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International Financial Institutions |
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The International Financial Institutions are multilateral financial institutions established and owned by more than one nation. Generally the International Financial Institutions are owned by the national governments and they are its shareholders. Most of the International Financial Institutions are owned by more than one nation state hence they are referred as international. As a result they come under the international law. There are some financial institutions that are owned by two nations.
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The World Bank, IMF, regional development banks and some UN agencies are the prominent International Financial Institutions. Majority of the International Financial Institutions were established after the World War II. The financial depression after the war led to the countries to formulate plans for establishing financial institutions to restore the slugging monetary system of the nations. They were also established to provide assistance for reconstruction of Europe and the newly emerging states. The World Bank, the IMF, the International Finance Corporation and other members of the World Bank Group established formally through the ratification of the Bretton Wood Agreement are the best examples which were established to provide financial and technical assistance to the countries. Hence these institutions are called Bretton Woods Institutions.
The Regional Development Banks like the Inter-American Development Bank, Asian Development Bank, African Development Bank and the European Bank for Reconstruction and Development are some of the regional banks that focus on the economic and social development of the regions.
The Netherlands Development Finance Company FMO and the German Development Bank DEG are the bilateral institutions set up by the individual countries to finance the social and economic developments in developing countries.
The European Investment Bank is the largest International Financial Institutions established by the members if the European Union to finance projects or activities of their mutual interests. The other regional financial institutions formed by groups of regional countries are Black Sea Development Banks, International Investment Bank, the Islamic development Bank and Nordic Investment Bank.
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