Text 4 (D) Common Market

Text 4 (С) International Banking

Large banks today are truly transnational enterprises. International banks, like domestic banks, act as financial intermediaries. But they operate in different legal environment.

The laws regulating domestic banking in each nation are typically very restrictive, yet many nations allow international banking to operate largely unregulated. Because they are not hampered by regulations, international banks typically can offer depositors and borrowers better terms than could be negotiated at a domestic bank.

The International Bank for Reconstruction and Development (IBRD), referred to as the World Bank, provides development aid to the world's poorest and underdeveloped countries. The International Monetary Fund (IMF) concentrates on providing advice and temporary funds for countries with economic difficulties.

The major role of the World Bank, the world's greatest development bank, is to provide a helping hand to countries in need. Its first activity, after being set up in Washington, D.C., in 1945, was to channel funds from the United States and other nations to rebuilding Europe after World War II.

The World Bank often relies on the IMF to encourage countries to make difficult economic reforms. The economic medicine prescribed by the IMF is painful. For example, it often insists on strict anti-inflationary measures, such as increasing the prices on basic goods and services.

Besides supervising the international monetary system and providing financial support to member countries, since the early 1990s the IMF has been concentrating its efforts in two areas. First, it has mounted a massive campaign to assist the countries of Eastern Europe in difficult transition from centrally planned to market economies. It is providing not only money but, what is more important, expertise in establishing those financial and economic Structures (central banks, tax systems, currency convertibility, tariff regimes, etc.) indispensable for functioning of a free-enterprise system. Second, it is continuing to assist its poorer members in creating environment for economic growth.

The European Economic Community (EEC; Common Market) was established by the six member states of the European Atomic Energy Community – France, Spain, Germany, the Netherlands, Belgium and Italy. The controlling bodies of these three communities merged in 1967 to form the Commission of European Communities and the Council of European Communities. The European Parliament and the European Court of Justice were formed in accordance with he Treaty of Rome in 1957.

At present the European Common Market has almost 50 years of history behind it. It has grown to 12 member states, and some other countries would like to join it.

It is a fact of modern life that trade, economic, social and technological projects would be impossible without international cooperation. In the EC countries there are no trade barriers. The capitals and goods flow freely. Besides their national currencies the member states had the common currency called ECU (European Common Unit).

In January 1999, the Common Market began official operations with the new currency – EURO. Since 1999 it has been more expensive than the US dollar but used only in the banks. In 2003 it was internationally accepted and became the major European currency.

ВАРИАНТ 1

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