The World Bank has announced a major update to its global income classifications, with six economies moving into higher income categories from July 1, 2026. The changes reflect developments in national income, economic growth, statistical revisions and population estimates.

Under the World Bank’s 2026–27 classification, five countries—Jordan, the Federated States of Micronesia, the Philippines, Sri Lanka and Vietnam—have moved from the lower-middle-income group to the upper-middle-income category. Togo has also advanced, moving from low-income to lower-middle-income status. No economy moved to a lower income category in this year’s update.

The World Bank determines income categories using Atlas-method GNI per capita from the previous calendar year. For the 2026–27 fiscal year, the thresholds are $1,175 or less for low-income economies, $1,176–$4,635 for lower-middle-income economies, $4,636–$14,375 for upper-middle-income economies and above $14,375 for high-income economies.

Vietnam, Philippines and Sri Lanka Make Notable Progress

Vietnam’s upgrade reflects strong economic expansion and export performance. The World Bank said Vietnamese exports increased by more than 15% in both 2024 and 2025, while GDP growth reached 7% in 2024 and 8% in 2025. GNI also expanded strongly during the period.

The Philippines reached the upper-middle-income category following several years of broad-based growth. According to the World Bank, GDP expanded by an average of 5.8% annually over five years, with gains spread across major areas of the economy rather than being concentrated in one sector.

Sri Lanka’s reclassification comes after a severe economic crisis in 2022. The country recorded real GDP growth of 5% in 2025, supported by a recovery across industries as well as improvements in financial and tourism-related services.

Jordan and Micronesia Also Move Up

Jordan’s new classification was influenced significantly by an extensive revision of its national accounts. After updated statistical methods and broader data coverage, the size of the economy was estimated to be nearly 10% larger than previously calculated. This revision, combined with economic growth, pushed Jordan across the upper-middle-income threshold.

The Federated States of Micronesia advanced after steady improvement following the prolonged disruption caused by the COVID-19 pandemic. Construction and agriculture contributed to growth, although a decline in net primary income limited some of the gains.

Togo’s Upgrade Has a Different Story

Togo’s move from low-income to lower-middle-income status was influenced heavily by a population revision. Following detailed results from its 2022 census, the country’s population estimate was reduced by 11.7%. Because GNI per capita is calculated using population, the lower population estimate increased the per-person figure. Economic growth and exchange-rate movements also contributed to the change.

The World Bank emphasizes that these classifications are statistical groupings and do not provide a complete picture of living standards or development. The categories are updated every July and remain in effect for the following fiscal year.

The 2026 update covers 218 economies and will serve as the World Bank’s official income classification framework through June 2027. The latest changes highlight how economic growth, improved statistics and demographic revisions can significantly affect the way countries are positioned in the global economic landscape.