Following is the full transcript of CNBC's exclusive interview with Nils Andersen, Former Group CEO of A.P. Moller – Maersk. This interview broadcasted in Asia on Friday, 15 September at the 2017 Singapore Summit.
All references must be sourced to a "CNBC Interview".
Interviewed by Amanda Drury, Contributor, CNBC.
Amanda Drury (AD): Unfortunately one of the by-products of what's been happening with North Korea is that we have seen an increase in the tensions between (the) U.S. and China. The world's biggest economy and the world's second largest economy. This is not necessarily a good thing for world trade. Is that how you see it? Or is it not that bad?
Nils Andersen: Well I think first of all, North Korea is in isolation not an issue for global issue - because North Korea is not an actor on the global scene. But of course, trade between countries is never good. I think the reality will pan out because there's been a lot of talk about trade restrictions and building up of custom barriers and so on, over the last couple years. But the gradual increase in global activity level will put somewhat breaks on that. Because usually the combination of people's fear about losing their jobs combined with rhetoric affecting the whole thing. I think it's very expensive to play with global trade so therefore, I think when… there will be a few obstacles but generally the trend towards more trade will continue.
AD: And a trend towards more trade in the globe is something that a big shipping container company like Maersk absolutely needs. It's very interesting isn't it, when you look at some of the share price action in Maersk because when you look at when it hit bottom in 2016, since then until July… so really only a couple months ago, it was doing very well. Since July, the share price has come down. Do you find that an interesting price action? Because on the one hand, you have got a company that is doing a massive restructuring, trying to refocus its business on container shipping and logistics. On the other hand, you have some really upbeat comments from the CEO about the shipping business. So why do you think the share price is not reacting?
Nils Andersen: I'm really only commenting on Maersk as a pure outsider but generally, you can say the issue in the shipping industry is - one is about global growth, of course, and demand but it's also about supply. And I think when you see a short term movement in share price and so on, that doesn't really correspond with trade developments. Often it's a little bit of worry about, "will new orders for ships be placed?" and so on and so forth. So I don't think you should take the development in an individual company's share price as an indicator of the global growth situation. The world economy is doing well; it's doing well in basically all markets - even developing markets - after having seen the effect of the fall of commodities, are picking up now. So I think we have reason to be reasonably optimistic about the developments in global GDP and I think personally, that trade will grow in line with and maybe even a little bit faster than that.
AD: So as you say, excuse me, from an outsider looking back in to Maersk now, with this radical restructuring going on, most recently with the selloff Maersk Oil to Total of France, do you think the right steps are being taken to improve shareholder value?
Nils Andersen: I'm sure they are. It's been the effort of many years to refocus the company more to its core, which is shipping, transportation and logistics. And that is the trend that is being followed, also with the acquisition of Hamburg Süd. So I think that's the right steps.
AD: And very quickly, you're about to go to Washington, because you're also on the board of BP. What do you think is going to happen to oil prices?
Nils Andersen: That's a really good question. I think there's… you can say there's a need for oil and gas for a long time to come. There's obviously a lot of supply pressure now in the U.S. shale, is pulling maybe a top on the price. Also to a certain extent, the bottom, because that is what moves the price. So I think the most realistic is that the price will continue at more or less at the levels where it is today, a little bit down, possibly also a little bit up but more shale oil will come out in the short term. So I think the oil companies should obviously hope for high oil prices but a prudent oil company today will be able to survive and prosper on current oil prices.