Bretton Woods Agreement Of 1944

730 delegates from the 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire, USA, for the United Nations Monetary and Financial Conference, also known as the Bretton Woods Conference. Delegates deliberated from July 1 to 22, 1944 and signed the Bretton Woods Agreement on the last day. Through the establishment of a system of rules, institutions and procedures for regulating the international monetary system, these agreements created the IMF and the International Bank for Reconstruction and Development (IBRD), now part of the World Bank Group. The United States, which controlled two-thirds of the world`s gold, insisted that the Bretton Woods system was based on both gold and the U.S. dollar. Soviet representatives attended the conference, but then refused to ratify the final agreements and claimed that the institutions they had created were “branches of Wall Street.” [1] These organizations were commissioned in 1945 after the agreement was ratified by a sufficient number of countries. A devastated Britain had little choice. Two world wars had destroyed the country`s main industries, which paid for the import of half of the food and almost all of its raw materials except coal. The British had no choice but to ask for help. It was only when the United States signed a 4.4 billion pound British aid agreement on 6 December 1945 that the British Parliament ratified the Bretton Woods Agreements (which took place later in December 1945). [24] Here is a brief summary of why global economies were part of the Bretton Woods system, how the system worked, why it failed, and what impact the agreement had on the development of the international monetary system. Modern economists can draw a perspective and insight from the discovery of their profession`s past. But on a larger scale, the agreement brought together 44 nations from around the world, who brought them together to solve a growing global financial crisis.

It has helped strengthen the global economy as a whole and maximize international trade benefits. The Bretton Woods monetary management system established the rules governing trade and financial relations between the United States, Canada, Western European countries, Australia and Japan under the Bretton Woods Agreement of 1944. The Bretton Woods system was the first example of a fully negotiated monetary settlement designed to govern monetary relations between independent states. The main features of the Bretton Woods system were each country`s commitment to a monetary policy that kept its exchange rates within 1% by linking its currency to gold and the ability of the International Monetary Fund (IMF) to overcome temporary imbalances in payments.