DP World CEO says outlook positive despite trade tensions
COMPANY HAS PERFORMED ‘REASONABLY WELL’ SO FAR THIS YEAR AMID DJIBOUTI ISSUE
Even as its legal dispute with the government of Djibouti escalates, DP World said it has a “very positive outlook” on its financial and operational performance, reiterating that Djibouti is a “very small part” of its network.
Mohammad Al Muallem, CEO and managing director for the UAE region at DP World, said the company has performed “really reasonably well so far” this year “considering what is happening globally,” referring to trade tensions.
“We have been very fine. We are still growing. In terms of performance, we have done well, and we are growing,” he told Gulf News in an interview, adding that 2018 has been “a good year.”
Al Muallem said DP World is also eyeing further expansion, especially in emerging markets including Africa, after it started the first phase of construction on a port in Somaliland last week. The DP World Berbera port is expected to serve landlocked countries in the Horn of Africa where the company sees strong opportunities for growth.
“There are the mature markets, in which we will continue to expand our facilities, and these are Europe. And there are developing markets where facilities and infrastructure are needed to help trade to grow, so it’s a different mix,” he said.
Djibouti dispute
The CEO did not specify which countries in Africa the company is planning to expand in or a timeline, but said that its dispute with Djibouti has not deterred it from investing in other African nations.
“We don’t generalise at all,” Al Muallem said, pointing to what he described as “fantastic relationships” with other African governments including those in Egypt, Algeria, Senegal, Rwanda, and Mozambique.
DP World has been fighting a legal battle with the government of Djibouti, which in February illegally seized control of a joint venture it had with the ports operator.
The issue has since been with the High Court of England and Wales in London, with rulings in favour of DP World. The latest ruling, in late September, upheld an injunction prohibiting the Port de Djibouti, a state-owned firm, from interfering with the management of the joint venture.
While Al Muallem said he could not provide updates on the legal issues between the two sides as he was not involved in them, he said he was not concerned about the financial impact of the dispute.
“Djibouti is a very small part of our network. I mean, we have 78 terminals around the world, and this is only one, so this is where I say our strength comes in; because we are so spread all over,” he said.
In early October, Sultan Bin Sulayem, Chairman of DP World, told Bloomberg TV that the issue with Djibouti’s government is “a battle that will continue,” and that the company “will pursue it with every power we have legally.”
Away from Africa, Al Muallem discussed the macroeconomic environment, saying that DP World has a wide enough geographical footprint to counter a possible slowdown in one region or the other from rising trade tensions around the world.
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Al Muallem added: “We know that trade will continue to grow no matter whatever happens … We’re not going to stop consuming, we’re not going to stop buying — it will continue to grow.”
He was speaking on the sidelines of a media event this week to mark the one-month countdown to the 10th DP World Tour Championship, which will take place on November 15-18.
The golf championship will bring together the top 60 players on the European Tour’s race to play in front of 65,000 spectators and another 500 million watching on television.
DP World has the event
10 years.
“It’s a global and international sport, and we’re also a global and international player as a business. It’s a brand of Dubai; DP World is one of Dubai’s major economic players, and we want to be associated with bringing a major event like this to a city like Dubai,” Al Muallem said, adding that the event highlights Dubai’s position not just in business but also in sports.
There are the mature markets, in which we will continue to expand our facilities, and these are Europe. And there are developing markets where facilities and infrastructure are needed to help trade to grow, so it’s a different mix.” Mohammad Al Muallem| CEO, DP World
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