Trade values predictive model of Southeast Asia under the Belt-Road Initiative

Abstract

This research aims to quantitatively evaluate the impact that future logistics development projects may have on Southeast Asia’s trade values (import and export) under the Belt-Road Initiative (BRI) scheme with Logistic Performance Indicators (LPIs) as the medium of evaluation. We investigate the multicollinearity effect, which are typically common for logistics performance indicators. The research adopts a model development technique from the Principal Component Regression (PCR) and integrates it to the Analytic Hierarchy Process (AHP) to cope with industry and freight logistics practitioner opinions on various logistics infrastructure developments under the BRI scheme. The predictive model to trade activities of South East Asia under the China-Indochina Peninsula Economic Corridor will be proposed. Our predicting model will be weighed under the 8 different scenarios existing BRI logistic projects. This research significantly contributes to solution methodology for building a predictive model of logistic indices to trade activities under the multicollinearity effect.