postal Union (UPU), with its headquarters in the Swiss
capital Berne, is the second oldest international organization worldwide.
It is a primary forum for cooperation between postal sector players. It helps to ensure a
truly universal network of up-to-date products and services.
WHY
• During the 17th and 18th centuries, the exchange of mail between countries was
largely governed by bilateral postal agreements.
• But by the 19th century, the web of bilateral agreements had become so complex
that it began to impede the rapidly developing trade and commercial sectors.
• Order and simplification were needed in the international postal services.
• On 9 October of 1874– a day now celebrated throughout the world as World Post
Day – the Treaty of Bern, establishing the General Postal Union, was signed.
• Membership in the Union grew so quickly during the following three years that its
name was changed to the Universal Postal Union in 1878.
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It sets the rules for international mail exchanges and makes recommendations to stimulate
growth in mail, parcel and financial services volumes and improve quality of service for
customers.
• 4 bodies
• The Congress
• 2 cooperatives
• Telematics Cooperative
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• EMS Cooperative
WHAT
WMO is dedicated to international cooperation and coordination on the state and
behaviour of the Earth’s atmosphere, its interaction with the land and oceans, the weather
and climate it produces, and the resulting distribution of water resources.
Year of Establishment – 1950
Headquarters – Geneva, Switzerland
President – David Grimes
Member - 191
WHY
• It originated from the International Meteorological Organization (IMO), which was
founded in 1873.
• Established by the ratification of the WMO Convention on 23 March 1950, WMO
became the specialised agency of the United Nations for meteorology (weather and
climate), operational hydrology and related geophysical sciences a year later.
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WMO programmes facilitate and promote:
WHAT
WIPO was created to encourage creative activity, to promote the protection of intellectual
property throughout the world.
Year of Establishment – 1967
Headquarters – Geneva, Switzerland
Director - General – Francis Gurry
Member - 191
WHY
• In 1883, the Paris Convention for the Protection of Industrial Property is born. This
international agreement is the first major step taken to help creators ensure that
their intellectual works are protected in other countries. The need for international
protection of intellectual property (IP) became evident when foreign exhibitors
refused to attend the International Exhibition of Inventions in Vienna, Austria in
1873 because they were afraid their ideas would be stolen and exploited
commercially in other countries.
• United International Bureaux for the Protection of Intellectual Property (BIRPI),
immediate predecessor of WIPO was established in 1893.
• In 1970, BIRPI was transformed to become WIPO
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WIPO's two main objectives are
WHAT
IFAD is an international financial institution and a specialised agency of the United Nations
dedicated to eradicating poverty and hunger in rural areas of developing countries.
Year of Establishment – 1977
Headquarters – Rome, Italy
Head – Gilbert Houngbo
WHY
• Seventy-five percent of the world's poor live in rural areas in developing countries,
yet only 4% of official development assistance goes to agriculture.
• IFAD's goal is to empower poor rural men and women in developing countries to
achieve higher incomes and improved living.
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IFAD connects producers, the private sector, governments and other players in the
agricultural and rural sectors so that everyone benefits.
Through partnership, it invests in rural development and broker partnerships among the
diverse parties working in development, and for South-South and triangular cooperation.
WHAT
The Organization's primary objective is the promotion and acceleration of industrial
development in developing countries and countries with economies in transition and the
promotion of international industrial cooperation.
Year of Establishment – 1966
Headquarters – Vienna, Austria
Head – Li Yong
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Members - 168
WHY
• On 17 November, 1966, the United Nations General Assembly passes resolution
2152 (XXI) establishing the United Nations Industrial Development Organization
(UNIDO) as an autonomous body within the United Nations to promote and
accelerate the industrialization of developing countries.
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Organization’s programmatic focus is structured in four strategic priorities:
WHAT
The agency is responsible for the promotion of responsible, sustainable and universally
accessible tourism.
It is the leading international organization in the field of tourism, which promotes tourism
as a driver of economic growth, inclusive development and environmental sustainability and
offers leadership and support to the sector in advancing knowledge and tourism policies
worldwide.
Year of Establishment – 1975
Headquarters – Madrid, Spain
Members - 158 countries and 6 Associate Members
WHY
• In 1970, the IUOTO general assembly voted in favor of forming the World Tourism
Organization (WTO).Based on statutes of the IUOTO, and after ratification by the
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Priorities of UNWTO –
WHY
• Inter-Governmental Maritime Consultative Organization (IMCO) was formed in
order to bring the regulation of the safety of shipping into an international
framework, for which the creation of the United Nations provided an opportunity.
• It was later renamed the IMO in 1982 and has continued to produce new and
updated conventions across a wide range of maritime issues covering not only safety
of life and marine pollution but also encompassing safe navigation, search and
rescue, wreck removal, tonnage measurement, liability and compensation, ship
recycling, the training and certification of seafarers, and piracy.
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• Its role is to create a level playing-field so that ship operators cannot address their
financial issues by simply cutting corners and compromising on safety, security and
environmental performance. This approach also encourages innovation and
efficiency.
• The Global Maritime Distress and Safety System (GMDSS) is an integrated
communications system using satellite and terrestrial radiocommunications to
ensure that no matter where a ship is in distress, aid can be dispatched.
• Under the GMDSS, all passenger ships and all cargo ships over 300 gross tonnage on
international voyages have to carry specified satellite and radiocommunications
equipment, for sending and receiving distress alerts and maritime safety
information, and for general communications.
• The GMDSS became fully effective from 1 February 1999. It is currently undergoing a
comprehensive review.