DP World chairman issues trade warning due to US-China spat
International tensions such as those between the United States and China will make the trade environment in 2019 challenging but not unmanageable, says DP World chairman Sultan Ahmed bin Sulayem.
Speaking to Reuters on Sunday, Sulayem said he believed the psychological impact of trade tensions involving the United States were starting to translate into reality.
His comments came a few weeks after DP World cautioned in August that geopolitical risks and changes in trade policies would impact the global economy. During the first half of 2018, DP World’s profit fell 2.1 percent.
“We are finding ways to make sure that we do well in 2019,” Sulayem said in an interview with Reuters. He declined to comment when asked if the company would report a higher profit this year.
“Historically, we have managed worse scenarios than this,” he said of global market conditions, adding that DP World had reached its goals in 2018.
Sulayem said that he believes financial institutions are becoming increasingly cautious and taking measures such as tightening lending in reaction to trade tensions, which is likely to negatively impact growth in emerging markets.
Trade tensions were evident in Papua New Guinea on Sunday when Asia-Pacific leaders failed to agree on a communique at a summit for the first time in their history as deep divisions between the United States and China over trade and investment stymied cooperation.
DP World, one of the world’s largest port operators, is taking measures to reduce costs, and is addressing how it will manage a challenging 2019, bin Sulayem said, without elaborating.
DP World itself is in a dispute with the government of Djibouti which in February seized a DP World-operated port in the country.
Bin Sulayem repeated a denial that the government of Djibouti has offered to buy DP World’s stake in the 50-year concession. He said he asked them to make an offer in January.
They have not taken “any measures to contact us,” he said.
DP World has also launched legal proceedings in Hong Kong against China Merchants over allegations they have infringed on their concession rights in Djibouti.