1. Project Name: Demand Survey, Logistics Cost Survey and Economic Analysis for Logistics Terminal

2. Duration:  June 2023 - February 2024

3. Background:

This Official Development Assistance (ODA) project, initiated in response to Laos' request, aims to revitalize Champasak Province's economy by modernizing its logistics infrastructure and maximizing its potential as a regional hub. The project, contracted in August 2022 and led by a KRIHS consortium, builds upon a project concept paper received in December 2020 and subsequent discussions with Lao officials. It encompasses four key assignments: developing a logistics master plan for Champasak; analyzing the feasibility of logistics terminals (including site review, freight demand forecasting, and economic analysis); assessing the feasibility of Pakse ring roads, bypasses, and a Mekong River bridge (including field surveys, cost estimation, and basic design); and implementing a Korean capacity-building program. This project seeks to validate existing local plans and feasibility studies through external review and guidance. 

4. Client: Logistics Revolution Korea (LRK)

5. Government Counterpart: Ministry of Public Works and Transport, Department of Public Works and Transport of Champasak Province

6. ERA's Contribution & Scope:

I. Demand Survey

• determine the current and future demand for logistics services within the terminal's service area.

• Identify key stakeholders: manufacturers, distributors, freight forwarders, retailers, and other relevant businesses.

• Conduct surveys and interviews to gather data on:

1. 1. 1. Current and projected freight volumes.

      2. Types of goods handled.

      3. Transportation modes used.

      4. Logistics service requirements (e.g., warehousing, handling, distribution).

      5. Potential utilization of the new logistics terminal.

• Analyze market trends and economic forecasts to project future demand.

• Demand forecasts, market analysis reports, and assessments of potential terminal utilization.

II. Logistics Cost Survey

• Evaluate the current logistics costs incurred by businesses in the region and assess the potential cost savings offered by the new terminal.

• Collect data on:

1. 1. 1. Transportation costs (e.g., freight rates, fuel costs).

      2. Warehousing costs (e.g., storage fees, handling charges).

      3. Inventory holding costs.

      4. Administrative and other logistics-related expenses.

• Compare current logistics costs with projected costs using the new terminal.

• Analyze the impact of the terminal on supply chain efficiency and cost reduction.

• Logistics cost analysis reports, cost-benefit assessments, and evaluations of potential cost savings.
  Assess the overall economic viability and impact of the logistics terminal project.

• Conduct a cost-benefit analysis, considering:

1. 1. 1. Capital investment costs.

      2. Operating and maintenance costs.

      3. Projected revenue streams.

      4. Economic benefits (e.g., job creation, increased trade, regional development).

• Evaluate the project's financial feasibility (e.g., net present value, internal rate of return).

III. Economic Analysis

Assess the project's potential impact on the local and regional economy.

Analyze the impacts of the terminal on the surrounding areas, such as increases in local business, and impacts on local employment.

Economic feasibility studies, financial analysis reports, and assessments of the project's economic impact.

7. Summary

From June 2023 to February 2024, as part of an Official Development Assistance (ODA) project initiated by Laos, a comprehensive Demand Survey, Logistics Cost Survey, and Economic Analysis were conducted for a proposed logistics terminal in Champasak Province. This project, led by a KRIHS consortium and contracted by Logistics Revolution Korea (LRK), aimed to revitalize the region's economy by modernizing its logistics infrastructure. ERA's contribution focused on assessing the terminal's feasibility through detailed demand surveys, identifying current and future logistics service needs; logistics cost surveys, evaluating potential cost savings for businesses; and thorough economic analysis, determining the project's viability and regional impact. This effort supports the broader goal of validating existing local plans and feasibility studies, contributing to the development of a robust logistics master plan for Champasak Province, with the Ministry of Public Works and Transport serving as the government counterpart.