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.
NEW MARKET: The partnership opens up India to the Dutch company, which already has a strong hold in the semiconductor market of South Korea, Taiwan and China ASML Holding NV entered into a partnership agreement with Tata Electronics Pvt Ltd aimed at ramping up India’s goal to develop domestic chip-manufacturing capabilities. The Dutch company’s technology would help power Tata Electronics’ planned 300 millimeter (mm) semiconductor foundry in Gujarat, according to a joint statement from the two companies on Saturday. The signing of a memorandum of understanding coincides with a visit by Indian Prime Minister Narendra Modi to the Netherlands, which is looking to deepen bilateral relations with New Delhi. ASML, whose top customers include Taiwan Semiconductor Manufacturing Co (台積電) and Samsung Electronics Co, makes lithography machines that can print
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
TECH RELIANCE: Growth is increasingly reflecting an unequal K-shaped distribution, where technology sectors outperform and other industries struggle, an expert said Standard Chartered Bank has significantly raised its forecast for Taiwan’s economic growth to 9.5 percent this year, up from 7.6 percent previously, citing surging artificial intelligence (AI) demand driving exports, semiconductor production and investment. The upgrade reflects a sustained AI supercycle that continues to fuel demand for advanced chips and technology infrastructure, which form the backbone of Taiwan’s exports, the bank said in a report this week. “We raise our 2026 growth forecast to reflect a much stronger-than-expected first-quarter GDP figure,” Standard Chartered senior economist for greater China and Asia Tommy Wu (胡東安) said in the report. Driven largely by a 35.3 percent
Two of Taiwan’s international carriers, Starlux Airlines Co (星宇航空) and EVA Airways Corp (長榮航空), have retained the five-star airline rating awarded by international airline review organization Skytrax. Starlux was awarded the distinction for a second consecutive year, while EVA Air received it for the 11th straight year, Skytrax said in statements released yesterday and on Thursday last week, respectively. The five-star rating is considered one of the airline industry's highest honors and is awarded following professional audits of airline product and frontline service standards, Skytrax said. The ratings are based on in-depth assessments using unified global quality standards rather than customer review scores
RSS