Taiwan has upgraded its growth forecast for 2021, predicting the economy this year could expand at the fastest rate in seven years — thanks to global semiconductor demand boosting exports from the island.

Its economy is forecast to grow by 4.64% in 2021 from a year ago — making it the quickest expansion since 2014, according to data from the Taiwanese statistics bureau.

Taiwan’s projected growth for 2021 is an upgrade of the previous forecast for a 3.83% expansion, and an acceleration from the revised growth of 3.11% for the whole of 2020, the bureau said on Saturday.

The North Asia economy was the fastest-growing in Asia last year, when the Covid-19 pandemic hit activity in many countries and territories. Taiwan also grew faster than China for the first time in 30 years.

Gary Ng, an economist at French investment bank Natixis, said Taiwan’s economy is in a “sweet spot” of very strong demand for tech products globally, as well as a relatively successful containment of the coronavirs pandemic.

“On the external front, definitely semiconductor is really the spotlight,” Ng told CNBC’s “Squawk Box Asia” on Monday, noting that technology products account for more than half of Taiwan’s total exports.

Goods exports grew 4.9% in 2020 compared to a year ago, as lockdown measures aimed at containing the spread of Covid-19 forced a greater number of people to work and study remotely. That in turn boosted demand for electronic products such as laptops.

Growth in Taiwan’s goods exports are forecast to nearly double to 9.58% in 2021, said the island’s stats bureau.

In addition to exports, Taiwan’s domestic demand has also held up better than many other economies, said Ng.

The pandemic’s hit to consumption has been limited — thanks to early containment of the coronavirus, while government schemes have helped to incentivize firms to invest, the economist added.

With a population of more than 23 million people, Taiwan reported 942 confirmed cases of Covid-19 and nine deaths as of Sunday, according to data by the Taiwan Centers for Disease Control.

“If we put all of these factors together, we actually see that this has supported Taiwan to become an ace for economic growth in 2020. And I think we are expected to see basically more upside surprise in 2021 as well,” said Ng.

But Taiwan’s growth is not likely to outpace China’s again, noted Ng.

The International Monetary Fund said last month that China’s growth would jump to 8.1% this year from last year’s 2.3%, as the world’s second largest economy charges ahead of the other major economies, including the U.S.

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