Story · Developing economies / Global
World Bank forecasts developing-economy growth slowing to 3.6% in 2026
11 June 2026
The World Bank's June 2026 Global Economic Prospects forecast developing-economy growth slowing from 4.4% in 2025 to 3.6% in 2026. More importantly for A-Level evaluation, the Bank said developing economies excluding China and India are approaching a decade with almost no progress in narrowing the per-capita income gap with advanced economies. This makes the release a strong growth-versus-development case.
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What happened
The World Bank forecast global growth of 2.5% in 2026 and developing-economy growth of 3.6%, down from 4.4% in 2025. It warned that developing economies other than China and India would by 2028 have collectively experienced nearly a decade without progress in narrowing their per-capita income gap with advanced economies. The report also highlighted the fiscal vulnerability created by commodity dependence and rising public debt.
Why it matters
A country can record positive real GDP growth while making limited progress in economic development. If population rises quickly, income per head can grow much more slowly than total GDP. If growth is concentrated in commodity sectors or its gains are unevenly distributed, poverty, health, education and living standards may improve less than headline growth suggests. Fiscal weakness can further restrict investment in infrastructure and human capital.
Use it in an exam
Chain
Slower developing-economy growth → weaker growth in output, jobs and tax revenues → slower gains in income per head and fiscal capacity → less scope to improve health, education, infrastructure and poverty outcomes → development progress may slow
Evaluation
Real GDP growth is neither necessary nor sufficient evidence of broad development. The outcome depends on population growth, income distribution, the sectors driving growth, institutions, public spending quality, debt constraints and exposure to commodity-price shocks. Regional differences are large, so a global developing-economy average should not be treated as every country's experience.
Useful diagram: PPF or LRAS diagram showing an increase in productive capacity, followed by evaluation of why higher real GDP does not automatically equal economic development
Sources and evidence note
Forecasts and structural facts are taken from the World Bank's June 2026 Global Economic Prospects release. Development effects are analytical channels and vary substantially across countries; forecasts are not guaranteed outcomes.