Posted on 03/09/2006 9:02:17 AM PST by prairiebreeze
Dubai is threatening retaliation against American strategic and commercial interests if Washington blocks its $6.8 billion takeover of operations at several U.S. ports.
As the House Appropriations Committee yesterday marked up legislation to kill Dubai Ports World’s acquisition of Britain’s Peninsular and Oriental Steam Navigation (P&O), the emirate let it be known that it is preparing to hit back hard if necessary.
A source close to the deal said members of Dubai’s royal family are furious at the hostility both Republicans and Democrats on Capitol Hill have shown toward the deal.
“They’re saying, ‘All we’ve done for you guys, all our purchases, we’ll stop it, we’ll just yank it,’” the source said.
Retaliation from the emirate could come against lucrative deals with aircraft maker Boeing and by curtailing the docking of hundreds of American ships, including U.S. Navy ships, each year at its port in the United Arab Emirates (UAE), the source added.
It is not clear how much of Dubai’s behind-the-scenes anger would be followed up by action, but Boeing has been made aware of the threat and is already reportedly lobbying to save the ports deal.
The Emirates Group airline will decide later this year whether it will buy Boeing’s new 787 Dreamliner or its competitor, Airbus A350. The airline last fall placed an order worth $9.7 billion for 42 Boeing 777 aircraft, making Dubai Boeing’s largest 777 customer.
Dubai in mid-February also established the Dubai Aerospace Enterprise, a $15 billion investment to create a company that will lease planes, develop airports and make aircraft parts to tap into growing demand for air travel in the Middle East and Asia.
The family-ruled sheikhdom may buy as many as 50 wide-body aircraft from Boeing and Airbus during the next four years, according to Aerospace Enterprise officials.
The UAE military also bought Boeing’s Apache helicopters. Meanwhile, Boeing has been in talks with the emirates to try to sell its AWACS planes.
An industry official with knowledge of Boeing’s contracts with Dubai said that the company has been involved in the emirate and that it would take a lot “to knock” those relationships.
“Nothing about the [ports] controversy diminishes our commitment to the region,” said John Dern, Boeing’s corporate spokesman. He added that at this point the company has no indication that there is or will be an impact on the company.
Any repercussion to Boeing could put House Speaker Dennis Hastert (R-Ill.) in a delicate position. Boeing’s decision to move its headquarters to Chicago has been seen as calculated to facilitate a close relationship with Hastert. He is against the ports deal, and his office did not return calls by press time.
Several businesses have expressed concern that the controversy over the $6.8 billion ports deal could damage trade with the UAE. Dubai is one of the seven emirates. The United States and the UAE are meeting next week for a fourth round of talks to sign a free-trade agreement. The American Business Group of Abu Dhabi, which has no affiliation with the U.S. government, said that Arabs may hesitate to invest into the United States, according to a report by Reuters.
A Republican trade lobbyist said that because the ports deal is a national-security issue blocking it would not be in violation of World Trade Agreement rules.
“In terms of them retaliating legally against the U.S. … I don’t think there are many options there,” the lobbyist said.
But when it comes to the emirates’ cooperation in the war on terrorism and in intelligence gathering, there is concern that some help may be pulled.
“If we reject the company in terms of doing the [ports] work, they are going to lose a lot of face. In the Arab culture, losing face is a big deal,” a former government official said. “We risk losing that help. It is not an empty threat.”
Dubai is a critical logistics hub for the U.S. Navy and a popular relaxation destination for troops fighting in the Middle East. On many occasions since the ports story erupted, the Pentagon has stressed the importance of the U.S-UAE relationship.
Last year, the U.S. Navy docked 590 supply vessels in Dubai, plus 56 warships, Gordon England, deputy secretary of defense, said in a Senate hearing last month. About 77,000 military personnel went on leave in the UAE last year, he added.
During the hearing, he warned about the implications of a negative decision on the ports deal: “So obviously it would have some effect on us, and I’d not care to quantify that, because I don’t have the facts to quantify it. It would certainly have an effect on us.”
Although owned by the Dubai government, the company at the heart of this controversy, Dubai Ports World, is trying to distance itself from any kinds of threats, said a lobbyist closely tracking the deal.
Another lobbyist monitoring the controversy said K Street still believes there will be a compromise that allows the Dubai deal to go through while meeting congressional security concerns, even though a bill aimed at that result, put forward by House Homeland Security Committee Chairman Peter King (R-N.Y.), was widely repudiated amongst lawmakers Tuesday.
Senate leaders have indicated that they would wait to take action until the new 45-day Committee on Foreign Investment in the United States (CFIUS) review is completed.
Meanwhile, in London, DP World cleared the last hurdle for its take over of P&O. The Court of Appeal in London refused Miami-based Eller & Co., which opposed the deal, permission to appeal against clearances for the legal and financial measures necessary to implement the takeover.
P&O said it expects to file the requisite court orders, making the takeover terms binding on DP World, according to the Financial Times.
Elana Schor contributed to this report.
Howlin: Not on the threads I see here on FR.
You really have me confused now. =8^O
Excellent post, man.
Did you see #10 and #22 at the other link? You didn't mention those.
My point was made. There have been a far too many anti-ARAB (not anti-Muslim) posts here. I'm sure you can concede that point.
If not, I'll continue to go through this thread because there's a lot more posts that fit the shoe.
This could be a record for posts to an article whose only source is 'unnamed'.
Bogus article.
Colossal waste of time.
Misleading.
Unworthy of Free Republic, IMO.
This thread has led FR discussion today down a primrose path.
Sad.
This thread has been like the ultimate country song. It had all the requisite elements: name calling, accusation of lies, some very concise posts, some excellent research links, a retread troll (complete with a fresh zot), ganging up, poking fun. Just about everything but an Opus. Sorta like a pick up game of kick the can.
LOL...
And all for 'an unnamed source'...
http://www.freerepublic.com/focus/f-news/1593184/posts?page=1519#1519
"I characterize that lack of intellect as "stupid"..."
Since Malkin and others linked it and Rush talked about it, I thought it was FR materials. Apparently so did a few others.
Sorry it didn't measure up to your personal standard of thread.
I agree with you.
Sure. And the American congress can demonstrate how it can go back on it's word after only 45 days.
What an example to set.....
Has nothing to do with 'my standards'.
Just pointing out that it was a concocted story designed to foment fear and that it was based on an 'unnamed source'.
meant 6 out of 45
Oh, I'm sorry. Ok, so not "Run", "Control", or "Operate"... Got it. Ok, wait, "Manage", that's the one. Sheesh...
Ok, not the "port", just a couple of measly "terminals" at... the "Port" !!
You know, if it's a hot dog stand at the port being run by a company owned by an Arab Sheikdom, it's a security risk. Ok? (Or is that not "informed" enough for you?)
The anonymity of the source was pointed to and acknowleged throughout the early part of the thread.
Interestingly I didn't post it into Breaking News but instead, put it into Front Page. Apparently the mods moved it.
LOL...I'm saying most of the people on the threads want them ALL deported. :-)
Which I thought was pretty awful...one of the worst examples of moderation I've seen on FR.
There was a thread posted that highlighted the real story: that Dubai had pulled the deal...but whoever was moderating pulled that thread and put this up instead...an article that misleads the reader about the real issues and spins the story in a way that is the most damaging to Republicans.
Just my opinion.
Also one is a dictatorship and the other is a state in a constitutional republic.
Well, he was busy on another thread, posting in his usual smugness.
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