Developing country

World map indicating the categories of Human Development Index by country (based on 2015 and 2016 data)

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A developing country (or a low and middle income country (LMIC), less developed country, less economically developed country (LEDC), or underdeveloped country) is a country with a less developed industrial base and a low Human Development Index (HDI) relative to other countries.^[1] However, this definition is not universally agreed upon. There is also no clear agreement on which countries fit this category.^[2] A nation's GDP per capita compared with other nations can also be a reference point.

The term "developing" describes a currently observed situation and not a changing dynamic or expected direction of progress. Since the late 1990s, developing countries tended to demonstrate higher growth rates than developed countries.^[3] Developing countries include, in decreasing order of economic growth or size of the capital market: newly industrialized countries, emerging markets, frontier markets, least developed countries. Therefore, the least developed countries are the poorest of the developing countries.

Developing countries tend to have some characteristics in common. For example, with regards to health risks, they commonly have: low levels of access to safe drinking water, sanitation and hygiene; energy poverty; high levels of pollution (e.g. air pollution, indoor air pollution, water pollution); high proportion of people with tropical and infectious diseases (neglected tropical diseases); high number of road traffic accidents. Often, there is also widespread poverty, low education levels, corruption at all government levels and a lack of so-called good governance. Effects of global warming (climate change) are expected to impact developing countries more than wealthier countries, as most of them have a high "climate vulnerability".^[4]

The Sustainable Development Goals, by the United Nations, were set up to help overcome many of these problems. Development aid or development cooperation is financial aid given by governments and other agencies to support the economic, environmental, social and political development of developing countries.

Definitions[edit]

Developing economies according to the IMF

Developing economies out of scope of the IMF

Graduated to developed economy

Newly industrialized countries
(As of 2014)^{[citation needed]}

Least Developed Countries

Graduated to developing economies (as of 2008)^{[citation needed]}

The United Nations Statistics Division acknowledges that the UN has "no established convention for the designation of "developed" and "developing" countries or areas".^[5]^[2] According to its so-called M49 standards, published in 1999:

The designations "developed" and "developing" are intended for statistical convenience and do not necessarily express a judgement about the stage reached by a particular country or area in the development process.^[6]^[7]

The UN implies that developing countries are those not on a tightly defined list of developed countries:

There is no established convention for the designation of "developed" and "developing" countries or areas in the United Nations system. In common practice, Japan in Asia, Canada and the United States in northern America, Australia and New Zealand in Oceania, and Europe are considered "developed" regions or areas. In international trade statistics, the Southern African Customs Union is also treated as a developed region and Israel as a developed country; countries emerging from the former Yugoslavia are treated as developing countries; and countries of eastern Europe and of the Commonwealth of Independent States [the former Soviet Union] in Europe are not included under either developed or developing regions.^[2]

However, under other criteria, some countries are at an intermediate stage of development, or, as the International Monetary Fund (IMF) put it, following the fall of the Soviet Union, "countries in transition": all those of Central and Eastern Europe (including Central European countries that still belonged to the "Eastern Europe Group" in the UN institutions); the former Soviet Union (USSR) countries in Central Asia (Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan and Turkmenistan); and Mongolia. By 2009, the IMF's World Economic Outlook classified countries as advanced, emerging, or developing, depending on "(1) per capita income level, (2) export diversification—so oil exporters that have high per capita GDP would not make the advanced classification because around 70% of its exports are oil, and (3) degree of integration into the global financial system"^[8]

Along with the current level of development, countries can also be classified by how much their level of development has changed over a specific period of time.^[9]

In the 2016 edition of its World Development Indicators, the World Bank made a decision to no longer distinguish between “developed” and “developing” countries in the presentation of its data, considering the two-category distinction outdated.^[10] Instead, the World Bank classifies countries into four groups, based on Gross National Income per capita, re-set each year on July 1. In 2016, the four categories in US dollars were:^[10]

Low income countries: $1,025 or less.
Lower middle income countries: $1,026 to $4,035.
Upper middle income countries: $4,036 to $12,236.
High income countries: $12,237 and above

Measure and concept of development[edit]

Least developed economies according to ECOSOC

Least developed economies out of scope of the ECOSOC

Graduated to developing economy

^[when?]^{[citation needed]}

Newly industrialized countries as of 2013.^{[citation needed]}

Kofi Annan, former Secretary General of the United Nations, defined a developed country as "one that allows all its citizens to enjoy a free and healthy life in a safe environment".^[11]

Development can be measured by economic or human factors. Developing countries are, in general, countries that have not achieved a significant degree of industrialization relative to their populations, and have, in most cases, a medium to low standard of living. There is a strong association between low income and high population growth.^{[citation needed]} The development of a country is measured with statistical indexes such as income per capita (per person), gross domestic product per capita, life expectancy, the rate of literacy, freedom index and others. The UN has developed the Human Development Index (HDI), a compound indicator of some of the above statistics, to gauge the level of human development for countries where data is available. The UN had set Millennium Development Goals from a blueprint developed by all of the world's countries and leading development institutions, in order to evaluate growth.^[12] These goals ended in 2015, to be superseded by the Sustainable Development Goals.

The concept of the developing nation is found, under one term or another, in numerous theoretical systems having diverse orientations — for example, theories of decolonization, liberation theology, Marxism, anti-imperialism, modernization, social change and political economy.

Another important indicator is the sectoral changes that have occurred since the stage of development of the country. On an average, countries with a 50% contribution from the secondary sector (manufacturing) have grown substantially. Similarly countries with a tertiary sector stronghold also see a greater rate of economic development.

Terms used to classify levels of development[edit]

Countries described as Advanced Economies by the IMF in 2008.^[13]

^{[needs update]}

There are several terms used to classify countries into rough levels of development. Classification of any given country differs across sources, and sometimes these classifications or the specific terminology used is considered disparaging. Use of the term "market" instead of "country" usually indicates specific focus on the characteristics of the countries' capital markets as opposed to the overall economy.

Developed countries and developed markets
Developing countries include in decreasing order of economic growth or size of the capital market:

Developing countries can also be categorized by geography:

Other classifications include:

Heavily indebted poor countries, a definition by a program of the IMF and World Bank
Transition economy, moving from a centrally planned to market-driven economy
Multi-dimensional clustering system: with the understanding that different countries have different development priorities and levels of access to resources and institutional capacities^[18] and to offer a more nuanced understanding of developing countries and their characteristics, scholars have categorised them into five distinct groups based on factors such as levels of poverty and inequality, productivity and innovation, political constraints and dependence on external flows.^[19]^[20]

Criticisms and other terms[edit]

There is criticism for using the term "developing country". The term could imply inferiority of this kind of country compared with a developed country. It could assume a desire to develop along the traditional Western model of economic development which a few countries, such as Cuba and Bhutan, choose not to follow.^[21] Alternative measurements such as gross national happiness have been suggested as important indicators.

The classification of countries as "developing" implies that other countries are developed. This bipartite division is contentious.^{[citation needed]}

To moderate the euphemistic aspect of the word "developing", international organizations have started to use the term less economically developed country for the poorest nations—which can, in no sense, be regarded as developing. This highlights that the standard of living across the entire developing world varies greatly. Other terms sometimes used are less developed countries, underdeveloped nations, and non-industrialized nations. Conversely, developed countries, most economically developed countries, industrialized nations are the opposite end of the spectrum.

Third World[edit]

Over the past few decades since the fall of the Soviet Union and the end of the Cold War, the term Third World has been used interchangeably with developing countries, but the concept has become outdated in recent years as it no longer represents the current political or economic state of the world. The three-world model arose during the Cold War to define countries aligned with NATO (the First World), the Communist Bloc (the Second World, although this term was less used), or neither (the Third World). Strictly speaking, "Third World" was a political, rather than an economic, grouping.

Global South[edit]

The term "Global South" began to be used more widely since about 2004.^[22]^[23] It can also include poorer "southern" regions of wealthy "northern" countries.^[24] The Global South refers to these countries' "interconnected histories of colonialism, neo-imperialism, and differential economic and social change through which large inequalities in living standards, life expectancy, and access to resources are maintained".^[25]

Common challenges[edit]

Most developing countries have these criteria in common:^[26]^[27]

High levels of poverty – measured based on GNI per capita averaged over three years. For example, if the GNI per capita is less than US $1,025 (as of 2018) the country is regarded as a least developed country.^[27]
Human resource weakness (based on indicators of nutrition, health, education and adult literacy; for example low literacy levels).
Economic vulnerability (based on instability of agricultural production, instability of exports of goods and services, economic importance of non-traditional activities, merchandise export concentration, handicap of economic smallness, and the percentage of population displaced by natural disasters).

Urban slums[edit]

According to UN-Habitat, around 33% of the urban population in the developing world in 2012, or about 863 million people, lived in slums.^[28] In 2012, the proportion of urban population living in slums was highest in Sub-Saharan Africa (62%), followed by South Asia (35%), Southeast Asia (31%) and East Asia (28%).^[28]^:127

The UN-Habitat reports that 43% of urban population in developing countries and 78% of those in the least developed countries are slum dwellers.^[29]

Slums form and grow in different parts of the world for many different reasons. Causes include rapid rural-to-urban migration, economic stagnation and depression, high unemployment, poverty, informal economy, forced or manipulated ghettoization, poor planning, politics, natural disasters and social conflicts.^[30]^[31]^[32] For example, as populations expand in poorer countries, rural people are moving to cities in an extensive urban migration that is resulting in the creation of slums.^[33]

In some cities, especially in countries in Southern Asia and sub-Saharan, slums are not just marginalized neighborhoods holding a small population; slums are widespread, and are home to a large part of urban population. These are sometimes called "slum cities".^[34]

Violence against women[edit]

Several forms of violence against women are more prevalent in developing countries than in other parts of the world. For example, dowry violence and bride burning is associated with India, Bangladesh and Nepal. Acid throwing is also associated with these countries, as well as in Southeast Asia, including Cambodia. Honor killing is associated with the Middle East and South Asia. Marriage by abduction is found in Ethiopia, Central Asia and the Caucasus. Abuse related to payment of bride price (such as violence, trafficking and forced marriage) is linked to parts of Sub-Saharan Africa and Oceania.^[35]^[36]

Female genital mutilation is another form of violence against women which is still occurring in many developing countries. It is found mostly in Africa, and to a lesser extent in the Middle East and some other parts of Asia. Developing countries with the highest rate of women who have been cut are Somalia (with 98 per cent of women affected), Guinea (96 per cent), Djibouti (93 per cent), Egypt (91 per cent), Eritrea (89 per cent), Mali (89 per cent), Sierra Leone (88 per cent), Sudan (88 per cent), Gambia (76 per cent), Burkina Faso (76 per cent), and Ethiopia (74 per cent).^[37] Due to globalization and immigration, FGM is spreading beyond the borders of Africa and Middle East, to countries such as Australia, Belgium, Canada, France, New Zealand, the U.S., and UK.^[38]

The Istanbul Convention prohibits female genital mutilation (Article 38).^[39] As of 2016, FGM has been legally banned in many African countries.^[40]

Public health[edit]

People in developing countries usually have a lower life expectancy than people in developed countries.

Undernutrition is more common in developing countries.^[41] Certain groups have higher rates of undernutrition, including women—in particular while pregnant or breastfeeding—children under five years of age, and the elderly. Malnutrition in children and stunted growth of children is the cause for more than 200 million children under five years of age in developing countries not reaching their developmental potential.^[42] About 165 million children were estimated to have stunted growth from malnutrition in 2013.^[43] In some developing countries, overnutrition in the form of obesity is beginning to present within the same communities as undernutrition.^[44]

The following list shows the further significant environmentally-related causes or conditions, as well as certain diseases with a strong environmental component:^[45]

Illness/disease (malaria, tuberculosis, AIDS, etc.): Illness imposes high and regressive cost burdens on families in developing countries.^[46]
Tropical and infectious diseases (neglected tropical diseases)
Unsafe drinking water, poor sanitation and hygiene
Indoor air pollution in developing nations
Pollution (e.g. air pollution, water pollution)
Motor vehicle collisions
Unintentional poisoning
Non communicable diseases and weak healthcare systems

Water, sanitation, hygiene (WASH)[edit]

Access to water, sanitation and hygiene (WASH) services is at very low levels in many developing countries. In 2015 the World Health Organization (WHO) estimated that "1 in 3 people, or 2.4 billion, are still without sanitation facilities" while 663 million people still lack access to safe and clean drinking water.^[47]^[48] The estimate in 2017 by JMP states that 4.5 billion people currently do not have safely managed sanitation.^[49] The majority of these people live in developing countries.

About 892 million people, or 12 per cent of the global population, practiced open defecation instead of using toilets in 2016.^[49] Seventy-six per cent (678 million) of the 892 million people practicing open defecation in the world live in just seven countries. India is the country with the highest number of people practicing open defecation.^[49] Further countries with a high number of people openly defecating are Nigeria (47 million), followed by Indonesia (31 million), Ethiopia (27 million), Pakistan (23 million),^[50] Niger (14 million) and Sudan (11 million).^[49]^[51]

Sustainable Development Goal 6 is one of 17 Sustainable Development Goals established by the UN in 2015. It calls for clean water and sanitation for all people. This is particularly relevant for people in developing countries.

Energy[edit]

In 2009, about 1.4 billion of people in the world lived without electricity, and 2.7 billion relied on wood, charcoal, and dung (dry animal dung fuel) for home energy requirements. This lack of access to modern energy technology limits income generation, blunts efforts to escape poverty, affects people's health, and contributes to global deforestation and climate change. Small-scale renewable energy technologies and distributed energy options, such as onsite solar power and improved cookstoves, offer rural households modern energy services.^[52]

Renewable energy can be particularly suitable for developing countries. In rural and remote areas, transmission and distribution of energy generated from fossil fuels can be difficult and expensive. Producing renewable energy locally can offer a viable alternative.^[53]

Renewable energy can directly contribute to poverty alleviation by providing the energy needed for creating businesses and employment. Renewable energy technologies can also make indirect contributions to alleviating poverty by providing energy for cooking, space heating, and lighting.^[54]

Kenya is the world leader in the number of solar power systems installed per capita.^[55]

Pollution[edit]

Indoor air pollution[edit]

Indoor air pollution in developing nations is a major health hazard.^[56] A major source of indoor air pollution in developing countries is the burning of biomass. Three billion people in developing countries across the globe rely on biomass in the form of wood, charcoal, dung, and crop residue, as their domestic cooking fuel.^[57] Because much of the cooking is carried out indoors in environments that lack proper ventilation, millions of people, primarily poor women and children face serious health risks.

Globally, 4.3 million deaths were attributed to exposure to IAP in developing countries in 2012, almost all in low and middle income countries. The South East Asian and Western Pacific regions bear most of the burden with 1.69 and 1.62 million deaths, respectively. Almost 600,000 deaths occur in Africa.^[58] An earlier estimate from 2000 but the death toll between 1.5 million and 2 million deaths.^[59]

Finding an affordable solution to address the many effects of indoor air pollution is complex. Strategies include improving combustion, reducing smoke exposure, improving safety and reducing labor, reducing fuel costs, and addressing sustainability.^[60]

Water pollution[edit]

Water pollution is a major problem in many developing countries. It requires ongoing evaluation and revision of water resource policy at all levels (international down to individual aquifers and wells). It has been suggested that water pollution is the leading worldwide cause of death and diseases,^[61]^[62] and that it accounts for the deaths of more than 14,000 people daily.^[62]

India and China are two countries with high levels of water pollution: An estimated 580 people in India die of water pollution related illness (including waterborne diseases) every day.^[63] About 90 per cent of the water in the cities of China is polluted.^[64] As of 2007, half a billion Chinese had no access to safe drinking water.^[65]

Further details of water pollution in several countries, including many developing countries:

Global warming[edit]

The effects of global warming such as extreme weather events, droughts, floods, biodiversity loss, disease and sea level rise are dangerous for humans and the environment.^[66] Developing countries are the least able to adapt to climate change (and are therefore called "highly climate vulnerable") due to their relatively low levels of wealth, technology, education, infrastructure and access to resources. This applies to many countries in Sub-Saharan Africa or Small Island Developing States. Some of those island states are likely to face total inundation.^[67] Fragile states or failed states like Afghanistan, Haiti, Myanmar, Sierra Leone, and Somalia are among the worst affected.

Climate vulnerability has been quantified in the Climate Vulnerability Monitor reports of 2010 and 2012. Climate vulnerability in developing countries occurs in four impact areas: health, extreme weather, habitat loss, and economic stress.^[66]^[4] A report by the Climate Vulnerability Monitor in 2012 estimated that climate change causes 400,000 deaths on average each year, mainly due to hunger and communicable diseases in developing countries.^[68]^:17 These effects are most severe for the world’s poorest countries.

A changing climate also results in economic burdens. The economies in Least Developed Countries have lost an average of 7% of their gross domestic product for the year 2010, mainly due to reduced labor productivity.^[68]^:14 Rising sea levels cost 1% of GDP to the least developed countries in 2010 – 4% in the Pacific – with 65 billion dollars annually lost from the world economy.^[66] Another example is the impact on fisheries: approximately 40 countries are acutely vulnerable to the impact of greenhouse gas emissions on fisheries. Developing countries with large fisheries sectors are particularly affected.^[68]^:279

In many cases, developing countries produce only small quantities of greenhouse gas emissions per capita but are very vulnerable to the negative effects of global warming.^[67] Such countries include Comoros, The Gambia, Guinea-Bissau, São Tomé and Príncipe, Solomon Islands and Vanuatu - they have been called "forced riders" as opposed to the "free riders".^[4] Internationally there is recognition of this issue, which is known under the term "climate justice". It has been a key topic at the United Nations Climate Change Conferences (COP).

During the Cancún COP16 in 2010, donor countries promised an annual $100 billion by 2020 through the Green Climate Fund for developing countries to adapt to climate change. However, concrete pledges by developed countries have not been forthcoming.^[69]^[70] Emmanuel Macron (President of France) said at the 2017 United Nations Climate Change Conference in Bonn (COP 23): "Climate change adds further injustice to an already unfair world".^[71]

Climate stress is likely to add to existing migration patterns in developing countries and beyond but is not expected to generate entirely new flows of people.^[72]^:110 A report by World Bank in 2018 estimated that around 143 million people in three regions (Sub-Saharan Africa, South Asia, and Latin America) could be forced to move within their own countries to escape the slow-onset impacts of climate change. They will migrate from less viable areas with lower water availability and crop productivity and from areas affected by rising sea level and storm surges.^[73]

Economic development and climate are inextricably linked, particularly around poverty, gender equality, and energy.^[74] Tackling climate change will only be possible if the Sustainable Development Goals (SDGs) are met (goal number 13 is on climate action).^[74]

Others[edit]

Over the last few decades, global population growth has largely been focused in developing countries (which often have higher birth rates (higher fertility rate) than developed countries).
Increased and intensified industrial and agricultural production and emission of toxic chemicals directly into the soil, air, and water.
Unsustainable use of energy resources.
High dependency on natural resources for livelihood, leading to unsustainable exploitation or depletion of those resources
Child Marriage
Political instability ^[75]
Political corruption^[76]
Indebtedness (see Debt of developing countries)
Underperforming civil service (see Civil service reform in developing countries)
Food insecurity
Illiteracy
Unemployment

Opportunities[edit]

Human Capital
Trade Policy: Countries with more restrictive policies have not grown as fast as countries with open and less distorted trade policies.^[75]^[77]
Investment: Investment has a positive effect on growth.^[75]
Education ^[78]

Country lists[edit]

Developing countries according to International Monetary Fund[edit]

The following are considered developing economies according to the International Monetary Fund's World Economic Outlook Database, April 2018.^[79]^[80]

Countries not listed by IMF

Countries and regions that are graduated developed economies[edit]

The following, including the Four Asian Tigers and new Eurozone European countries, were considered developing countries and regions until the '90s, and are now listed as advanced economies (developed countries and regions) by the IMF. Time in brackets is the time to be listed as advanced economies.

Hong Kong (since 1997)^[81]
Israel (since 1997)^[81]
Singapore (since 1997)^[81]
South Korea (since 1997)^[81]
Taiwan (since 1997)^[81]
Cyprus (since 2001)^[82]
Slovenia (since 2007)^[83]
Malta (since 2008)^[84]
Czech Republic (since 2009,^[85] since 2006 by World Bank)^[86]
Slovakia (since 2009)^[85]
Estonia (since 2011)^[87]
Latvia (since 2014)^[88]
Lithuania (since 2015)^[89]

Three economies lack data before being listed as advanced economies. Because of the lack of data, it is difficult to judge whether they were advanced economies or developing economies before being listed as advanced economies.