Following are the introduction about the 3 international economic institutions:
1. International financial corporation (IFC): It is a private sector arm of the World Bank family established in July 1956. Its main aim is to promote productive private investment in developing countries. It s objectives are:
a) with the help of private investors help in financing the establishment, improvement and expansion of productive private enterprise.
b) bring together investment opportunities, domestic and foreign, private capital.
c) to help in creating conditions, to flow the private, domestic and foreign capital into productive investment in member countries.
2. Asian development bank (ADB): ADB is a financial established for the purpose of landing funds, promoting investments and providing technical assistance for the economic and social progress of its developing member countries in the Asia and pacific region.
It started its operation in Manila in December 1966. The bank operates under aegis of ECAFE. The idea for establishing ADB was first proposed by United Nations economic commission for Asia and the far east (ECAFE) in 1963. It main features are:
a) It is Asian bank conceived by ECAFE. Its headquarter are located in ECFAE region in Manila, Philippines. ADBs capital is subscribed by its 40 regional members and 16 countries from outside the region. The president and 7 out of 10 directors also come from the region.
b) The membership of the bank extends beyond the region. So many countries outside Asia have contributed to the capital of the bank. Such member numbering are 16, they are designed as non regional members.
3. International development association (IDA): IDA is the soft loan window of IBRD which was established in September 1960. The president of world bank is its head. Its objectives are:
a) to provide help to the poorest countries of the world
b) to provide concessional financial assistance to the poorest countries to raise their standard of living.
Membership: The membership of IDA is open to all members of World Bank. In 1996, it had 181 members. If the country is no longer the member of world bank, its membership of IDA is automatically ends. Its members are divided into 2 parts. Part 1- developed countries, Part 2-developing countries.
IDA supplements world bank financial efforts. There are many projects which world bank does not finance. IDA finances these projects. Many projects like steel plants, fertilizers factories, bridges slum clearance, education development have been financed by IDA.
These are the 3 International economic institutions. I will discuss more International economic institutions in coming articles.