An Optimum Location-Allocation Model of Logistics Parks forFreight Transit in the ECO Region

The Economic Cooperation Organization (ECO) region has a good potential for freight transit due to its geographical location. The region can act as a land bridge between Asia and Europe as well as having a vital role for the development of Central Asia land-locked countries. To promote the trade and transit among these countries, appropriate transportation infrastructure and services are required. Logistics is the management of the flow of goods, information and other resources, including energy and people, between the point of origin and the point of consumption in order to meet the requirements of consumers. Logistics involves the integration of information, transportation, inventory, warehousing, material-handling, and packaging, and occasionally security. Logistics is a channel of the supply chain which adds the value of time and place utility. Logistics parks are the key element of good intermodal transit transportation. The core of the strategy to develop logistics parks is industry capacity development with a focus on assisting logistics service providers to build their own enterprise capacity. Logistics parks help governments to promote the development of modern facilities in a new industrial cluster – including a major truck-park, transportation terminals, distribution centers, processing facilities, a logistics incubator, and a technology center. In this research, an optimum location-allocation model for development of logistics parks in the ECO region to provide services for transit freight is presented. Transport and logistics requirements are determined based on an assessment of the agricultural and resource sectors, and the light and heavy industries associated with those sectors. Special attention should be given to the role as a “transit-hub”. Based on our scope to provide services just for transit freight, the role as a transit hub is considered as the demand of logistics parks. There are no logistics parks in the ECO region. Also service providers as well as local transport operators, terminal facilities and distribution centers that all play roles in the logistics industry are in poor condition. In fact logistics industry (supply) in the ECO region is weak. Freight demand and supply are taken into consideration to determine the location of logistics parks. Based on demand role as transit hub and weakness in the supply sector, transit hubs are considered as the best location of logistics parks.