New Delhi [India], February 1 (ANI): Taiwan's gross domestic product (GDP) increased an estimated 8.63 per cent in 2025 from a year earlier, marking its strongest growth in 15 years.

According to a Focus Taiwan report, the economic expansion was driven primarily by a surge in exports and rising demand for artificial intelligence (AI) applications. The Directorate-General of Budget, Accounting and Statistics (DGBAS) released these findings on Friday, noting that the performance significantly exceeded earlier projections.

The full-year growth figure exceeded a prior forecast by 1.26 percentage points, allowing Taiwan to surpass regional peers. DGBAS specialist Chiang Hsin-yi told reporters that Taiwan's per capita GDP reached USD 39,477 in 2025, approaching the USD 40,000 mark.

This figure reflects strong performance, moving Taiwan ahead of Japan (USD 34,713) and South Korea (USD 35,962). Chiang explained that exchange rate gains from a strengthening Taiwan dollar also contributed to the rise in per capita figures.

Economic momentum accelerated sharply in the final months of the year. Fourth-quarter GDP growth reached an estimated 12.68 per cent, representing a 4.77 percentage-point jump from earlier projections. Chiang said this surge was a major factor in lifting the full-year growth rate. She attributed the strong performance to 'unexpectedly robust AI-related demand' and the 'absence of U.S. tariffs on semiconductor products,' which had initially led to more conservative economic forecasts.

The export sector remained the primary engine of the economy throughout the year. Taiwan's AI and high-performance computing sectors continued to fuel this growth by boosting sales of chips, servers, and components. Beyond external trade, Chiang noted that 'private consumption and investment also contributed' to the GDP increase.

This internal growth was supported by a recovering car market, government cash handouts to residents, and active trading within the stock market.

Data from the DGBAS showed that Taiwan's 8.63 per cent growth outperformed several neighbouring economies. China reported 5 per cent growth, followed by Singapore at 4.8 per cent, Hong Kong at 3.5 per cent, and South Korea at 1 per cent.

Looking ahead, the DGBAS indicated that a recently concluded Taiwan-U.S. trade agreement is expected to further support exports. The agreement lowers tariffs to 15 per cent and is designed to improve competitiveness for traditional industries, including machine tools, bicycles, and hardware.

'According to the DGBAS, a new growth forecast for 2026 will be issued on Feb. 13, with analysts expecting an upward revision,' the report said. (ANI)