Taiwan’s March trade figures beat forecasts, with exports and imports rising and the trade balance reaching a five-month high of USD 21.3bn. The 1Q26 trade surplus totalled USD 53.0bn, up 124.2% year-on-year.
Tech-related goods made up 84.0% of total exports in 1Q26, compared with 80.4% in 2025 and 73.2% in 2024. Export prices also increased, adding to export growth.
Taiwan Trade Performance And Growth Implications
In 4Q25, when the trade surplus also more than doubled, net exports added 11.9 percentage points to GDP growth. The latest trade performance is expected to support another quarter of double-digit GDP growth when 1Q26 GDP is released at the end of April.
ING upgraded its 1Q26 GDP growth forecast to 11.5% year-on-year from 10.2%. It also raised its 2026 full-year GDP forecast to 8.2% year-on-year from 6.7%.
The outlook assumes higher energy prices can be absorbed if tech demand remains strong, but energy supply shortages could affect production. The forecast depends on limited disruption to energy supplies, including developments related to Iran in the coming weeks or months.
The surprising strength in Taiwan’s trade data for the first quarter suggests we should position for continued upside in the coming weeks. With the Q1 GDP report due at the end of April, the massive 124.2% jump in the trade surplus points to another significant economic beat. This recalls the dynamic we saw in the fourth quarter of 2025, where a similar export surge drove a major rally in local assets.
Positioning Ideas Ahead Of The Gdp Release
We should consider buying call options on the TAIEX index, anticipating a positive reaction to the upcoming GDP figures. The index has already climbed over 15% this year to date, largely driven by the tech sector which now accounts for 84% of exports. Given that market forecasts have consistently underestimated this growth, options provide a leveraged way to capitalize on another potential upside surprise.
The surging trade surplus, hitting $53.0 billion in the first quarter, is a strong tailwind for the Taiwanese Dollar. We could look at buying TWD call options or USD/TWD put options expiring after the GDP announcement. A strong economic print would likely attract more capital inflows, further strengthening the currency against the US dollar.
However, we must hedge the clear risk tied to energy prices, which is contingent on the situation in Iran. Geopolitical tensions have already pushed Brent crude prices up from $85 to over $92 a barrel in the last month. Buying out-of-the-money call options on crude oil futures could be a cost-effective way to protect our bullish Taiwan positions from a potential supply shock.
The economy’s heavy reliance on a single sector is itself a risk that needs monitoring. With tech’s share of exports growing from 73.2% in 2024 to 84.0% now, any specific downturn in global AI or semiconductor demand could have an outsized negative impact. This concentration justifies keeping some protective put positions on key tech names, even within a broadly bullish strategy.
