The Chung-Hua Institution for Economic Research (CIER) released its latest economic growth forecast on Friday, projecting that Taiwan’s GDP growth in 2025 could fall to as low as 0.16%.

CIER President Lien Hsien-ming (連賢明) said U.S. tariff plans remain fluid, with negotiations ongoing and no final decisions yet in place. As a result, the think tank presented three simulated scenarios. Under an optimistic outlook, Taiwan’s economy could grow by 2.85% in 2025. A neutral scenario sees growth slowing to 1.66%, while in the most extreme case, such as a global recession or stagflation, growth could dip to just 0.16%. Lien noted, however, that the probability of this worst-case scenario is relatively low, estimated at around 10% to 20%.

Lien emphasized that the U.S.-China tariff conflict is critical to Taiwan, as both are major trading partners. Nevertheless, he said that he believes the current standoff is unlikely to persist indefinitely, and that the two economic giants will eventually seek to negotiate.

He added that the biggest challenge at the moment is uncertainty. Taiwan’s industrial sector is largely adopting a wait-and-see approach. A 90-day buffer period has triggered a flood of urgent orders, with companies rushing to deliver within the timeframe. The situation remains complex and warrants close monitoring.