Cleo Bonny reading ambassador killer presentation skills international financial system world first agenda presentation for international financial system

1. Presentation by Cleophus Bonny
Zamadunga on the in-depth of international
financial system

2. 
 The international financial system is the global
framework of legal agreements, institutions, and
both formal and informal economic actors.
International financial
system

3. 
 It was after the Second World,1944 Bretton Woods system
agreements took place pertaining to the international gold
standard in the 1930. It was time of economic
unsustainability and great depression.
 to govern monetary relations among independent states.
 The Bretton Woods system of monetary management
recognized the rules for commercial and financial
relations among the world's major industrial states and
independent states.
 From 1944 to 1971 gold exchange standard used to
maintain the dollar price of gold at 35$ per ounce.
The creation of international financial
system

4. 
 Historically between 1870s to the eruption of World
War I in 1914 there was so called “first age of
globalisation”. Rich nations, colonialists and the
ruling elites except poor nation were advancing from
a well-integrated financial order. Imperialists, and
industrial power, ruled more of the world, however
this international financial allowed members to
convert or accept each other's currency as legal
tender. And transactions were facilitated by
widespread participation in the gold standard.
Fin B Jansen (1966)

5. 
 This is the General or multilateral Agreement on Tariffs
and Trade that regulates international trade reduced
tariffs, trade barriers and getting rid of preferences. This
was prior to International Trade Organization's failure
(ITO never saw the light) which was replaced by the
World Trade Organization in 1995.
 World Trade Organization supervises and formalizes
agreements signed by representatives of member
governments. It provides dispute resolution and
liberalizes international trade which started on 1 January
1995 under the Marrakech Agreement replacing the
General Agreement on Tariffs (GATT).
General agreement trade and tariffs
(GATT)

6. 
 The regional currency Euros for European countries
can create hostile environment through single
interest rates for smaller or larger.
 The single interest rate can be lowered or increased
and hurt larger or small countries.
The regional currency in international
financial system

7. 
 According Fin B Jensen (1966) two world wars
between 1914 to 1945 brought bad and severe
disintegration and unhappiness in financial systems
such as inflation.
 After the wars North America was to transfer capital
to the rest of the world.
Origins of International monetary
fund

8. 
 The World Bank is an inter-governmental institution,
whose capital stock is owned by its member
governments
 John Maynard Keynes said that the World Bank
group speared-head by America and Europe will be
only one with a duty to expand the world’s
economy. The economy these powerful nations have
only expanded instead.
WORLD BANK (WB, 1944)

9. 
 It provides financial assistance to development of the
territories of its members. It facilitates the investment of
capital for production. It promotes private foreign
investment by means of guarantee of participation in
loans and other investments.
 According to Oliver's accounts of Bretton Woods the
conditions of world Bank and its policies has become the
projects for developing countries.
 The World Bank imposes policies and make nations weak
while loosing certain national interests.
 The Bank's advice is based on a wealth of technical
knowledge, information and research.
Functions of the World
Bank

10. 
 As Gilbert et al (1996) states the World Bank's to be:
1.Bank, money lending and advice or educator.
2. Development Agency, supervising projects,
objectives of government's policies and development
practice.
3. Development research institution, from the research
activities and policy conditions to development agency
for poor nations.
Three Main functions of World Bank

11. 
 There is no autonomy because of political pressure
mostly from United States. Financial top up and the
negotiation requires agreement from potential
members. Its about rapid growth of world
productions for industrialized nations.
 The Bank's bureaucrats research, prepare policies
(projects) for poor countries. These policies are
approved by political masters such as United States
and United Kingdom. The loans and the bank's
policies for poor countries are politically influenced
by powerful members.
World Bank independent?

12. 
 The bank borrows on capital markets and lends to
poor countries.
 In the process the bank generates its own income.
 The paid-in capital subscription by national
governments have diminished.
 This is a system begs to reserve a fixed exchange rate
with a foreign currency such as a dollar with an
obligation of a central bank to be subordinated to the
exchange rate target of the dollar.
How does the bank raise its money?

13. 
 The Role of Central Banks in international financial
system and its Stability has been a gradual
integration of international financial system in the
central banks of the countries. And they meet to
discuss the key role in international financial system.
Central banks in international
financial system

14. 
 Perhaps Marxism’s criticism of capitalism was right.
African and Asian nations are forced to accept
projects and policies if the loans are granted.
 Liberalism international financial system is there to
persuade smaller and poor countries to give up their
rich resources to the global market through the
multinational corporations, powerful states,
international financial institutions.
 It confirms Mercantilism theory that the IFS conducts
research, protect, preserve wealth and power and
sustain to the clubs of powerful nations.
Marxism and Liberalism Mercantilism

15. 
 The money system has regulators and institutions to
supervise those on the regional and national level.
 E.g. World Bank, international monetary system,
National agencies, departments, ministers, central
banks, and private institutions.
 Harry Dexter White and John Maynard Keynes
Structure of international financial system

16. 
 The effects in those countries are either good or
negative especially when the United States and its
federal system change its financial policies.
The dangers of pegging a currency to
the dollar

17. 
 Defective financial system can hamper trade flows,
destabilize prosperity and create financial disaster.
 It is International financial system creates credit,
prosperity and growth environment.
 It (Gill and Law, 1993) gives greater power to those who
can move the capital around the global.
 Foreign investors with potential capital can threaten the
government if the government creates policies favouring
the welfare.
 Financial markets operates and transactions are real quick
in the world as a result the governments looses power.
The disadvantages of International
financial system

18. 
 Before the international financial system, operations were
characterized by disintegration and competitive
devaluations. Therefore free trading system and fair
international financial rules.
 system was formed to conform stable democracies
with a policy instrument to guide and steer the
economy towards fair trade and distribution .
The importance of international
system

19. 
 The responsibility of capital flows, markets, trade,
exchange rates, foreign policies, credit has moved
from government to corporations, international
organizations and powerful nations with influential
policies. Balance of payments: A favourable balance
of payments exists when more payments are coming
in than going out.
 This characteristic of international financial system
lies in lending and its power to research in potential
projects and policies. The system still favours its own
political master.
The dangers

20. 
 Bretton Woods’s system was the first model of a
fully negotiated monetary order intended to govern
monetary relations among independent states.
 The Bretton Woods system of monetary management
recognized the rules for commercial and financial
relations among the world's major industrial states in
the mid-20th century.
Bretton Woods agreements

21. International Monetary Fund, was established at the same
time as the World Bank to tackle the problem of
international investment.
REGIONAL FINANCIAL AGREEMENT SYSTEM
1. European Central Bank
2. African Bank
Monetary agreement system
agreement system in among countries like Swaziland,
Lesotho, Namibia, whose currencies are pegged to South
African Rand.
INTERNATIONAL MONETARY FUND
AND REGIONAL SYSTEMS

22. 
 It provides temporary assistance in correcting the
balance of payments difficulties and a long term
investment to other institutions.
 However, countries in Asian, African, and Latin
America that obtained IMF loans made their
conditions the worse medicine than the serious
terminal disease.
International Monetary Fund

23. 
 Industrialised countries and exclusive clubs that
regularly meet, discuss the world economy, financial
systems and global challenges in the absence of
countries like Mozambique in the world of close to
200 countries.
G8 OR G20

24. 
 1. International Bank for Reconstruction and Development (IBRD).
Funds projects to developing countries.
 2. International Finance Corporation (IFC). Funds private development
projects (1956).
 3. Multilateral Investment Guarantee Agency (MIGA, 1985) political risk
insurance guarantees to investors and protect foreign direct investments
against political and non-commercial risks in developing countries.
 4. International Development Association (IDA, 1956) Developing nations
could no longer afford borrowing, IBRD was not good enough. Poor
nations called for the establishment IDA grant loans to them.
 5. International Centre for Settlement of Investment Disputes (ICSID, 1966)
International negotiation institution facilitates settlement and resolution of
legal disputes between international investors.
Five different parts of World bank

25. 
 International economic sanctions are quite common
in the international financial systems in such
countries as Zimbabwe. However the United States
and Europe have been the major country imposing
economic sanctions in the world. The target country
may loose its own national interest through its
foreign policies formulation and implementation as
well as welfare.
SANCTIONS IN INTERNATIONAL
FINANCIAL SYSTEM

26. 
 The international financial system power and the problems of
poor countries may have been influenced and created by
mercantilists.
 Thomas Munn one of economists. The idea of using policies of
protection, subsidy, taxing, accumulation, trade competitive
surplus goods.
 Sell goods and you do not buy goods. Receive gifts but do not
give gifts. Poor nations consuming and enjoying what the rich
nations produce while they bring themselves up.
 Sell more at higher price to strangers and consume less of their
value. Sell them cheap if items loose quality than loose them
completely.
 Increase the wealth and treasure from poor and weak nations
and export more and import less.
Thomas Munn's theory (1571-1641) with a problem of
international financial system in poor countries

27. 
 According to Dominick Salvatore absolute advantage is
the ability of an individual or group to carry out a
particular economic activity more efficiently than another
individual or group.
 This group is G8 and G20, World Bank, IMF, regional
organizations, international organizations, multinational
corporations, security council in UN.
 So even when Adam Smith attacks Thomas Munn with
his comparative advantage theory which is an ability of
an individual or group to carry out a particular economic
activity more efficiently than another activity of any
nation is still practiced in powerful group.
Theories of David Ricardo in
international financial system

28. 
 There is still movement of Money internationally
even if international regulations of international
financial systems are in place.
 Illegitimate drugs money, money movement.
Illegitimacy of International
financial system

29. 
 The rise of digital and virtual currencies such as Bitcoin.
 This is peer to peer form of payments which can no
longer be ignored.
 Bitcoin as a safe and well preserved from inflation, and
sanctions and a way to evade capital controls from formal
regulations. However this digital transaction has
instability for it to be international currency.
 But it meets the requirements to be accepted as national
currency since it can evade sanctions, inflation.
Contemporary financial
international system

30. 
 Policy proposals and funds conditionality must promote equity
markets and make emerging market countries less vulnerable.
 Reduce fund surveillance and strategic interest of creditor
countries.
 Funds that spells out the debtor countries national agenda.
 Vulnerable countries to establish different institutions and
different markets before accepting the loans and defining their
approaches.
 IFS to warn poor nations the dangers of liberalizing foreign aid
which has self-interest elements, international capital flows
and domestic financial markets.
 Tax payers of creditor countries to be educated.
Recommendations (Reformation of IFS)

31. 
 From 1944 to 1971 gold exchange standard used to
maintain the dollar price of gold at 35$ per ounce.
 From 1870 to the eruption of World War I in 1914
there was so called “first age of globalisation in
which colonialists, mercantilists and the ruling elites
moved their wealthy across the global.
 After the war North America was to transfer capital
to the rest of the world.
 Reduce fund surveillance and strategic interest of
creditor countries.
Conclusion

32.  Bibliography
 1. Harold James, 1996, international Monetary Corporation since Bretton Woods,
New York, Oxford University Oress
 2. Orman Suze, 2003, The laws of money, the lessons of life, New York, Free
Press
 3. Boorman Jack and Icard Andre, 2011, Reform of the international monetary
system, New Delhi, SAGE Publications Inc
 4. Cohen j. Benjamin, 2008, Global monetary governance, New York, Routledge
 5. Franser Robert and Long Christopher, 1992, second edition, United Kingdom,
Longman Group
 6. Norton Joseph. J and Auerback Raymond M, 1993, International finance in the
1990s, United States of America, Blackwell Publishers
 7. Harter Marjorie B. Ph.d, 2004, Contemporary Living, Washington, DC,
Goodheart-Willcox Company, Inc
 8. Isard Peter,2005, Globalisation and the international financial system, Cape
Town, Cambridge University Press
Bibliography