Taiwan's 2025 economic growth to reach 15-year high: Academia Sinica

Taipei, Dec. 22 (CNA) Taiwan is projected to record its strongest economic growth in 15 years, fueled by surging global demand for AI technology, Academia Sinica said Monday.

The top academic research institute in Taiwan forecast a 7.41 percent growth rate for 2025 -- up 4.48 percentage points from its July prediction -- at a press conference in Taipei.

That figure is higher than all other recent projections made by major research institutions both in Taiwan and abroad.

It surpasses the 7.40 percent projected by the Cathay Financial Holdings-National Taiwan University research team last week and the 7.20 percent forecast by J.P. Morgan earlier this month.

Peng Shin-kun (彭信坤), a distinguished research fellow at the research institute, noted that the projected 15-year high stems primarily from the expansion of the semiconductor and information and communications technology (ICT) sectors.

The surge follows reports in late November that Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, plans to build three additional 2-nanometer process factories in southern Taiwan.

Earlier the same month, Jensen Huang (黃仁勳), founder of American technology company Nvidia, visited Taiwan to secure increased chip supply.

However, Peng cautioned that this robust growth masks a significant decline in traditional industries.

The institute added that the projection remains subject to several variables, including U.S. currency and trade policies, geopolitical changes, supply chain shifts, and the ongoing evolution of AI and other emerging technologies.

Asked how long the AI market's momentum might last, Academia Sinica economist Lin Chang-ching (林常青) said the longevity of the boom depends on how effectively AI can be integrated into various sectors to form a comprehensive "AI industry."

Growth is expected to continue in 2026, though a high comparison base is likely to moderate the annual growth rate to 3.71 percent, the institute said.