World Bank: AI Can Accelerate Developing Economies' Growth
Artificial intelligence could help developing economies achieve a century of progress in a decade if governments close infrastructure gaps, the World Bank says.
Artificial intelligence (AI) has the potential to significantly boost economic growth in developing nations, but realizing this potential hinges on timely investments in energy infrastructure, digital connectivity, skills training, and robust public institutions. This is the central finding of the World Bank Group's "World Development Report 2026: The Promise of Artificial Intelligence."
The report, published in Tashkent, Uzbekistan, suggests that with appropriate public policies, AI could enable developing economies to achieve a century's worth of development in just a decade. Conversely, delays in addressing current infrastructure and institutional limitations could exacerbate the technological divide between countries.
According to the World Bank, the risk of job automation by generative AI is more than three times higher in high-income countries compared to low- and middle-income states. While 14.2% of jobs in advanced economies are susceptible to automation, this figure stands at 4.5% in developing countries.
Despite this, AI offers substantial potential for enhancing labor productivity. In developing nations, AI could improve efficiency in 16.2% of jobs, a figure only slightly lower than the 18.7% estimated for advanced economies. The study's authors anticipate that for most developing economies, the primary impact of AI adoption will be increased productivity rather than widespread job displacement.
Indermit Gill, Senior Vice President and Chief Economist of the World Bank Group, emphasized that countries don't necessarily need to develop their own large language models or massive data centers to benefit from AI. He noted that small, affordable AI solutions tailored to local conditions could expand access to medical, educational, judicial, and agricultural services for millions.
The report highlights that AI is already assisting public authorities and businesses in data analysis, forecasting, and service improvement. The technology can aid doctors in diagnoses, support farmers in decision-making, boost enterprise efficiency, and enhance tax administration, social programs, healthcare, education, and emergency response.
The study's authors point out that developing economies are currently experiencing their lowest average growth rates in three decades. They believe AI could noticeably accelerate economic development as early as the late 2020s, though this outcome is not guaranteed.
Key obstacles identified include power shortages, limited internet access, insufficient computing capacity, a lack of data, a shortage of skilled professionals, and ineffective public institutions. Without necessary reforms, AI could worsen global and domestic inequality, further concentrate market power, and introduce additional risks to security, personal data protection, and public trust.
The World Bank advocates a phased approach to AI development. Initially, countries should actively adopt existing solutions, then adapt them to national contexts, and only after establishing the required infrastructure should they transition to developing their own frontier AI systems.
Gaurav Nayyar, director of the report's author team, underscored the narrow window of opportunity for effective decision-making. He stated that countries investing now in energy, internet, human capital development, and institutions will be well-positioned to leverage AI for the benefit of their citizens and economies.
The study places particular emphasis on developing basic infrastructure. Sub-Saharan African countries serve as an example, where nearly a third of rural schools lack reliable electricity and over two-thirds lack stable internet access. To address this, the World Bank and its partners are implementing the Mission 300 initiative, aiming to provide electricity to 300 million residents in the region by 2030.
The report also recommends expanding access to computing resources, increasing data volumes (including local language materials), supporting innovative companies, improving public procurement mechanisms and project evaluation, and strengthening public trust in AI through responsible regulation and international cooperation.
The authors suggest that voluntary industry standards could play a crucial role in the initial stages, with existing legislation applied as needed to prevent negative consequences of AI use.