The World Bank has warned that the 2020s are on track to become a lost decade for many developing economies, with nearly half failing to narrow the income gap with wealthier nations since 2019. A combination of global shocks, including the COVID-19 pandemic, geopolitical conflicts, rising debt levels, and weak investment growth, has significantly slowed economic progress across the developing world.
Global economic growth is projected to remain subdued, reaching only 2.5% in 2026, one of the weakest performances outside of a recession in nearly two decades. Many low-income and fragile economies are expected to remain poorer than they were before the pandemic, while debt burdens, food insecurity, and declining private investment continue to constrain development prospects.
Despite these challenges, the World Bank identifies three major trends that could create significant opportunities for developing countries during the 2030s. The first is the rapid advancement of artificial intelligence (AI), which has the potential to boost productivity and economic growth worldwide. If adopted effectively and inclusively, AI could help deliver the strongest decade of global economic growth since the 1970s.
The second opportunity lies in the global shift toward clean energy. Growing concerns about energy security and climate resilience have accelerated investments in renewable energy technologies. Record levels of investment in clean energy are creating opportunities for job creation, improved energy access, and greater economic resilience, particularly in countries that rely heavily on imported fossil fuels.
A third promising trend is the expansion of regional trade. While globalization has slowed in some areas, regional trade agreements have grown significantly and now account for a majority of global trade activity. These agreements can help developing economies increase market access, attract investment, improve supply chains, and create more stable business environments.
However, substantial barriers remain. Many developing countries lack the digital infrastructure, technical expertise, and computing resources needed to fully benefit from AI. Similarly, access to financing remains a major obstacle for clean energy projects, particularly in smaller and highly indebted economies. Trade opportunities are also constrained by regulatory barriers, inefficient border procedures, and limited access to finance for businesses.
The World Bank emphasizes that governments must continue addressing immediate economic challenges while preparing for future growth opportunities. Priorities include reducing debt burdens, controlling inflation, improving infrastructure, strengthening education and workforce skills, enhancing investment climates, and expanding private sector participation.
