The World Bank and IMF in Developing Countries: Helping or Hindering?

Abstract

The presence of the World Bank and IMF in developing countries dates back as early as 1960s. Having similar structure and membership, both institutions attempt to provide more stability and certainty for the globalized world-economy by providing technical and financial assistance to developing countries, and to those nations struggling with economic and financial difficulties. However, their claims of assisting developing countries are often questioned and castigated. This study examines whether these institutions are contributing to the growth, development and well-being of developing countries or undermining their activities and achievements. Despite that developing countries are marginalized in power sharing, decision making and designing policies and projects in these institutions, they are imperialism tools used to exploit resources of the developing world and to protect interests of the west. They provide painful and destructive financial and technical support leading to retarded growth, expanded inequality, and occasionally global instability. We argue that it is time for the developing countries, to join and contribute the improvement of existing alternative financial and development institutions such as the New Development Bank established by BRICS countries.

Keywords: Developing countries, IMF, World Bank, development, international financial/economic institutions, west.

JEL Code: F33, F34, F35, F36, O19.