Dr. Donal Donovan:

The Chairman can ask me further about it if I leave anything out. The IMF was set up in 1945, following the so-called Bretton Woods Conference, to try to avoid, collectively, the bad policies that had occurred in 1930s. By now, nearly all countries in the world are members of it.

The IMF has two main functions. One is to lend money to countries that enter into crisis situations and that require bailouts, which we have seen recently. This function has been around for 50 years. It lent mainly to low-income countries, emerging market economies. Before Iceland in 2010, the IMF had not lent to an industrial country for 30 years. The last one was the UK in 1977, but now it is different.

The second function it has, which is what we are talking about today or what I mentioned in my statement, is that it is supposed to exercise surveillance, that is, discuss, analyse and offer policy recommendations, which may or may not be accepted, to member countries, which are then discussed collectively by the IMF board, as I mentioned.

It is possibly the case that the IMF has been more successful in the first activity, which one could call picking up the pieces, than it has been in the second activity in the area of crisis forewarning and prevention. The record would show over several decades that despite many efforts that has not been terribly successful, and the euro crisis would be a good case in point.

The IMF is funded by all the member countries, and the Chairman asked about this. It is like a credit union. Everyone puts in a certain amount of money and that amount of money is calculated; it is basically related to the size of the country in the world economy. There is a total pool of, say, 100, and everyone's contributions are calculated as a percent in regard to their relative size in the world economy. That determines what money they put in, and it also determines the voting power of countries within the IMF. For example, the US is the largest shareholder. It has about 16% of the votes. It puts in 16 cent on every dollar and it has, more or less, its exact equivalent in having 16% of the votes. I do not have the exact figure for Ireland but it is quite small. It has perhaps 0.2% of the votes and puts in 0.2% of the money. I hope that is helpful.