Powerful organization and global groups

G6 to G8 to G7

The Group of Eight Countries, or G8, was the name of a political forum that existed from 1997 until 2014. In 2014, it became the Group of 7, or G7. The forum was first started in 1975 as the Group of Six, or G6. The original countries that were members of this group were: France, Germany Italy Japan, United Kingdom and United States.  In 1976, Canada was added to make it G7. Russia was added to the forum in 1997, but was suspended in 2014. Three years later, Russia announced that it would permanently withdraw from the forum. Today, the forum is known as G7.  These seven nations have about 58% of the world’s total wealth represented as the total GDP of these nations.

BRICS

BRIC or Big Four is an acronym originally used to represent four countries that have similar economic development includes Brazil, Russia, India, China, began informally in 2006. The first official summit held in 2009 in Russia. At present, BRICS is the group composed by the five major emerging countries – Brazil, Russia, India, China and South Africa -, which together represent about 42% of the population, 23% of GDP, 30% of the territory and 18% of the global trade. Goldman Sachs economist, Jim O’Neill first used the acronym in 2001. Undoubtedly, the two most notable achievements of the BRICS have been the institutionalization of the New Development Bank (NDB) and the Contingency Reserve Arrangement. So far, the NDB has approved more than 8 billion-dollars in infrastructure and renewable energy financing projects in the BRICS countries. The CRA is operational and is an important financial stability mechanism for countries affected by crises in their balance of payments.

World Bank and the International Monetary Fund (IMF)

The Main difference between IMF and the World Bank is in their proposes and operation. The IMF oversees the world’s monetary system’s stability, while the World Bank’s goal is to reduce poverty by offering assistance to middle-income and low-income countries.  Both organizations are based in were established as part of the Bretton Woods Agreement in 1945, after the Second World War. IMF monitors member countries’ economic health and lends money to countries with balance of payments difficulties. However, the borrowing country must implement fiscal initiatives (tax and other economic measures) suggested by the IMF.  On the other hand, World Bank provides support and aid for long-term economic development.

Multi-Governmental Organizations (MGOs)

The emergence of large trading bloc and Multi-governmental organization(MGOs) in recent years is part of the wider process of globalization. In some ways globalization can be viewed as a natural development from large trading blocs into a unified world market. At the simplest level, free trade associations have been set up between countries, such as Mercosur in South America, NAFTA in North America. On the other extreme trading associations may tend towards  political integration and economic bullying, for example, in the European Union.

Impacts of Globalization