Taiwan’s economic growth ability under threat with firms to shun investment as hedge against cross-strait tensions
- Diversification could limit future investment in Taiwan, potentially muting economic growth, with capital already shifting to other Asian economies, including Malaysia
- Internal discussions are ongoing about de-risking supply chains away from Taiwan and mainland China, says European Chamber of Commerce Taiwan CEO Freddie Hoeglund
Taiwan is expected to face growing headwinds from diversification as major companies expand away from the island toward India and Southeast Asia, with global ratings agencies pointing partly at a hedge against any conflict with mainland China.
Diversification would further dent the US$820 billion-plus economy that has lost momentum over the past year amid a post-pandemic wind down in global demand for its signature consumer electronics components.
European businesses in Taiwan are examining their exposure to both the island and mainland China, extending discussion that started after the Pelosi visit, said Freddie Hoeglund, CEO of the European Chamber of Commerce Taiwan.
There’s a lot of ongoing talk about de-risking supply chains, both regarding Taiwan and China
“There’s a lot of ongoing talk about de-risking supply chains, both regarding Taiwan and China,” he said on Friday.
