Thirty-two countries now account for 95% of global growth. In April, 54 did. That narrowing sits at the heart of the International Monetary Fund's latest outlook, released Tuesday in Bangkok. The fund nudged its 2026 global growth forecast up to 3.1% from 3.0% in July, while warning that the gains are landing in fewer and fewer places.
Growth will slow in 2027, the fund said. The world economy expanded at an annual pace of 3.5% in 2025. The IMF released its forecast as economic and financial leaders gathered in the Thai capital for the fall meetings of the IMF and World Bank.
A Divided Global Economy
"The outlook is highly uneven," Silvana Tenreyro, the IMF's director of research, told reporters in Bangkok. The report described the mechanism more bluntly. "The global economy is not simply slowing or accelerating; rather, growth is being reallocated across countries according to their exposure to the war-induced supply shock and AI-related demand strength," it said.
The figures show who's on each side. Artificial-intelligence investment is helping offset damage from sharply higher oil and gas prices, but the benefits remain concentrated. The United States and China accounted for more than three-quarters of net demand for imports of computer chips and other AI-related equipment. Meanwhile, the IMF expects oil prices to climb nearly 41% in 2026 to an average of $96 a barrel, pushing global inflation to 4.7% from 4.1% in 2025.
Advanced economies are forecast to grow 2.1% in 2026, then slow to 1.9% in 2027. The United States is expected to grow 2.3% in both years. The 21 countries sharing the euro should expand 1.1% this year and 1.2% next. China is projected to grow 4.5%, down from 5% in 2025. India, at 7%, is the fastest-growing major economy, though that's down from 7.7% last year.
Who Pays for the Energy Shock
Developing and emerging economies more vulnerable to higher oil and gas costs are forecast to grow 3.7% in 2026, down from 4.5% in 2025, before recovering to 4.4% in 2027. Economies in the Middle East and Central Asia are expected to contract this year. The IMF said low-income developing countries that import oil and have no stake in the AI investment boom face the greatest exposure to shocks from the Iran war.
Petya Koeva Brooks, deputy director of the IMF's Research Department, told AFP that many heavily indebted oil importers face wrenching choices as they shield citizens from the energy shock. "Unfortunately, after years of the global economy being hit by shock after shock, debt levels have increased quite a lot, and at the same time, inflation has become a problem," she said.
The poorest face the hardest trade-offs. "For those countries that are most vulnerable, this is where the consumption basket is heavily weighted towards energy and food, and so indeed it is much much more difficult," Koeva Brooks said. "But unfortunately there is no other choice."
The fund urged governments to offer narrow, targeted subsidies, rebuild fiscal buffers and address rising debt. Koeva Brooks said many low-income countries are in debt distress or close to it, and should seek restructuring if they can't fix the problem on their own. "Where debt is not sustainable, then resolving that debt and having orderly and timely restructuring is always better than waiting, because then the cost of restructuring down the road is going to be much higher," she said.
AI, Jobs and Climate Risk
Managing Director Kristalina Georgieva described AI's effect on employment at an event Monday as "a slow moving tsunami, but tsunami nonetheless." She added: "The impact over time on jobs globally we estimate to be around 40% — jobs either augmented or downgraded or eliminated. And we are already seeing some of this impact." Employment effects drew particular attention at the Bangkok meetings.
The forecast also rests on a fragile bet. It assumes oil and gas shipments through the Strait of Hormuz resume by March and that AI demand moderates. If AI investment slowed, Koeva Brooks said, the world economy "would see a negative impact on output, not only in advanced countries like the U.S. but again through trade linkages also in Asia." In the IMF's worst-case scenario, where AI fails to deliver promised productivity gains, global GDP forecasts for 2028 would fall by as much as 0.4%.
Climate pressures are already reaching the checkout. Koeva Brooks said higher prices for certain foods already reflect some effects of a particularly intense El Niño. "We have a significant increase in beverage prices, in the prices of rice, and so on," she said. "Of course, it could turn out that the domino effect is even bigger than what we currently have."
Last week, the IMF said rising debt poses a growing risk to global financial stability, particularly amid high borrowing costs, and urged rich and poor countries alike to improve their national finances. Finance ministers and central bank governors in Bangkok are set to assess the world economy and discuss ways to support financial stability and sustained growth.
Why This Matters:
A headline growth number of 3.1% hides who's actually gaining. Thirty-two countries generate 95% of global growth; the remaining economies, including heavily indebted oil importers with no AI boom to lean on, absorb shocks they didn't cause. Their households spend most of their income on energy and food, the very goods whose prices are rising. The IMF's own officials say these governments face the hardest choices, and delaying debt restructuring only raises its eventual cost. That puts a spotlight on the multilateral institutions meeting in Bangkok: whether they can coordinate relief, targeted support and timely debt resolution will shape how many families in the poorest countries are protected. The AI jobs warning—roughly 40% of jobs augmented, downgraded or eliminated—adds a second question: who is cushioned when work changes?