This decision is in response to the potential global economic shocks the island may face in the coming years, including the impact of the COVID-19 pandemic, global inflation, and the ongoing war in Ukraine.
The Investment will be directed towards subsidies for electricity prices, labor and health insurance, and another spending to cope with the impact of global inflation and international economic challenges. Additionally, government departments will be reviewing future industrial development strategies, specifically the role and layout of the semiconductor and information and communications industries in the global supply chain. This review aims to consolidate Taiwan's key role in the global supply chain and maintain the sustainable momentum of industrial development and economic stability.
Taiwan is a major producer of semiconductors, with Taiwan Semiconductor Manufacturing Co. Ltd (TSMC) being the world's largest contract chipmaker. The country's export-dependent economy grew 6.45% in 2021, the fastest rate since 2010, but is expected to slow down in 2022 and 2023 due to the aforementioned global economic challenges.
In December, Taiwan's central bank reduced its 2022 GDP growth estimate to 2.91% from its previous forecast of 3.51%. The 2023 GDP growth forecast has also been lowered to 2.53%, down from the previous prediction of 2.9%. The economy grew 4.01% in the third quarter of 2021 compared to the same period in the previous year.
Taiwan Looks to Protect economy with $12 Billion Investment in 2023
To protect the economy from potential global economic shocks, Taiwan's President, Tsai Ing-wen, announced plans to invest an additional T$380 billion in tax revenue back into the economy in 2023. This Investment will provide subsidies for electricity prices, labor and health insurance, and another spending to cope with the impact of global inflation and international economic challenges.
Government departments will also be reviewing future industrial development strategies, specifically the role and layout of the semiconductor and information and communications industries in the global supply chain.
Taiwan is a major player in the semiconductor industry, with Taiwan Semiconductor Manufacturing Co. Ltd (TSMC) being the world's largest contract chipmaker. The country's export-dependent economy grew 6.45% in 2021, the fastest rate since 2010, but is expected to slow down in the coming years due to the COVID-19 pandemic, global inflation, and the ongoing war in Ukraine. In December, Taiwan's central bank lowered its 2022 GDP growth estimate to 2.91% from its previous forecast of 3.51%.
The 2023 GDP growth forecast has also been revised downward to 2.53%, compared to the previous prediction of 2.9%. The economy grew 4.01% in the third quarter of 2021 compared to the same period in the previous year.
