Good news about AI for developing economies

Artificial Intelligence (AI) is not solely about massive investments in data centers and large language models, according to the World Bank's World Development Report 2026. The report aims to 'de-demonize' AI, presenting it as a valuable tool that can significantly improve the functioning of economic systems in developing economies, thereby boosting their growth.

The World Bank emphasizes that developing nations should not be discouraged by their inability to make large financial outlays for AI-powered data centers. Instead, the report points to successful examples like India and Brazil, which have leveraged AI to enhance their payment systems. India's Unified Payments Interface (UPI) and Brazil's Pix system are cited as evidence of how AI can be effectively implemented to create tangible benefits.

Indermit Gill, the World Bank's senior vice president and chief economist, stated in the report's foreword that AI, if managed well, could accelerate global growth to its strongest pace since the 2000s. He added that developing economies stand to gain significantly, even if AI does not fully meet all expectations. This assessment offers a balanced and optimistic view, urging economists and policymakers in these regions to pay close attention.

While advanced economies, particularly the United States, are experiencing a period of intense enthusiasm and investment surrounding AI, the World Bank's report suggests a more grounded approach for developing nations. It encourages a focus on practical applications that can directly improve economic performance and people's lives, rather than getting caught up in the hype of large-scale technological infrastructure.

“

If handled well, AI could help lift global growth to its strongest pace since the golden years of the 2000s, delivering tangible benefits to people in developing economies as well. This 2026 edition of the World Development Report shows that even if AI fails to live up to all its hype, developing economies would still be better off than they are today.