Fixed investment in Taiwan passed NT$6 trillion (US$196.54 billion) for the first time last year, up more than 6 percent from a year earlier, with semiconductor suppliers planning to expand production and upgrade technologies, and as many firms join the rush to invest in 5G applications, the Ministry of Economic Affairs said in a report on Wednesday last week.
The increase reflected moves by Taiwanese firms with overseas operations to invest in Taiwan amid escalating tensions between the US and China.
Fixed investments — referring to physical assets such as machinery, land, buildings, installations, vehicles and technologies — totaled NT$6.27 trillion last year, up 6.2 percent from a year earlier, adjusted for inflation, the report said.
Photo: Ritchie B. Tongo, EPA-EFE
From 2018 to last year, fixed investment in Taiwan grew at a compound annual growth rate of 8.2 percent, well beyond the 3.3 percent experienced from 2013 to 2017, the report said.
Fixed investments last year accounted for 27.6 percent of local GDP, up from 26.1 percent in 2021.
With investment in Taiwan on the rise, the ratio was at its highest since 1994, the report said.
Local fixed investments comprised 21.8 to 27.6 percent of national GDP from 2018 to last year, compared with 21.1 to 22.7 percent from 2013 to 2017, with the higher ratio over the past five years depicting fixed investment as a local economic growth driver, it said.
Semiconductor suppliers last year poured about US$36.3 billion into production equipment imports, up 13.1 percent from a year earlier, the report said.
That amount accounted for 48.3 percent of capital equipment imports, a record indicating that tech companies are looking to expand production and upgrade technology.
The ministry said the private sector serves as a major source of fixed investment in Taiwan.
Since 2014, private companies have accounted for more than 80 percent of Taiwan’s fixed investments, it said.
From 2021 to last year, the private sector accounted for 84.6 percent of total investment in the wake of an investment surge by the semiconductor industry, while the public sector accounted for just 15.4 percent last year, the ministry said.
Enterprises in Taiwan could scale back their investments this year amid global economic uncertainty, it said.
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