It’s an important trade hub, historically where ships coming from Europe would stop to trade with ships coming from China and Japan.
If you look at its location on the map, Singapore is located exactly where a ship coming around the tip of India would pass on its way to the Pacific.
There are similar points of geographically bottlenecked trade in Istanbul, Tangier, Cape Town, the UAE… if trade ships have to pass you, you might get rich middle-manning the trade.
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