Front Matter

Front Matter

International Monetary Fund. External Relations Dept.
Published Date:
September 1951
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    Second Annual Report on Exchange Restrictions April 1951



    Letter of Transmittal to Members and Governors of the Fund

    April 6, 1951

    Dear Sir:

    I have the honor of transmitting to you a copy of the International Monetary Fund’s Second Annual Report on Exchange Restrictions. In the first part of the Report the Fund sets forth its attitude on the role of restrictions under existing world conditions and its activities in the field of restrictions. Part II of the Report provides a survey of recent general developments in exchange controls and restrictions and outlines in summary form the restrictive systems of individual member countries.

    The Fund is aware of the difficulties and uncertainties which face a number of its member countries, particularly as a result of strategic considerations and increases in armament programs. Against this background, the question is being raised as to the immediate practicability of the Fund objective set forth in Article I(iv) of the Fund Agreement to assist in the establishment of a multilateral system of payments in respect of current transactions between members and in the elimination of foreign exchange restrictions which hamper the growth of world trade. It is the belief of the Fund that, although due caution is required, many member countries can and should make further progress toward the achievement of this objective.

    During the past year, there has been considerable improvement in the balance of payments and reserve position of many countries. This improvement has in a number of cases been accompanied by a relaxation of restrictions on current payments. Generally speaking, however, the Fund believes that the general improvement in the international financial position of many countries which has taken place warrants further relaxation of restrictions and reduction of discrimination.

    As you are well aware, Article XIV of the Fund Agreement provides that five years after the date on which the Fund begins operations (March 1952), and in each year thereafter, any member still retaining any restrictions inconsistent with Article VIII, Sections 2, 3, or 4, shall consult the Fund as to their further retention. In anticipation of these consultations, the Fund intends to be in contact with its individual member countries on the implementation of these provisions.

    On behalf of the Executive Board, I should like to express our appreciation of the cooperation of the members in the preparation of the second part of the Report.

    Sincerely yours,


    A. N. OVERBY

    Acting Chairman of the Executive Board


    Acting Managing Director

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