*

Preliminary Q1 GDP +5.37% y/y vs Q4 +2.9% (Reuters poll

+3.4%)

*

Full year 2025 GDP forecast raised to 3.6% vs previous

3.14%

*

Trump's tariff policies posts threat, but exports will

remain

strong -analyst

(Recasts, adds details from statistics bureau, paragraphs 3, 4,

analyst comment, paragraphs 6, 7)

By Jeanny Kao and Faith Hung

TAIPEI, April 30 (Reuters) -

Taiwan unexpectedly raised its 2025 economic growth forecast

on Wednesday after a strong first quarter performance thanks to

an export surge on strong tech demand ahead of the introduction

of possible U.S. import tariffs.

Taiwan is a key hub in the global technology supply chain

for companies such as Apple ( AAPL ) and Nvidia ( NVDA ), and

home to the world's largest contract chipmaker, Taiwan

Semiconductor Manufacturing Co Ltd ( TSM ) ,.

After reporting a preliminary 5.37% on-year gross

domestic product (GDP) expansion, the fastest rate since the

6.64% in the first quarter of 2024, the statistics agency hiked

to 3.6% its full year growth forecast, from a previous 3.14%.

Production, exports and investment all performed well in

the first quarter, with AI-driven demand helping, so with growth

exceeding expectations the full year forecast has been raised,

the Directorate General of Budget, Accounting and Statistics

said.

The first quarter performance beat the 3.4% growth forecast

by analysts in a Reuters poll and was faster than growth of 2.9%

in the fourth quarter.

"Although Trump's tariffs pose a downside threat to the

economy, we expect growth to remain strong, helped by continued

rapid growth in information and communication technology

exports," Capital Economics said in a research report.

The continued strong growth of the economy reinforces

the view that Taiwan's central bank will be one of the few in

Asia to leave interest rates unchanged over the coming year, it

added.

Quarter-on-quarter, the economy grew at a seasonally

adjusted annualised rate of 9.67%.

U.S. President Donald Trump earlier this month paused plans

for sweeping import charges on all countries for 90 days to

allow negotiations to take place.

Taiwan's tech firms have reported roaring demand thanks to

the surge in interest in AI applications.

TSMC this month reported a 60% year-on-year surge in

first-quarter net profit, beating forecasts.

China's first-quarter economic growth outstripped

expectations, underpinned by solid consumption and industrial

output.

The United States is Taiwan's second-biggest export

destination after China.

Taiwan's statistics agency will provide revised figures in a

few weeks time, with more details and forward-looking forecasts.