For the primary time since 2003, Taiwan will surpass South Korea in per capita GDP, a key measure of common wealth.
The Central Bank of Taiwan forecasts 4.55 % financial progress in 2025, lifting Taiwan’s per individual output to about US$38,000—simply forward of South Korea’s US$37,400.
Behind this shift is TSMC, the world’s main contract chipmaker, which now controls roughly 70 % of the superior foundry market.
When the pandemic sparked a worldwide semiconductor scarcity, governments and tech giants turned to Taiwan’s factories to maintain all the pieces from vehicles to smartphones operating.
Then got here the AI growth: the introduction of instruments like ChatGPT drove unprecedented demand for high-performance chips, sending Taiwan’s GDP surging 8 % in Q2 2025, in contrast with simply 0.6 % progress in South Korea.
But there’s extra to the story. Decades in the past, many Taiwanese producers moved manufacturing to China for decrease prices, slowing the island’s progress to round 2–3 % yearly.
Yet Taiwan’s targeted funding in pure-play foundries—amenities devoted solely to chip fabrication—paid off when the world wanted semiconductors most.
A stronger New Taiwan greenback, up 9 % in opposition to the US greenback this yr, additional boosts its dollar-denominated GDP figures. The result’s a dramatic reversal: Taiwan’s tiny, export-dependent economic system has overtaken its bigger neighbor in common residing requirements.
Yet Taiwan nonetheless trails Japan and is lower than half as rich per individual as Singapore. The island now faces contemporary exams: can it flip its chip success into broader wage features, diversify past semiconductors, and handle a foreign money that may each empower customers and pressure conventional industries?
For readers outdoors Asia, Taiwan’s rise makes one factor clear: in an period outlined by chip shortages and AI, strategic give attention to important applied sciences can remodel nationwide fortunes—quick.
And with semiconductors on the coronary heart of all the pieces from electrical vehicles to knowledge facilities, Taiwan’s story issues to us all.
