Impact of IMF and World Bank on Political
economy: The two major world financial bodies, the IMF and the World Bank are regularly monitored
and regulated by the group of seven developed countries such as the USA, UK,
Japan, Germany, France, Canada, and Italy.
These countries forms the group 7 and they hold more than 40% of votes in the
boards of these world financial organizations. These seven countries have
empowered the World Bank and the IMF to impose
economic austerity policies in the third world countries. Once these countries
build up large external debts, they will be virtually trapped with no other
option left with than going for loans from IMF and
the World Bank by simply surrendering to all of their terms and
conditions.
