TAIPEI (Taiwan News) — Taiwan's economy outperformed expectations in the third quarter. 

Fueled by strong AI demand, full-year economic growth is projected at 4%, the Directorate-General of Budget, Accounting and Statistics (DGBAS) announced Thursday (Oct. 31).

Taiwan's exports experienced significant growth in the third quarter, contributing to a 3.97% economic expansion. This figure surpasses the August forecast of 3.21%, per CNA.

Emerging technologies are driving strong growth in the electronics and information and communications industries. This growth has been a major contributor to Taiwan's strong economic performance.

Increased demand for high-tech products has bolstered business sentiment and encouraged private investment. The DGBAS projects a 15.27% growth in gross capital formation, surpassing the initial forecast.

There was initial uncertainty in the market on future demand for artificial intelligence, the DGBAS said. However, TSMC Chair C.C. Wei (魏哲家) dispelled these doubts at the company's investor conference on Oct. 17.

Wei's support for AI has not only reassured the market but is also supported by concrete data. This indicates a surge in investment within the semiconductor industry to meet future demand for AI.

While some sectors are thriving, traditional industries are facing challenges due to sluggish global demand and excess capacity. The combination of sluggish global demand and overcapacity has put pressure on both the supply and demand sides of traditional industries.

Despite a slight deceleration in the third quarter, private consumption maintained positive growth for the twelfth consecutive quarter. The wealth effect generated by the sustained rally in the Taiwan stock market has played a significant role in bolstering consumer confidence.