Taiwan’s economy seen expanding 5.6% in first quarter on strong exports: Reuters poll

By Thomson Reuters Apr 28, 2024 | 11:55 PM

TAIPEI (Reuters) – Taiwan’s trade-dependent economy likely grew faster in the first quarter, supported by a rebound in exports amid upbeat demand for the technology that powers artificial intelligence (AI) applications, a Reuters poll showed on Monday.

Gross domestic product (GDP) is expected to have expanded 5.65% during January-March versus a year-ago period, according to the poll of 18 economists. GDP grew 4.93% year-on-year in the fourth quarter of 2023.

Economists’ forecast for preliminary GDP data, due on Tuesday, varied from an expansion of 4.2% to as much as 7%.

First-quarter exports rose 12.9% year-on-year, compared with the fourth-quarter’s annual expansion of just 3.4%, as Taiwan’s tech-heavy exporters like chipmakers rode a wave of AI demand.

Due to strong exports, the manufacturing sector is getting its wind back and unemployment remains low, SinoPac Securities Investment analyst Mickey Liao said.

“The first quarter should see the highest GDP growth this year, slipping back to 3.5% in the second quarter, but let’s see how the first quarter has panned out,” he added.

The government’s statistics bureau in February raised its forecast for full-year 2024 growth to 3.43% from a previous prediction of 3.35%. Last year, the economy expanded 1.31%, its slowest pace in 14 years.

The economy in China, Taiwan’s largest export market, grew faster than expected in the first quarter, expanding 5.3% year-on-year and comfortably topping forecasts.

Taiwan is a key hub in the global technology supply chain for giants such as Apple and Nvidia, as well as home to the world’s largest contract chipmaker Taiwan Semiconductor Manufacturing Co.

Taiwan’s preliminary GDP reading will be released in a statement with minimal commentary. Revised figures will be released a few weeks later, with more details and forward-looking forecasts.

(Poll compiled by Devayani Sathyan, Anant Chandak and Carol Lee; Reporting by Ben Blanchard and Roger Tung; Editing by Sherry Jacob-Phillips)