Q: With reference to the International Monetary and Financial Committee (IMFC), consider the following statements:
- IMFC discusses matters of concern affecting the global economy, and advises the International Monetary Fund (IMF) on the direction of its work.
- The World Bank participates as observer in IMFC’s meetings.
Which of the statements given above is/are correct?
a) 1 only
b) 2 only
c) both 1 and 2
d) neither 1 nor 2
The correct answer is Both 1 and 2.
- International Monetary and Financial Committee (IMFC)
- The IMFC has 24 members, drawn from the pool of 187 governors.
- Its structure mirrors that of the Executive Board and its 24 constituencies. As such, the IMFC represents all the member countries of the Fund.
- It makes recommendations and provides updates to the IMF Board of Governors on matters pertaining to the supervision and administration of the global monetary and financial system, particularly how to handle developing situations that could cause disruptions. Hence, Statement 1 is correct.
- Typically, the IMFC convenes twice a year.
- The World Bank is among the foreign organisations that attend the IMFC meetings as observers. Hence, Statement 2 is correct.
- It also considers proposals by the Executive Board to amend the Articles of Agreement and advises on any other matters that may be referred to it by the Board of Governors.
- Although the IMFC has no formal decision-making powers, in practice, it has become a key instrument for providing strategic direction to the work and policies of the Fund.
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