Developing economies face a narrowing window to reverse slowing growth, and the World Bank believes Artificial Intelligence (AI) could become one of the most important economic tools available not because it will replace workers, but because it can dramatically raise productivity across sectors where skilled labor remains scarce.
That is the central message of the World Development Report 2026: The Promise of Artificial Intelligence, released on Monday, which argues that countries that invest today in electricity, internet connectivity, digital skills and stronger institutions could compress decades of development into just a few years.
“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 centres 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.”
READ ALSO
The report arrives as many developing economies, including those in Sub-Saharan Africa, struggle with what the Bank describes as their weakest average growth performance in three decades.
Rather than viewing AI primarily as a threat to jobs, the World Bank presents it as a productivity multiplier capable of strengthening businesses, public services and economic competitiveness.
Productivity, Not Job Losses
One of the report’s most striking findings is that fears of mass automation may be overstated in developing economies.
Only 4.5 percent of existing jobs in low and middle-income countries are considered highly exposed to automation by generative AI, compared with 14.2 percent in high-income economies.
Instead, the bigger opportunity lies in productivity.
The report estimates that AI could significantly improve the performance of 16.2 percent of jobs across developing countries, close to the 18.7 percent expected in advanced economies.
For businesses, that could mean higher output without proportionately increasing labour costs.
Manufacturers could optimise production, financial institutions could improve credit assessment, logistics firms could strengthen forecasting, while farmers and healthcare providers could make better decisions using AI-powered tools.
“The greatest promise for developing countries lies not in replacing workers, but in amplifying what they can do,” the report said.
Growth Now Depends on Digital Infrastructure
The World Bank argues that AI adoption is becoming an economic competitiveness issue rather than simply a technology policy.
Countries lacking reliable electricity, broadband access, computing infrastructure and skilled workers risk being excluded from the next phase of global productivity growth.
That challenge is particularly acute in Sub-Saharan Africa.
Nearly one-third of rural schools still lack reliable electricity, while more than two-thirds have no dependable internet access.
Without addressing those deficits, AI adoption could remain limited to a small segment of urban economies.
The Bank linked AI readiness directly to infrastructure investment, pointing to its Mission 300 initiative, which seeks to provide electricity access to 300 million people across Sub-Saharan Africa by 2030.
A Different AI Strategy for Developing Countries
Unlike advanced economies investing billions of dollars in frontier AI models and hyperscale data centres, the World Bank says developing countries should avoid attempting to replicate expensive global AI ecosystems.
Instead, governments should focus on adopting existing AI tools, adapting them to local needs and gradually building domestic innovation capacity.
That means encouraging businesses to integrate affordable AI applications into existing operations rather than attempting to compete directly with the world’s largest technology firms.
According to the report, countries do not need massive computing infrastructure to benefit from AI.
Small, specialised models adapted to local languages and business conditions could generate significant gains in healthcare, agriculture, education, tax administration and financial services.
Investment Climate Matters
The report also places AI firmly within the broader investment agenda.
Governments are urged to improve access to finance for technology firms, simplify regulations, support experimentation and strengthen public procurement systems capable of scaling successful innovations.
The Bank argues that AI adoption will depend as much on business conditions as technological capability.
Countries with stronger institutions and better investment environments are expected to attract more AI-related capital and innovation.
Trust Could Become an Economic Asset
The World Bank warns that rapid AI adoption without appropriate safeguards could undermine public confidence.
Bias in public-sector AI systems, weak data protection and excessive concentration of technology markets could create new economic and social risks.
Rather than imposing extensive new regulation immediately, the report recommends building on voluntary industry standards while applying existing legal frameworks to address harmful uses of AI.
Maintaining public trust, it argues, will be essential if governments hope to deploy AI across healthcare, education, taxation and social protection.
The Business Opportunity
For developing economies such as Ghana, the report reframes AI as an economic development issue rather than a technology debate.
Countries that strengthen electricity supply, expand digital infrastructure, improve workforce skills and create business-friendly innovation ecosystems could use AI to accelerate productivity at a time when traditional growth drivers are weakening.
The World Bank’s message is ultimately straightforward: AI is unlikely to eliminate large numbers of jobs in developing countries. The greater risk is failing to adopt it quickly enough while competitors do.
As global growth slows and productivity becomes increasingly decisive, the countries that treat AI as part of their economic strategy, not simply their technology policy may be best positioned to close long-standing development gaps.
