Economy of Taiwan

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GDP

2024

4.3% rise thanks to chip manufacturing

At the end of 2024 GDP Taiwan , it increased by 4.3% - this is the maximum growth in three years. Significant positive dynamics is largely due to the production of chips, including for systems. artificial intelligence Economic indicators are provided in the report of the General Directorate for Budget, Accounting and Statistics (Taiwan DGBAS), published on January 24, 2025.

It is noted that in the first quarter of 2024, Taiwan's annual GDP growth was at 6.64%. In the second quarter of the same year, an increase of 4.89% was noted. The third and fourth quarters showed gains of 4.17% and 1.84%, respectively. Thus, during 2024, the growth of the country's economy gradually slowed down.

Taiwan

Thanks to the sustainable development of artificial intelligence, high demand for information and communication products and microchips, Taiwan's exports rose 8.54% year-on-year in 2024, it said. At the same time, imports increased by 11.62%.

The rate of increase in consumer spending in 2024 was recorded at 2.79% against 7.9% in 2023. Year-on-year government spending increased by 2.5%, while a year earlier growth was 0.42%. Investments in fixed assets increased by 12.13% against a decrease of 10.13% at the end of 2023. It is said to increase investments in equipment, construction and intellectual property products.

Analysts stress that Taiwan's economy could face uncertainties in 2025, driven by the president's new policies. USA Donald Trump According to Taishin Investment Advisory analyst Kevin Wang, this could largely affect the investment plans of Taiwanese companies.^[1]

Growth of 6.51% in the first quarter due to the take-off of exports of equipment for AI

Taiwan's economy is growing at its fastest pace since 2021 thanks to an artificial intelligence boom.

GDP grew by 6.51% in the first quarter, exceeding economists' forecasts of 6%.

Exports of AI equipment have been a major driver of growth.

2023: The fall in GDP by 3.02% in the first quarter is an anti-record since 2009.

GDP in the first quarter of 2023 fell by 3.02% compared to the same period last year. Economists polled by Bloomberg had forecast a 1.25% drop.

Taiwan's economy shrank at its fastest pace since 2009, recording a second straight quarter of declines as falling global chip demand shows no signs of weakening.

Taiwan fell into recession due to falling global demand for consumer electronics and problems in major global markets.

The tech sector makes up 30% of Taiwan's economy, and its factories produce nearly two-thirds of the world's computer chips.

2022

Taiwan GDP up 2.4%

On January 18, 2023, the General Directorate for Budget, Accounting and Statistics of Taiwan (DGBAS) published data on GDP growth in the country. It is reported that the pace of development of the state economy has slowed down.

At the end of 2022, Taiwan's GDP increased by 2.43%. This is the minimum increase since 2016, when the figure rose 2.17%. The result did not meet the expectations of analysts who said an average increase of 3.06%. The reduction in the pace of development of the country's economy is due to the difficult geopolitical situation. Fast-growing inflation on a global scale and aggressive interest rate hikes by the world's largest banks have hurt demand in all regions and led to food inventory adjustments in many industries, it said. The outbreak of COVID-19 in China also had a negative impact on consumption and interrupted production activities.

Taiwan's exports (products and services) rose 2.57% in 2022, while imports increased 4.59%. Consumer spending climbed 3.36% year-on-year. The public sector recorded a 2.69% increase in costs.

DGBAS documents said investment in manufacturing equipment and intellectual property continues to grow, however investment in transport equipment has decreased. Taiwan's imports were affected by slowing global demand. In addition, a decrease in commodity prices was recorded, which increased pressure on the cost of imports into the country. However, after the easing of restrictions associated with the COVID-19 pandemic, activity in the consumer sector increased. At the beginning of 2023, according to the Taiwan Ministry of Economy, manufacturers sought to adjust product supplies: this is expected to lead to a decrease in inventory.^[2]

GDP estimate - $0.8 trillion

GDP size forecast - $0.84 trillion

2021: GDP size - $0.79 trillion

2019: GDP $590 billion or $24,600 per capita

Sovereign Wealth Fund

Inflation

2022: Record inflation since 2008

Consumer inflation in Taiwan hit its highest level in 14 years (3.59%) in June.

National debt

2023: State debt - 27% of GDP

Industrial production

2023: Decline of 14.5% in March amid weak global demand

Industrial production in Taiwan decreased by 14.5% in March 2023 compared to a year earlier, the decline was the largest reduction since May 2009 - immediately after the global financial crisis - for any month except January and February (these months are often distorted by the Lunar New Year holiday).

Semiconductor manufacturing

2024: $16 billion earmarked for semiconductor industry

2022: Supporting the Trend of Innovative Manufacturing Transit in the United States

TSMC has established a complete supply chain for the closed-loop production of semiconductors. TSMC's net profit for the 12 months at the end of September 2022 increased by 45% compared to the previous same period^[3], and in 2023, analysts from the Institute for Information Industry predict the growth of the Taiwanese chip industry by 1,^[4]

Nevertheless, to maintain profitability, Taiwanese manufacturers are forced to support the trend of transit of innovative production in the United States. So, at the opening ceremony of the TSMC plant in Phoenix, Arizona, in December 2022, the founder of the company M. Chang announced the growth of investments to $40 billion and the launch in 2026 of the second factory for the production of chips 5-nm and 3-nm.

Taiwan is counting on US funding for its "friendship" projects. However, there is a great risk that large manufacturers such as Intel will impose on the Chinese the struggle to diversify production and at the same time attempt to lure TSMC personnel. In addition, the company's management admits that the transit of capacity will entail an increase in the cost of products by 55%^[5]. Thus, the issue of maintaining profitability for Taiwanese chipmakers not only persists, but will also worsen as large projects are implemented by global competitors.

2021: TSMC makes up to 92% of the world's high-tech chips

Taiwan-based TSMC (Taiwan Semiconductor Manufacturing Company) is the world leader in semiconductors; in 2021, it produced up to 92% of the world's high-tech chips^[6].

Communication

Main Article: Communications (Taiwan Market)

Information Technology

Taiwan IT Market

Main Article: Taiwan IT Market

Information security

Ransomware Viruses in Taiwan

Main article: Ransomware viruses (ransomware) in Taiwan

Foreign trade

2024

US once again the biggest consumer of exports from Taiwan after 20 years of China leadership

In the spring of 2024, the United States again became the largest destination for Taiwanese exports after decades during which China topped this list.

Exports of goods from Taiwan to the United States in 2024 amounted to $42 billion, imports - $116 billion, which led to a US trade deficit of $74 billion.

Renewed export growth amid AI boom

In March 2024, Taiwan's exports grew at the fastest pace in two years as shipments of computer equipment at the heart of the global AI boom rose more than 400%.

2023

Reduced export orders due to lower demand in the US and EU

Taiwanese export orders fall at the end of 2023 amid lower demand in the United States and Europe.

Reduced supply of chipmaking machines to China due to US pressure

According to data from the Taipei Ministry of Finance, in April 2023, due to pressure from USA Taiwan, Taiwan sent China Hong Kong 151 million chipmakers to and, dollars which is 26% less than a year earlier.

Despite the improvement from the March fall of almost 34%, this is still the 10th month in a row of supply cuts.

Strong decline in exports due to low demand for semiconductors

Taiwan's export orders fell by the largest amount in March 2023 since the 2009 global financial crisis, as global demand for semiconductors shows no signs of improvement.

2022: China is the biggest export destination

2021

Export growth to a record $446 billion

Taiwan's exports in 2021 rose to a record $446 billion thanks to growing demand for technological products and components.

Export of high-tech products exceeded $400 billion

At the end of January 2022, data from Taiwan the Ministry of Economy were released, according to which in 2021 local manufacturers received export orders for high-tech products worth more than $400 billion, which corresponds to 59.41% of total exports. This segment of foreign supplies grew by 22.9% on an annualized basis.

The volume of export orders for high-tech products in 2021 amounted to $193.07 billion for the market information technology (IT) and network/communication devices, an increase of 17.4% compared to 2020. For electronic components/devices and semiconductors, it amounted to $207.40 billion, an increase of 28.5% on an annualized basis. This reflects the effect of the transformation of Taiwan's economic structure, the National Development Council said. states

Taiwanese semiconductor manufacturers continue to withdraw from China and invest in Taiwan, telecom operators continue to create infrastructure-networks, 5G photovoltaic power plants and offshore wind farms, according to a government report, according to which investment in fixed capital of Taiwan in 2022 will grow by 2.99% on an annualized basis.

In order to cope with the global economic restructuring in the country after the crisis of the 19th century, the government of Taiwan seeks to turn the state into a center of high-tech production and advanced processes. Developing semiconductors using 5G and artificial intelligence technologies, driving integrated hardware and software production and attracting investment from international equipment manufacturers and various other material suppliers.

The head of the Statistics Department of the Ministry of Finance of Taiwan, Beatrice Tsai, noted that the high growth can be explained by the recovery of the global economy, steady demand for technical gadgets, as well as rising prices for raw materials and an increase in consumer spending associated with holidays and new technical products. Tsai added that exports of information and communication/video and audio devices, base metals and vehicles reached an all-time high in October 2021, and exports of cars and plastic/rubber products became the second largest in Taiwan's history.^[7]

Unemployment

2020: Unemployment rate - 3.9%

Incomes of the population

2023: Minimum wage - $800

2022:765 thousand millionaires in the country

Consumption

2023: Poultry meat is the most consumed type of meat

2019: Poultry meat is the most consumed type of meat

Notes