CHINA-TAIWAN-TECHNOLOGY-FOXCONN
Taiwan's export-oriented manufacturing sector's composite business sentiment index reached 101.39 in September 2026, a new high in approximately 54 months. The Taiwan Institute of Economic Research (TIER) pointed out that global investment in AI infrastructure and demand for new products from international brands continue to support manufacturing confidence. The image illustrates a Taiwanese electronics manufacturing industry chain.

Confidence in Taiwan’s export-oriented manufacturing sector continued to improve. The Taiwan Institute of Economic Research (TIER) said on Oct. 23 that the manufacturing business climate index rose to 101.39 in September 2026, up 0.50 points from August and reaching its highest level in about 54 months, or since February 2022. The increase was mainly supported by global investment in artificial intelligence (AI) infrastructure and inventory building ahead of new product launches by international brands.

According to Focus Taiwan, the English-language news service of the Central News Agency, the services sector business climate index fell 3.15 points month on month in September to 92.65, while the construction sector index rebounded 2.81 points to 110.42. The uneven performance across sectors reflects how AI-related demand is supporting manufacturing without yet translating into synchronized growth across all domestic demand-driven and services industries.

TIER said manufacturing continued to benefit from large-scale global investment in AI infrastructure, as well as inventory preparation ahead of new product launches by international brands. This included demand related to the iPhone 18 series and iPhone Duo. AI servers, the semiconductor and electronic components supply chain, are key sources of momentum for Taiwan’s manufacturing sector.

The business confidence index reflects companies’ assessment of current and future operating conditions; it is not equivalent to actual output, revenue or earnings. Improving business confidence may indicate stronger expectations for orders and production, but final results will still be affected by factors including global end-market demand, raw material costs, exchange rates and international trade policies.

TIER also warned that manufacturing continues to face potential risks. Concerns in international financial markets have recently increased over the scale of AI capital spending by major technology companies and the returns on those investments. If companies reassess data center construction or adjust procurement plans, the outlook for orders across related supply chains could be affected. Geopolitical developments and changes in trade policy could also increase operating uncertainty for export-oriented companies.

For Taiwan, AI demand is still creating growth opportunities for the semiconductor, server and electronics manufacturing industries, but performance may continue to diverge across sectors. Manufacturing orders, industrial production, export data and corporate earnings reports should be monitored to determine whether improved business confidence can continue to translate into actual operating results.