Ashwin Kamath

Dear Anna, let me highlight for you the 3 main entrepot powers in the world: 1.Hong Kong is world’s largest entrepot economy. The special administrative of China is located to the east of the Pearl River (Xu Jiang) estuary on the south coast of China. It is an established entrepot between the world and China and leading in world for its Entrepot trade. 2.Dubai is also among the leading hubs experiencing continuous growth on the entrepot trade. Dubai Entrepot contribute about 15% share to the Dubai’s economy. The hub is practicing an open door policy and extended facilities to international trading. Dubai is a brilliant transit point that connects Africa so well to Asia and Europe. 3.Singapore is the largest port in Southeast Asia and one of the busiest in the world. Singapore is the 14th largest exporter and the 15th largest importer in the world. The country has the highest trade-to-GDP ratio in the world at 407.9 percent, signifying the importance of trade to its economy. Entrepot trade accounts for about one-third of Singapore’s export trade.

Hi Andrea! The World Trade Organization (WTO) is the only international organization dealing with the global rules of trade among nations. It sets the rules for the global trading system and resolves disputes between its member nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible. Another important objective of WTO is to actually promote international trade. WTO also covers trade in services, such as telecommunication and banking, and others issues such as intellectual rights.

Hello Robert! I will share with you some of the reason for the need of Entrepot trade. 1.Accessible Trade - non-availability of accessible trade to the destination importing country; 2.Processing Facilities - lacking processing & finishing facilities by importing or exporting country; 3.No Trade Agreement - lack of trade agreement between the two trading countries; 4.Banking Facilities - inadequate facilities available in the importing country; 5.Volume of Trade - volume of trade does not justify to have regular foreign trade; 6.Direct Link - difficult to establish direct link between the exporting country and the consuming country. Basically, these reasons are create the need of re-export trade to still be present nowadays in our society.

Hello Anna! This concept of entrepot trade popped up in international market mainly because of higher dependency on transshipment of cargo in Singapore, Hong Kong and Dubai.The external trades of these countries are 90% dependent on transshipment which has played a leading role in their economic boom. Entrepot trade is of the kind of external trade. It is basically a trade in which imported goods are re-exported with or without any additional processing or repackaging. Entrepot is mainly used to refer to duty-free ports with the high volume or re-export trade. At entrepot, goods do not face any import and export duties upon shipment from the port. In simple terms, it can be said that if goods are imported from one country with the purpose of re-exporting to another, it is called Entrepot trade. In this situation the trader becomes the consignee who imports and is also the exporter at the moment of the re-exporting to the third party country where the goods will be ultimately received. For example, if an Indian company imports rubber from Thailand and exports it to Japan then it is called Entrepot trade for India.