The World Bank Group released its annual Country Income Classifications on July 1, 2026, revealing that six nations advanced to higher income categories while none moved downward — a reflection of divergent but ongoing global development progress.
Published by the World Bank’s Development Data Group, the classifications assess 218 countries based on gross national income (GNI) per capita for the 2025 calendar year, using the Atlas methodology. The thresholds defining each income group are adjusted annually for inflation using the Special Drawing Rights deflator.
Five countries moved from lower-middle-income to upper-middle-income status: Jordan, Micronesia, the Philippines, Sri Lanka, and Viet Nam. Togo advanced from low-income to lower-middle-income status. Each nation reached the same threshold through a distinctly different economic path.
Viet Nam achieved its upgrade through sustained export-led growth. The country recorded export surges exceeding 15 percent in both 2024 and 2025, with GDP expanding at 7 percent and 8 percent respectively. GNI per capita grew at an average annual rate of 10 percent between 2021 and 2025, marking one of the strongest runs in the East Asia and Pacific region.
The Philippines advanced through broad-based economic expansion, with GDP averaging 5.8 percent annual growth over a five-year period. Gains were registered across all major industries rather than concentrated in a single sector, reflecting economy-wide momentum.
Sri Lanka reclassified as upper-middle-income just three years after its severe 2022 economic crisis. Real GDP grew by 5 percent in 2025, driven by a rebound across industries and growth in financial and tourism services. The classification change marks a notable recovery, though the country crossed the threshold narrowly.
Micronesia achieved modest but steady growth driven by construction and agriculture following a prolonged COVID-19 recovery. Jordan was reclassified after a comprehensive national accounts revision revealed the economy was nearly 10 percent larger than previously estimated. Combined with steady 2.8 percent growth in 2025, the revised data pushed the country decisively across the threshold.
Togo moved from low to lower-middle-income largely due to a population revision. Following the release of detailed 2022 census results, the country’s population estimate was reduced by 11.7 percent, producing a higher per capita GNI figure. GDP grew by 5.9 percent in 2025, and exchange rate movements also contributed to the reclassification.
Since 1987, the share of economies classified as low-income has declined from 30 percent to 11 percent, though these shifts have not been evenly distributed across regions. The classifications are used by governments, researchers, and international organizations to determine access to concessional loans and development assistance, making them a critical tool for tracking global economic progress.
Sources: worldbank.org
