TAIPEI (Taiwan News) — Taiwan raised the full-year GDP forecast to 4.27%, ranking first among “Four Asian Tigers” and higher than the global average.

According to the Directorate General of Budget, Accounting, and Statistics, the GPD forecast was lifted by 0.37% based on better-than-expected export performance and strong private investment. The DGBAS predicted economic growth will fall back next year to 3.29%, according to Liberty Times.

DGBAS deputy head Tsai Hung-kun (蔡鴻坤) said "The domestic economic situation is good, but still shows signs of being uneven." Tsai believes growth was higher than expected partly due to a lower comparison base last year.

Tsai said Taiwan's 4.27% is higher than the global average of 2.7%, Singapore’s 3.5%, Hong Kong's 2.5%, and South Korea’s 2.4%. Domestic exports have largely driven economic growth.

With the revised GDP, Taiwan’s GDP per capita is US$33,864 (NT1.1 million).

Tsai warned that the global economy is encountering an era of worldwide overcapacity and economic recovery varying in different countries. "Taiwan is lucky to have AI, which has brought about growth in related industrial chains,” said Tsai.

The DGBAS pointed out the AI wave has driven the export of electronic components and IT products, with exports this year reaching US$474.5 billion, an annual increase of 9.9%. 

In terms of private investment, semiconductor manufacturers are actively expanding production capacity and investing in research and development. Another major form of investment is transportation capacity in the transport industry.

As for economic rises, uncertainty has increased in the housing market, restraining some momentum. However, private investment is forecast to grow in real terms this and next year.

Tsai said domestic consumption has been good despite the lack of population growth. Tsai says Taiwan should maintain domestic consumption in the next few years.

The DGBAS predicted the Consumer Price Index (CPI) will rise by 2.18%, a slight increase of 0.01%. DGBAS said the service category is still experiencing upward pressure, but the overall CPI growth will slow, with next year’s slowing down to 1.93%.