WORLD - The World Bank Group has released its annual update of country income classifications, revealing that six economies have moved to higher income categories, reflecting a mix of strong growth, post-crisis recovery, and statistical revisions.
The classifications, updated annually by the World Bank’s Development Data Group, are based on gross national income (GNI) per capita using the Atlas methodology. The system divides 218 economies into four groups: low, lower-middle, upper-middle, and high income.
This year’s update shows no countries moving down, while six advanced to higher categories, highlighting continued but uneven global economic progress.
Countries Moving Up
Five countries—Jordan, Micronesia, the Philippines, Sri Lanka, and Viet Nam—moved from lower-middle to upper-middle income status. One country, Togo, moved from low to lower-middle income.
Each case reflects different underlying drivers of change.
Growth and Recovery Drive Gains
Viet Nam recorded one of the strongest performances, with exports rising more than 15% in both 2024 and 2025. The economy grew by 7% and 8% respectively, while GNI expanded by an average of 10% annually between 2021 and 2025.
The Philippines saw broad-based expansion across sectors, with average GDP growth of 5.8% over five years, supporting its upgrade to upper-middle income status.
Sri Lanka’s classification reflects a fragile but notable recovery following its 2022 economic crisis. Real GDP grew by 5% in 2025, driven by rebounds in tourism and financial services.
Micronesia experienced modest growth supported by construction and agriculture, although weaker net primary income limited overall gains.
Data Revisions Also Play a Role
Jordan’s upgrade resulted primarily from a revision of national accounts. Updated statistical methods showed the economy was nearly 10% larger than previously estimated, which, combined with steady growth of 2.8% in 2025, pushed the country above the threshold.
Togo’s shift to lower-middle income was driven mainly by a population revision following the 2022 census, which reduced the population estimate by 11.7%. As income is measured per capita, this adjustment significantly raised GNI per person.
Why the Classification Matters
The World Bank’s income categories influence access to concessional financing and development assistance, and are widely used by governments, researchers, and international organizations to track economic progress.
GNI per capita figures are adjusted annually for inflation and exchange rate movements to ensure comparability over time.
While the system provides an important global benchmark, the World Bank notes that no single indicator can fully capture the complexity of development outcomes.
