Taiwan's GDP Grows 13.7% in Q1 2026 Amid Middle East Crisis
Taiwan's economy expanded by 13.7% year-on-year in Q1 2026, the highest growth rate since 1987, driven by AI technology demand. Despite this surge, concerns remain regarding the Iran war's potential effects on the critical semiconductor industry and energy imports.
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In the first quarter of 2026, Taiwan's gross domestic product increased by 13.7%, surpassing the 11.3% forecast and marking the fastest growth since Q2 1987. The economy's expansion is attributed to strong demand for artificial intelligence technology, though concerns linger over the Iran war's impact on the semiconductor sector and energy imports.
Taipei has absorbed fuel price increases and secured LNG and oil supplies, primarily from the Middle East. Despite this, a slowdown in consumption and investment is anticipated due to sentiment affected by the conflict. The economy had previously expanded by 8.6% in 2025 but is projected to grow by only 3.5% in 2026.
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