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The International Monetary Fund (IMF) and the World Bank were both established in 1944 by the United Nations under the Bretton Woods System. Both institutions were set up to support each other for the main purpose of developing a stronger global economy after World War II. The Bretton Woods system was based on agreements between various nations, including the United States and the United Kingdom for this reason. Although both financial institutions have evolved since their birth, they have remained connected in many ways. For example, staff members from both work together on a regular basis in order to gauge the world economy, to offer financial and advisory assistance to countries in need, and to promote global economic growth and cooperation.
Both the International Monetary Fund and the World Bank were formed at a meeting held in Bretton Woods, New Hampshire, United States, at the end of World War II. They were created under cooperative agreements between many nations, which were jointly called the Bretton Woods system. Initially, the financial institutions were mainly set up to rebuild Europe after it suffered major destruction in the war. They were given different tasks, although they shared the goal of rebuilding economies and facilitating international trade by setting up necessary systems. Today, their scope of operations has markedly widened, and the International Monetary Fund acts an international fund, while the World Bank acts as an international bank.
To effectively reach their common goals, which include creating a prosperous and more cooperative global economy, the International Monetary Fund and the World Bank work together on a regular basis to develop strategies so their objectives can be achieved. They have in place what is called the Joint Management Action Plan (JMAP) on World Bank International Monetary Fund Collaboration, for instance, which sets the terms that the two institutions observe when they work together. For example, under the JMAP, they are meant to share necessary information between each other, and they also can allocate needed work from each institution to help out a particular nation.
Often referred to as sister institutions, the International Monetary Fund and the World Bank complement each other with their respective roles. The IMF provides necessary aid to its member countries to help them with their economies, especially in times of financial hardship. This might come in the form of policy advice and/or financial loans. Whereas the IMF's financial support is more short-term, the World Bank plans ways to help nations grow their economies for the long term. For example, poor countries might turn to the bank for assistance to help them build their infrastructural facilities and utilities, such as schools, hospitals, and water management systems.
Generally, the two institutions collaborate regularly and help each other in many areas. For example, the IMF might take part in a World Bank mission to aid a particular country. They hold annual meetings in which the member nations' representative agents on the boards of each discuss matters regarding the economic and financial state of the world. The director of the IMF and the president of the World Bank also meet on a regular basis, make statements together, and sometimes write articles together, all regarding international economic and financial issues. Member nations of the World Bank are also members of the IMF.