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Taiwan Economy Profile 2018

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Economy - overviewTaiwan has a dynamic capitalist economy that is driven largely by industrial manufacturing, and especially exports of electronics, machinery, and petrochemicals. This heavy dependence on exports exposes the economy to fluctuations in global demand. Taiwan's diplomatic isolation, low birth rate, rapidly aging population, and increasing competition from China and other Asia Pacific markets are other major long-term challenges.

Following the landmark Economic Cooperation Framework Agreement (ECFA) signed with China in June 2010, Taiwan in July 2013 signed a free trade deal with New Zealand - Taipei’s first-ever with a country with which it does not maintain diplomatic relations - and, in November of that year, inked a trade pact with Singapore. However, follow-on components of the ECFA, including a signed agreement on trade in services and negotiations on trade in goods and dispute resolution, have stalled. In early 2014, the government bowed to public demand and proposed a new law governing the oversight of cross-Strait agreements, before any additional deals with China are implemented; the legislature has yet to vote on such legislation, leaving the future of ECFA uncertain. President TSAI since taking office in May 2016 has promoted greater economic integration with South and Southeast Asia through the New Southbound Policy initiative and has also expressed interest in Taiwan joining the Trans-Pacific Partnership as well as bilateral trade deals with partners such as the US.

Taiwan's total fertility rate of just over one child per woman is among the lowest in the world, raising the prospect of future labor shortages, falling domestic demand, and declining tax revenues. Taiwan's population is aging quickly, with the number of people over 65 expected to account for nearly 20% of the island's total population by 2025.

The island runs a trade surplus with many economies, including China and the US, and its foreign reserves are the world's fifth largest, behind those of China, Japan, Saudi Arabia, and Switzerland. In 2006, China overtook the US to become Taiwan's second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Taiwan since 2009 has gradually loosened rules governing Chinese investment and has also secured greater market access for its investors on the mainland. In August 2012, the Taiwan Central Bank signed a memorandum of understanding (MOU) on cross-Strait currency settlement with its Chinese counterpart. The MOU allows for the direct settlement of Chinese renminbi (RMB) and the New Taiwan dollar across the Strait, which has helped Taiwan develop into a local RMB hub.

Closer economic links with the mainland bring opportunities for Taiwan’s economy but also pose challenges as political differences remain unresolved and China’s economic growth is slowing. Domestic economic issues loomed large in public debate ahead of the January 2016 presidential and legislative elections, including concerns about stagnant wages, high housing prices, youth unemployment, job security, and financial security in retirement.
GDP (purchasing power parity)$1.175 trillion (2017 est.)
$1.152 trillion (2016 est.)
$1.136 trillion (2015 est.)
note: data are in 2017 dollars
GDP (official exchange rate)$571.5 billion (2016 est.)
GDP - real growth rate2% (2017 est.)
1.5% (2016 est.)
0.7% (2015 est.)
GDP - per capita (PPP)$49,800 (2017 est.)
$49,000 (2016 est.)
$48,300 (2015 est.)
note: data are in 2017 dollars
Gross national saving34.8% of GDP (2017 est.)
35.6% of GDP (2016 est.)
36.4% of GDP (2015 est.)
GDP - composition, by end usehousehold consumption: 52.4%
government consumption: 14.1%
investment in fixed capital: 21.4%
investment in inventories: 0%
exports of goods and services: 64.8%
imports of goods and services: -52.7% (2017 est.)
GDP - composition by sectoragriculture: 1.8%
industry: 36%
services: 62.1% (2017 est.)
Population below poverty line1.5% (2012 est.)
Labor force11.78 million (2017 est.)
Labor force - by occupationagriculture: 4.9%
industry: 35.9%
services: 59.2% (2016 est.)
Unemployment rate3.8% (2017 est.)
3.9% (2016 est.)
Household income or consumption by percentage sharelowest 10%: 6.4%
highest 10%: 40.3% (2010)
Distribution of family income - Gini index33.6 (2014)
32.6 (2000)
Budgetrevenues: $93 billion
expenditures: $91.67 billion (2017 est.)
Taxes and other revenues16.3% of GDP (2017 est.)
Budget surplus (+) or deficit (-)0.2% of GDP (2017 est.)
Public debt29.9% of GDP (2017 est.)
31.2% of GDP (2016 est.)
note: data for central government
Inflation rate (consumer prices)1% (2017 est.)
1.4% (2016 est.)
Central bank discount rate1.38% (31 December 2016)
1.63% (31 December 2015)
Commercial bank prime lending rate2.7% (31 December 2017 est.)
2.63% (31 December 2016 est.)
Stock of narrow money$535.1 billion (31 December 2017 est.)
$501.2 billion (31 December 2016 est.)
Stock of broad money$1.374 trillion (31 December 2017 est.)
$1.28 trillion (31 December 2016 est.)
Stock of domestic credit$835.8 billion (31 December 2017 est.)
$778.3 billion (31 December 2016 est.)
Market value of publicly traded shares$851.2 billion (31 December 2016)
$742.5 billion (31 December 2015)
$848.3 billion (31 December 2014)
Agriculture - productsrice, vegetables, fruit, tea, flowers; pigs, poultry; fish
Industrieselectronics, communications and information technology products, petroleum refining, chemicals, textiles, iron and steel, machinery, cement, food processing, vehicles, consumer products, pharmaceuticals
Industrial production growth rate2% (2017 est.)
Current Account Balance$79 billion (2017 est.)
$74.28 billion (2016 est.)
Exports$344.6 billion (2017 est.)
$310.4 billion (2016 est.)
Exports - commoditiessemiconductors, petrochemicals, automobile/auto parts, ships, wireless communication equipment, flat display displays, steel, electronics, plastics, computers
Imports$272.6 billion (2017 est.)
$239.7 billion (2016 est.)
Imports - commoditiesoil/petroleum, semiconductors, natural gas, coal, steel, computers, wireless communication equipment, automobiles, fine chemicals, textiles
Reserves of foreign exchange and gold$468.1 billion (31 December 2017 est.)
$439 billion (31 December 2016 est.)
Debt - external$204.7 billion (31 December 2017 est.)
$172.2 billion (31 December 2016 est.)
Stock of direct foreign investment - at home$85.58 billion (31 December 2017 est.)
$80.68 billion (31 December 2016 est.)
Stock of direct foreign investment - abroad$367.2 billion (31 December 2017 est.)
$354 billion (31 December 2016 est.)
Exchange ratesNew Taiwan dollars (TWD) per US dollar -
30.68 (2017 est.)
32.325 (2016 est.)
32.325 (2016 est.)
31.911 (2014 est.)
30.363 (2013 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on January 20, 2018