The global race to build artificial intelligence infrastructure is no longer just reshaping the technology industry. It is transforming entire economies, with Taiwan emerging as one of the biggest beneficiaries of the unprecedented wave of investment in AI chips, semiconductor manufacturing and data centre infrastructure.
According to Jefferies’ latest GREED & fear report, the ongoing AI investment cycle has pushed Taiwan into boom territory. “The continuing AI capex arms race, which has to rank as the most dramatic capex cycle GREED & fear has ever seen, has also continued to contribute, unsurprisingly, to boom like conditions in the Taiwan economy,” the brokerage said.
The numbers reflect the scale of the transformation. Taiwan’s real GDP surged 14.55% year on year in the first quarter of 2026, marking the country’s fastest quarterly economic growth in nearly 48 years. Export orders jumped 53.4% year on year to $268 billion during the three months ended May, while cumulative export orders reached $409 billion in the first five months of the year, up 49% from a year earlier.
Jefferies attributes the surge to massive investments across the AI infrastructure value chain. “This data is further testimony to the massive investments being made on the AI related data center ramp up,” the report said, pointing to Taiwan Semiconductor Manufacturing Co.’s aggressive expansion plans.
TSMC expects to raise its capital expenditure to $56 billion in 2026 from $41 billion last year. Jefferies’ Taiwan research partner, Fubon Research, forecasts the world’s largest contract chipmaker could increase annual capital spending to $65–70 billion by 2027 as demand for AI processors continues to accelerate.
The investment boom is extending well beyond a single company. TSMC’s revenues climbed 30% year on year to NT$1.96 trillion in the first five months of 2026, while Jefferies estimates AI will contribute 31% of the company’s revenues this year.
For the brokerage, Taiwan’s economic resurgence underscores a broader global trend. As hyperscalers and technology companies continue investing billions of dollars in AI chips, advanced packaging, servers and data centres, countries at the heart of the semiconductor supply chain stand to reap outsized economic benefits. Taiwan’s record growth may therefore offer an early glimpse of how the AI infrastructure boom is beginning to reshape national economies.
