Assessing import channels for a land‐locked country: the case of Lao PDR

Abstract

Lao PDR, as the sole land‐locked country in South East Asia, is dependent upon available infrastructure in neighbouring countries for fast and efficient import of goods. The validity of a cost model for multimodal transport, which was originally proposed by Beresford and Dubey (1990) and developed by Beresford (1999), is tested against a real case in international logistics, namely the import of wine from Marseilles in France to Vientiane in Lao PDR. The main elements of the model are as follows: cost, time, distance, transport mode and intermodal transfer. The model is tested using real data over a series of alternative routes between Marseilles and Vientiane. The selection of appropriate international logistics system will have a direct impact on the efficiency of Lao PDR import channels. The research findings clearly demonstrate that the “sea‐road” combination via Danang Port in Vietnam is the most competitive in terms of costs while the “sea‐rail‐road” option via port Klang in Malaysia and through Thailand offers the fastest transit time.