TAIPEI (Taiwan News) — Taiwan’s economy remained in a yellow-red light zone in April for the fourth month, buoyed by strong AI demand and preemptive stocking ahead of possible tariff hikes, the National Development Council reported Tuesday.
The National Development Council said in a press release that April’s composite score fell two points to 33, still within the expansion range. According to its system, yellow-red stands for a warming economy.
While AI-related manufacturing sales pushed some indicators higher, concerns over global trade tensions and unclear tariff policy dampened business sentiment, per CNA. Of the nine components in the index, manufacturing sales rose by one point and flashed red, thanks to brisk demand from AI and high-performance computing sectors.
However, the stock market index dropped two points into yellow-blue, and both manufacturing confidence and business climate indicators slipped into the blue, signaling sluggishness. The remaining indicators were unchanged.
NDC Economic Department Director Chiu Chiu-ying (邱秋瑩) explained that Taiwan’s exports remain resilient, driven by essential demand for advanced semiconductors. However, uncertainty surrounding US tariff policy – especially pending decisions on semiconductor-related duties – continues to weigh on market confidence.
US President Donald Trump’s shifting positions on trade, coupled with ambiguous progress in negotiations with China, have further clouded the global outlook. Chiu warned that despite hopeful signs, businesses remain cautious.
The NDC said this caution is reflected in the leading economic indicator, which declined for the third straight month. Rising financial market volatility and weaker order expectations have added to the pressure.
Still, the coincident index, which tracks current economic activity, rose for the 24th month in a row – evidence, Chiu said, that Taiwan’s economic expansion remains intact.
Looking ahead, the NDC expects momentum from AI and emerging tech to support semiconductor and server exports. Steady job growth and rising wages are also propping up domestic demand, it added.
