The International Monetary Fund (IMF) is an international institution responsible for promoting international monetary cooperation, ensuring financial stability, facilitating international trade and contributing to the economic stability.
The IMF is actively engaged in Europe as a provider of policy advice, financing, and technical assistance. They work with European Union (EU) countries, in cooperation with European institutions, such as the European Commission (EC) and the European Central Bank (ECB).
What are the IMF’s responsibilities in Europe ?
It’s important to say that the IMF’s work in Europe has intensified since the start of the global financial crisis in 2008. Because the main role of the IMF is to ensure the stability of the international monetary system. Since the start of the global financial crisis, a number of emerging and advanced European countries have requested financial support from the IMF to help them overcome their fiscal and external imbalances.
For example, the IMF participated in the financial assistance and economic adjustment programs for Greece, Ireland and Portugal by contributing around one third to the emergency funds. In a “Troika”, together with the European Commission (EC) and the European Central Bank (ECB), the IMF elaborated the economic adjustment programs for these economies and closely monitored their progress through quarterly reviews based on economic missions.
IMF provide technical expertise
The IMF delivers technical assistance in various ways. Support is often provided through staff missions of limited duration sent from headquarters, or the placement of experts and resident advisors for periods ranging from a few weeks to a few years. Assistance might also be provided in the form of technical and diagnostic studies, training courses, seminars, workshops, and online advice and support.
IMF provide financing
Most of the first wave of IMF-supported programs in 2008-09 was for countries in emerging Europe. The IMF also provided financing to Iceland when its banking system collapsed in late 2008.
As of September 2016, the IMF had active arrangements with 6 emerging market countries in Europe (see table) with commitments totaling about EUR 33.9 billion or $38 billion. Total credit outstanding to European members was around EUR 49.4 billion or around US$ 55.4 billion.
IMF need the Europe to be strong
The IMF published papers making the case for a Banking Union to strengthen the EU financial oversight and sever bank-sovereign linkages; a Fiscal Union to address gaps in the euro area’s architecture; and a more effective Economic Governance framework to better incentivize structural reforms.