Surrounded by the Philippine Sea, the East China Sea and the Taiwan Strait, Taiwan is a territory of the Republic of China. A notable geographical feature is the rugged mountains in its eastern side. Through the centuries, Taiwan’s economy has had its highs and lows. In the 1980’s the country moved to forward to knowledge-based and capital-intensive industries. As a result, the country’s economy expanded due to a high rate of savings, increased labour productivity, privatization, and considerable foreign investment. Taiwan soon became one of the world’s largest producers of computers and succeeded in establishing shipbuilding and steel industries. Taiwan is now a member of the Asia-Pacific Economic Cooperation (APEC).
Currently, Taiwan’s economy is a free market economy where there is little government involvement, and the prices of both goods and services are determined within a free price system. Its economy is significantly huge and occupies the position of being the 5th largest economy in Asia. To add to that, it has the highest Global Entrepreneurship Index in the region.
On a global scale, Taiwan holds a significant position as the 15th largest economy in the world with regards to the Gross Domestic Product (GDP), and is considered by the International Monetary Fund as an advanced economy. Concerning purchasing power parity, the economy is 19th in the world. In March 2018 the country’s nominal GDP was USD 149.9 billion, which was a rise from USD 147.5 billion in the previous quarter. Investing in this economy can be seen to be a wise decision and can be an excellent opportunity for non-citizens of the country who want to indulge in overseas trading.
Given that Taiwan has a capitalist economy, the production techniques are decided by the privately-owned companies whose primary goal is to earn a profit. Moreover, the industrial companies and banks that were previously owned by the state are now privately owned. This can be said to have considerably contributed to the impressive unemployment rate of only 4% with a workforce of over 11 million people. Across the industrial spectrum, Taiwan is a major supplier of goods as well as being one of the major players in the information and communication technology industry in the world.
Confidence has increased on Taiwan’s economy after the government said that the economic growth in the first half of the year, had surpassed what had been originally projected. This was according to a survey done by Cathay Financial Holding Co which is one of Taiwan’s leading financial holding companies. Cathay Financial also stated that this optimistic outlook toward the country’s economy was a result of upward revisions of the previously projected GDP. This gain in confidence toward the economy has led to a more upbeat mood where consumers are more willing to spend, according to Cathay Financial.
There have been positive remarks from the people, according to surveys that were conducted, who believe that the economy is on steady growth. Experts in the Directorate General of the Budget, Accounting and Statistics also concur with this optimistic trend, through raising its forecast GDP growth from 2.60% to 2.69% for the year 2018.
This expected growth in the economy can also be attributed to improved levels of demand on world markets. Based in Taipei, the Taiwan Stock Exchange (TWSE) is the securities trading centre in the country and has been operating since 1962. It facilitates international share trading for those who invest in overseas shares from other countries.
Investors prefer to invest their money in economies that have the promise of growth, and Taiwan’s economy sure is proving to be on an upward trend. This year the country’s economy has been seen to rise from 3.10% increase in the first quarter to 3.30% in the second. This is a great leap for the economy and one that has surpassed even the optimistic previous projections.
With the above in mind, it is easy to see that one has good reason to have confidence in the Taiwanese economy. When looking for a good market to help diversify your portfolio, Taiwan is definitely worth your consideration.