Industry Perspective: Trade wars cause uncertainty of future economic outlooks. Larger trade restrictions indicate smaller trade growth.
A.P. Moller-Maersk A/S, the world’s biggest container-shipping company, signaled it’s less optimistic about growth in its industry as trade wars dent the economic outlook.
Copenhagen-based Maersk now sees global growth for the sector of 1-2% compared with a previous estimate of 1-3% for this year, it said on Friday. The company predicted growth in its own business may be “slightly lower” than the industry average, but said it will rein in costs to support profits.
AP Moller-Maersk A/S CEO Soren Skou Interview
Soren Skou
The more pessimistic outlook “reflects the broad-based weakening of the economic environment in all the main economies,” Chief Executive Officer Soren Skou said in the statement. “Negative effects from escalating trade restrictions also weighed on trade growth.”
In an interview with Bloomberg Television, Skou said Maersk has been able to deal with the challenging environment by keeping its costs under control. He also said there’s “more to be done on the cost agenda.”
Shares in Maersk opened about 2.5% higher when trading started in Copenhagen.
“We have been able to more than mitigate the low demand growth scenario by taking cost down and so on,” Skou said. “But obviously for the world and for the global economy it is not good news that we are not growing faster than we are. We will continue as a company to be very disciplined in terms of our capacity deployment and that means we can keep our costs low and therefore we also can continue to grow earnings despite the fact that we are in a very weak growth scenario.”
Content reprinted from Bloomberg, By Christian Wienberg, Nov. 15, 2019, 3:11 pm GMT+8 Read more…
