Global Governance and International Institutions Essay

The World Bank and IMF are seen as disproportionately accountable to the United States; on the other hand, there are opportunities for other nations too to hold the bank accountable. Therefore, the activities of the international bankers are regulated by other nations apart from the United States. Often, the Operations Evaluation Department (OED) evaluates the activities of the World Bank in terms of the developmental impacts and performances achieved over a given period. The international regulations are essential since they help keep the monetary institutions up to the expected standard. Most of the activities are regulated by the United States because the institution's headquarters are located there. Therefore, most of their policies and strategies are within the United States' standards and United States will continue ruling over the operation of the World Bank and IMF. The United States, through the World Bank, provide economic solutions to the international development issues which are essential for sustainability and global economic growth. The U.S. control most of the operational policies and frameworks because they were the originators of the World Bank (Woods, 2003). The regulations help in limiting the severity and incidences of economic crisis like the one witnessed in 2008. Within the World Bank, various economists analyze and interpret the bank's data and thereafter propose the recommendations to be adopted in helping the banks promote global development. However, concerns have emerged that there is a need to be an equal representation in the institution and develop a balance policy system that supports all other nations such as the United Kingdom equally. For instance, the United States would also dominate the votes cast and this was an element of institutional design. In addition, the initial structure of the World Bank institution made U.S immune from the pressures exerted to them in terms of maintaining regular funding (Woods & Narlikar, 2001).

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The World Bank and International Monetary Fund (IMF) promote global economic development by pooling resources and uses the capital to lend the members in need (Corning, 2016). The lending is mainly done to the developing nations which cannot sustain themselves economically. The purpose for lending is to let the borrowing nations to stabilize their monetary system(Woods, 2014). The World Bank offers long-term loans to facilitate specific projects that help alleviate poverty and promoting development. Therefore, in as much as most of the policies are controlled by the United States, the motive behind the formation of the institution was good. Economic sustainability realization requires that the United States empowers the surrounding nations and developing countries to create a market and promote the trading activities. The original intention for the formation of an institution still applies to this date; though, adjustments have been made to expand its coverage.

The World Bank has various institutions and financial instruments working as separate entities. For instance, the International Bank for Reconstruction is one of the entities in the financial institution that works jointly with the International Finance Corporation. The joint operation enhances transparency and accountability in addition to the corporate governancesystem used by the institution; it is governed by a board of directors and the operative decisions on loan limits and other financing strategies are discussed jointly during the board of governors' meeting. Therefore, it is apparent that a group of nations work jointly to regulate the processes and activities taking place in the institution, and this is essential for good governance and ensuring that the World Bank works to achieve its goals and objectives (Woods & Narlikar, 2001).

The United States is an important figure in the global economic governance considering that they hold the majority of the shares in the World Bank. Consequently, issuesemerged after the World War I concerning the need to expand the international economic governance and develop a system that could be governed by a war-weary public and not the one statesman. The United States negotiators were more powerful to wield compared to their colleagues from other states (Woods & Narlikar, 2001). As a result, they retained their authority over the World Bank through the voting rights and control over mandates. The United States remains to control the international banking institution as through the voting rights and funding, therefore, they are likely to remain key players in the corporate governance of the bank.

Conclusion

Finally, international regulations are meant to ensure that the banking institution operates according to the set standards and protocols. Considering that the World Bank and IMF were founded by the United States, it may be impossible to achieve 100% equality in terms of voting right and decision-making (Woods, 2003). The United States controls most of the activities in the banking institutions considering that they hold majority votes and funding. As a result, the autonomy of the bank has been affected by the voting structure, funding and the degree of discretion (Woods, 2014). However, it is important that the banking institution stick to their mission and be separated from the political affiliations; political influences are likely to affect the banks capacity to promote global development. In as much as political systems may be working to revert the voting power held by the United States, it may be impossible to achieve this considering that U.S membership constitutes more than 85% of the total votes.

References

Corning, G. P. (2016). Managing the Asian Meltdown: The IMF and South Korea. SAGE.

Woods, N. (2003). The United States and the international financial institutions: Power and influence within the World Bank and the IMF. Foot, McFarlane and Mastanduno (Eds.), US Hegemony and International Organizations, Oxford, 92-114.

Woods, N. (2014). Globalizers. Cornell University Press.Woods, N., & Narlikar, A. (2001). Governance and the Limits of Accountability: The WTO, the IMF, and the World Bank. International Social Science Journal, 53(170), 569-583.