Artificial intelligence is reshaping economies and societies at a remarkable pace, transforming how people learn, work and live. Its ability to unlock access to knowledge, boost productivity and open new markets holds immense potential to accelerate development, creating jobs, new industries and boosting economic transformation, says the World Bank’s ‘Digital Progress and Trends Report 2025: Strengthening AI Foundations’. It offers a comprehensive data-driven snapshot of the global AI landscape.
The report also underscores that while AI opens up opportunities, low- and middle-income countries face steep challenges to adapt or deploy AI effectively and at scale. Yet a promising trend is emerging as many countries are actively adopting ‘Small AI’ solutions. These approaches are more affordable, easier-to-use applications designed to run on everyday devices like mobile phones, and they are already helping extend AI’s reach to help solve today’s most pressing development challenges in areas like agriculture, health and education.
As developing countries adopt AI, they continue to strengthen the foundations for AI innovation. This report emphasises the importance of the ‘four Cs’: connectivity (energy and digital infrastructure), compute (AI chips, data centres, cloud computing), context (data) and competency (skills). Together, these elements form the bedrock of inclusive and effective AI ecosystems, enabling countries to adopt, adapt and innovate responsibly.
The World Bank says it is committed to helping countries harness AI for inclusive and sustainable development. This includes strengthening the foundations for adoption, adaptation and innovation; advancing data governance; championing regulatory and institutional reforms; and investing in the skills needed to thrive in the digital era. It also means fostering local innovation ecosystems and ensuring that AI solutions are tailored to local realities and priorities. At the same time, policies that promote competition and ensure the equitable distribution of AI’s benefits will be essential to mitigate risks and deliver broad impact.