International Official Institutions

Abstract

The major countries that won World War II created international official institutions to facilitate cooperation among nations during peace. Significant part of the dialogue occurs in two restricted groups. The Group of Seven (G7) consists of the wealthier industrialized countries that discuss periodically political and economic affairs to maintain world stability. The Group of Ten (G10) consists mainly of the central banks and monetary authorities of the wealthier countries that design policies and institutions for international economic and financial stable progress. The main institution of the G10 is the Bank for International Settlements (BIS). The design for stability in the world economy consists of two types of institutions. The international financial institutions are the IMF, the World Bank, the BIS and the multilateral development banks. The IMF provides a safety net for crises in individual emerging countries and LDCs. The World Bank initially financed infrastructure in Europe and subsequently in emerging countries, shifting its focus recently to alleviating world poverty and inequality. The multilateral development banks engage in projects of interest at the regional level in the Americas, Europe and Asia. The responsibility for stability in the more advanced countries rests with the individual central banks. The WTO engages in negotiations among most countries in the world in promoting freer international trade. The UN provides the forum to prevent conflicts among nations and engages also in promoting the alleviation of poverty and inequality. These institutions are discussed in turn.