The World Bank assigns the world’s economies to four income groups—low, lower-middle, upper-middle, and high income. The classifications are updated each year on July 1 and are based on the GNI per capita of the previous year (2021). GNI measures are expressed in United States dollars (USD), and are determined using conversion factors derived according to the Atlas method.
Classifications can change for two reasons:
Changes to Atlas GNI per capita: In each country, factors such as economic growth, inflation, exchange rates, and population growth influence the level of Atlas GNI per capita. Revisions to improve national accounts estimates and methods can also have an impact. Updated data on Atlas GNI per capita for 2021 can be accessed here.
Changes to classification thresholds: To keep income classification thresholds fixed in real terms, they are adjusted annually for inflation using the Special Drawing Rights (SDR) deflator, a weighted average of the GDP deflators of China, Japan, the United Kingdom, the United States, and the Euro Area. The new thresholds for Atlas GNI per capita are as follows:
Changes in classifications
The tables below list the economies moving to a different classification group this year.
Economies moving to a higher income group.
The economy of Belize was severely affected by the COVID-19 pandemic in 2020 and moved to the lower-middle-income group. In 2021, economic growth rebounded, led by tourist-related activities and investments, bringing Belize back to its prior classification as an upper-middle-income country.
The economies of Panama and Romania were each also impacted by the COVID-19 pandemic in 2020 and moved to the upper-middle-income group. In 2021, both experienced a strong rebound, bringing them back to the high-income group.
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Economies moving to a lower income group.
For the eleventh consecutive year, Lebanon’s real GDP per capita fell in 2021, and the country also experienced sharp exchange rate depreciation. Therefore, Lebanon, an upper-middle-income country for almost 25 years, now moves to the lower-middle income group.
Palau’s economy has experienced a downward trend since 2016. Tourism and related industries have been severely impacted by the pandemic, and trade flows were disrupted. While Palau has been a high-income country since FY18, it will now move to the upper-middle-income group.
While a rebound in the price of copper boosted Zambia’s GDP in 2021, a sharp deterioration in exchange rates led to a large decrease in Atlas GNI per capita expressed in US dollars, reclassifying the country to the low-income group.
It is to be noted that Venezuela, classified as an upper-middle income country until FY21, has been unclassified since then due to the unavailability of data.
Detailed information on how the World Bank classifies countries is available here. The country and lending groups page provides a complete list of economies classified by income, region, and World Bank lending status and includes links to prior years’ classifications. The classification tables include World Bank member countries, along with all other economies with populations greater than 30,000.
These classifications reflect the best available GNI figures for 2021, which may be revised as countries publish improved final estimates.
In countries where dual or multiple exchange rates are in use, the exchange rate used to convert local currency units to US$ is an average of these exchange rates, provided necessary data are available.
Data for GNI, GNI per capita, GDP, GDP PPP, and Population for 2021 are now available on the World Bank’s Open Data Catalog. Note that these are preliminary estimates and may be revised.
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July 1, 2022 Published by The World Bank.
