Taiwan posts 3.97% year-on-year GDP growth in Q3

Taipei, Oct. 31 (CNA) Taiwan's gross domestic product (GDP) in the third quarter of 2024 grew by roughly 3.97 percent year-on-year, higher than an earlier forecast of 3.21 percent made in August, preliminary government data showed.

The better-than-anticipated growth is largely due to strong exports fueled by global AI demand, the Directorate General of Budget, Accounting and Statistics (DGBAS) said in a report on Thursday.

The figure is 0.76 percentage points higher than an earlier forecast made in August, the DGBAS said, adding that the revised estimate brings the country's expected growth for the whole of 2024 to 4.10 percent, a 0.2 percentage point increase from the previous projection.

DGBAS specialist Wang Tsui-hua (王翠華) said the performance is due to a strong increase in exports of electronic, information and communication technology (ICT) driven by robust demand for emerging technologies.

Strong demand in high-tech industries also helped boost manufacturers' confidence and was conducive to private investment. The DGBAS estimates that capital formation (including government, public and private fixed investment and inventory changes) grew by 15.27 percent in real terms, an increase of 0.18 percentage points from the previous projected figure.

Statistical data also showed that the semiconductor industry has been accelerating investment in response to future demand, Wang said.

The Taiwan dollar-denominated value of imported semiconductor equipment in the second quarter rose 11.72 percent from a year earlier, and grew 31.41 percent in the third quarter year-on-year.

However, Wang noted that the recovery of local manufacturers has been uneven, especially in old-economy industries. As global end-user demand has not yet fully recovered and there is also an overcapacity problem, both supply and demand are under pressure, leading to a slower-than-expected pace of recovery in the manufacturing sector.

In terms of domestic demand, the DGBAS anticipates private consumption will grow 1.92 percent in the third quarter, a decrease of 0.39 percentage points from the previous forecast.

Wang attributed the fall to the high base of comparison last year.