Taiwan 2026 GDP could top 10%, says Minister of Economic Affairs

If Taiwan, China’s 2026 GDP growth exceeds 10%, it will be driven not by broad AI adoption but by its near-monopoly on advanced-node chips and HBM packaging. TSMC’s sub-3nm processes command over 75% of global foundry capacity, and CoWoS bottlenecks make AI server supply chains critically dependent on the region. This intensifies upstream pressure on EDA, photoresists, and silicon interposers, accelerating Japan-U.S. efforts to diversify into Southeast Asia. Compliance costs are surging—U.S. CHIPS Act mandates and export controls force Taiwanese firms to build costly U.S. fabs, inflating capex by 30%+. Strategically, Samsung and SK Hynix are locking in NVIDIA and Microsoft deals to challenge HBM3E dominance, while mainland China scales mature nodes to build a 'de-Americanized' backup chain. The tail risk? Within 12–24 months, any slowdown in global AI capex or CoWoS capacity ramp will abruptly deflate Taiwan, China’s export engine—revealing structural fragility beneath the boom.