AI boom boosts Taiwan’s economy by 8.6% in 2025

Taiwan’s economy grew at an annual rate of 8.6% last year, its fastest pace in 15 years, according to The Associated Press. This expansion was supported by its export-oriented industries, which benefited from strong demand related to artificial intelligence and a significant increase in shipments to the United States.

The preliminary estimate, released by Taiwan’s statistics agency on Friday, exceeded economists’ forecasts. It represents the strongest growth rate since 2010.

Earlier this month, Taiwan established a trade arrangement with the administration of U.S. President Donald Trump. This agreement reduces U.S. tariffs on imports from Taiwan to 15% from 20%, in exchange for commitments for at least $250 billion of investment in the U.S., including in semiconductors and AI. Economists indicate this could lead to increased exports and further stimulate the economy this year.

Bank of America economists Xiaoqing Pi and Helen Qiao stated in a recent analysis that they anticipate AI-related demand will continue to support Taiwan’s export performance through 2026, contributing to overall economic growth amid ongoing global AI investment.

Taiwan is a leading producer of AI servers, computer chips, and precision instruments. Its exports rose by nearly 35% last year compared to the previous year, driven primarily by technology-related shipments. Exports to the U.S. increased by 78%.