World Bank: One in four developing economies poorer than in 2019

Says global economy shows resilience amid historic trade, policy uncertainty

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THE global economy is proving more resilient than anticipated despite persistent trade tensions and policy uncertainty despite one in four developing economies being poorer than they were in 2019, according to the World Bank's latest Global Economic Prospects report.

Global growth is projected to remain broadly steady over the next two years, ‘easing to 2.6% in 2026 before rising to 2.7% in 2027, an upward revision from the June forecast.

The World Bank said, the resilience reflects better-than-expected growth, especially inthe United States, which accounts for about two-thirds of the upward revision to the forecast in 2026. Even so, if these forecasts hold, the 2020s are on track to be the weakest decade for global growth since the 1960s.

The sluggish pace is widening the gap in living standards across the world, the report finds: at the end of 2025, nearly all advanced economies enjoyed per capita incomes exceeding their 2019 levels, but about one in four developing economies had lower per capita incomes.

In 2025, growth was supported bya surge in trade ahead of policy changes and swift readjustments in global supply chains. These boosts are expected to fade in 2026 as trade and domestic demand soften. However, the easing global financial conditions and fiscal expansion in several large economies should help cushion the slowdown, according to the report.

Global inflation is projected to edge down to 2.6% in 2026, reflecting softer labour markets and lower energy prices. Growth is expected to pick up in 2027 as trade flows adjust and policy uncertainty diminishes.