International Financial institutions

1. Read and learn the following words and word combinations. Translate the examples:

convene v – скликати, збирати (конференцію, збори, засідання)

e.g. The conference was convened in July, 1944.

creditworthy adj – платоспроможний

creditworthiness n – платоспроможність

e.g. The customer who proved to be able to redeem a credit in due time (i.e. has a good credit history) is considered to be creditworthy.

contribution n – 1) внесок; 2) участь; 3) сприяння

contribute v – 1) робити внесок; 2) брати участь; 3) сприяти; contributor – учасник

e.g. The resources of the fund come from the contributions of the member countries.

mean n – 1) середнє число, середня величина; syn. average 2) pl. засіб, спосіб, метод; financial means – фінансові засоби; means of payment – платіжні засоби; means of production – засоби виробництва; by means of – шляхом, засобом, за допомогою; ways and means – шляхи і засоби

e.g. The conference discussed ways and means of avoiding international economic difficulties.

save v – 1) економити; 2) зберігати, заощаджувати; saving – економія, збереження, заощадження; pl. заощадження (гроші); energy saving – економія електроенергії; personal savings – приватні заощадження

e.g. The bank finances energy saving and power generation projects.

SDR (Special Drawing Rights) – Спеціальні права запозичення (СДР)

CIS (the Commonwealth of Independent States) – Співдружність Незале­жних Держав (СНД)

2. Read and translate the text:

International Financial Institutions

Bretton Woods is the name of a town in New Hampshire, USA. It was here that an international conference was convened in July 1944 to discuss ways and means of avoiding the international economic difficulties which were expected to occur after the Second World War. As a result, the International Bank for Reconstruction and Development, known as the World Bank, was established in December 1945. The World Bank is owned by more than 125 member countries and has its headquarters in Washington, D.C. The World Bank extends long-term loans to member countries for development projects such as dams, electrification, general infrastructure, agricultural development and public health. World Bank loans are made in hard currencies at market interest rates. Loans are to be repaid in the same currency within 25 years. The World Bank is the largest source of development assistance, providing nearly 30 billion US dollars in loans annually to its clients. The World Bank today consists of 5 closely associated institutions:

IBRD – The International Bank for Reconstruction and Development, which provides loans and development assistance to middle-income countries and creditworthy poor countries.

IDA – The International Development Association, which focuses its assistance on the poorest countries and provides interest-free loans and other services. IFC – The International Finance Corporation, which finances private sector invest­ments and provides technical assistance and advice to governments and businesses in the developing countries.

MIGA – The Multilateral Investment Guarantee Agency, which provides guarantees to foreign investors in developing countries against loss caused by non-commercial risks and disseminates information on investment opportunities.

ICSID – The International Centre for Settlement of Investment Disputes, which provides facilities for settlement of investment disputes between foreign investors and their host countries.

The Bretton Woods conference also established the International Monetary Fund (IMF), which came into operation in 1947, with its headquarters in Washington, D.C. Its objectives are 1) to stabilize rates of exchange, 2) to facilitate multilateral clearing system, and 3) to eliminate unnecessary restrictions on foreign trade. The IMF provides short-term loans of about 5 years to countries in balance of payments difficulties. It supplies a country with currency it needs in return for that country's own currency. The resources of the IMF come from contributions of the member countries. Another means of increasing the reserves of the Fund was the establishment of the Special Drawing Rights (SDR) in the late 60s. Since then SDR has become the standard unit of account of the IMF and is used in transactions between central banks and governments.

The European Bank for Reconstruction and Development – the EBRD- was set up with the specific aim of assisting the countries in Eastern Europe and the countries of CIS – the Commonwealth of the Independent States – in their transi­tion towards a market economy. The Bank works with various partners: foreign investors, local businessmen, domestic financial institutions. The projects it finances include financial institutions, telecommunications, energy saving, power generation, transport construction, manufacturing and agriculture. The EBRD has become the leading investor in the private sector with the overall total benefit to the countries in which it operates of 13.7 billion euro. The headquarters of the EBRD are in London, Great Britain.

3. Answer the following questions:

1. When and where was Bretton Woods Conference convened?

2. With what aim was the conference convened?

3. What bank was established as a result of the conference?

4. How many countries are the members of the World Bank?

5. What projects does the Bank finance?

6. What loans does the World Bank provide and what are the terms of their redemption?

7. What is the present day structure of the Bank?

8. What activity do the main bank institutions provide?

9. When and where was the International Monetary Fund established?

10. What are the IMF objectives?

11. Where do the resources of the IMF come from?

12. What loans does the IMF provide and what are the terms of their redemption?

13. What artificial unit of account was established by the IMF?

14. With what aim was the EBRD created?

15. With what countries does the EBRD work?

16. Where does the EBRD direct its loans?

4. Give Ukrainian equivalents of the following:

which were expected to occur; public health; the largest source of development assistance; middle-income countries; settlement of investment disputes; to come into operation; countries in balance of payment difficulties; power generation; overall total benefit.

5. Give English equivalents of the following:

скликати конференцію; уникати труднощів; науково-технічні проекти (розробки); платоспроможні бідніші країни; безпроцентна позика; збитки, викликані некомерційним ризиком; стандартна одиниця розраху­нків4 перехід до ринкової економіки.

6. Match the definitions on the right with the words on the left. Learn the definitions:

   saving	the approach to transition from socialism to market capitalism that entails deregulation of prices, liberalization of trade and privatization
   shock therapy	an agreement between a borrower country and the IMF in which the country agrees to improve its economic policies to provide incentives for higher export earnings and lower imports
   privatization	a part of income that is not consumed in a given period
   stabilization programme	the transfer of government business to the private sector

7. Match the synonyms. Use any 5 words in the sentences of your own:

   to occur	to agree (upon)
   2) to repay	to provide
   3) to disseminate	to happen
   4) to settle	to redeem
   5) to supply	to spread

8. Adjective free is sometimes used as a suffix that gives a word the opposite meaning, for example, interest-free loan – безпроцентна по­зика. Based on this model, translate the following into English:

   1. товари, що не обкладаються митом;

   2. прибуток, що не обкладається податком;

   3. зона, що вільна від транспорту;

   4. територія, вільна від забудов

9. Fill in the gaps in these sentences with a word built from the word given on the right:

   BP is a large … corporation. Before operating the machine, you must … the screws. The … of their offices has cost a lot of money. The applicant is too … for us to consider employing him. We’ve had complaints because the machine is …. We’re still waiting for the … of the loan we gave them. She is a very good manager and …. Thank you for your …, it was very helpful. … favours home producers over foreign ones.

   national tight modern experience rely pay administrate recommend protect

10. Fill in the gaps with the words from the list below: