Europe News

Global Economy ‘Very Different to 2008’: CEO


There has been no global recession but negative sentiment and maximum uncertainty are clouding the reality of the situation, Frank Appel, Deutsche Post’s CEO told CNBC on “Worldwide Exchange.”

“I have found in the past three years that what the majority says usually doesn’t happen; we have not seen a recession globally anyway. If we were all bullish then I would be concerned. The mood is negative and that makes me more positive. Inventory levels are relatively low and if they are low, companies do not overproduce. The situation is very different to 2008,” he said.

Deutsche Post, which owns DHL, posted a 64 percent jump in profits in the first quarter on the back of strong business in Asia.

He added that he remained positive on the global economy and prospects for his company.

“We have not seen any real, massive slowdown of the economy and we still believe we will see global GDP growth and that has confirmed our targets for this year.

Our mid-term outlook till 2015 [includes] growing DHL’s bottom line by 13 to 15 percent and stabilize the mail division,” he said.

He added he hoped investors would see the group was on a “healthy path for growth.”

'Grexit’ Would Boost Sentiment

Appel said there would be limited impact on his business were the troubled Greece to leave the single currency, blaming the unpredictability of the situation on dampening business sentiment.

“It will not have too much [impact] and we live in a time of maximum uncertainty and that is not good for business. Whatever happens, it will not have a major impact on the euro and therefore the impact on the business will be limited. It will probably increase certainty, which is better than uncertainty. I’m not too pessimistic on the impact on the global economy,” Appel added.

An European Union summit Wednesday failed to deliver any decisive shot to deal with the prevailing crisis in the euro zone, with EU leaders failing to agree on the most contentious issue of joint euro zone bonds, also known as Eurobonds.

He said the way forward for the region would be for further integration leading to a Federal Europe.

“I’m convinced we need more of a federal state of Europe because that’s the only chance for Europe to compete on a global scale," Appel said.

"We have to see what the European Union has brought to Europe, 70 years of peace which we haven’t had before for centuries and that’s worth talking about,” he added.