The founder of TSMC claims that free trade has lately come with 'conditions.'

Free trade and market is one of the remedies for the scarcity of chip. In response of the shortage of chips free market has proved its relevance.

FREMONT, CA: Morris Chang, the founder of Taiwan Semiconductor Manufacturing Co., reaffirmed the importance of free trade in resolving supply concerns in the key chip business, but he cautioned that this has been accompanied with additional conditions in recent years.

Chang, who was representing Taiwan at the leaders' conference of the Asia-Pacific Economic Cooperation on Friday, expressed worry that "free trade" had come to be associated with more constraints and requirements than it did before. He subsequently explained that such "conditions" alluded to the United States' intention to manufacture more chips domestically, during a press conference.

In the midst of a prolonged worldwide chip deficit and requests from both Washington and Beijing for local chipmakers to strengthen self-reliance, his remarks come at a time when Taiwan's leading position in the semiconductor market is under threat. TSMC, the world's largest chipmaker, will construct a facility in Japan and is exploring the construction of a new facility in Germany.

As Chang points out that although a scarcity of any vital component is a major concern, the free market — which includes free trade and free competition — remains the best remedy. He has previously expressed concern that attempts by governments throughout the globe to establish local chip supply chains might result in cost increases and the failure to achieve self-sufficiency in the long run.

According to Chang, the increased construction of chip manufacturing capacity in response to recent shortages demonstrates the relevance of the free market in today's world. According to him, the scarcity is the conclusion of a previous underestimation of demand, natural calamities, logistical bottlenecks, and an increase in demand for digital content.