Taiwan's economy has benefited from the global artificial intelligence (AI) boom, with strong exports of semiconductors, servers and electronic components. Japanese scholar Yoshiyuki Ogasawara analyzed that Taiwan's economic growth rate is expected to exceed 10% in 2026, and its per capita GDP will also surpass Japan. However, the eye-catching economic data may not make people feel that their lives have improved. Facing the nine-in-one elections at the end of the year, President Lai Qingde is gradually adjusting his political strategy, shifting from emphasizing fighting the threat of China in the past to focusing on people's livelihood economy, childcare subsidies and wealth distribution, trying to translate the results of economic growth into actual feelings of the people.
Ogasawara Yoshiyuki wrote in "Toyo Keizai" that the Taiwan government estimates that the real economic growth rate in 2026 will reach 11%, and the International Monetary Fund (IMF) estimates that it will be 10.7%. The main growth momentum will come from AI-related exports and private equipment investment. Ogasawara Yoshiyuki also quoted the IMF's forecast that Taiwan's per capita GDP will reach US$43,950 this year, higher than Japan's US$35,400. Corporate profits and stock market performance will also drive an increase in government tax revenue. However, these economic data are the forecast values cited by Ogasawara Yoshiyuki, and the actual results must still be based on official information.
However, rapid economic growth does not mean that all people can share in the gains. Ogasawara Yoshiyuki pointed out that Taiwan’s real salary growth rate is about 1% to 2%, which is significantly different from the overall economic growth rate. Coupled with rising prices and high housing prices, many young people are still facing heavy life pressure. In particular, the difference in prosperity between the AI industry and other industries has caused a gap in how different ethnic groups feel about the current economic situation. People's evaluation of the prosperity is also affected by the tendency to support political parties.
Ogasawara Yoshiyuki analyzed that the Rai government has recently gradually linked economic growth with people's livelihood policies. After the opposition party pushed for universal cash distribution of NT$10,000 in 2025, the Lai government proposed a universal cash distribution of NT$10,000 per person in August this year, which is expected to be implemented in January 2027. It hopes to allow the people to share the fruits of economic growth through increased taxation. The Kuomintang proposed a universal cash distribution of NT$20,000 per person. The competition between the government and the opposition on cash distribution and welfare policies has also raised concerns about fiscal discipline and the ability to afford long-term financial resources.
It is worth noting that Yoshiyuki Ogasawara cited a public opinion poll in August this year and pointed out that for the first time, the proportion of respondents who thought Taiwan's economic situation was good exceeded the proportion who thought it was bad. This was the first time since the relevant survey was conducted in June 2006. The article believes that this change may reflect that some people are beginning to feel the economic improvement, and it also allows the Lai government to gain new political space before the election. However, the author also reminds that economic growth rate and stock market figures may not directly translate into political support. People's actual feelings about wages, prices and quality of life are important factors that affect the election.
In response to the Democratic Progressive Party's election strategy, Ogasawara Yoshiyuki pointed out that Lai Ching-te was elected with about 40% of the vote in the 2024 presidential election, which is lower than about 57% when Tsai Ing-wen was re-elected in 2020. Some votes went to the People's Party candidate Ke Wenzhe, reflecting changes in the support of young and middle voters for the Democratic Progressive Party. The article analyzes that although the DPP’s political discourse that emphasized the threat from China and national security in the past is still important, if it cannot simultaneously respond to issues such as youth employment, housing, and family life, it may be difficult to regain lost voters.
Ogasawara Yoshiyuki believes that Lai Qingde has adjusted his strategy from the setback of the recall operation in 2025. The local elections at the end of the year will no longer simply focus on "pro-China and anti-China" as the main offense and defense, but will allow candidates in each county and city to focus on local governance and people's livelihood issues. The article also mentioned that in May this year, Lai Qingde proposed the idea of paying 5,000 yuan per month in child care subsidies to children aged 0 to 18 years old. If received from birth to 18 years old, the cumulative amount can reach 1.08 million yuan; however, the relevant system details and financial resource planning still need to be clarified, and there is room for discussion whether it can effectively improve the problem of low birthrate.
Ogasawara Yoshiyuki finally pointed out that in the future, Taiwan will not only have to cope with the continued pressure exerted by China, but also face challenges such as increased defense spending, demographic changes and a possible slowdown in economic growth. The Lai government needs to propose long-term policies that will allow people to live with peace of mind, and the opposition parties should also explain the fiscal plan behind the expansion of welfare. The nine-in-one elections at the end of the year will not only be a competition for local political territory, but may also become an important indicator to test whether Taiwan’s government and opposition parties can shift from short-term cash handouts to discussing long-term economic and social development visions.
