Taiwan Institute of Economic Research President Gordon Chang Chien-yi said on July 21 that the institute’s latest GDP forecast will be revised up to more than 10%, putting it broadly in line with Academia Sinica’s 10.16% estimate and the Directorate-General of Budget, Accounting and Statistics’ 9.64% projection. The three institutions are now pointing to the same factor behind Taiwan’s unusually strong outlook this year: AI-related exports and capital spending have run well ahead of earlier expectations.
TIER signals another upward revision
According to Economic Daily News, Chang made the remarks while speaking to reporters at TIER’s 50th anniversary event. He said the institute’s internal calculations suggest actual growth this year could come in stronger than the earlier estimates published by the DGBAS, Academia Sinica and the central bank, with one main explanation: exports have been much stronger than the assumptions used in their models.
Academia Sinica moved first. On July 13, it sharply raised its 2026 GDP growth forecast to 10.16%, up 6.45 percentage points from the 3.71% estimate it issued in December last year. That made it the most optimistic forecast among Taiwan’s major research bodies. The DGBAS had first projected 7.71% in February and later revised that figure to 9.64%, an increase of 1.93 percentage points. With TIER now indicating that its own forecast will move above 10%, the three major projections are converging.
AI, HPC and cloud demand drive exports and investment
Chang said the core support behind the stronger forecast is demand for AI, high-performance computing and cloud infrastructure that has exceeded expectations. That demand has boosted exports from Taiwan’s semiconductor and information and communications technology sectors while also supporting robust private investment.
He said business tied to AI should continue at least through 2028, and added that after Taiwan’s growth rate reaches 10% this year, next year should also deliver a solid performance.
He also flagged the base effect as the key variable to watch. Growth bases for both this year and last year are already high. If Taiwan can still record growth above 8% next year, Chang said, that would be stronger evidence that AI demand is not a one-off burst but can stay strong even on top of an elevated comparison base.
Comments on trade realignment
Beyond AI-led export momentum, Chang also discussed Taiwan’s position in a changing global trade structure. He said globalization is still continuing, but at a visibly slower pace. In his view, U.S.-China confrontation is now a settled reality, and the world could split into three circles: one centered on the United States, one centered on China, and a third made up of economies aligned with neither side, led by the European Union.
Chang said Taiwan does not necessarily have to rely only on the two major camps to do business. The deciding factor, he said, is whether it can stay within the security limits each country is willing to accept.
ART agreement seen as close to an FTA
Chang also pointed to Taiwan’s ART agreement with the United States, signed in response to reciprocal tariffs. He said the contents are close to a free trade agreement, and that some terms may even be better than those found in a typical FTA. In his view, that has made economies including the European Union and Japan more willing to discuss similar deals.
He said that could open a rare window for traditional industries that have long been disadvantaged on tariffs because Taiwan did not have FTAs in place.