The CEO of DP World port operator Dubai, active worldwide, predicted "the worst" for international trade, considering that the 19-Covid pandemic damage could match those of the Second World War.
In an interview with AFP, Sultan Ahmed bin Soulayem ensures however that his group, present in 54 countries, is still hungry for acquisitions abroad.
Already one of the entities most profitable of the Government of Dubai, DP World has launched in recent years in a buying spree, spending billions of dollars to buy shares in companies such as P & O Ferries in Britain or terminal in Chile.
But the crisis caused by the pandemic choked world trade, of which approximately 80% is carried by sea, paralyzing the major supply chains and reducing imports and exports.
- "misleading sales" -
Sultan Ahmed bin Soulayem, world trade has paid a "heavy price" that during the financial crisis of 2007-2008 and the situation is comparable to the post-World War II period.
The difference "today, (is that) factories are intact, but no one can work. The streets are safe and no one gets out. The shops are full of goods, but nobody buys."
rapid recovery predictions are too optimistic, he said, and the assumption of a stronger fall --In the crise-- followed by stagnation is more probable, unless significant stimulus measures are adopted .
The World Trade Organization (WTO) said in April that international trade could fall by 13-32% in 2020 due to the pandemic.
Sultan Ahmed bin Soulayem says that the activity of 82 ports, terminals and logistics centers DP World in the world has declined by about 4% in the first quarter of 2020.
A figure "misleading", he said, however, pointing out that the activity of recent weeks was related to orders placed before the crisis.
"What will happen in the next four months? That is the key question (...). We have to monitor the situation, but we are preparing for the worst," he warns.
Despite these gloomy prospects, the CEO of DP World says that his group did not ask the help of Government of Dubai and will use it if necessary to the markets to finance its expansion.
- Reaping profits "immediately" -
DP World has multiplied in recent years acquisitions with the intention of becoming the leading global provider of logistics end to end.
Sultan Ahmed bin Soulayem ensures that his group plans to invest "even during this crisis," but warns of a condition: "If we believe that investment will increase our revenue and generate profits."
"We are a company that has become a source of revenue for the government" and therefore must "earn money immediately," he says.
DP World, which in February announced its exit from the Dubai Financial Market and its return to full ownership of the emirate provides neither layoffs or wage cuts according to its CEO, unlike other major company in Dubai, as Emirates airline.
The port operator, which operates a global network of 123 business units managed by a staff of 56,500 people, last year recorded a 4.6% increase in net profit to $ 1.33 billion.
In 2019, DP World took over 71.2 million TEUs (twenty-foot containers), which ranks among the top five global operators. Its port, Jebel Ali, located in the south of Dubai, processed 14.1 million TEUs, down 5.6%, but still ranks among the top ten worldwide.
The free zone of Jebel Ali, a subsidiary of DP World, contributed 23% to gross domestic product (GDP) of Dubai last year.
According to Sultan Ahmed bin Soulayem, none of the 8,000 companies based there is partly because of the crisis.
© 2020 AFP