Developing economies are experiencing their weakest average economic growth in 30 years, according to the World Bank's August 4 report [1]. To reverse the trend, the World Bank recommends that these countries adopt small, low-cost, locally adapted artificial intelligence tools rather than invest in large data centers or advanced AI models [1, 2, 3, 4].

The bank's 2026 World Development Report is the first comprehensive assessment examining AI's potential impact on developing countries [2, 3, 4]. Indermit Gill, World Bank Group Chief Economist, said, "AI has thrown developing economies a lifeline, and they should seize it. They do not need large models or big data centres to reap its benefits" [2]. He added, "AI really can complement the capabilities of people and provide them with expertise that they may not have ready access to" [4].

AI adoption could improve public services such as medical care, education, justice, and agriculture in developing economies [1, 2, 3, 4]. Approximately 16.2% of jobs in developing countries have potential labor productivity increases from AI, close to 18.7% in high-income countries [3]. Moreover, jobs in high-income countries face more than triple the automation risk from generative AI compared to those in low- and middle-income countries, with estimates at 14.2% versus 4.5% respectively [1, 3, 4]. Gaurav Nayyar, director of the World Bank's World Development Report, explained, "Developing countries needed to be optimistic about what the technology could bring. So, really, the technology could play a complementary role in closing existing gaps" [4].

However, significant infrastructural challenges remain. Many developing countries lack reliable electricity, internet connectivity, skills, institutions, and adequate data availability [1, 3, 4]. In sub-Saharan Africa, around one-third of rural schools lacked reliable electricity in 2024, and over two-thirds had unstable internet connectivity [1, 3]. Without improvements in these areas and access to finance, AI adoption risks widening the productivity gap between richer and poorer countries [1, 3, 4]. The report also warned that AI could increase domestic inequality, market concentration, cybercrime, reduce public trust in institutions, and create new social and security risks [1, 3, 4].

The World Bank is addressing infrastructure through initiatives such as its "Mission 300" plan, aiming to bring electricity to 300 million people in sub-Saharan Africa by 2030 to support digital and AI development [3]. Nayyar emphasized the urgency, saying, "Artificial intelligence provides an important opportunity to solve long-standing development challenges, but the window for action is very limited" [3].

The report's release on August 4 marks a call for rapid, targeted AI adoption tailored to local needs to enhance productivity and public services during a prolonged period of sluggish growth [1].