Taiwan’s economy exhibited its strongest quarterly growth in nearly three years during the first quarter of 2024, with a notable 6.51% increase in GDP, outperforming the anticipated 5.65% forecast by analysts? Reuters reported. This surge is largely attributed to robust exports, particularly in the technology sector, driven by escalating global demand for artificial intelligence applications.
As a vital player in the global technology supply chain, Taiwan houses major firms like Apple and Nvidia, along with the world’s leading contract chipmaker, Taiwan Semiconductor Manufacturing Co. (TSMC). These connections have positioned Taiwan at the forefront of the AI technology wave, significantly benefiting its export-driven economy.
The first-quarter performance marks the quickest pace of growth since the second quarter of 2021 when the GDP expanded by 8.07%. According to Yen Chen-hui, an economist at Yuanta Securities, this strong start to the year suggests that Taiwan’s full-year economic growth could surpass initial projections, potentially reaching or even exceeding 4%.
The quarter-on-quarter figures also showed resilience with a seasonally adjusted annual growth rate of 1.13%. Furthermore, year-on-year exports for the first quarter jumped by 12.9%, a significant increase from the 3.4% growth seen in the last quarter of 2023. This boom in exports underscores Taiwan’s pivotal role in meeting the burgeoning demand for AI-driven technologies.
Despite the positive economic data, the ongoing performance of Taiwan’s main trading partner, China, remains a variable, with recent indicators suggesting a possible slowdown. Taiwan’s statistics agency plans to release revised GDP figures soon, which will provide a more detailed view of the economic outlook and potential impacts on future growth.
Amidst these developments, Taiwan’s main stock index has seen a nearly 14% increase this year, largely fueled by optimistic prospects for the tech sector, highlighting investor confidence in Taiwan’s continued economic resilience and growth potential.
