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FRAGILE

GLOBAL ECONOMY

We have asked Graham Slack, chief economist at Maersk, to comment on the state of global economy and how it may affect our business.

HOW DO YOU SEE THE OUTLOOK FOR THE GLOBAL ECONOMY?
“The global economy is in a fragile position. The underlying drivers of slowdown are China, lower commodity prices and a lack of structural reform in some economies. These developments are occurring against a backdrop of high debt levels, rising US interest rates, slowing export markets and a potential stock market bubble. Overall, it raises the likelihood of a so-called hard landing with the global economy slowing down. This outlook could further damage investor and customer confidence, causing
a further pullback in demand.”

SO IS THE GLOBAL ECONOMY ONLY GOING DOWNHILL FROM HERE?
“It’s a mixed picture, so we need to have a balanced view. The Chinese authorities are adopting stimulative policies, Europe isdoing reasonably well and the US grew at 3.9% last quarter. On the other hand, a country such as Australia is particularly exposed to the commodity crisis.”

HOW DO YOU SEE SVITZER IN THIS CONTEXT?
“Some of Svitzer’s operations are likely to be impacted by the slowdown in shipping. That said, we have seen plenty of examples that difficult markets can be beneficial for the strongest operators. Svitzer needs to make sure that everyone from office staff
to crews pull in the same direction to enhance service levels and reduce costs. It takes hard work and willingness to embrace changes in the workplace to deliver strong results in a difficult environment. I believe you are already ahead of your competitors
in many respects, so keep it up!”

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