DP World’s investments top $10bn in past decade

Dubai’s DP World has invested more than $10bn (Dhs37.3bn) in the global logistics sector since 2012, making it one of the top five overseas investors in this period, according to the latest foreign direct investment (FDI) data from fDi Intelligence.

The state-owned ports operator ranked fifth in the world in 2022 by total value of direct investments allocated to the overseas logistics services sector.

Other companies among the top five include e-commerce giant Amazon and Denmark’s AP Moller Maersk. The company is the only firm in the top five based outside of the US and Europe.

“The data shared by fDi Intelligence demonstrates where we stand globally within the logistics sector, not only in the last year but consistently over the last 10 years,” said Sultan Ahmed Bin Sulayem, group chairman and CEO of DP World.

“Investing in developing economies helps trade go further, facilitates economic growth, attracts foreign investment and generates thousands of jobs — raising the quality of life for everyone.”

DP World’s investments in 2022 totalled $320m despite the plunge in the demand for logistics services due to a confluence of a slowing global economy, supply chain crunch and geopolitical tensions.

The global logistics industry is expected to record single-digit growth in 2023.

In January, the latest Trade in Transition study that was commissioned by DP World and led by Economist Impact, revealed the emergence of major shifts in globalisation as companies rushed to move manufacturing closer to home to protect against supply chain disruptions.

.@DP_World has invested more than $10 billion (AED37.3 billion) in the global logistics sector since 2012, making it one of the top five overseas investors in this period, according to the latest foreign direct investment (FDI) data released by leading industry consultants. pic.twitter.com/goGHe9SaIJ

— Dubai Media Office (@DXBMediaOffice) March 26, 2023

The study showed that 96 per cent of companies are making changes to their supply chains due to geopolitical events – as increasingly protectionist policies are breaking the world into trade blocs.

DP World’s global investments

DP World, one of the world’s biggest port operators, said among its key priorities in 2022 was to broaden its partnerships to unlock global trade opportunities.

The company enhanced its relationship with India’s National Infrastructure Investment Fund to raise as much as $300m and created a new investment platform with the British development finance agency CDC Group to drive investment in Africa.

The DP World-CDC Group investment platform is expected to support five million jobs, create 138,000 employment opportunities, improve access to vital goods for 35 million people and add $51bn to total trade by 2035.

DP World expects about $1.7bn in capital expenditure this year to be invested in the UAE, Jeddah, London Gateway, Dakar, the Democratic Republic of the Congo’s Banana port, Peru’s Callao and DPW Logistics in South Africa.

The company and the Somaliland government opened the new Berbera Economic Zone which, along with Berbera Port, is expected to develop the area into a major trade hub serving the Horn of Africa.

Read: Dubai’s DP World, Saudi Ports Authority sign agreement to build logistics park at Jeddah Islamic Port

The UK has been also a key destination for investments and DP World said it invested $2.4bn in the country over the past decade, supporting thousands of jobs. The logistics major has earmarked a further $1.2bn of investment in the UK over the next decade.

DP World’s financial matrix

Meanwhile, the ports and logistics giant’s annual revenues surged by nearly 60 per cent to Dhs62.9bn in 2022 from Dhs23.3bn a year earlier, driven by acquisitions and the solid performance of its ports and terminals, and marine services.

Read: Ports operator DP World’s revenues surge to $17.1m in 2022

DP World said its containerised revenue increased by 12.1 per cent due to the increased demand for ancillary container services.

The broadening of strategic partnerships and monetisations of assets in 2022 also strengthened the company’s balance sheet while providing long-term flexibility, with more than Dhs29.4bn raised from the selling of stakes in key assets in the UAE. DP World is rated Baa2 and BBB- by Moody’s and Fitch Ratings, respectively.