Taiwan’s economy is expected to have grown at a faster pace in the first quarter of the year, driven by an increase in exports and strong demand for technology used in artificial intelligence applications. According to a Reuters poll of 18 economists, Gross Domestic Product (GDP) is projected to have expanded by 5.65% compared to the same period last year. This growth follows a 4.93% increase in GDP during the fourth quarter of the previous year.
Taiwan’s tech-heavy industries, particularly chipmakers, capitalized on the rising demand for AI technology and led to a resurgence of the manufacturing sector in Taiwan. As a result, unemployment rates have remained low due to this surge in exports.
Analysts predict that the first quarter will see the highest GDP growth for the year, with a slight dip to around 3.5% in the second quarter. The government has raised its forecast for full-year growth in 2024 to 3.43%, up from an initial prediction of 3.35%. This comes after a year where the economy expanded by 1.31%, which was the slowest pace in 14 years.
Taiwan’s largest export market, China, also experienced faster-than-expected growth in the first quarter, expanding by 5.3% year-on-year. Taiwan plays a crucial role in the global technology supply chain, serving companies like Apple and Nvidia, and housing the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co., which has been experiencing rapid growth itself due to increasing demand for AI technology.
The preliminary GDP data for Taiwan will be released shortly with limited commentary followed by revised figures with more detailed analysis and future projections later on.
Overall, despite some uncertainties regarding trade tensions between China and other countries as well as geopolitical issues affecting Taiwan directly or indirectly such as North Korea’s nuclear weapons program or tensions with Iran over nuclear proliferation issues