TAIPEI (Taiwan News) – Taiwan’s economy will grow by 3.38% this year due to a surge in exports, the Chung-Hua Institution for Economic Research (CIER) said Friday (April 19).

However, the electricity rate hikes introduced on April 1 will force inflation up to 2.30%, instead of the 1.88% predicted in January, according to the leading think tank. In addition, prices for imported raw materials for industry and agriculture are also likely to rise, keeping the consumer products index (CPI) above 2% for the year.

Strong global demand for AI products will fuel exports for Taiwan’s technology sector, Radio Taiwan International (RTI) reported. Forecasters said that while major corporations might have delayed plans to increase investments, the result would still mean growing business expenditure.

Economic growth both inside and outside Taiwan shows signs of heating up during 2024, CIER economists said. Domestic spending is likely to rise by only 2.09% though, as in the aftermath of the April 3 earthquake in Hualien County, many Taiwanese would prefer to travel overseas and spend outside the country, per CNA.