Bretton Woods Conference

The Bretton Woods Conference was also known as the United Nations Monetary And Financial Conference. It was a joint gathering that consisted of a total of 730 delegates coming from different Allied Nations. About 44 Allied Nations participated in the conference that happened at the Mount Washington Hotel in Bretton Woods, New Hampshire, United States. The main purpose of the conference was to ensure the regulation and implementation of the different international financial as well as monetary orders right after the ending of the second world war. 

Here, we will discuss all the details about the conference and the terms which were discussed at the event. 

Bretton Woods Conference: Definition and Facts 

According to the Bretton Woods Conference definition and facts, the conference was held in the Mount Washington Hotel which was situated in New Hampshire of the United States. The location of the hotel was in Bretton Woods and hence the name. More than 700 delegates belonging to the different Allied Nations attended this particular conference in order to have a look at the financial state of the world after the great World War II. This conference was held in the exact location from July 1st to July 22nd in 1944. There were certain agreements that were signed regarding the legislative ratification of the different member governments. 

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The conference also was responsible for the establishment of the International Bank for Reconstruction and Development, also known as IBRD. This establishment was in the latter portion of the World Bank Group. Apart from that, the Bretton Woods Conference outcome also led to the creation of the International Monetary Fund, also known as IMF. In the future, the Bretton Woods Conference also created the Bretton Woods System in order to facilitate the international relations of the financial and commercial kinds all over the world. That is one of the main reasons why the Bretton Woods Conference remains one of the most important events to occur in history. 

Background of The Bretton Woods Convention 

For the sake of the economies of the country's post-war, it was essential to have multilateral economic and financial cooperation amongst the different countries. Hence, these countries that were concerned about the welfare of their economies sought the establishment of a unitary international financial and monetary system that would foster cooperation as well as growth amongst their economies in the best way. These countries also wanted to avoid different complications that they faced during the period of war. This was due to the fact that gold standards had dropped, there was the Great Depression in the countries as well as trade wars. Hence, the need for a particular entity that would maintain equilibrium in the exchange rates as well as prevent the competitive devaluations of the countries was established. This led to the proposal of the Bretton Woods Conference. 

Bretton Woods Conference Agreements 

There were three major results of the Bretton Woods Conference summary.

• Articles of Agreement in order to create the International Monetary Fund. The purpose of the meeting was to ensure that stability of financial flows and exchange rates were ensured in the countries that had suffered during the war. 

• Articles of Agreement in order to create the IBRD. The main purpose behind the creation of this agreement was to ensure that the reconstruction of the countries after the Second World War was speeded up. This would also prove to be beneficial when it came to fostering the economic development of the countries through the help of infrastructure. 

• Some other recommendations were also made in order to foster international economic cooperation amongst the countries. The Final Act that was prepared in the particular conference incorporated these recommendations and agreements that were made by the countries in the conference. 

The idea behind the Bretton Woods Conference showed that countries wanted to have a proper foreign exchange market rating system. The exchange rates were actually pegged for gold. Members and representatives of the different countries made a pledge to ensure that the currencies of their countries would be convertible to make sure that transactions that were trade-related and other account transactions could be made in the best possible way. However, there were some other transitional provisions that will allow for a delay in the acceptance of these conditions as well. Since there was a chance that the exchange rates which were established in the conference might not be favorable to the other countries, they were actually allowed to make certain revisions of up to 10% on these conditions. 

In the Bretton Woods Conference summary, it can be said that this conference made way for the entire financial market to change the story after the problems that each of these countries faced after the war ended.