IMF raises Taiwan's 2025 growth forecast to 3.7%

Taipei, Oct. 15 (CNA) The International Monetary Fund (IMF) has raised its forecast for Taiwan's 2025 economic growth to 3.7 percent, amid stronger-than-expected recovery momentum worldwide.

In its latest World Economic Outlook report released Tuesday, the IMF projected Taiwan's real GDP will grow 3.7 percent in 2025, up from 2.9 percent in its April forecast. However, the 2026 growth forecast was revised downward to 2.1 percent from 2.5 percent.

The report also estimated that Taiwan's consumer price inflation will reach 1.7 percent in 2025, slightly below the April projection of 1.8 percent, and will remain stable at 1.6 percent in 2026.

The unemployment rate is expected to stay at 3.4 percent in both years, according to the report.

The global economy, meanwhile, is expected to expand 3.2 percent in 2025, the IMF said, raising its forecast from 3.0 percent in July.

According to Reuters, the brighter outlook reflects a series of recent trade agreements that helped the United States and several major economies avoid the sweeping tariffs threatened by U.S. President Donald Trump.

IMF Economic Counsellor Pierre-Olivier Gourinchas said the global economy has shown greater resilience than expected, aided by flexible corporate supply chain adjustments, fiscal stimulus in Europe and China, a weaker U.S. dollar, and rising investment in artificial intelligence.

However, the IMF cautioned that a renewed U.S.-China trade conflict could still significantly weigh on global output.

China's growth outlook remains unchanged at 4.8 percent for 2025 and 4.2 percent for 2026, the IMF said, noting that the country's recent export gains may be difficult to sustain.

According to the Directorate-General of Budget, Accounting and Statistics (DGBAS), Taiwan's economy is improving faster than expected, with continued export strength and solid AI-related demand likely to push growth above earlier projections.

Speaking at a legislative hearing on Wednesday, DGBAS Minister Chen Shu-tzu (陳淑姿) noted that the economic situation has improved in recent months.

The DGBAS' previous forecast of 4.45 percent growth for 2025 "was probably an underestimate," she said.

AI-driven demand continues to boost exports and investment, which suggests that Taiwan's actual growth next year could surpass 4.5 percent, she said.