Conditions for the emergence of entrepot trade
Entrepot Trade means that the import and export trade between two countries is completed through the transfer of goods by middlemen in a third country. This trade mode is indirect export in the producing country and indirect import in the consuming country, so it is an indirect trade mode. For the third country, it exports the imported goods again, so it is re-export, also known as re-export trade. Entrepot trade has a history of hundreds of years. London, Rotterdam and Singapore are famous entrepot trade ports. After the war, entrepot trade developed rapidly in Hong Kong, Singapore, Japan and other places, and became an important part of foreign trade in these areas.
Entrepot trade for the country where the middleman is located, generally must have two conditions:
(1) Natural conditions, that is, the port of the transit country must be a deep-water port, strong handling capacity, advantageous geographical position, and located in the traffic arteries between countries or on the main international route;
(2) Artificial conditions: the transit countries are required to adopt special preferential tariff policies and trade policies, such as free ports and free trade zones, so that the transit costs are not too high. At the same time, the infrastructure, transportation, finance, information and other service systems are required to be developed and complete in order to facilitate the transit trade.