DP World resolves UK row + aims to commit GBP 1 bn towards London Gateway today

DP World’s UK row resolved: Dubai port operator DP World will take part in a UK investment forum today and commit GBP 1 bn (c. USD 1.3 bn) in investments for the DP World-operated London Gateway port following a temporary pause in plans last Friday, Bloomberg reports, citing a source familiar with the matter.

What happened? DP World executives were reportedly angered by comments by UK transport secretary Louise Haigh and UK Deputy Prime Minister Angela Rayner regarding working practices at DP World’s subsidiary P&O Ferries, with Haigh calling DP “ rogue employers ” and calling for a boycott. UK Deputy Prime Minister Angela Rayner was also quoted describing a P&O Ferries’ mass sacking of hundreds of employees “an outrageous example of manipulation,” BBC added.

Starmer saves the day: UK Prime Minister Keir Starmer indicated to the BBC that Haigh’s comments were not “the view of the government” — and DP World had welcomed the PM’s intervention, “following constructive and positive discussions with the government, we have been given the clarity we need. We look forward to participating in Monday’s international investment summit,” DP World said in a statement picked up by Bloomberg on Saturday.

A boon for London Gateway’s operations: London Gateway — which boasts three berths with a four set to open within weeks — would see the addition of two more berths, increasing the port’s capacity by 50% and bringing DP World’s total employment at the port to 1.6k from the previous 1.2k, Bloomberg writes. The expansion would strengthen London Gateway’s position to take over Felixstowe as the UK’s busiest container facility by 2030.

BACKGROUND- DP World has been looking to develop berths five, six, and seven at London Gateway, without specifying the investment ticket or timeline. The move looks to meet the additional capacity needs expected in UK markets starting 2027. DP World is investing AED 2.1 bn to expand London Gateway, Dubai’s First Deputy Ruler Maktoum bin Mohammed bin Rashid Al Maktoum said in a statement back in August, ahead of DP World’s launch of the port’s GDP 350 mn fourth berth. Construction work on the London Gateway expansion project — which will handle around 55% of the UK’s South East cargo — was launched nearly two years ago.

There’s a catch? The latest expansion plan — which is subject to building and environmental approvals — would require land to be reclaimed along River Thames in order to add a fifth berth slot to open in about three years, a second rail terminal, and a six berth following that, Bloomberg added.

IN OTHER DP NEWS-

DP World is looking to “tap the China market more,” on the heels of its acquisition last month of Hong Kong-based logistics firm Cargo Services Far East, CEO Sultan Ahmed Bin Sulayem told South China Morning Post on Thursday. The acquisition has better positioned the firm in China, giving it “better access to logistics and connecting [its] customers to other regions,” Bin Sulayem said. The firm has taken a particular interest in China’s Greater Bay Area, which Bin Sulayem notes has a lot of potential going forward, with a collective USD 1.7 tn GDP and population of over 89 mn.

The Greater Bay Area? Five years ago, Beijing established the Greater Bay Area to unite Hong Kong, Macau, and nine mainland cities in Guangdong province into a strong economic hub. “We watch the fantastic development in the Greater Bay Area. When you put Hong Kong as part of the Greater Bay Area, growth opportunities become very significant,” Bin Sulayem. The company is exploring the robust manufacturing capabilities in Guangzhou, the capital of Guangdong province in southern China, and ways to enhance the efficiency of shipping its products globally, he added.