The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday revised down its forecast for the nation’s GDP growth this year, but said it expected the figure to remain above 2 percent as robust capital spending helps mitigate the pain of slower exports.
The institute now expects the economy to expand by 2.06 percent, down from its previous forecast of 2.15 percent.
“The nation’s economic growth might stay above the 2 percent mark, as it improves each quarter,” following a lackluster 1.7 percent increase in the first half, CIER president Chen Shi-kuan (陳思寬) said.
The second half is usually the high season for consumer electronic devices, which should benefit Taiwanese companies in their global supply chains.
Fixed investment, led by technology firms, is expected to lift GDP growth this year by 1.21 percentage points with a 6.36 percent expansion, the Taipei-based think tank said in its quarterly report.
Imports of capital equipment rose 15.7 percent in the first half, with semiconductor equipment swelling 40.28 percent in US dollar terms, the institute said.
The government and public enterprises should help boost the economy, with investments rising 10.15 percent and 7.5 percent respectively, as exports take a hit from the US-China trade dispute, it said.
Exports, normally the main growth driver, is forecast to swing to growth from this quarter, advancing by 3.13 percent and 6.03 percent in the third and fourth quarters respectively, it said.
The critical GDP component contracted 4.24 percent and 2.56 percent in the first and second quarters due to uncertainty and a seasonal slowdown.
For the full year, exports are expected to edge up 0.7 percent, while imports are forecast to rise 1.79 percent, thanks in part to Taiwanese businesses moving back from China, the institute said.
The government has received more than 80 such applications, bringing more than NT$400 billion (US$12.87 billion) in prospective investments.
More than 60 percent of Taiwanese companies maintain factories or operations in China and 60 percent have taken measures to cope with tariff hikes, CIER said, adding that nearly 19 percent are considering moving back to Taiwan.
The trade dispute topped the list of concerns among local firms, followed by currency volatility, and wild swings in global crude oil and raw material prices, it found.
Local firms have to watch out for Chinese yuan movements as it seeks to replace the US dollar in global trade, Yuanta-Polaris Research Institute (元大寶華綜經院) president Liang Kuo-yuan (梁國源) said.
CHIP RACE: Three years of overbroad export controls drove foreign competitors to pursue their own AI chips, and ‘cost US taxpayers billions of dollars,’ Nvidia said China has figured out the US strategy for allowing it to buy Nvidia Corp’s H200s and is rejecting the artificial intelligence (AI) chip in favor of domestically developed semiconductors, White House AI adviser David Sacks said, citing news reports. US President Donald Trump on Monday said that he would allow shipments of Nvidia’s H200 chips to China, part of an administration effort backed by Sacks to challenge Chinese tech champions such as Huawei Technologies Co (華為) by bringing US competition to their home market. On Friday, Sacks signaled that he was uncertain about whether that approach would work. “They’re rejecting our chips,” Sacks
NATIONAL SECURITY: Intel’s testing of ACM tools despite US government control ‘highlights egregious gaps in US technology protection policies,’ a former official said Chipmaker Intel Corp has tested chipmaking tools this year from a toolmaker with deep roots in China and two overseas units that were targeted by US sanctions, according to two sources with direct knowledge of the matter. Intel, which fended off calls for its CEO’s resignation from US President Donald Trump in August over his alleged ties to China, got the tools from ACM Research Inc, a Fremont, California-based producer of chipmaking equipment. Two of ACM’s units, based in Shanghai and South Korea, were among a number of firms barred last year from receiving US technology over claims they have
It is challenging to build infrastructure in much of Europe. Constrained budgets and polarized politics tend to undermine long-term projects, forcing officials to react to emergencies rather than plan for the future. Not in Austria. Today, the country is to officially open its Koralmbahn tunnel, the 5.9 billion euro (US$6.9 billion) centerpiece of a groundbreaking new railway that will eventually run from Poland’s Baltic coast to the Adriatic Sea, transforming travel within Austria and positioning the Alpine nation at the forefront of logistics in Europe. “It is Austria’s biggest socio-economic experiment in over a century,” said Eric Kirschner, an economist at Graz-based Joanneum
BUBBLE? Only a handful of companies are seeing rapid revenue growth and higher valuations, and it is not enough to call the AI trend a transformation, an analyst said Artificial intelligence (AI) is entering a more challenging phase next year as companies move beyond experimentation and begin demanding clear financial returns from a technology that has delivered big gains to only a small group of early adopters, PricewaterhouseCoopers (PwC) Taiwan said yesterday. Most organizations have been able to justify AI investments through cost recovery or modest efficiency gains, but few have achieved meaningful revenue growth or long-term competitive advantage, the consultancy said in its 2026 AI Business Predictions report. This growing performance gap is forcing executives to reconsider how AI is deployed across their organizations, it said. “Many companies
RSS