The Directorate-General of Budget, Accounting and Statistics (DGBAS) yesterday sharply raised its GDP growth forecast for this year from 4.45 percent to 7.37 percent, the fastest expansion in 15 years, thanks to strong global demand for electronics used in artificial intelligence (AI) applications.
The revised outlook marks the best performance since 2009 and represents a 2.92 percentage point jump from the agency’s August estimate, driven overwhelmingly by technology exports linked to AI, and new-generation smartphones and other mobile devices.
“The upgrade reflects much stronger second-half showings than previously projected,” DGBAS Minister Chen Shu-tzu (陳淑姿) said.
Photo: CNA
The economy grew 8.21 percent year-on-year in the third quarter, better than a 7.64 percent increase indicated in last month’s advance report, she said, adding that the outperformance stemmed mainly from aggressive capital spending by US hyperscale cloud companies on AI-related hardware, which benefited local suppliers.
These investments boosted third-quarter exports by 36.49 percent, while imports climbed 24.91 percent, as domestic tech manufacturers increased purchases of raw materials and equipment to satisfy customer needs, Chen said.
In all, external trade contributed 7.57 percentage points to third-quarter growth, the strongest contribution since 2008.
Meanwhile, private consumption provided only limited support, with household spending rising by 1.19 percent in the third quarter, and modest growth in domestic tourism and higher stock market turnover partly offset by sluggish retail and restaurant activity along with weak car sales, the DGBAS said.
Taiwanese spent 7.59 percent more on overseas travel, while domestic tourism spending rose only 0.76 percent, it added.
The economic growth momentum is expected to carry into the current quarter.
The DGBAS said it is looking at a fourth-quarter growth of 7.91 percent, far exceeding the previous projection of 1.61 percent.
Exports are forecast to surge 36.84 percent during the October-to-December period to US$172.3 billion, supported by sustained global demand for AI servers, chips and related components, it said.
Despite the rapid acceleration in output, inflation would remain well-controlled, it said.
The consumer price index is expected to rise 1.67 percent this year and 1.61 percent next year, helped by soft global oil prices and mild food inflation, the DGBAS said.
The agency also said it expects GDP growth to moderate to 3.54 percent next year, as global trade growth would slow to 2.3 percent from 3.6 percent this year.
Exports could reach US$664.4 billion next year, 6.32 percent higher than this year’s exceptionally high base, the DGBAS said, adding that Taiwan is well-positioned to outperform as AI adoption deepens, sovereign AI initiatives expand, global hardware demand remains solid and new advanced semiconductor capacity comes online.
Conflict with Taiwan could leave China with “massive economic disruption, catastrophic military losses, significant social unrest, and devastating sanctions,” a US think tank said in a report released on Monday. The German Marshall Fund released a report titled If China Attacks Taiwan: The Consequences for China of “Minor Conflict” and “Major War” Scenarios. The report details the “massive” economic, military, social and international costs to China in the event of a minor conflict or major war with Taiwan, estimating that the Chinese People’s Liberation Army (PLA) could sustain losses of more than half of its active-duty ground forces, including 100,000 troops. Understanding Chinese
The Ministry of Foreign Affairs (MOFA) yesterday said it is closely monitoring developments in Venezuela, and would continue to cooperate with democratic allies and work together for regional and global security, stability, and prosperity. The remarks came after the US on Saturday launched a series of airstrikes in Venezuela and kidnapped Venezuelan President Nicolas Maduro, who was later flown to New York along with his wife. The pair face US charges related to drug trafficking and alleged cooperation with gangs designated as terrorist organizations. Maduro has denied the allegations. The ministry said that it is closely monitoring the political and economic situation
UNRELENTING: China attempted cyberattacks on Taiwan’s critical infrastructure 2.63 million times per day last year, up from 1.23 million in 2023, the NSB said China’s cyberarmy has long engaged in cyberattacks against Taiwan’s critical infrastructure, employing diverse and evolving tactics, the National Security Bureau (NSB) said yesterday, adding that cyberattacks on critical energy infrastructure last year increased 10-fold compared with the previous year. The NSB yesterday released a report titled Analysis on China’s Cyber Threats to Taiwan’s Critical Infrastructure in 2025, outlining the number of cyberattacks, major tactics and hacker groups. Taiwan’s national intelligence community identified a large number of cybersecurity incidents last year, the bureau said in a statement. China’s cyberarmy last year launched an average of 2.63 million intrusion attempts per day targeting Taiwan’s critical
‘SLICING METHOD’: In the event of a blockade, the China Coast Guard would intercept Taiwanese ships while its navy would seek to deter foreign intervention China’s military drills around Taiwan this week signaled potential strategies to cut the nation off from energy supplies and foreign military assistance, a US think tank report said. The Chinese People’s Liberation Army (PLA) conducted what it called “Justice Mission 2025” exercises from Monday to Tuesday in five maritime zones and airspace around Taiwan, calling them a warning to “Taiwanese independence” forces. In a report released on Wednesday, the Institute for the Study of War said the exercises effectively simulated blocking shipping routes to major port cities, including Kaohsiung, Keelung and Hualien. Taiwan would be highly vulnerable under such a blockade, because it
RSS