UPDATE 1-Taiwan raises 2017 GDP growth, sees faster pace next year

* Forecast for 2017 raised to 2.11 percent from 2.05 pct

* Economy is forecast to expand 2.27 pct in 2018

* Demand good, but momentum could slow - statistics agency

TAIPEI, Aug 18 (Reuters) - Solid demand for the components Taiwan pumps out for tech gadgets has led the island to slightly raise its growth forecast for this year and predict further gains in 2018.

On Friday, Taiwan nudged up the 2017 projection to 2.11 percent from the 2.05 percent seen in May and 1.92 percent predicted in February.

The last time Taiwan’s full-year growth topped 2 percent was in 2014, when it was 4.01 percent

The export-driven economy can have 2018 growth of 2.27 percent, the Directorate General of Budget, Accounting and Statistics said.

The agency also marginally amended second-quarter GDP expansion to 2.13 percent from the 2.10 percent released last month.

Exports were strong early this year, and the second half is traditionally the strong season for components.

“With demand growing in the hot season in the second half of the year, exports momentum can get a boost from new handheld device launches and continued strong demand for new applications in vehicles, Internet of Things (IOT) and artificial intelligence,” the agency said.

“However the pace is expected to slow as the low base effect phases out,” it added.

Taiwan is one of Asia’s major exporters especially of technology goods, and its export trend is an important gauge of global demand for technology gadgets worldwide.

In the first half of 2017, Taiwan’s exports rose 12.5 percent from a year earlier. In June, export orders rose 13 percent.

Apple Inc. recently delivered surprisingly strong fiscal third-quarter earnings and signaled that its coming 10th-anniversary phone lineup was on schedule, boosting expectations of increasing shipments from its Taiwanese suppliers.

Chu Tzer-ming, minister of the statistics agency, said the higher GDP forecast for this year is “mainly because of a slight increase in private consumption and in exports.”

In a report before Friday’s data release, DBS in Singapore said Taiwan’s outlook was improving as growth in the Eurozone and Japan was gathering pace, and demand from the United States should increase in the “next couple of quarters”. (Editing by Richard Borsuk)