Taiwan's AI-fueled forecast of 11% GDP growth likely not sustainable, economists say

The city skyline is seen with the landmark Taipei 101 building from a lookout point on Elephant Mountain in Taipei on April 14, 2025. (Photo by I-Hwa Cheng / AFP) (Photo by I-HWA CHENG/AFP via Getty Images) I-hwa Cheng | Afp | Getty ImagesThe Taiwanese government's double-digit GDP forecast growth in 2026 may reflect optimism in the artificial-intelligence economy, but growth is likely to moderate over time given risks of capex slowdown and macroeconomic downturns, and with its high concentration in the semiconductor industry. Earlier this month, Taiwan's statistics agency said it expects its GDP growth to be at 11.05% for the year, up from ⁠9.64% forecast it issued in May. Taiwan's weighted stock index has seen a growth of over 56% year-to-date, supported by AI demand for its tech industry. Stock Chart IconStock chart icon Taiwan"I think it is important not to extrapolate the exceptional pace of growth this year too far ahead," said Saktiandi Supaat, head of FX research at Maybank. While Taiwan has greatly benefited from huge investments by global tech companies amid growing demand for AI-related products, if the pace of AI investment slows, "this could feed relatively quickly int...