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Bretton Woods Agreement Contribution To Globalization

The United States launched the European Economic Recovery Plan (Marshall Plan) to provide significant financial and economic assistance for the reconstruction of Europe, mainly through grants, not loans. Countries that are part of the Soviet bloc, for example. B Poland, were invited to receive the subsidies, but obtained a favourable agreement with the COMECON of the Soviet Union. [31] In a speech at Harvard University on June 5, 1947, U.S. Secretary of State George Marshall stated that the IMF was working to mitigate the negative effects of globalization on the world economy in two ways: by ensuring the stability of the international financial system and by helping individual countries exploit the investment opportunities of international capital markets. while reducing their vulnerability to negative shocks or changes in investor sentiment. On the other hand, the role of the State in the economy was linked to the assumption of the responsibility of the State to guarantee its citizens a certain degree of economic well-being. The system of economic protection for vulnerable citizens, sometimes referred to as the welfare state, was born out of the Great Depression, which created a popular demand for state intervention in the economy, and theoretical contributions from the Keynesian school of economics, which affirmed the need for state intervention to combat market imperfections. The critical debate on globalization, although temporarily mitigated by the events of 11 September 2001, continues to raise issues that are at the heart of national and international political agendas. This note provides a conceptual framework for the IMF`s engagement in the global economy.

It describes what the Fund uses within its mandate, under the Terms of the Fund, to (1) secure the international financial system and (2) enable more countries to reap the benefits of globalization while minimizing risks. At the same time, it recognizes that the IMF is part of a broader network of international institutions, each of which plays an important role in improving globalization. The Bretton Woods Agreement was created in 1944 at a conference of all allied nations of World War II. It took place in Bretton Woods, New Hampshire. The Bretton Woods Agreement of 1944 established a new global monetary system. It replaced the gold standard with the US dollar as the world currency. In this way, it established America as a dominant power in the global economy.