Taiwan GDP growth forecast hits 15-year high on surge in AI demand

Taiwan's tech-heavy economy is expected to grow at its fastest pace in 15 years, riding the wave of demand for artificial intelligence (AI) technology, the statistics office said on Friday, though US tariffs are likely to cloud the outlook next year.

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Gross domestic product (GDP) is expected to expand by 7.37% this year, much better than the 4.45% pace it predicted in August and a level not seen since the 10.25% posted in 2010, said the Directorate General of Budget, Accounting and Statistics.

Taiwan plays a pivotal role in the global AI supply chain for companies such as Nvidia and Apple. Its position is anchored by the world's largest maker of chips used in AI applications, Taiwan Semiconductor Manufacturing (TSMC).

"The growth beat expectations on strong demand for AI servers as US CSP (cloud service providers) continued to intensify their competition," said analyst Kevin Wang of Taishin Investment Advisory.

The agency, however, is cautious about the GDP growth outlook in 2026 over concerns about the impact of US tariffs.

Taiwan's exports to the United States are subject to a 20% tariff, which Taipei is in talks to reduce, though semiconductors are currently excluded.

"Tariffs was not a big impact for this year, but it remains an uncertainty for next year," the agency said. For 2026, the statistics office raised its GDP growth forecast to 3.54%, above its earlier projection of 2.818.