The World Bank has warned developing countries to urgently embrace Artificial Intelligence (AI) or risk falling behind in economic growth and public service delivery, describing the technology as a once-in-a-generation opportunity to transform key sectors.
The warning was issued on Tuesday as the global financial institution unveiled its 2026 World Development Report, which argues that AI could help developing nations improve governance, healthcare, education, agriculture and justice without requiring expensive technology infrastructure.
Speaking during the report’s launch, the World Bank Group’s Chief Economist, Indermit Gill, said lower-income countries should take advantage of affordable AI solutions instead of waiting to develop sophisticated systems similar to those in advanced economies.
“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,” Gill said.
According to him, countries can adapt lower-cost AI technologies to local realities and use them to improve access to essential public services for millions of people.
The World Bank noted that although the world’s most advanced AI systems are largely developed in the United States and China, developing nations do not need massive data centres or expensive computing infrastructure before they can benefit from the technology.
The report comes as many developing economies continue to struggle with weak economic growth after years of global crises. Earlier this year, the World Bank described the 2020s as a “lost decade” for many low-income countries due to repeated economic shocks.
It also recently lowered its 2026 global growth forecast, citing the economic consequences of the Iran conflict, with developing countries bearing the heaviest impact.
According to the report, AI has the potential to significantly boost economic growth before the end of the decade while expanding access to vital services that have remained out of reach for billions of people.
The World Bank believes AI can help deliver medical care, legal services, education and agricultural support to underserved communities in years rather than decades.
To achieve this, the institution advised governments to invest in electricity generation, digital infrastructure, computing capacity and locally relevant data while encouraging the development of AI tools designed specifically for local needs.
“The window to get this right is narrow,” said Gaurav Nayyar, Director of the World Development Report.
“AI presents a once-in-a-lifetime opportunity to solve problems that have resisted solutions for generations,” he added.
The report highlighted successful examples of AI already being used in developing countries, including improving diabetes screening in Bangladesh and helping farmers in India reduce costs through advanced weather forecasting.
It also stressed that AI solutions must be adapted to local realities, especially for people without smartphones or internet access.
According to the report, many AI services may need to be delivered through voice calls on basic mobile phones to reach millions of people in poorer communities.
While encouraging wider adoption of AI, the World Bank also warned governments to protect citizens’ privacy and ensure the technology is used responsibly.
The report cautioned that poorly regulated AI could deepen inequality, concentrate economic power, weaken trust in public institutions and create new risks for human rights and social stability.
It also warned that although AI currently poses little threat to employment in many developing countries, it could eventually eliminate middle-class jobs that traditionally provide economic mobility.
The World Bank therefore urged policymakers to strike a balance between embracing innovation and protecting citizens as AI becomes increasingly integrated into public services and national economies.
Source: AFP.
