DP World, one of the world's largest port operators, registered a nearly 3 per cent annual rise in gross container shipping volumes in the second quarter of the year, as trade picked up globally.
The company handled 20.2 million twenty-foot equivalent units (TEU) during the April-June period, with volume growth driven by its terminals in Asia Pacific, the Americas and Australia, Dubai-based DP World said on Wednesday.
The results are "another solid set of throughput figures", which are "once again ahead of industry growth", said Sultan bin Sulayem, group chairman and chief executive of DP World.
"This robust performance illustrates the resilience of the global container industry, and DP World’s continued ability to outperform the market," Mr Bin Sulayem said.
Shipping costs have risen after the Covid-19 pandemic, which has disrupted supply chains, with the continuing Russia-Ukraine conflict further straining operators.
In particular, the conflict is stifling trade and logistics in the Black Sea region, increasing global vessel demand and the cost of shipping around the world, the UN Conference on Trade and Development said last month.
Shipping distances have also increased, along with transit times and costs, as Ukraine's trading partners now have to source commodities from farther away.
The global shipping container market is projected to grow to more than $10 billion in 2022 from $9.37bn in 2021, and is seen to hit around $13.5bn by 2026 at a compound annual growth rate of 7.5 per cent, according to Research and Markets.
For the first six months of the year, DP World transported 39.5 million TEU across its global portfolio of container terminals, up more than 2 per cent annually.
The Americas and Australia recorded the strongest growth in the first half, with volumes increasing 4.5 per cent to more than 5.7 million TEU.
The Asia Pacific and Indian subcontinent regions handled more than 17.6 million TEU, an increase of 3 per cent annually, while volumes in Europe, the Middle East and Africa (Emea) grew about 1 per cent to more than 16.1 million TEU.
DP World's flagship Jebel Ali port in Dubai handled almost 7 million TEU in the first half and more than 3.5 million TEU in the second quarter, an increase of 1.2 per cent and 3.5 on a yearly basis, respectively.
Mr Bin Sulayem said the near-term outlook is uncertain given the geopolitical environment, inflationary pressures and continued impact of the Covid-19 pandemic.
DP World, however, remains "positive on the medium to long term outlook for global trade".
This robust performance illustrates the resilience of the global container industry, and DP World’s continued ability to outperform the market
Sultan bin Sulayem,
group chairman and chief executive of DP World
"Overall, given the solid start to the year, we expect to deliver an improved full performance," he added.
DP World, which operates through a global network of 295 business units in 78 countries, has been aggressively expanding its portfolio.
Its South African unit, Imperial Logistics has this month increased its stake in Botswana firm PST Sales & Distribution; received approval to buy a 100 per cent stake in Mozambique-based logistics company J&J Group; and acquired a controlling stake in Nigeria's Africa FMCG Distribution.
In June, DP World and the Saudi Ports Authority signed an agreement to build a "port-centric" logistics park at the Jeddah Islamic Port with a total investment of more than 500 million Saudi riyals ($133.33m).
Also last month, DP World and Dubai’s Ports, Customs and Free Zone Corporation signed an agreement with Romania to develop infrastructure in the port city of Constanta and help it become one of the Black Sea’s “most important” cargo and vehicle ports.
Canadian fund Caisse de Depot et Placement du Quebec, also announced in June that it will invest $5bn in three of DP World's UAE assets — Jebel Ali Port, Jebel Ali Free Zone and National Industries Park.
More on animal trafficking
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What vitamins do we know are beneficial for living in the UAE
Vitamin D: Highly relevant in the UAE due to limited sun exposure; supports bone health, immunity and mood.
Vitamin B12: Important for nerve health and energy production, especially for vegetarians, vegans and individuals with absorption issues.
Iron: Useful only when deficiency or anaemia is confirmed; helps reduce fatigue and support immunity.
Omega-3 (EPA/DHA): Supports heart health and reduces inflammation, especially for those who consume little fish.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
FIRST TEST SCORES
England 458
South Africa 361 & 119 (36.4 overs)
England won by 211 runs and lead series 1-0
Player of the match: Moeen Ali (England)
Company%20profile
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UAE currency: the story behind the money in your pockets
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
MATCH INFO
Everton 2 Southampton 1
Everton: Walcott (15'), Richarlison (31' )
Southampton: Ings (54')
Man of the match: Theo Walcott (Everton)
FIXTURES
Monday, January 28
Iran v Japan, Hazza bin Zayed Stadium (6pm)
Tuesday, January 29
UAEv Qatar, Mohamed Bin Zayed Stadium (6pm)
Friday, February 1
Final, Zayed Sports City Stadium (6pm)
Getting%20there%20
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BIG SPENDERS
Premier League clubs spent £230 million (Dh1.15 billion) on January transfers, the second-highest total for the mid-season window, the Sports Business Group at Deloitte said in a report.
