Requirements for the development of a competitive Logistics Hub based on Northeast Asia studies

The main purpose of this study is to explore the concept of a logistics hub, identify key factors and milestones for its development, and give some recommendations and implications to developing countries in South America. To attract capitals and cargo, and to improve business logistic activities, developing a scheme called logistics hub can be consider as a general aim of this study. The terms Free Trade Zone (FTZ), Special Economic Zone (SEZ), within other necessary variables for the implementation of a hub area will be discussed. Ideas of South Korea, Japan and China, competitors in Northeast Asia (NEA) to be Logistics hub are going to be described. Important mega logistics hub as Singapore or Hong Kong for Southeast Asia, Rotterdam or Lyon for Europe or Jabel Ali in Dubai are just some examples of the idea for successful mega hub area. This successful city ports have develop its position as gateways to its regions on the basis of its excellent infrastructure and quality of services. In the new “global” environment the world is still facing steps of regional integrationKorea, Japan and China have under its priority policies the development of a logistics hub visioning to be the central area of the region. The winner will achieve micro economic and macroeconomic prosperity with developments in port, IT, R&D within other activities. After reviewing cases in this region, five factors came up as key determinants for the success implementation of a hub project: 1. Logistics services support and infrastructure. 2. Business environment. 3. Economic determinants. 4. Political support and 5. Access to international markets. These are going to be analyzed together with its different variables. Different governments of developing countries including South America should evaluate the challenge and milestones of the projects in Northeast Asia. National and local governments should start thinking in being central areas of their blocs or of different countries among the future Free Trade Area or the Americas in the economic integration scheme. South America region has big amount of natural resources and it is still “virgin” in the development of different activities. From a logistic perspective, South America markets are ripe for innovation and integration to develop competitive supply chain activities. The result of this study can be used as research material for project developers and governments of developing and also developed regions. Key words: Logistics hub, Special Economic Zone, Free Trade Zone, Foreign Direct Investments, Regional Integration, Distribution Centers, Clusters, Competitiveness, Relaibility, Multimodalism, IT, Logistics Service Providers, Business Operations, Political Support, Fiscal policies.the countries that becomes hub in their specific region will achieve socio-economic benefits. In Northeast Asia1. INTRODUCTION 1 2. LITERATURE REVIEW 3 2.1 Logistics centers 3 2.2 Foreign Direct Investments (FDI) 6 2.3 Port activity 8 2.4 Air port activity 9 2.5 Multimode transport activity 11 3. NORTH EAST ASIA EXPERIENCE 15 3.1 The economic and logistic environment of the Northeast Asia 15 3.2 Logistics demand in North East Asia (NEA) 16 3.3 Logistics infrastructure systems in Northeast Asia and trends 17 3.3.1 Maritime transport 17 3.3.2 Air transportation 18 3.3.3 Rail and Road transportation 19 3.4 Korea, China and Japan situation. 20 3.4.1 Republic of Korea 20 3.4.2 Republic of China 26 3.4.3 Japan 30 4. RESEARCH DESIGN 34 4.1 Selection of the research topic 34 4.2 Scheme to develop trade: 35 a) The Logistics hub (LH) 35 b) The Special Economic Zone (SEZ) and Free Trade Zones(FTZ) 35 c) Special Economic Zones (SEZ) and Logistics hub (LH) 36 4.3 Research instrument 36 4.4 Sample design 37 5. EMPIRICAL RESULT 39 5.1 Descriptive analysis of data. 39 5.2 Correlation analysis 41 5.3 Factor analysis 43 5.4 Regression analysis 45 5.4.1 Factors of Importance in the Building of an integrated Hub 45 5.4.2 Regression Model 46 5.4.3 One-Way analysis and t-test. 50 5.5 Interpretations of results. 55 6. RECOMMENDATIONS AND IMPLICATIONS TO DEVELOPING REGIONS 57 6.1 Situation in Latin America 57 6.2 Foreign Direct Investments (FDI) 58 6.3 Policy Recommendations for Attracting Center 60 7. CONCLUSIONS AND RECOMMENDATIONS FOR FUTURE RESEARCHES 63 BIBLIOGHAPHY 6