Taiwan's economy is surging, driven by a global AI boom and its dominant position in semiconductor manufacturing.
As the world's leading chipmaker, Taiwan accounted for nearly two-thirds of global semiconductor output last year — with TSMC producing over 90% of the most advanced chips used in artificial intelligence — helping fuel economic growth of nearly 9%.
This heavy reliance on microchips has created both strength and risk: semiconductors contribute around one-fifth of Taiwan's GDP and form the backbone of its "silicon shield," but also make the island a critical global chokepoint.
Amid tensions with China, US efforts to reshore chip production and rising competition, Taiwan is seeking to diversify into AI, defense, drones, cybersecurity and next-generation communications.
Its long-term resilience may depend on its ability to adapt and innovate beyond semiconductors.
This video summary was created by AI from the original DW script. It was edited by a journalist before publication.