Economics & Development

Liberia’s economy grew by 5.1 percent in 2025, up from 4.0 percent in 2024, driven by a rebound in mining. Inflation remained in single digits, and fiscal consolidation strengthened public finances despite declining grants. Extreme poverty is projected to increase in 2025 before reversing thereafter. The quality of jobs remains weak and financing conditions tight, underscoring the need for diversification, domestic revenue mobilization, and private investment.

Economic growth is estimated to have slowed in 2025, driven by cuts in foreign aid and adverse climate conditions. Declining foreign aid adversely impacted demand, fiscal performance, constrained humanitarian support, and slowed poverty reduction. Recent oil price shocks are expected to further downsize private consumption and GDP growth while increasing inflationary pressures. The medium-term outlook remains uncertain, with risks tilted to the downside

Growth remained strong at 6.3 percent in 2025, supported by strong private demand, near-zero inflation, and a decade-high trade surplus. Fiscal consolidation reduced the deficit to 3.0 percent of GDP. Despite strong performance, high informality and weak job quality limit poverty reduction. Growth is set to average 6.4 percent over 2026–2028, lowering middle-income poverty amid climate and significant geopolitical risks, especially from the Middle East events.

Estimated GDP growth declined to 4.2 percent in 2025, as extractive output and gas investment declined. Lower inflation and stronger agricultural growth reduced poverty to 25.2 percent. Fiscal and external balances improved, underpinned by initial gas revenues, elevated gold prices, and new fiscal measures. Growth is projected to rebound to 4.4 percent in 2026, as rising gas output and high commodity prices offset import price pressures from the Middle East conflict.

The Malaysian economy was resilient in 2025, growing at 5.2 percent, surpassing the official projection of 4.0–4.8 percent. The economy is expected to grow at 4.4 percent in 2026. While Malaysia has successfully reversed pandemic-era setbacks in poverty, the transition toward high-quality, productivity-led growth is challenged by structural labor market imbalances and a narrow fiscal envelope.

Growth is expected to slow to 3.5 percent in 2026 as higher fuel prices linked to the Middle East conflict curb external and domestic demand. Structural imbalances limit the economy’s ability to absorb external shocks, slowing welfare gains. Poverty at the $4.20 line (2021 PPP) is projected to continue declining but a slower pace from 22.5 in 2024 to 20.4 percent in 2025 and 19.1 percent in 2026.

This statement, delivered by Scott Bessent, Secretary of the Treasury of the United States, to the 113th Meeting of the Development Committee on April 16, 2026, sets out U.S. priorities for refocusing the International Monetary Fund (IMF) and the World Bank on their core mandates of macroeconomic stability, growth, poverty reduction, and country self‑reliance. It highlights the United States’ pro‑growth economic agenda centered on fiscal prudence, deregulation, energy abundance, and private‑sector‑led job creation, while calling for a more balanced global economy. The statement emphasizes the need for the IMF to reverse mission creep and concentrate on rigorous surveillance, external imbalances, disciplined lending, strong conditionality, debt sustainability, and borrower accountability, supported by a strong, quota‑based IMF and completion of quota reforms. It calls for strengthened debt transparency, timely restructurings under the Common Framework, and improved debt sustainability analysis. The statement urges the World Bank to sharpen its focus on foundational investments that boost productivity and growth, prioritize poorer and less creditworthy countries, and implement graduation policies to redirect resources where they have the greatest impact. It supports the Bank’s jobs agenda, human capital development, quality infrastructure, competition in procurement, and access to abundant, affordable, and reliable energy through a technology‑neutral approach, including gas and nuclear power. The statement also underscores the importance of budget discipline, institutional efficiency, and governance reforms to ensure the international financial institutions remain fit for purpose and focused on delivering measurable development outcomes.

This statement, delivered by Guy Parmelin, President of the Swiss Confederation and Head of the Department of Economic Affairs, Education and Research, on behalf of Azerbaijan, Kazakhstan, the Kyrgyz Republic, Poland, Serbia, Switzerland, Tajikistan, Turkmenistan, and Uzbekistan, to the 113th Meeting of the Development Committee on April 16, 2026, reaffirms strong support for a rules‑based multilateral system and the central role of the World Bank Group (WBG) in fostering resilience, inclusive growth, and job creation amid heightened geopolitical uncertainty and overlapping global challenges. It strongly endorses job creation as a core development priority, emphasizing the need for more and better jobs to address rapid labor force growth, persistent informality, and rising vulnerabilities in developing and emerging economies. The statement welcomes the WBG’s three‑pillar Jobs Strategy, highlighting the importance of a dynamic private sector, macroeconomic stability, sound public finances, open markets, effective institutions, and access to finance particularly for small and medium‑sized enterprises. It underscores the value of business‑enabling reforms in job‑rich sectors while encouraging country‑specific, flexible approaches that address cross‑sectoral constraints and local conditions. The statement stresses that job quality, formality, rights at work, social dialogue, and social protection are essential for durable development outcomes. It highlights the WBG’s role in addressing global challenges such as climate change, fragility, conflict, and violence, advancing gender equality, and supporting country‑led transition pathways. It also underscores the importance of the Knowledge Bank, strong accountability mechanisms, partnerships across the multilateral system, and safeguarding IDA’s long‑term financial sustainability. The statement concludes by reaffirming commitment to close collaboration with the World Bank Group to deliver tangible, lasting development impact.

Evaluating how interventions contribute to change is especially challenging in complex settings. Results often emerge over time, involve multiple actors, and are shaped by factors beyond the control of a single intervention. This makes it difficult to explain what difference an intervention actually made. Contribution analysis (CA) offers a way to address these challenges. It helps build credible explanations of how and why an intervention contributed to observed changes, alongside other influences. As CA has been applied in new contexts, its practice has also become more varied. This has led to uncertainties about what CA involves, the types of contribution claims it supports, and how quality should be assessed. This guidance note serves as a shared reference for the high-quality application of CA. Aimed at experienced evaluators and evaluation commissioners, it sets out six core steps spanning theory building and theory testing.

This edition of the Macro Poverty Outlooks periodical contains country-by-country forecasts and overviews for GDP, fiscal, debt and poverty indicators for the developing countries of the East Asia and the Pacific region. Macroeconomic indicators such as population, gross domestic product, and gross domestic product per capita, and where available, other indicators such as primary school enrollment, life expectancy at birth, total greenhouse gas emissions and inflation, among others, are included for each country. In addition to the World Bank’s most recent forecasts, key conditions and challenges, recent developments and outlook are briefly described for each country in the region.