Taiwan's economic growth to slow to 2.4% in 2026: Rating agency

Taipei, Dec. 16 (CNA) Taiwan's economic growth will slow to 2.4 percent in 2026 amid shrinking investments in artificial intelligence, local credit rating agency Taiwan Ratings Corp. said Tuesday.

At a press conference announcing the firm's 2026 outlook, Taiwan Ratings Chief Analyst Hsu Chih-ching (許智清) said economic growth would slow across the Asia-Pacific next year, driven by factors such as U.S. tariffs, weak Chinese consumer demand and trade-related uncertainty.

Moreover, a weakening U.S. dollar will push Asian currencies higher. Combined with expected U.S. interest rate cuts, this could lead Asian central banks to continue cutting rates to support economic growth, Hsu said.

As for Taiwan, Hsu said the agency forecasts a growth rate of 6.7 percent in 2025 and 2.4 percent for 2026, with the dropoff mainly caused by slowing investments in AI infrastructure.

"While AI-driven export growth has supported Taiwan's economic growth, the risk of economic over-concentration needs to be monitored," Hsu said.

With the current frenzy around AI likely to weaken, consumer spending and investments will be unable to make up for the impact of lower economic growth, making it hard to sustain 2025 levels of economic growth, Hsu added.

Taiwan Ratings is a subsidiary of S&P Global Ratings.