Functions and Differences of UN, WB, IMF, and WTO

Among so many international organizations, UN is the most authoritative organization in making universal international rules and UN system is the most powerful tool to stabilize the world and keep a secure development environment. WB, IMF, and WTO are the most widely-recognized three international economic organizations for now. However, they are different groups and play various important roles in the international affairs. Next, they will be analyzed respectively to give a better understanding to people.

UN, a short form of United Nations, is an international organization composed of the countries that have sovereignty of its own. It was founded in 1945 and headquartered in New York, America. Till now, there are one hundred and ninety-three member states. Six principal organs were established when UN formed: General Assembly, Security Council, Economic and Social Council, Trusteeship Council, International Court of Justice, and UN Secretariat. Besides that, the UN system also includes many programs, funds, and some specialized agencies, such as ILO, IMF, UNESCO, WB, WHO, etc. The functions of UN mainly contain the following five aspects: to keep peace and secure for people in the world, to boost the economic development and protect the environment around the globe, to protect human rights, to maintain the International Law, and to provide humanitarian help to wherever it needs.

WB, standing for World Bank, was found in 1944 and became a specialized agency of UN in 1947. It is headquartered in Washington, D.C. and consists of one hundred and eighty-nine member countries. WB consists of five institutions: IBRD, IFC, IDA, MIGA, and ICSID. It works to reduce poverty and improve the economy by offering loans to the member states. The member country of WB must be one of the member states of IMF.

IMF, the International Monetary Fund, was created in 1945 and owns one hundred and eighty-eight member countries now. It is headquartered in Washington; D.C. IMF also became a specialized agency of UN in 1947. It works to stabilize the international monetary system through monitoring the economies of the member countries and providing necessary financial and technical aid to the countries that trapped in payment difficulties. A member of IMF may not be the member of WB.

WTO, World Trade Organization, is an international organization that is accountable for world economic and trade rules. It is independent of UN system. It was established in 1995 with headquarter in Geneva, Switzerland. In 1996, WTO replaced the GATT completely, which was created in 1947. WTO extended the trade scopes. Till 2015, there are already 162 member countries in WTO. It is committed to building a more dynamic and permanent multilateral trading system by designing and administrating the global trade agreements, setting up forums for trade negotiations, dealing with trade disputes, supervising each member’s trade policies and cooperating with other organizations.

The Difference between IMF and WB

Although both IMF and WB can make contributions to supporting the economic adjustments and alleviating the debt crisis of their member countries, they differ significantly in functions, capital source, and loan policies. The major role of IMF is more like an auditor who records the trade and debt numbers of each country and takes charge of international monetary and economic policies making. Though the reserve fund can be used by IMF to lend to member countries to keep the currency stable in a short period, the money borrowed must be returned to IMF within very short time. IMF’s role was designed to monitor the foreign exchange market and keep the currency of every member countries stable. Thus, IMF is not a bank. The capital source of IMF mainly comes from the subscribed shares of each member. The other sources, like gold, the lending and borrowing policies are also important strategies to generate profits. In contrast, WB functions more like an investment bank. They issue bonds and lend what they earn to the ones who need money. They can provide long-term loans, by which they can also make money.

The Difference between WTO and IMF, WB

WTO’s organizational structure and decision-making system are different from that of IMF and WB. The member countries in WTO can be better represented by “one country, one vote” system, which gives all the members the equal right to vote. Whereas IMF and WB adopt a system that can reflect the economic positions of the member countries in the decision-making process. The super economic powers can influence the final policy with their dominating advantages while the weak ones seldom have the chance to make changes. In WTO, every member can let their opinions heard or realized.

WTO focuses on international trade laws based on the multilateral deals. It provides a unified system and efficient protection for goods trade, service trade, intellectual property and transnational direct investment. IMF and WB are mainly engaged in creating a sensible and sound international monetary system for the world. Moreover, WTO creates a very successful multilateral system to solve the disputes between different nations, which strengthens the global economic stability.

The future planning for IMF and WB needs more flexibility and transparency. Reforms to the voting system are required to improve the drawbacks so as to make IMF and WB more democratic and impartial. When IMF and WB represent most of the members, they will function better in the world economic trade and cooperation. However, WTO also needs to tackle the problems how to overcome the trade protectionism to maximize the trade freedom, and how to cope with the areas related to trade but beyond the trade business in the future.

The Difference between WTO and UN

UN is a world political organization that aims to promote international cooperation in international law, international security, economic development, social progress, human rights and the realization of world peace. Policies and operations are mainly implemented through the effort of every member government. WTO is a global economic organization that is responsible for managing the world economy and trade order. Sometimes, WTO is also called “the economic UN” by some scholars. WTO is an international organization with legal person status, so it has more authority over dispute mediation in the world. It aims to enhance the economic and trade development, initiate sustainable plans for the development, reduce trade barriers and discrimination by various agreements.

As a result, the contributions UN and WTO made to the world differ, either. It is reported that the world conflicts has been decreased by 40% since 1990 under the interference of UN. Many wars have been avoided, and many places destroyed by conflicts were also recovered with peace with the efforts of UN mission groups. UN also launched many projects to improve the life quality in more than one hundred countries. Meantime, UN is dedicated to the protection of world heritage and human rights and obtained remarkable achievements. UN also took the lead in protecting the environment and medical treatment and made significant progress.

WTO created a new era of the world trade. It changed the traditional concepts of trade protection and trade sanctions. WTO increased the freedom of world trade by reducing tariffs and making trade agreements, which laid a stable foundation for the development of international trade so that foreign trade plays a more important role in the economic development of each country. It also triggered a revolution in the ways and strategies of international market competition, which is helpful to the redistribution and use of the global resources. WTO made the world market compete in an orderly way and brought another chance for the economic development in those underdeveloped countries.

The Difference between UN and IMF, WB

Although IMF and WB are specialized agencies of UN, they run separately. They have their own membership, leadership, and budget plans. Their functions are confined to some particular fields. By agreements between UN, and IMF or WB, UN recognizes the duties and powers of IMF or WB, and IMF or WB accepts the guidance from UN. However, UN covers much broader scopes of work, including economy, politics, culture, environment, etc. and is entitled with more power and functions.

UN, WB, IMF, and WTO are different international organizations that were set up due to economic reasons or political reasons at that time. They were designed to adapt the new development circumstances. Despite the various distinct functions of these organizations, they already became an important part of the social development. As the global economy grows further, they are more interconnected and work in a closer way than before. The communication and cooperation between these organizations become more and more important to construct and maintain an orderly world economic system. The overview of the functions and differences of UN, WB, IMF, and WTO will present a clear picture of the history, the significance and the impacts these organizations created to people who are still confused about these agencies. With a good understanding for UN, WB, IMF, and WTO, people will be more aware of what is happening in the world and their own life.