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NYK faces uncertainty in global expansion

NYK Group NYK Group Takaya Soga
NYK’s President has pointed to multiple geopolitical challenges affecting its ability to make immediate judgments on the group’s position in many countries.

In a New Year’s address titled “Pioneering the Era of Turmoil”,  NYK President Takaya Soga said global trends are becoming increasingly confusing, picking out the Russia-Ukraine war, conflict between Israel and Hamas, and the Houthi threat to shipping off Yemen.

“Divisions are occurring everywhere worldwide, and the international order established since the end of the Cold War is no longer sustainable. When the term “economic security” is heard in many countries, we cannot make an immediate decision about the position of the NYK Group, which is expanding its business worldwide.”

Soga said there are elections scheduled in 45 countries in 2024 and picked out Taiwan’s presidential election, Russia’s presidential election, the first European Parliament elections since Brexit, South Korea’s general election, and the US presidential election as those most likely to impact Japan and the NYK Group.

Despite the backdrop, NYK forecasts a recurring profit of JPY235.0bn for its financial year ending March 31, 2024, an upward revision of JPY35bn from the start of the year. 

In his New Year’s address, MOL Group President and CEO Takeshi Hashimoto referred to the global situation in 2023 as chaotic, with geopolitics, global economics and severe weather events all impacting the group’s business environment.

Those same factors are expected to be felt into 2024, although Hashimoto had a more positive outlook on the economics front.

“We expect the economy to gradually return to a growth trajectory as inflation in Europe and the US subsides and investment recovers due to interest rate cuts. In India and Southeast Asia, we expect business opportunities to expand due to robust domestic demand, government-led infrastructure investment, and the resulting increase in demand for energy. 

“On the other hand, it will take some more time for the Chinese economy to return to a stable growth trajectory due to real estate problems and sluggish consumer spending,” said Hashimoto.

MOL Group’s financial forecast for the current financial year has also improved, with its net income forecast rising JPY10bn to JPY220bn. A weaker yen and stronger markets for car carriers and chemical tankers supported the upward revision.