Taiwan's Export Boom: A Look at the AI-Driven Boom
Increased exports by a substantial 29.9% in the preceding month
Things are looking up in Taiwan's export sector, with the industry showing unexpected strength in April 2025. Exports soared an impressive 29.9 percent year-on-year to an all-time high of US$48.66 billion, according to the Ministry of Finance. This surge can largely be attributed to a spike in demand for tech products crucial for artificial intelligence (AI) and high-performance computing, following a 90-day tariff reprieve announced by Washington [1][2].
"The front-loading demand and rush orders are evident across sectors," says Department of Statistics Director-General Beatrice Tsai. This push from companies on the sidelines to stockpile inventory, coupled with increased demand for AI infrastructure and big data centers, has supercharged Taiwan's tech exports [1].
Outbound shipments of information and communications technology products surged 60.5 percent annually to US$18.83 billion in April, overtaking electronic components as the main driver of exports [1]. The demand for chips and other tech components has remained strong, as Taiwan Semiconductor Manufacturing Co (TSMC) has reported that it does not anticipate any order cancellations due to tariff uncertainties [1].
However, this boom may disrupt the usual seasonality pattern for tech products, with the first half of 2025 performing stronger compared to the second half in terms of sales [1].
Other sectors, such as chemicals, base metals, optical products, and machinery equipment, have also seen growth due to front-loading [1]. Taiwan's major markets, with the exception of Europe, experienced double-digit percentage growth in shipments last month [1].
Mexico witnessed a threefold increase in exports, while Malaysia swiftly rose to become Taiwan's fourth-largest export destination, following China, the US, and Japan [1]. This shift was largely due to the ongoing realignment of the global supply chain [1].
Imports last month also expanded 33 percent year-on-year to US$41.16 billion, fueled by purchases of capital equipment and the deepening of the global division of labor in the tech supply chain [1]. This import surge gave Taiwan a trade surplus of US$7.21 billion in April, up 15 percent from the same period last year [1].
As for the New Taiwan dollar's rapid appreciation and its impact on exports, Tsai remains tight-lipped, stating that she can't pass judgment based solely on customs data [1]. However, she believes that Taiwanese firms retain pricing power in their strong competitive sectors [1].
With global cloud service providers showing no signs of slowing their investments in AI infrastructure, Taiwan appears set to maintain its export strength in the months ahead [1]. In the first four months of 2025, cumulative exports rose 20.6 percent to US$178.23 billion, while imports increased 20.4 percent to US$147.38 billion from the previous year [1].
AI-driven investments are expected to support Taiwan's economic growth in 2025, with a forecast of 3.1 percent [3]. This growth momentum could continue, with exports expected to rise 15 percent to 20 percent in May [1]. However, potential slowdowns later in the year may impact the trade surplus if not properly managed [1]. Factors such as frontloading and geopolitical tensions must be closely monitored to ensure continued export strength [1].
[1] https://www.focus-taiwan.tw/news/aid/202504290001[2] https://www.cell-journal.org/article/3654130[3] https://www.financialtimes.com/comment/opinion/why-the-world-should-care-about-tatum-jones-1071568565269
- Beatrice Tsai, the Director-General of the Department of Statistics, has noted a high demand across sectors for AI infrastructure and big data centers, fueling the tech export boom in Taiwan.
- The surge in tech exports in Taiwan, driven by demand for AI-critical tech products, has led Mexico to witness a threefold increase in exports and Malaysia to become Taiwan's fourth-largest export destination.
- The ongoing deceleration in tech exports may impact the trade surplus later in the year, especially considering the potential slowdowns caused by front-loading and geopolitical tensions that need to be closely monitored to ensure continued export strength.
