Globalisation will perhaps have to be redefined in the light of uncertainties of the world today, the chairman of Ryanair and former Kerry Group chief executive Stan McCarthy has said.
Speaking in New York he said there would still be globalisation but it may have to change in light of geopolitical risks that “were unearthing themselves around the globe”.
He said this was not just in Ukraine but also due to tensions in Asia.
He said the word "adaptive" was key to how businesses dealt with uncertainties. "We see it in Ireland in trying to move produce to mainland Europe without going through the UK."
Decisions
“Be adaptive. You have to make decisions quickly. You cannot procrastinate. Decisions are forced upon you to a certain extent but you have to be able to make those decisions rather quickly,” he said.
Mr McCarthy said that companies may rethink the extent to which they will invest in particular geographic areas or within sectors in particular locations.
“One of the phrases I used to use when I was on roadshows with investors after results was ‘do not bet the whole corporation in one geography’ .
“You have to balance up the risk in the long as well as the short term and take an appropriate view.”
Mr McCarthy suggested that the current circumstances would give organisations “reasons to pause and think certain geographies ”.
He pointed to the aircraft leasing sector for which Ireland was a hub. He said there was a problem relating to security around aircraft assets that had been leased into Russia and Ukraine.
“They will get through that but they will have to redefine how they approach those countries in the future and how they develop risk strategies around that.”
Mr McCarthy said that Ryanair did not have bases in Ukraine or Russia although the airline did fly to Ukraine.
Threat
However, he said Ukraine represented less than 1 per cent of the airline’s traffic and did not present any threat to the company.
He said there were no indications that fears over the conflict in Ukraine was impacting on bookings for the airline.
“The aviation industry is pretty volatile since its foundation,” he said.
He said Ryanair had carried more than 11 million people in March and this was scheduled to increase significantly in the months ahead.
“I do not think the transatlantic or intercontinental level of traffic will be back this year, but within continents the numbers are looking very healthy at this point for 2022.”
Mr McCarthy was honoured at the Irish American Partnership Business Leaders breakfast in New York on Thursday.
Asked at the event about the issue of Kerry Group’s operation in Russia following the invasion of Ukraine, Mr McCarthy said knowing the company it would do the right thing. He said Kerry had withdrawn completely and suspended operations but was fulfilling some contracts.
“Taking food away from the ordinary people on the ground in Russia. Surely you think differently about that then buying oil, when you can get it somewhere else.
“These are tough decisions.You spend 15 or 20 years trying to develop a business there and say ‘OK, we are not doing that anymore’. But Kerry has done the right thing.”
