Updated August 30, 2019
The International Monetary Fund
The International Monetary Fund (IMF, the Fund), founded
in 1945, is an international organization that works to
ensure the stability of the international monetary system.
The United States is a founding member of the IMF and the
largest financial contributor. This In Focus report provides
a brief overview of the IMF and its operations.
The IMF: Key Facts and Figures
Membership: 189 Countries.
Headquarters: Washington D.C.
Executive Board: 24 Directors; the United States, China,
Japan, Germany, France, and the United Kingdom each have their
own representatives; others are formed into constituencies.
Total Resources: $661 billion in quota; $693 billion of
additional pledged or committed resources.
U.S. Financial Commitment: about $115 billion to IMF quota
and $39 billion to supplemental funds.
Largest Borrowers: Argentina, Ukraine, Greece, and Egypt.
The IMF has reinvented itself several times since it was
created. From 1946 to 1971, during the so-called Bretton
Woods monetary system, the IMF oversaw a network of
pegged exchange rates centered on the value of the U.S.
dollar. When currencies (other than the U.S. dollar, which
was then fixed to the price of gold) suffered balance of
payments imbalances arising from their normal trading and
financial relationships, the IMF provided short-term
financing to cover temporary hard currency shortfalls.
After the collapse of the Bretton Woods system of fixed
exchange rates, IMF members enacted a comprehensive
reform of the organization and its operations beginning in
1975. The IMF transformed itself from being an
organization focused exclusively on issues of foreign
exchange convertibility and stability to one having a
broader mandate: lending for a range of financial crises,
including debt, currency, and banking crises, and engaging
on a wide range of issues including capital flows, financial
regulation, and surveillance of the global economy.
Since the 1970s, the IMF’s mandate of promoting
international monetary stability has translated into three
Surveillance. The IMF regularly monitors the economic
and financial policies of its member countries. Through
surveillance at the global level and in individual
countries, the IMF highlights possible risks to domestic
and external stability and advises on needed policy
adjustments. The effectiveness of IMF surveillance is
dependent on the peer pressure exercised by other IMF
member countries, and increasingly the global financial
sector, as most IMF analysis of global economic risks is
Loans. The IMF makes loans to countries experiencing
balance-of-payments difficulties, which generally means
they are facing problems paying for necessary imports
or servicing their debt payments. The temporary
financial assistance enables countries to stabilize their
economies while implementing economic reforms. The
IMF disburses its loans in phases (“tranches”) after
verifying that specified economic conditions and
reforms have been met (“conditionality”).
Capacity Development. The IMF provides technical
assistance and training to help member countries
strengthen their capacity to design and implement
effective policies. The IMF provides technical assistance
in monetary and financial policies; fiscal policy and
management; statistical data complication; and
economic and financial legislation.
Organization and Structure
The IMF’s governing document, the Articles of Agreement,
provides for a three-tiered governance structure with a
board of governors, an executive board, and a managing
director. The board of governors is the highest policymaking authority of the IMF. All countries are represented
on the board of governors, usually at the finance minister or
central bank governor level. Day-to-day authority over
operational policy, lending, and other matters is vested in
the board of executive directors, a 24-member body that
meets three or more times a week to oversee and supervise
the activities of the IMF. As the largest shareholder, the
United States has its own seat on the executive board. The
executive board or board of governors of the IMF can
approve loans, policy decisions, and many other matters by
a simple majority vote; however, a supermajority vote is
required to approve major IMF decisions. The
supermajority may require a 70% or 85% vote, depending
on the issue. At 16.52% of total voting power, the United
States has unique veto power over major policy decisions.
The primary source of IMF lending resources is the
financial contributions or quota subscriptions of its member
nations. A country’s proportion of quota, or quota share,
broadly reflects its weight in the global economy; larger
economies have larger quotas. A member’s quota also
impacts the country’s voting power at the IMF. Countries
with larger quotas, and thus larger financial commitments
to the institution, have a greater say in how the IMF is run.
The United States contributes $117 billion to the IMF quota
(17.46%). In addition, the United States has contributed $44
billion to funds at the IMF that supplement quota resources.
The International Monetary Fund
Issues for Congress
Size of the IMF
To support its recent additional lending, IMF members
agreed in December 2010 to a wide-ranging set of reforms
that also doubled the IMF’s quota (meaning its member
contributions). In addition to increasing the size of IMF
resources available to fight financial crises, the reforms also
increased the financial contributions (and voting power) of
emerging economies relative to advanced economies.
China, for example, increased its quota share at the IMF by
2.4%. Congress passed legislation authorizing U.S.
participation in the reform package in December 2015 (P.L.
114-113) and the reform package took effect in January
have further limited the ability of the U.S. to vote for large
IMF programs, especially, where the Fund is co-financing
with larger creditors.
Figure 1. Total IMF Lending, 2007 and 2017
Millions of U.S. Dollars
In addition to its quota resources, the IMF can draw on an
additional $692 billion, comprised of bilateral borrowing
arrangements and two supplemental funds, the New
Arrangements to Borrow and the General Arrangements to
Borrow. The future availability of these supplemental funds
is uncertain. The NAB was renewed in November 2016 for
a five-year period. U.S. contributions to the NAB are set to
sunset in 2021. Further renewal requires congressional
authorization. It is also uncertain whether countries
providing bilateral credit lines to the IMF will be willing to
extend them further when they expire in 2019 (extendable
for a further year through end-2020). These issues will
likely shape debate on the next IMF quota review in 2019.
The Trump Administration does not appear to support a
boost in Fund resources. At a December 2018 hearing
before the House Financial Services Committee, then
Treasury Undersecretary David Malpass told Members that
“[the Administration is] opposed to changes in quotas given
that the IMF has ample resources to achieve its mission.”
The most controversial of the IMF’s activities is its lending
program, and its role in financial crises. In the past decade,
the IMF made several large loans to European countries. In
the years immediately following the 2008-2009 global
financial crisis, the IMF lent too many Central and Eastern
European countries. More recently, the IMF has lent to
Western European countries, including Greece and
Portugal. Europe’s borrowing from the IMF has declined in
recent years, yet continues to make up a large share of
outstanding IMF loans (Figure 1).
In addition to representing a majority of the IMF’s
outstanding loans, the IMF made exceptionally large loans
to some European countries. According to IMF rules, the
amount a country is able to borrow from the IMF is related
to the country's quota. In most instances, countries may
borrow several multiples of their quota. The current limit is
145% in a 12-month period; 435% over the lifetime of a
program. The conditionality and performance standards
attached to a loan become more rigorous and demanding as
its size (relative to the borrower's quota) increases. While
provisions for exceptional access have existed since the
early 1980s, the relative amount of lending skyrocketed
with the recent European programs. In an effort to address
this issue, Congress insisted on restrictions on exceptional
access when it approved the quota and governance reforms.
Legislation introduced but not passed in the 115th Congress,
The IMF Reform and Integrity Act (H.R. 1573), would
Source: International Monetary Fund.
Some Members of Congress, among other observers, have
also considered concerns that IMF lending, may generate
moral hazard. Some have argued that crisis countries may
more be willing to engage in risky financial behavior since
they can anticipate financial assistance from the IMF if they
run into economic trouble. Other analysts argue that while
the IMF may generate moral hazard, international financial
markets are inherently unstable. A variety of factors in a
particular crisis, such as coordination problems between
creditors and the country in crisis, can spark a financial
crisis that can quickly spread to neighboring countries or
beyond, they say, and the IMF is needed to respond to
Martin A. Weiss, Specialist in International Trade and
The International Monetary Fund
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.
https://crsreports.congress.gov | IF10676 · VERSION 6 · UPDATED