International Trade and Transportation Chains

International trade is based on the notion of exchange which involves the nature of merchandises being traded, the partners involved as well as the transactional environment in which trade takes place, namely tariff and non-tariff barriers. The physical realization of international trade requires a transport chain that can provide a succession of modes and terminals, such as railway, maritime and road transportation systems. The first stage in the transport chain is composition where merchandises are assembled at origin (A), often on pallets and/or containers. The cargo being traded then moves along the transport chain and transshipped at terminals from one mode to the other. Once it enters another country customs inspection takes place. This activity is dominantly located at major terminals, or points of entry, namely ports and airports. The final stage of the transport chain, decomposition, takes place at destination (B). In this context, the container is useful to facilitate transfers between modes where the most important function in international transportation becomes transshipment.