About IMF-WB - Bank Sentral Republik Indonesia
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October 01, 2020

International Monetary Fund

  • IMF was found in July 1945 during Bretton Woods Conference, New Hampshire, US, where 45 government representatives agreed on an economic cooperation framework that was designed to prevent 1930’s Great Depression from happening again. IMF Headquarter is located in Washington DC, US.
  • IMF comprises of 189 member countries, in which each of the members is obliged to contribute financially, that will further determine quota and voting rights in IMF. Each member is entitled to certain quota that reflect their relative positions to the other members. IMF also collects financial resources from its members that can be lended to member that is going through balance of payment difficulty.
  • IMF is an international organization that aims to:
    - Endorse international cooperation and maintain financial stability
    - Facilitate international trade
    - Stimulate the sustainable economic growth as well as workforce absorption
    - Reduce poverty in the world
  • Indonesia’s membership in IMF, the process wasn’t directly from Indonesia’s membership in UN - 28th September 1950. On 10 September 1952, Board of Governors of the IMF and IBRD (World Bank) agreed on resolution of terms and conditions upon Indonesia’s membership. Indonesia accepted it and signed in mid 1953 (officially became the member), it was then legalized through Act No. 5 1954 on Indonesia’s Membership in IMF and IBRD (UU No 5 Tahun 1954 tentang Keanggotaan RI dari IMF dan IBRD).

World Bank

  • WB was found on July 1944 (Bretton Woods Conference in 1st-22nd July 1944), and was officially established in 1 May 1945. WB Headquarter is located in Washington DC, and have more than 10.000 staffs in over 120 offices around the world.
  • WB is an international financial institution that provides lending to developing countries under capital injection program with a purpose to reduce poverty. All decisions have to be directed to promoting foreign investment, international trade, and facilitate capital investment.
  • WB consists of 5 organizations, which are:
    - The International Bank for Reconstruction and Development (IBRD) was found in 1945, aimed to faciilitate lending, development assistance for middle-income countries.
    - The International Development Association (iDA) was found in 1960, aimed to facilitate soft credit, and development partnership for developing countries.
    - The International Finance Corporation (IFC) was found in 1956, is the world’s biggest development institution that focuses on private sector.
    - The Multilateral Investment Guarantee Agency (MIGA) was found in 1988, aimed to promote FDI towards developing countries to support the economic growth, reduce proverty, and raise the living standard.
    - The International Centre for Settlement of Investment Disputes (ICSID) was found in 1965, aimed to facilitate arbitration as well as investment problems in member countries.
  • On15 April 1954, Indonesia became the member of IBRD (according to Act No. 5 1954 on Indonesia’s Membership in IMF and IBRD), but due to political situation, Indonesia withdrew its membership on 17th August 1965. Indonesia became the member again in September 1966 as the transition from Orde Lama to Orde Baru took place.
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