Taiwan’s economy grew by 12.93% year-on-year in the second quarter of 2026, slightly above the preliminary estimate of 12.92% but down from the robust 15.43% expansion recorded in the first quarter. This was the slowest pace of growth since the third quarter of 2025.
The moderation was largely driven by a marked deceleration in external trade. Export growth cooled sharply to 21.24% from 35.41% in Q1, while import growth eased to 18.25% from 25.41%. In contrast, domestic demand gained momentum, accelerating to 8.83% from 5.73% previously. This improvement was underpinned by stronger household consumption (5.91% vs. 4.83%) and a solid pickup in gross fixed capital formation (11.45% vs. 8.04%), which together more than offset a slowdown in government spending (3.24% vs. 4.29%).
On a seasonally adjusted quarter-on-quarter basis, GDP expanded by 1.39%, down from 2.46% in the previous quarter and marking the weakest quarterly performance since the first quarter of 2025.
Looking ahead, Taiwan has raised its 2026 growth forecast to 11.05%, setting the stage for the economy’s first double-digit annual expansion since 2010, supported by the continued outperformance of its AI-driven semiconductor sector.
