List of Third World Countries: Development Guide

Understanding Poverty Lines

Figuring out poverty lines is like peeking into how different countries are coping with their wallets. You got two main lines that paint this picture: the extreme poverty line and the one for wealthier upper-middle-income folks.

Extreme Poverty Line

So, here’s the deal with the extreme poverty line. It’s aimed at low-income spots where folks live off just $2.15 a day—barely enough for the essentials like grub, a roof, and some threads. World Bank says about 8.5% of the world’s folks, roughly 700 million souls, are stuck here. Most are hanging out in Sub-Saharan Africa or in tough spots where peace is, well, on a break.

Fact	Number Crunching
People making do under $2.15/day	8.5% (700 million souls)
Top Spots with Most Folks Struggling	Sub-Saharan Africa and places dodging bullets

If you’re curious, swing by the list of african countries to see where extreme poverty hits hardest.

Poverty Line for Upper-Middle-Income Countries

Now, in the fancy digs of upper-middle-income joints, the poverty line is bumped to $6.85 per day (World Bank). That’s because life costs more there. Despite tons of effort for better days, 44% of folks around the globe, translating to around 3.5 billion people, are scraping by under this mark. They’ve been stuck here since the early ’90s, thanks a lot, population boom.

Fact	Number Crunching
Folks getting by under $6.85/day	44% (3.5 billion)
This Crowd Hasn’t Moved	Stuck since 1990 ’cause there’re just more of ’em now

If crunching numbers is your jam, check the list of countries by gdp to peek at the economics scene across different places.

Getting a handle on these poverty lines helps us grasp the hustle and bustle of economic ups and downs in different places. Curious for more? Trot over to the list of developing countries and list of developed countries to see who’s who on the global stage.

Impact of Climate Change on Poverty

Climate change isn’t just some distant worry—it’s a real pickle hitting economic stability, especially for those in what’s sometimes called the “Third World.” The effects of climate change don’t hit everyone equally; instead, they tend to make poverty and global inequality even worse.

Severe Weather Shocks

Severe weather shocks are like nature’s nasty surprise, being one of the first punch impacts of climate change, and they seriously challenge efforts to reduce poverty. The World Bank claims that almost 1 in 5 folks worldwide will face some wild weather during their life that threatens their recovery. We’re talking hurricanes, floods, droughts, and other extreme weather that can wreck roads, uproot families, and throw local economies into confusion.

Impact	Description
Economic Loss	Tornadoes through infrastructure and homes lead to massive financial bruises.
Displacement	Brutal weather can force folks off their land, messing with their opportunities.
Agricultural Decline	Droughts and floods mess up food growth, boosting hunger and malnutrition.

Places struggling with poverty are more vulnerable to these shocks, lengthening recovery and digging deeper into poverty pockets. Curious about how climate chaos shakes up economies? Have a gander at the list of countries by GDP.

Global Inequality Threats

Climate change turns the dial up on existing global inequalities. Countries with fewer coins, usually nestled in risky spots, bear the brunt. They’re often short on cash and solid infrastructure to deal with and adjust to climate drama. The World Bank points out that climate change pushes global inequality because poorer places and communities often eat the biggest slice of bad pie.

Factor	High-Income	Low-Income
Adaptive Capacity	High	Low
Financial Resources	Tons	Just a few coins
Infrastructure Robustness	Solid as a rock	Fragile as a teapot

The uneven spread of resources and ability to adapt means poorer countries keep fighting an uphill battle. That makes the distance between the well-off and the not-so moneyed widen even more.

If you fancy more insights about how economic standings affect world progress, check out our bit on current economic classifications or the list of developing countries to spy on nations wrestling with these issues.

When we recognize these challenges, it’s clear as day that tackling climate change matters for more than just saving the planet; it’s vital for whittling down global poverty and inequality. With wild weather swinging by more often and with more muscle, taking steps to help vulnerable folks and ensure fair growth everywhere is a must-do.

Historical Evolution of “Third World”

Cold War Origins

Back in the mid-20th century, during the tense days of the Cold War, the term “Third World” popped up. It was a catchy phrase that indicated countries not locking arms with the two heavyweight champs of that era: the capitalist First World, with players like the United States and parts of Western Europe, or the communist Second World, starring the Soviet Union and its Eastern European entourage. Those hanging out in the Third World were primarily newly independent states across Asia, Africa, Latin America, and the Middle East, shaking off the dusty chains of colonialism. They wanted space away from the big guys’ influence.

These days, folks throw around terms like First, Second, Third, and even Fourth World as if it’s the new global fashion. The First World painted a picture of industrialized nations rocking the capitalism trend, while the Second World marched to a communist beat, following the Soviet Union’s lead. Meanwhile, Third World countries, mainly from Asia and Africa, chose not to dance to either tune. There was even the Fourth World—a style all its own—describing areas cut off from international politics and the economy (Investopedia).

To simplify this Cold War lineup:

Classification	Characteristics	Examples
First World	Capitalist, industrialized	United States, Western Europe
Second World	Communist	Soviet Union, Eastern Europe
Third World	Non-aligned, developing	Nations in Asia, Africa
Fourth World	Isolated, most impoverished	Far-off places with little global chatter

Modern Interpretation

Fast forward to today, and “Third World” has gone through some changes. You’re more likely to hear it referring to nations grappling with high poverty rates, shaky economies, and political roller coasters—the stuff that keeps them in the ‘developing’ or ‘underdeveloped’ column (Corporate Finance Institute). This update in meaning comes from the world’s top brass and economic realities that have shifted since the Cold War days wrapped up.

Now, when it comes to supporting these developing places, hefty organizations like the International Monetary Fund (IMF) and the World Bank step in. They dish out financial help aimed at beefing up the infrastructure and economic frameworks of these countries. The IMF and the World Bank tend to categorize them as lower-middle or low-income, highlighting the journey they have ahead in terms of growth and economic health.

So, when we talk about the “Third World” today, it’s less about where a country lines up in global politics and more about the hurdles they face in economic development and growth. For a peek into who’s who in the economic zoo, you can check out resources such as the list of countries by economic status and list of developing countries.

Getting to grips with both the past and present meanings of “Third World” gives you a pretty clear-eyed view of the globe’s poverty and development scene. For more deep dives into these topics, explore our articles on the list of african countries, list of european countries, and list of asian countries.

Current Economic Classifications

Getting a handle on the types of economic classifications is key when you’re chewing over the list of third world countries. Heavy hitters like the International Monetary Fund (IMF) and the World Bank have this knack for slotting countries into categories based on cash flow, growth mojo, and how developed they are.

Developing Countries

Far from being stuck in a rut, developing countries, also called emerging or middle-income nations, are on the upswing, hustling to amp up their economies. You’ll see them beefing up infrastructure, cranking up industry, and aiming to bump up the quality of life. They often get a hand from global outfits like the IMF and the World Bank.

When it comes to tagging developing countries, the IMF and World Bank focus on Gross National Income (GNI) per person. You’ll usually find these countries’ GNI per capita bouncing from low to upper-middle incomes. They’re definitely growing and getting stronger economically, but still butting heads with troubles like poverty and dodgy infrastructure.

For a deeper dive into where developing nations stand and how they’re doing, check out the list of developing countries.

Low and Middle-Income Countries

Busting it into smaller bits, low and middle-income countries are sliced into lower-middle and upper-middle income stacks, based on their Gross National Income (GNI) per person.

Low-Income Countries: If a country’s GNI per capita maxes out at $1,045, you’ll see significant hurdles like sketchy access to healthcare, education, and basic services in these places.
Lower-Middle-Income Countries: Clocking a GNI per capita between $1,046 and $4,095, these countries are at the dawn of industrialization and amping up their economic game.
Upper-Middle-Income Countries: With a GNI per capita between $4,096 and $12,695, these places have more polished infrastructures and economies but still wrestle with inequality and similar issues.

Income Group	GNI per Capita (USD)
Low-Income Countries	≤ $1,045
Lower-Middle-Income Countries	$1,046 – $4,095
Upper-Middle-Income Countries	$4,096 – $12,695

Getting a grip on these income bands helps you see the different development paths and the kind of lift they need. Low and middle-income countries are often hustling to juice up their economies by diving into the global trade bandwagon, which has been pretty sweet for cutting poverty. Look at trade in spots like India, Vietnam, and Uganda; it’s driven quicker growth and cut poverty (IMF).

For a closer look at nations by how they stack up economically, visit the list of countries by GDP.

The gap between developing countries and low to middle-income ones lays out a way to make sense of the global economic pecking order and how these nations are moving forward. Having dibs on resources, international aid, and getting into global trading are big in shaping their growth stories.

For more on how countries rank and economic talk, take a spin over to the list of developed countries and the list of countries by HDI.

Trade as a Driver of Development

Trade is like the rocket fuel for economic progress, especially for countries still finding their economic footing. Here’s where we chat about how the World Bank and IMF are in on the action, and how all this trade stuff helps kick poverty to the curb.

Role of World Bank and IMF

The IMF and World Bank are like the financial fairy godmothers for countries trying to level up their game. They hand out funds, strategically, to help these nations get their infrastructure and economic systems in good shape. These organizations have a keen eye for categorizing countries based on their income, signaling the areas most in need of a financial boost (Investopedia).

Here’s what they focus on:

Infrastructure Growth: We’re talking roads, bridges, and getting everyone better connected.
Economic Makeover: They’re all about helping countries tweak policies to keep the economy steady and climbing.
Financial Power-Ups: Tossing in some coins to keep public amenities and social safety nets running smoothly.

Impact on Poverty Reduction

Trade is a game-changer for cutting down poverty in developing countries. Globally, trade has ramped up at an average of 6% each year for over twenty years, way faster than overall world production. These countries are now a hefty piece of the trade pie, going from one-quarter to one-third of global trade since the ’70s.

Trade and Poverty Alleviation:

Nations dipping their toes into global trade have seen a sharp drop in poverty – we’re talking a reduction of over 120 million people (14%) between ’93 and ’98. Places like India, Vietnam, and Uganda know firsthand the magic of trade liberalization as their economies and the people in them benefit from it (IMF).
Knocking down all trade walls could bring in economic boons anywhere between US$250 billion to US$680 billion each year. For developing countries, the gains would count for more, relative to their GDP compared to wealthier nations.

Time Frame	Poverty Reduction Count
1993-1998	120 million people (14%)

We’re seeing these countries switch gears from shipping out just raw stuff to pushing out manufactured products and services. These days, manufactured goods make up a whopping 80% of what they export (IMF).

Agricultural and Manufacturing Impact:

Opening up agricultural markets is gold for industrial countries.
For nations strapped for cash, any easing up on agriculture in richer countries is great news due to how agriculture holds up their economies.
Both manufacturing and farm produce market openings bring benefits all around for these developing nations (IMF).

Getting a handle on how trade and financial handouts from global entities turbocharge development reveals the ever-changing game of global economic progress. Fancy diving deeper? Check out our list of South American countries and list of BRICS countries for some solid insights.

Least Developed Countries (LDCs)

Least Developed Countries (LDCs) make up the club of nations defined by the United Nations as having the lowest levels of social and economic progress. These countries face a mountain of hurdles — think high poverty rates, shaky economies, and limited human resources. Right now, there are 44 LDCs, according to UNCTAD.

Eligibility Criteria

When it’s time to slap an LDC label on a country, the United Nations pulls out three big measures:

Gross National Income (GNI) per Person: The current cutoff for LDC status is a GNI per head of $1,018 or less.
Human Assets Index (HAI): This is where they look at how well people are doing in education (like whether adults can read and how many kids are in high school) and health (such as child death rates and hunger levels).
Economic Vulnerability Index (EVI): The EVI checks out things like how tiny the economy is, how far off the beaten path the country sits, and how likely it is to experience natural disasters.

How it’s Measured	What’s LDC-Level?
GNI per Capita	$1,018 or lower
HAI	Not Good
EVI	Pretty High

These metrics pinpoint countries that need extra hand-holding on the international stage, flagging them for special aid and the possibility of easier trade deals.

Graduation Process

Breaking out of LDC status is a huge leap forward for any country. To achieve this, a nation needs to hit at least two of the three noted criteria in back-to-back reviews every three years.

Assessment: The initial checkup to see how the country stacks up against LDC standards.
Recommendation: If everything looks good, the United Nations Committee for Development Policy (CDP) recommends moving the country up the ranks.
Endorsement and Transition Plan: The Economic and Social Council (ECOSOC) and the UN General Assembly give a thumbs-up. Then comes a three-to-five-year transition to ensure there’s no stumbling during the changeover, with continued access to some perks.

Process Step	What It Involves
Assessment	Check-Up Time
Recommendation	CDP Suggestion
Transition	3-5 Years to Gradually Step Up

Getting upgraded from LDC status means a country has ramped up its game in social and economic areas. This usually opens doors to better trading conditions and invites more investors.

This system of labeling and upgrading strives to keep LDCs on the path to beefed-up economies and sturdier growth. If you’re curious, poke around our other reads on the list of developing countries or the list of countries by GDP for more context.

Contemporary Terminology

Grasping the lingo around different country classifications is like having a cheat sheet to global economics and development. This bit breaks down the terms “Developing Nations” and “Frontier Markets.”

Developing Nations

Developing nations often find themselves in the watchful eyes of international heavyweights like the IMF and the World Bank. These institutions toss out grants and loans to help these countries beef up their infrastructure and finances. They like to label these nations as lower-middle or low-income (Investopedia). The big-ticket item for these places? Economic growth.

A lot of these countries are kicking poverty to the curb and finding their groove with economic stability. Those jumping into the global trade bandwagon—like India, Vietnam, and Uganda between ’93 and ’98—saw a sweet 14% drop in absolute poverty.

Here’s a little chart action on some cool development projects:

Country	Income Category	Major Development Projects
India	Lower-Middle Income	Infrastructure updates, Digital India
Vietnam	Lower-Middle Income	Economy shakeup, Trade boosts
Uganda	Low Income	Farming focus, Better healthcare

Check out our list of developing countries for more juicy details.

Frontier Markets

Frontier markets? They’re the wild west of the developing nations. Think smaller, less crowded, and kinda mysterious compared to the big-shot emerging markets. What’s the allure? They’re packed with potential for major gains.

Investing here is a bit of a daredevil move—high risks but potential jackpot returns as these markets inch towards an economic lift-off. It’s like watching a city skyline go up, brick by brick.

The perks? Jobs galore for folks who otherwise scrape by, and big steps toward slicing down global inequality. The IMF reckons knocking down trade barriers could do developing nations a world of good, even more than the industrialized ones (IMF).

Here’s what’s happening in some frontier locales:

Country	GDP Growth Rate (2021)	Main Industries
Bangladesh	5.5%	Fashion threads, Medicine
Kenya	4.5%	Farming, Safari scenes
Nigeria	2.6%	Oil rigs, Farming

Dive into these frontier markets for the full scoop on their money moves.

Getting clued-up on the developing and frontier territories helps in piecing together the global economic picture. It gives you a sense of where third world countries are headed and the strides they’re making on the global stage.

Benefits of Global Trade

Prosperity in Developing Countries

Folks in developing countries have seen their fortunes change, thanks to global trade. Back in 1990, they were only responsible for about 16% of the exports hitting the international market. But fast forward to 2017, and they’re putting out nearly twice that at 30%. This spike in their export game has not only revved up economic engines in these lands but also chopped down poverty rates across the globe. In the last few decades, an astounding billion people have been lifted out of poverty with some help from trade.

Year	Share of Global Exports	Global Poverty Rate
1990	16%	36%
2017	30%	9%

Opening the doors to global trade has been a game-changer for these nations. Places like India, Vietnam, and Uganda jumped on the trade liberalization bandwagon and sprinted ahead faster in terms of growth and pulling folks out of poverty. Those countries that slashed tariffs in the 80s saw their economies zoom in the 90s more than their reluctant peers.

Reduction of Absolute Poverty

Trade has been a big help in cutting down the number of folks living in absolute poverty. Between 1993 and 1998, as developing countries decided to mingle economically on the global stage, they cut their absolute poverty numbers down by over 120 million, which is roughly a 14% drop. Getting rid of trade shackles allowed these economies to stretch their legs, create jobs, and slash poverty (IMF).

Year	Reduction in Absolute Poverty
1993-1998	120 million people (14%)

Kicking aside all barriers to trade in merchandise could mean a cool $250 billion to $680 billion boost per year. Developing countries, with these new gains, could leap ahead in GDP percentages more than the developed ones. This boost would mean fresh job opportunities, bringing many unskilled workers into the middle class and helping decrease global inequality levels since 1990 (IMF).

Wanna know more? You can delve deeper into these goodies:

list of developing countries
list of countries by gdp
list of developed countries