DP World expects return to growth in Europe, says curbing costs a challenge in China

DP World, the port operator with terminals from China to the Netherlands, expects a return to growth in some European markets after a period of stagnation and said it has avoided a hard landing in China. “Europe almost bottomed and there’s only going up,” chairman and chief executive officer Sultan bin Sulayem said in a TV […]

DP World, the port operator with terminals from China to the Netherlands, expects a return to growth in some European markets after a period of stagnation and said it has avoided a hard landing in China.

“Europe almost bottomed and there’s only going up,” chairman and chief executive officer Sultan bin Sulayem said in a TV interview with Bloomberg Markets Middle East. “I’m not that optimistic we’re going to see big growth, but I expect to see growth.”

DP World relies on geographically diversified markets to offset dips or limited growth in lower-performing regions. The company said last week it posted growth in container volumes in the first quarter, driven by its terminals in Europe and the Indian subcontinent. New developments in Europe, including Rotterdam, the Netherlands and Yarimca, Turkey should deliver an increased contribution in the second half, it said.

DP World has seen growth in China, where it has three locations, despite difficult economic conditions, Mr Sulayem said. Increasing expenses remain a challenge, though, he said.

“China’s biggest challenge in my opinion is curbing costs,” he said. “We have terminals where we’re facing 20 per cent increase in labour charges every year, for the past seven years,” Mr Sulayem said.

DP World, which has expressed interest in Russian investments in the Black Sea and Baltic region, has “enough cash” to take advantage of “viable” opportunities when they arise, Mr Sulayem said, declining to reveal specifics.

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Source: Business

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