TAIPEI (Taiwan News) – Taiwan’s economy is likely to expand by 3.57% in 2024 backed by the high-tech sector, the Taiwan Research Institute (TRI) said Thursday (June 27).

A majority of think tanks have raised their 2024 predictions for the country’s gross domestic product (GDP) to a level above 3%, indicating the economy was doing much better than last year, per CNA. Domestic consumption was returning to normal levels, with a growth rate of 2.75% likely for this year.

However, due to international uncertainty, businesses were turning more conservative about investing, with growth for the year predicted at 1.47%. While advanced technology played a key role in the improving business picture for 2024, TRI founder Liu Tai-ying (劉泰英) warned it might result in a more unequal distribution of wealth. Inflation was also likely to stay above 2% for the rest of the year, reaching an average of 2.2%, TRI said.

The think tank also released its electricity prosperity index in May, with the manufacturing sector and the semiconductor industry showing strong advances. Traditional sectors of the economy, including plastics, rubber, and chemicals, were recovering from a slump, the TRI said.

Earlier, the government’s Directorate General of Budget, Accounting and Statistics (DGBAS) put the expansion of the country’s GDP at 3.94% for 2024. The figure was the highest level in three years. The rapid development of AI technology and high-performance computing were mentioned as the reasons for the boost.