At the dawn of the 21st century, world leaders aimed to eradicate poverty and hunger. They pledged to make development accessible to all. By 2015, their ambition grew stronger, setting a bold deadline: eliminate poverty and hunger by 2030.
For a while, progress seemed promising. Economic growth surged, and many nations appeared poised for a breakthrough. Nevertheless, as 2030 nears, reality paints a different picture. The World Bank’s latest Global Economic Prospects report highlights a worrying trend. Many developing economies are struggling, with growth prospects weaker than ever since the century’s start.
GROWTH STALLS, CHALLENGES MOUNT
Developing economies began the century closing the income gap with wealthier nations. Yet, progress has reversed. Key growth drivers have weakened, giving way to formidable barriers. Investment and productivity gains have slowed. Aging populations, geopolitical tensions, and climate change now present major obstacles.
Despite early progress, global economic integration has lost momentum. Foreign direct investment (FDI) in developing nations has fallen sharply. Trade restrictions are rising, adding new burdens on fragile economies.
THE HARD TRUTH: POVERTY AND HUNGER PERSIST
By 2030, an estimated 622 million people will still live in extreme poverty. Hunger and malnutrition levels will remain stubbornly high. Countries once seen as emerging success stories now face stagnation.
For low-income economies—home to 40% of the world’s most impoverished people—the situation is dire. Economic crises, conflicts, and sluggish growth have stalled their progress. Since 2000, 39 low-income countries, including India and Indonesia, have moved to middle-income status. However, many others remain stuck, with GDP per capita barely improving over 15 years.
SHIFTING ECONOMIC POWER AND DEPENDENCE
Developing economies now hold nearly half of global GDP, up from 25% in 2000. Their influence has grown, and they trade more among themselves. Over 40% of their exports now go to other developing nations—double the share from 2000.
Still, growth in advanced economies still strongly impacts them. A 1% GDP increase in the U.S., Europe, and Japan boosts GDP in developing economies by nearly 4% within three years. By contrast, growth in China, India, and Brazil has half that effect. While reliance on rich nations has lessened, it remains significant.
NEED FOR A NEW STRATEGY
The coming decades will be even tougher than the past 25 years. Developing economies must adopt a new approach to secure sustainable growth. With the right policies, challenges can become opportunities. Strengthening trade, attracting investment, and modernizing infrastructure are crucial.
A focus on human capital, digital transformation, and climate adaptation will also be key. With deeper regional cooperation and smarter economic policies, developing economies can forge a stronger, self-reliant future.
TIME TO ACT IS NOW
The global economy is expected to grow by 2.7% in 2025, below pre-pandemic levels. However, inflation and interest rates may stabilize, creating a rare window for reform. Policymakers must seize this moment to build resilience and drive long-term progress.
In an era of uncertainty, taking control of economic destiny is more important than ever. The future of developing economies depends on the actions taken today.
