Think tank expects Taiwan's GDP growth to top 10% in 2026

Taipei, July 21 (CNA) The Taiwan Institute of Economic Research (TIER), one of the leading think tanks in the country, said Tuesday Taiwan's gross domestic product (GDP) growth will top 10 percent in 2026, citing strong export performance during the current AI boom.

Speaking with reporters on the sidelines of an economic forum held by the think tank, TIER President Chang Chien-yi (張建一) said the research institute will release an updated Taiwan GDP growth forecast Friday forecasting growth in excess of 10 percent this year as "exports are strong."

In late April, TIER raised its forecast for Taiwan's GDP growth to 7.56 percent for 2026, an upgrade of 3.51 percentage points from an estimate made in January.

TIER appears more upbeat than the Directorate General of Budget, Accounting and Statistics, which forecast in late May that Taiwan's economy will grow 9.64 percent in 2026.

Last week, Academia Sinica raised its forecast of Taiwan's GDP growth from 3.71 percent to 10.16 percent, the highest among the local major research institutions.

Explosive global demand for AI applications has created tremendous business opportunities, Chang said.

During the AI era, production capacity for AI-related chips such as graphics processing units (GPUs) and tensor processing units (TPUs) has been fully utilized, he added.

In addition, AI services such as assembly services are also in high demand as supplies of contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC) advanced IC assembly services -- particularly Chip-on-Wafer-on-Substrate (CoWoS) technology -- are tight, Chang said.

At an investor conference held on July 16, TSMC raised its capital expenditure plan to a range of US$60.0 billion-US$64.0 billion for 2026, an increase from its previous estimate of US$52.0 billion-US$56.0 billion in mid-April. TSMC said the higher capex aims to meet robust global demand.

"There is no question that business opportunities created by AI will continue," Chang said. "Such an uptrend will continue into 2028."

"I expect Taiwan will also see strong economic growth next year," he noted.

The recent sell-off among AI stocks in global markets came from growing concerns over an AI bubble. "Although some startups could go broke, the AI industry itself will continue to grow," he said.

Addressing the TIER economic forum, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said Taiwan can serve not only as a provider of AI hardware but also a provider of AI services.

The government aims to cultivate 500,000 AI experts by 2040 to allow the technology to be used in all business sectors, thereby boosting Taiwan's competitive edge in the global market, Kung said.