Taiwan’s economy is expected to have grown faster in the first quarter, driven by an increase in exports fueled by demand for technology used in artificial intelligence (AI) applications. Economists predict that Gross Domestic Product (GDP) likely expanded by 5.65% year-on-year during January-March, higher compared to the 4.93% year-on-year growth in the fourth quarter of 2023.
The growth forecast for GDP varies among economists, with expectations ranging from 4.2% to as high as 7%. The increase in exports during the first quarter was particularly notable, with a 12.9% year-on-year increase compared to the previous quarter’s growth of only 3.4%. Taiwan’s tech-heavy exporters, such as chipmakers, benefited greatly from this demand for AI technology.
Analysts suggest that Taiwan’s manufacturing sector is regaining strength due to strong export performance and low unemployment rates, contributing to a positive economic outlook. The government’s statistics bureau has raised its forecast for full-year GDP growth from a previous prediction of 3.35% to 3.43%. Last year, Taiwan’s economy grew by only 1.31%, its slowest pace in over a decade.
China’s robust economy also played a significant role in supporting Taiwan’s economic performance as China remains Taiwan’s largest export market. As a crucial player in the global technology supply chain, Taiwan caters to companies like Apple and Nvidia and hosts significant firms such as Taiwan Semiconductor Manufacturing Co., making it an important contributor to the global tech industry.
Preliminary GDP data will be released soon, providing more detailed insights into Taiwan’s economic performance during the first quarter, including forecasts for future quarters and years to come.
Taiwan’s trade-dependent economy is expected to have grown faster than anticipated in the first quarter of this year due to an increase in exports driven by demand for technology used in artificial intelligence (AI) applications according to a Reuters poll.
Economists predict that Gross Domestic Product (GDP) likely expanded by around 5.65% year-on-year during January-March, higher than last year’s slowest pace of growth of just 1.31%, which was recorded over a decade ago.
The growth forecast for Q1 GDP varies among economists but ranges from around 4.2% upwards while low unemployment rates contribute positively towards economic prospects.
The manufacturing sector is regaining strength thanks to strong export performance and low unemployment rates while chipmakers are among those benefiting from increased demand for AI technology.
Taiwan remains critical player globally due its contributions towards various companies such as Apple and Nvidia while hosting significant firms like TSMC.