Developing Countries 2023

Although exact definitions vary, a developing country is generally defined as one whose industrial and/or economic development has not yet reached full maturity. This shortcoming leads directly or indirectly to social, political, economic, and environmental challenges that significantly impede quality of life in that country.

Also known as low-income, underdeveloped countries, and/or middle-income countries—a reference to their stunted economies—developing countries are less industrially advanced than countries classified as high-income, or developed countries. The most challenged among them are often given the sub-classification of least developed countries.

How do we know if a country is a "developing" country?

The United Nations uses a metric called the Human Development Index (HDI) to determine whether a country is fully developed or still developing. The HDI considers a broad range of factors, including economic growth, life expectancy, health, education, and quality of life. The highest possible HDI score is a 1.0, and any country that scores less than .80 is considered developing. Of the 191 countries analyzed in the 2021/22 Human Development Report, 125 scored below .80 and were considered developing (see table that follows text).

Another frequently used method of determining whether a country is developed or developing is to examine that country's nominal gross national income (GNI) per capita, which is a useful at-a-glance tool to estimate a country's overall standard of living. Countries whose nominal GNI rises above a certain threshold (which changes slightly each year) are classified as developed, while those whose GNI falls below that amount are considered still developing.

For example, for 2022, the World Bank classifies countries and territories whose GNI is $12,696 or higher as High Income economies. Anything below that number would be considered a developing country (though World Bank prefers the terms Upper-Middle Income, Lower-Middle Income, and Low Income). In 2022, 80 of the 217 countries and territories tracked by World Bank qualified as High Income, while 137 qualified as developing economies/countries.

It is worth noting that these two methods are not always entirely in sync with one another. For example, the U.N. would consider Argentina a developed country thanks to its 2019 HDI of .830, which is above the .800 threshold. However, World Bank classifies Argentina as Upper-Middle Income and still developing based upon its 2020 GNI of $9070, which is well below the $12,695 dividing line.

Difficulties faced by developing countries

Many developing countries encounter similar challenges, including income inequality and/or widespread poverty, low education and literacy levels, inadequate infrastructure, and government corruption. Their energy production can be inadequate and they may experience higher rates of violence against women. They may even struggle with health risks such as decreased access to safe water and sanitation, high levels of pollution, and an increased percentage of people with infectious diseases. The United Nations and many other aid organizations have established programs to help developing countries overcome these and other social, political, economic, and environmental challenges they face.