Taiwan's GDP growth forecast raised to 7.71% for 2026

Taipei, Feb. 13 (CNA) Taiwan's government has raised its forecast for 2026 gross domestic product (GDP) growth to 7.71 percent on the back of robust global demand for artificial intelligence applications and the removal of tariff uncertainties, the Directorate General of Budget, Accounting and Statistics (DGBAS) said Friday.

The DGBAS upgraded its 2026 GDP growth forecast sharply from the previous estimate of 3.54 percent in November by 4.17 percentage points.

Speaking with reporters, DGBAS Minister Chen Shu-tzu (陳淑姿) said despite a relatively high comparison base in 2025, when Taiwan's economy grew at a pace of 8.63 percent, the highest in 15 years, GDP will continue to grow significantly this year.

With the local economy remaining stable, the performance will still be extremely high in 2026, Chen said.

Echoing Chen, Tsai Yu-tai (蔡鈺泰), head of the DGBAS's Department of Statistics said strong global demand for AI devices has continued to boost the local export-oriented economy, while a trade deal with the United States has removed uncertainties faced by Taiwanese semiconductor and related tech firms.

The DGBAS has forecast Taiwan's exports of merchandise and services in 2026 will grow 12.68 percent from a year earlier, an upgrade of 7.84 percentage points from the earlier estimate. In addition, imports are expected to grow 9.06 percent, up 4.74 percentage points from the previous estimate.

Many semiconductor firms appear to have expanded production and upgraded their technologies to meet solid global demand for AI by making large investments in Taiwan, Tsai said.

According to the DGBAS, private investment in Taiwan is expected to grow 4.24 percent from a year earlier in 2026, up 2.51 percentage points from the previous estimate, while fixed capital formation is expected to grow 4.08 percent, up 1.91 percentage points from the earlier figures.

The DGBAS said with many employers raising wages for their employees and a high-flying stock market pushing up household disposable income, private consumption in Taiwan is expected to grow 2.51 percent from a year earlier, up 0.08 percentage points from the previous estimate.

In terms of inflation, the DGBAS said the local consumer price index is expected to grow 1.68 percent, up 0.07 percentage points from the previous estimate but still below the 2 percent alert level set by the central bank.

If global cloud services providers such as Meta and Goolge's parent Alphabet carry out their capital expenditure budgets as planned during the current AI boom, it is possible the DGBAS could raise its forecast of Taiwan's GDP growth even further, Tsai said.

In addition, the DGBAS has forecast local GDP will top US$1 trillion this year with GDP per capital expected to hit US$44,181.