According to the OECD, there are only 37 countries belonging to the developed countries list. In contrast, there are 152 developing countries. At least, that’s the number according to the definition supplied by the International Monetary Fund (IMF).
What constitutes a developing or developed country differs depending on the criteria applied. In terms of global economics, a developing country is generally considered to have a smaller economy than giant industrial nations.
That is to say, most of the world. The developing economies have less development, and fewer late-stage industries develop to competitive standards. That doesn’t mean that they are necessarily economically destitute.
Some of these countries are home to the most beautiful cities in the world. As investment goes, many global investment strategists look to these economies for growth and high returns. Here are 29 developing countries that are showing great potential.
29 Most Developing Countries in the World
Many factors determine whether a country’s economy appeals to investors, and there’s no need to go into all those here. Suffice it to say that the countries themselves are showing good potential, and these factors, at least on a basic level, may play a part in that.
Image by David Bawm from Pixabay
1. Bangladesh
It seems that it was a while ago that the music industry united to raise money for the Bangladesh famine. Around the time it gained independence in 1971, Bangladesh was a deeply impoverished country. Today it has far outgrown the economy of Pakistan, which Bangladesh gained its independence from.
Bangladesh is now among the top 40 biggest economies in the world. This has been driven by a robust financial sector, making it the big story of the Indian subcontinent in the 21st century.
Image by PublicDomainPictures from Pixabay
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2. Barbados
Tourism has returned with a vengeance to Barbados, a seemingly eternal popular draw for holidaymakers in the West Indies. Projections for the past year or two have been off the charts, hovering around the 10–11% range.
The consensus is that if Barbados and the Caribbean can weather the strain on global commodities caused by the Ukraine War, they should benefit from renewed interest in investment in a year or two.
Image by Anne-Onyme from Pixabay
3. Benin
Benin’s key trading partner is Nigeria, the most populous nation and biggest economy on the continent. That bodes well for Benin, as transportation services and agriculture form most of its economic drivers.
Despite intense pressure on specific sectors, like inflation brought about by the Ukraine War, there is some optimism for a good recovery. Corporate law reforms and agricultural sector administration upgrades are among the factors driving it.
4. Bhutan
Countries don’t come much smaller than the Himalayan nation of Bhutan. Its small population benefits from the country’s relative isolation and beneficial natural resources. The government has experienced significant economic growth in recent years due to its Gross National Happiness (GNH) policy of governance.
Bhutan has focused on reducing its poverty levels, which were extreme at one point. It does face unique challenges due to its geography and location between India and China. But its ability to leverage a good relationship with India has assisted with some revenue generation, especially from selling hydroelectric power.
I visited Bhutan in 2022 and absolutely loved it. There are some fantastic tourist places in Bhutan including its most famous landmark, the wonderful Tiger’s Nest Monastery.
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Image by maljaarsreinier123 from Pixabay
5. Burkina Faso
Burkina Faso was a near-fairy tale with its recovery after the pandemic year of 2020. It bounced back to an impressive 6.2% growth, driven mainly by massive service sector efforts and the uptake of gold exports.
Though 2022 also slowed slightly due to the war in Ukraine, some suggest that once food and petroleum product prices stabilize for this tiny nation, its economy may improve with private investment.
Image by Sasin Tipchai from Pixabay
6. Cambodia
Cambodia enjoys an open market-style economy. The economy itself is small but robust and constantly being improved. Like most developing countries, Cambodia sometimes falls victim to global factors outside its control.
But improvements to its essential operation, focus on its tourism sector, and a winning attitude in its garment sector have provided a lifeline in difficult times. As the world emerges from the pandemic, it only bodes well for the country since consumer spending is also increasing.
7. China
China’s manufacturing power is well-known. It can produce goods cheaper and faster than most other countries, with a population of over a billion people at the ready. With continued growth at its current pace, it may overtake the US in terms of GDP in 10 years.
Unfortunately, some things are hampering progress. The communist policy is struggling to transition into a consumer-based economy (though there are some successes here.) China is said to have the largest economy in terms of purchasing power, not to mention some magnificent landmarks. For a suitable investment, it’s hard to see a downside.
Image by Yann Fredy YEMAN from Pixabay
8. Côte d’Ivoire
While one of the caveats of Côte d’Ivoire’s economy is high inflation, its growth rate is also exceptionally high at almost 7% (according to a 2021 World Bank report). One of the positive factors for investors is that this growth rate was maintained even during the 2020 pandemic year.
Heritage.org reported that its economy was ranked above the regional and global averages in 2022. Most sectors of the economy are still dependent on exterior factors, with agriculture specifically in focus.
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9. Ethiopia
Historically, Ethiopia has been an agriculture-based economy. In recent years, however, the government has made very specific plans to diversify into textiles and manufacturing. Energy is also a popular field of interest in the African continent, with Ethiopia being no exception.
The country’s citizens remain impoverished, though GDP growth is significant and positive. Of the factors in the positive column for Ethiopia is the fact that it is the second-most populous country on the continent. It is one of the fastest-growing economies in the world. Much of this is attributed to efforts in public infrastructure development.
Image by jozuadouglas from Pixabay
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10. Ghana
Ghana has been impressing the number crunchers for some years now, showing a growth rate of around 6% on average for the past decade. In part, it’s because Ghana has a surprisingly strong automotive and manufacturing sector.
Ship and auto-building, and even tech industry sectors have been steadily growing alongside the more expected agricultural sector.
Image by Kevin Snyman from Pixabay
11. Guyana
Guyana doesn’t often make top lists like these, but it may be well deserved in this case. Wily investors may boast a great dividend in a few years if all goes well. The main reason for the optimism in Guyana is the mining sector, with bauxite and gold leading the way.
Bauxite, for the record, is used in the processing of aluminium, which certainly accounts for its value. Bauxite as a mineral seems concentrated in the tropics, which makes Guyana a prime candidate for its sourcing.
12. India
India is regarded by many as a powerhouse of industry and revenue in Asia. A billion-strong population and a fairly impressive services industry are partly to blame. India happens to be the fifth largest economy in the world by the nominal GDP metric.
It is remarkable to consider that 22% of the population does not participate in the active economy of the country, living below the poverty line. Even so, the output of the country is huge. Besides services, agriculture is also a significant contributor to the economy.
Side fact: India reportedly ranks fourth in the world for the number of billionaires.
Image by Olga Ozik from Pixabay
13. Laos
Laos is among the fastest-growing economies on this list and in the world. It is a socialist state but shows openness to foreign investment and private ownership in many sectors. One of the driving factors in the economy is the country’s wise and beneficial investment in hydroelectric power generation.
As a landlocked country, it is limited in terms of infrastructure. Some strategic alliances, however, and a strategically-designed tax policy make investment attractive. Labour costs are also low, given the country’s relatively unskilled workforce. The country managed to avert an economic crisis caused by the 2020 pandemic.
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14. Macao
Macao is hugely popular as a tourist destination, and its gambling laws have created a behemoth of an industry. This has been lucrative, drawing capital from neighbouring China, which prohibits gambling. Naturally, the revenue took a body blow during the pandemic, as travel was severely restricted.
But, with travellers and gamblers returning, the 42 casinos in Macau are expected to drive more growth. More gaming concessions are expected to be issued to accommodate returning visitors and increased interest.
Image by Walkerssk from Pixabay
15. Morocco
Morocco is currently suffering from an overreliance on food and energy imports as the Ukraine War continues to strain supplies. It is also suffering from an unusually long extended drought at this time. However, it must be noted that before this, Morocco suffered only one recession in its previous 20 years.
That suggests positive governance and good management on the part of its own industries and resources. Phosphate mineral mining, agriculture, and tourism form the backbone of its economy. Major mining operations are currently investing in significant projects in the country.
Image by Jean van der Meulen from Pixabay
16. Mozambique
There is a lot of hope for Mozambique to explore its natural resources like gas and coal. Large investments in these sectors have already delivered some dividends, and prospectors have also been considering the country’s potential for hydroelectric power generation.
Prior to the pandemic, the country was receiving positive outlook reports from the African Development Bank, amongst others. Among the risks cited are the ongoing issues with political fighting in the north and external factors.
17, Myanmar
A high GDP per capita contributes to a good outlook for Myanmar, at least on paper. In reality, recent political turmoil related to ethnic cleansing accusations and human rights violations may prevent even more potential growth for former Burma.
Agriculture is by far the largest sector of the economy. Myanmar is in no way considered a “hot prospect” But even as a low-income country, it is showing signs of long-term potential. If the country can stabilise its manufacturing sector and hopefully reform its political situation, medium-level growth might be maintained.
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18. Peru
Peru ranks surprisingly high in many lists on the development matrix. In North and South America, it ranks 8th in terms of market freedom, with its metrics and averages above regional and world standards.
Despite the global difficulties of the Covid pandemic and the war in Ukraine, Peru has maintained a positive outlook from investors. Recovery may be slow, but most reports suggest that it should resume its growth levels from before the pandemic. Increased political stability since the last three decades of conflict also helps in this regard.
Image by Andreas from Pixabay
19. Rwanda
It is true that the vast majority of Rwandans work in agriculture or some subsistence industry. Much of the country is also deeply impoverished. But there is hope on the horizon, as the government has undertaken to industrialise rapidly in an effort to drive the economy.
Today it is technically a mixed economy, which experienced a boost in the early 2000s. A large electrification program also helped bring vast areas of the country into play. The country remains “positive” for those looking to the African continent for investment, while the growth hovers between 6% and 8% annually.
Image by Mariam from Pixabay
20. Senegal
Senegal employs what it calls an Adjusted and Accelerated Priority Action Plan, which has seen it make a top ten list of fast-growing African economies over the past few years. Building and transportation were among the main elements of this plan, as well as a restructuring of its extractive industries.
Oil and gas are present in the country, contributing to what is expected to be an 8% plus growth rate over the next short term. Like most other developing countries, the growth took a devastating hit in 2020, but many are factoring that blip into their recast projections based on good progress before.
Image by Sue from Pixabay
21. St Kitts & Nevis
It may surprise many that the IMF recently ranked St Kitts & Nevis as the fourth fastest-growing economy in the world. Yes, the nation is relatively tiny, but the returns on investments can be decent for a smart investor.
At least one aspect of the country’s law is appealing — tax. Citizens pay no income, inheritance, or gift taxes. The government is working towards even more favourable conditions, hoping to draw investment from corporations and individuals. To that end, efforts have been made to make real estate and tourism key drivers.
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22. St Lucia
ICT (information and communications technology) and manufacturing are somewhat of a focus for the future in St. Lucia. Currently, the main investment areas are still tourism and hotel-related real estate and development.
The IMF sees the immediate future as positive, positioning the expected yearly rate of growth at around 10% on average.
Image by Makalu from Pixabay
23. Tajikistan
A country riddled with illegal trafficking activity should not be expected to be on this list. It is estimated that heroin-related business accounts for almost half of the GDP. The civil war between 1992 and 1997 also wreaked havoc on its economic status.
Tajikistan, fortunately, also has good gold and aluminium exports. Its above-board industries related to agriculture and services do perform well, too.
Unfortunately, these industries are very vulnerable to outside factors, owing to their need for foreign investment. Still, the few reforms made since independence offer some hope for investors not to be too averse to some risk.
24. Tanzania
The great news for Tanzania is that the poverty rates within the country seem to be decreasing. This is happening despite a spike in population growth. Tourism growth has contributed somewhat, and many experts believe the political stability of the past several years is showing benefits for investment.
Mining and Tourism are among the leaders in industrial growth, but Tanzania also benefits from an advantageous geographical position on the continent. Public efforts by the government to address social issues like gender-based violence and crime have also been welcomed.
Image by hanmuhado0 from Pixabay
25. Turkmenistan
The big draw in Turkmenistan is the massive oil and gas deposits. Most of the country is actually desert, though agriculture is strong in the areas that can be irrigated. Naturally, the Ukraine war is putting a strain on the country’s development due to its proximity.
But those looking beyond the war may want to recognize the potential in Turkmenistan’s rank as the 4th richest potential oil and gas reserves. As the country looks to free itself from the Russia-dependent pipelines, opportunities may continue to open up, with growth on the agenda.
Image by LoggaWiggler from Pixabay
26. Uzbekistan
There’s a strong drive to transition from the previous soviet system to a more free-market-based system in Uzbekistan. Cotton exports and gold will hopefully lead this transition. The reform process seems very animated and strongly championed by the current government.
Tax reforms and currency relation policies have allowed more foreign investment into the country since the mid-2010s. The country boasts a very strong literacy rate, and workers are generally considered skilled.
A government program allows citizens to study in the US, provided they return to work for the Uzbek government for five years. All of this has had a positive impact on the outlook of the country.
27. Vietnam
The main factor pushing Vietnam to the top of growth watchlists is its impressive handling of the recent Coronavirus pandemic. Whereas most countries and economies virtually shut down or saw retraction, Vietnam somehow managed to avoid the worst impacts of the disaster.
Their population kept working, and their sectors kept growing, and that has given the country a good gain over everyone else. Vietnam’s major industries are state-owned. That includes industries related to textiles, tourism, telecommunications, and plastics and products for the service sector.
Image by toubibe from Pixabay
28. Zimbabwe
The troubled recent history of Zimbabwe under Robert Mugabe seems to have a long tail as the country struggles to find its footing. Once an economic prospect for the future, Zimbabwe suffered greatly under trade sanctions for many years.
Today, the outlook is still strictly long-term and tentative, although there are some signs of potential growth. Inflation was slowing from skyrocketing levels a few years ago; agriculture is making a slow return. The informal sector of the economy remains significant, and it will take some work and some time to stabilise its contribution to the economy in general.
29. Malaysia
Finally, Malaysia remains classified as a developing economy despite its affluent image. Malaysia is indeed the third-largest economy in Southeast Asia. The economy is driven by a surprisingly strong export sector (notably of high-tech products) and a low tax rate.
The Straits Times reported that Malaysia saw double-digit growth in 2022, post-pandemic. There’s a wait-and-see approach to the latter half of 2023, as certain government programmes to stimulate the economy run to an end. But that will not likely dampen medium and long-term growth for this resilient nation.
Final Thoughts on the Most Promising Developing Countries
No one has a crystal ball to see the future, despite many economists claiming the ability to do so. It is perfectly possible that any random situation or circumstance can change matters in a heartbeat for any of these countries.
But, as best as anyone can guess, these economies are showing promise when it comes to growth. It may well be worth keeping an eye on how they shape up in the next medium term. In many cases, these countries are still amazing to visit. Know that if you do, you may be helping to build them into the future in some way.
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Amanda O’Brien is the creator and editor of The Boutique Adventurer. She has visited 80 countries and is a member of the British Guild of Travel Writers as well as the IFTWTA. She is passionate about wine had has just completed Level 3 of the WSET. Born in Australia, she lives in London.