Taipei: The export-oriented manufacturing sector served as the major contributor to Taiwan’s strong GDP growth in the first nine months of 2025, according to government statistics. Recent data from the Directorate-General of Budget, Accounting and Statistics (DGBAS) showed Taiwan’s GDP grew a stunning 7.15 percent during this period, with the manufacturing sector contributing 4.89 percentage points, or 68 percent of the total growth, and the service sector contributing 1.76 percentage points, or 24 percent.

According to Focus Taiwan, Tsai Yu-tai, head of the DGBAS’s Department of Statistics, noted that the electronics component and computer/optoelectronics industries benefited from solid global demand for AI applications, making the manufacturing sector the largest contributor to Taiwan’s GDP. In late November, the DGBAS raised its GDP growth forecast to 7.37 percent for 2025 and predicted the economy would grow another 3.54 percent in 2026, citing the continued AI boom.

Tsai acknowledged that the growth within the local manufacturing sector varied from industry to industry. The capital-intensive information and communications industry, along with the electronics industry, showed eagerness to increase wages in the AI era. However, these industries employed a relatively low number of people, while the labor-intensive services sector largely experienced flat growth.

Echoing Tsai, Wu Dach-rahn, an economist at National Central University, highlighted the uneven strength of the manufacturing sector, with the old economy sector facing challenges due to U.S. tariff measures. Wu mentioned that Taiwan’s electronics industry employs about 1 million people, compared with roughly 11 million workers nationwide. Meanwhile, traditional industries continued to report furloughs.

Under these circumstances, Wu pointed out that many local employees did not feel significant benefits from the GDP growth in Taiwan, and consumer confidence remained weak. In the service sector, the DGBAS reported that the retail and wholesale industry’s contribution to total GDP growth was 0.7 percentage points, and the financial/insurance industry’s share was 0.29 percentage points in the first nine months of last year.

Particularly, wholesale firms, especially machinery suppliers, gained from AI business opportunities as their operations were closely linked to robust exports, Tsai stated. He added that the financial/insurance industry was driven by the local stock market in terms of investment returns, as the benchmark index Taiex was also boosted by the AI frenzy in 2025, soaring 25.73 percent.