Most people think of the IMF as an institution that provides emergency credits to countries that have found themselves in difficulties, either as a consequence of poor economic policies or through external circumstances, such as a sudden drop in commodity prices, or a financial crisis in a neighboring country. In return the country is obliged to impose painful austerity policies, usually involving reductions of budget deficits, through spending cuts or increased revenue (taxation), a rise in interest rates to reduce inflation, and an alteration of the exchange rate (a devaluation).
INTERNATIONAL MONETARY FUND AND ITS ROLE IN INTERNATIONAL ECONOMY
Temurbek Usmanov, Jonibek Sattorov (Tashkent, Uzbekistan) | Download article