Roles of International Financial Institutions Essay

Roles of International Financial Institutions - Essay Example International financial institutions operate under international laws and this regulation applies to their roles. The institutions also operate and dispense their duties with a global focus according to the international laws and policies. The international financial institutions therefore implement international laws and policies. This paper will therefore analyze the roles of international financial institutions and their importance in the management of global risks. The World Bank is the largest and the most common international financial institution. The World Bank offers financial assistance to countries especially the developing countries as its main duty. The institutions mainly targets and finance development projects in the concerned countries with the aim of reducing poverty or assisting the countries to achieve global development goals. The international monetary fund the IMF has roles similar to the roles of the World Bank although the institution specializes in monitorin g global economy. International financial institutions (IFI) deals with global financial matters however, their duties are influenced by global politics. International financial institutions implements global policies and this link them with the global politics. The main duty of the IFI is maintaining economic and financial stability in different countries. Maintaining stable economies is an important part of international development. To play this role the institutions provides deposit and loans facilities to the concerned countries. This effort enables the institutions to actively control and monitor the flow of finances in these countries. These institutions work together with other international organizations such as the UN to carry out their duties. Although these multinational organizations have full control over the international financial institutions, the institutions have their own duties and agenda. Poverty eradication and economic stability of developing countries cannot be achieved without peace and stability in the involved countries and therefore the IFI have maintaining peace and stability in these countries as their secondary objective. The institutions influence the government of the concerned countries by altering their financial capabilities. This is achieved through offering of loan and financial sanctions to the concerned governments. This enables the IFI to control the monetary flow of the involved countries or their financial capabilities. The institutions also target the governments of the involved countries in order to maintain political stability. This enables the institutions to enhance global and regional stability through stable economies. Maintaining stability is an indirect role of the IFI aimed at enhancing global economic stability and development. The maintaining global and regional stability is a method of implementing international humanitarian law that is one of the duties of the institutions. Global financing operations a re financial procedures and analysis. Global financial operations include financial operation procedures such as accounting, strategic planning investment, financial analysis, and compliance (Hirschey, 2009). These procedures are carried out on a global scale and hence global financial operation reference. Global financial institutions have global duties and responsibilities. The institutions are therefore responsible for carrying out the global financial