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.
That's what you think, but I think he was tired of living and wanted to go out with dignity.
Wait let me guess: You are now employing the slippery slope fallacy into your argument.
Ad hominem
Slippery slope
etc.
etc.
Bottom line, the deal is dead. And the GOP leadership may have saved the majorities in the House and Senate.
The only "national security ramification" is that you're ready to kow-tow to the United Arab Emirates because you're afraid to, God forbid, disagree with the President.
Disagreeing with the President does not mean people want to destroy him.
"........and they don't seem to care if the security of the country goes down with it."
And UAE makes us safer? Whistle, graveyard, and all that...
You are a hopeless case, once I thought you might have a conservative thought or two, but no. Rats oppose just about every thing Bush does for no reason. They live to oppose Bush. Conservatives oppose Bush when his policies are not conservative. See the diference? Think real hard you can get it if you try.
In your dreams, pal.
And if that would happen, you'll lose ALL the other voters except the far right.
Now, remind me, what's the LAST election the far right won by itself?
Actually, I was doubled up so far in deep belly laughter that I plum lost sight of apprising the world of that fact!
The good news is that the GOP in the House and Senate will approve this compromise and won't put this to a vote. Now you'll see the Dems go nuts that there won't be a vote.
This is just closet racism/religious bigotry/painting em all with one big brush. That's it...nothing more.
And...instead of winning the political battle by calling it just that, Many GOP'ers have fallen in line BEHIND SCHUMER, CLINTON and REID and are THRILLLED to be doing so.
I have no problem dealing with problematic allies, even those that don't have the same values as us, or other members of the free world.
What I do have a problem with is compromising our security in order to grease the wheels for diplomacy.
Can you say Visa Express?
That's one of the reasons-if not the chief one-that the Twin Towers no longer stand in my city, and why over 2,600 Americans are now deceased.
Short-term political gains are not worth sacrificing our long-term interests, and there is no compelling reason to go through with this deal.
The UAE already has extensive ties to the United States in the economic realm, and our relationship is not going to go to seed simply because they did not get their way on this.
If it does, then it simply illustrates how unreliable our Arab "allies" are.
No kiddin'? That was my point. Other than that brain fart I agree with you.
Very well put!
You people really irritate me.....
I gotta log off this putz palace and try to get my blood pressure back under control.......
I am probably more insulted than the UAE....I have kids and Grandkids that will have to live with this nonsense, and I fear for their future.
Now, now; you know they will be thrilled; they are POSITIVE that, once they turn the GOP out for a few terms, we ALL will join them in putting "real, true" conservatives into office, doncha know?
"I just heard Warner's reading. DP World seems to predicate the deal on getting as much out of the sale as they put in for the U.S. assets."
________________________________
After they get out of this part of the deal, how long till they reevaluate their other investments and quietly start selling them off?
Not nearly enough-especially the abominable United States Senate-but much more in terms of enforcement than any of the proposals George W. Bush has ever entertained.
Great Post....I was on another thread earlier today...before we hear about this deal..and said that I had a feeling that all of these people who are trying to stick it to Bush (who is NOT running again)...
Both Dems and GOP....are gonna find out, hopefully, in November how their knee-jerkitis is gonna hurt THEM!!!
We need to make a list and keep it....about who has made a fool of him/herself on the GOP side.
Sorry, it was indeed a brain fart under duress.....:-)
I disagree with you, but that was funny.
Isreal, Afghanistan and India are not arab countries. India is not even a ME country. Do you even read before responding?
I see; asking you a flat out question is now characterized as "slipper slope."
Ignorant.
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