AI Offers Lifeline to Developing Economies in an Era of Weak Growth, World Bank Finds

Washington, D.C., 4 August 2026 — World Bank Group press release

Artificial intelligence could allow developing countries to do in a decade what might otherwise take a century — provided governments act swiftly to close gaps in power, connectivity, skills, and institutional quality — according to the World Bank Group's World Development Report 2026: The Promise of Artificial Intelligence, released on 4 August 2026.

Lower automation risk, real productivity upside

The report finds that jobs in high-income countries are more than three times as likely to be at risk of automation from generative AI as those in low- and middle-income countries — 14.2% of jobs at risk in high-income countries, compared with 4.5% in developing economies. At the same time, the productivity upside is comparable: 16.2% of jobs in developing economies could see meaningful productivity gains from AI, close to the 18.7% expected in high-income countries.

"AI has thrown developing economies a lifeline, and they should seize it," said Indermit Gill, Senior Vice President and Chief Economist of the World Bank Group. "They do not need large models or big data centers to reap its benefits. By adapting small, low-cost AI tools to local conditions, they can bring better medical care, education, judicial services and agricultural extension within reach of millions. But they must hurry: AI is spreading faster and is more context-specific than earlier general-purpose technologies like electricity and the internet."

A three-step path: adopt, adapt, advance

The report — described as the first comprehensive assessment of AI's implications for developing countries — sets out a sequenced path: adopt available AI tools, adapt them to local conditions, and, over time, advance toward frontier AI development. This is intended to help countries avoid costly attempts to replicate advanced AI systems before the foundational conditions — power, connectivity, skills, and institutions — are in place.

"The window to get this right is narrow," said Gaurav Nayyar, Director of the World Development Report 2026. "AI presents a once-in-a-lifetime opportunity to solve problems that have resisted solutions for generations. Developing countries that build the foundations now — power, connectivity, skills, and institutions — will be positioned to adopt and adapt AI for their people."

The infrastructure gap

The report is explicit that none of this is possible without first investing in basics. In Sub-Saharan Africa, nearly one-third of rural schools still lack reliable electricity, and more than two-thirds lack dependable internet access. The World Bank Group is working with partners through Mission 300 to provide energy access to 300 million people across Sub-Saharan Africa by 2030 as a foundation for broader digital and AI inclusion.

Beyond power and connectivity, the report says countries need to expand access to computing power and improve the availability of local data — including in local languages — so AI tools can be tailored to local economies. It also calls for clearer procurement and evaluation frameworks, so governments can tell which of the many AI pilots already underway actually deliver results.

Trust and governance

The report also stresses that public trust is essential to AI adoption. As AI evolves rapidly, it recommends governments begin by drawing on voluntary industry standards to encourage responsible use, anchored in international cooperation to avoid regulatory fragmentation — applying existing laws directly to address harms where voluntary measures fall short. It warns that if AI embeds bias in government decisions or erodes data privacy, the resulting loss of public trust will be difficult to recover.

The full report is available from the World Bank Group.