AI Is Rewriting the Growth Model for Emerging Markets and Developing Economies (EMDEs) and Putting Education at the Center - FII Institute

AI and Growth in Emerging Economies

The Future Investment Initiative Institute has published a new report, *AI-Led Growth and Jobs in Emerging Markets and Developing Economies (EMDEs)*, during FII PRIORITY Miami 2026. The report, authored by Dr. Jeffrey D. Sachs, is part of the institute’s AI series produced in collaboration with the Center for Sustainable Development at Columbia University.

The report examines how artificial intelligence is reshaping development pathways across emerging markets and developing economies. It argues that AI is shifting growth away from traditional low-cost labor models and toward higher productivity, stronger human capital, and faster expansion in services.

According to the report, labor-intensive manufacturing is no longer likely to be the main route to development for many emerging economies. Instead, future growth is expected to come from AI-enabled gains in agriculture, mining, commodity-based manufacturing, green energy, and modern services.

Key Findings

The report says growth and employment will increasingly come from different sectors. While GDP growth may be driven by more capital-intensive industries, most job creation is expected to come from construction, healthcare, education, tourism, public administration, and other services. It describes this as a growing divide between the sectors that generate output and those that create jobs.

Education is identified as the highest-return investment in the AI era. The report says AI can improve teaching and learning outcomes, but argues that large-scale investment in teachers, training, and access to quality education remains essential.

It also highlights the creative economy as a major future source of jobs and exports. Film, music, fashion, design, and other creative industries are described as labor-intensive and globally tradable sectors that AI can strengthen.

Policy and Regional Opportunities

The report stresses that public policy will determine whether AI supports shared prosperity. It says AI alone will not guarantee inclusive growth and calls for integrated government strategies spanning education, urban development, fiscal policy, service delivery, and natural-resource management.

The report also points to opportunities in Latin America, especially in creative industries and green energy. It identifies the region as having strong untapped potential in an AI-shaped global economy.

A link to the report is available here: AI-Led Growth and Jobs in Emerging Markets and Developing Economies.