What would happen if the United States withdrew from the International Monetary Fund (IMF)?
Experts warn that such a move would severely damage America's global prestige and weaken its privileged role in international finance.
Former President Donald Trump previously pulled the U.S. out of the Paris Climate Agreement and the World Health Organization (WHO). Now, he is reportedly targeting the IMF. The Project 2025 policy blueprint, published by the Heritage Foundation, proposes that a future Trump administration should withdraw from the IMF, claiming that the institution supports policies contrary to America's traditional values of free markets and limited government.
However, leaving the IMF would almost certainly amount to a self-inflicted wound for the United States.
By withdrawing, the U.S. would lose all influence over IMF policies and operations. More critically, it would undermine the global standing of the U.S. dollar.
Currently, most IMF operations are conducted in U.S. dollars, and borrowers predominantly request and repay funds in dollars.
If the U.S. exits, other countries would assume control of dollar-related operations, pushing the dollar out of IMF transactions.
International demand for dollars has already declined by 5.6% over the past four years. A U.S. withdrawal would likely accelerate that trend even further.
Although the IMF operates under a multi-currency system, the U.S. dollar remains the dominant currency, comprising 43% of the Special Drawing Rights (SDR) basket.
If the U.S. were to leave, the dollar would have to be removed from the SDR basket, since only currencies from member countries can be included.
Relinquishing leadership at the IMF would open the door for China and Europe to expand their influence.
China could even push to relocate the IMF headquarters to Asia, marking a symbolic and strategic shift away from U.S. leadership in global finance.
Beyond losing a critical channel for international financial assistance, the U.S. would forfeit its ability to influence the very IMF policies it finds problematic.
The biggest risk: The dollar could lose its status as the world’s premier reserve currency.
Even Trump's former economic adviser, Stephen Moore, emphasized the importance of preserving the dollar’s reserve status. Yet an IMF withdrawal could directly undermine that goal.
Leaving the IMF would trigger a realignment where currencies from China, Europe, and smaller nations replace the dollar within the international financial system.
U.S. financial institutions would also face reduced preferential access to dollar liquidity through the Federal Reserve, weakening America's leverage globally.
This would not simply be a diplomatic misstep.
It would represent a rapid erosion of U.S. financial dominance and a crippling blow to the effectiveness of U.S. sanctions as a strategic tool.
In short, quitting the IMF would be an economic, financial, and political disaster for the United States.
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