IMF Case Study Example | Topics and Well Written Essays - 1000 words

IMF - Case Study Example It was founded to help developing countries by lending cash for development of financial structures so that it can reach developed stage (Mody & Saravia, 2008). However, this contradicts the functions of IMF presently. Some of these countries engage in highly risky activities with the notion that IMF will come to their rescue in case of failing of the business or inevitable losses. This has led to increased numbers of financial crises due to the increased responsiveness of the IMF to such crises. As a result of the increased number of crisis, the IMF has faced overloading of tasks. This needs response; hence, its main aim of increasing financial structures of developing countries is often slow to allocate and fund them. They give first priorities to crisis’s hit countries hence these countries tend to drag in developments (Mody & Saravia, 2008). IMF system of short-term crisis management is too costly, responds too slow, its advice often incorrect to the lending and repayment, and its efforts to influence policy and practice too intrusive. IMF management of crisis is often too expensive due to the process of analyzing the extent of the crisis, and vulnerability and the dangers and also the damage it has caused and it can cause if not addressed. This is done by a set of appointed board members to analyze it for a time and make a decision on the outcome and the necessary measures to solve such a crisis. This process is often somehow expensive as it includes payments to those appointed to analyze within that short period. The steps of this process are often costly and expensive as they include vital decisions that need careful analyzation before coming up with a decision (Collyns & Kincaid, 2003). Management of crisis is often a slow process as it includes analyzing the extent of the crisis, and the damage caused, the effect it would cause if not collected and the way to solve