Chinese economy

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published: 29.08.2025

Taiwan soars on AI boom but two-tier economy risks run deep

Bruegel Senior Fellow Alicia Garcia-Herrero highlights Taiwan’s remarkable economic surge driven by its dominance in AI chip manufacturing, especially through companies like TSMC and Foxconn. However, this growth is uneven and potentially fragile, as traditional industries struggle and the economy becomes increasingly dependent on a single sector amid rising geopolitical risks.