Taipei: Taiwan’s GDP growth in the second quarter of 2025 reached an estimated 7.96 percent over the previous year, according to data released by the Directorate General of Budget, Accounting and Statistics (DGBAS) on Thursday. The figure marks an upward revision of 2.73 percentage points from May, representing the highest quarterly number in four years.
According to Focus Taiwan, exports in this quarter soared by 34.06 percent, driven by strong demand for artificial intelligence and new technology applications, as well as orders placed ahead of the expiration of the U.S. tariff suspension. Good performance in triangular trade spurred exports of goods and services up by 35.1 percent year-on-year, a rise of 6.58 percent from the previous estimate.
DGBAS specialist Chiang Hsin-yi noted that electronic components and information, communication, and audio-video products accounted for over 70 percent of exports, indicating strong demand for artificial intelligence. However, other industries showed unspectacular or declining performance. Taiwanese firms, led by export and investment demands, actively prepared materials and purchased equipment, resulting in a growth of 31.95 percent in imports of goods and services, which was 6.25 percentage points higher than the preliminary estimate.
In balance, net foreign demand contributed 5.77 percentage points to the period’s economic growth. Capital formation, which includes private and public investment, showed a growth of 5.56 percent, up 7.9 percentage points from the initial estimate. However, private consumption was relatively weak, with a growth of only 0.56 percent.
Chiang mentioned that automobile purchase sentiment was delayed, and fluctuations in Taiwan’s stock exchange weakened consumption. Looking to the future, local economic institutions commonly predict a bleak economy in the latter half of the year as “reciprocal tariffs” with the United States are set to be implemented in August, with growth forecast to be lower than 1 percent.
Chiang stated that the tariffs will directly impact Taiwan’s exports, but investments are long-term. From the data in the second quarter, new tech demands are strong and may extend relevant business investments into the third quarter. The DGBAS will release a forecast of Taiwan’s economic growth for 2025 on Aug. 15. Predictions from overseas and local institutions of Taiwan’s annual growth rate in July stand at around 2.8 percent to 4 percent.