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.
Let's cut to the chase: it's brown skin that's the problem here.
And watch all these people who are crowing about Congress "doing what it's suppose to be doing, listening to their constituents" when Congress doesn't pass anything to fix immigration.
It will be another story then.
LOL Serenity now! Serenity now!
(sorry for the arcane Seinfeld reference for those who don't know it)
What is your point?
That the capabilities of our intelligence services-both domestically and abroad-are deficient?
I agree with you.
This is not a case of guilt by association.
The U.S. pressured the United Arab Emerites to crack down on Islamic terrorism, fraudulent banking transactions, and numerous other kinds of criminal activity prior to 9/11.
They did not listen to our advice because they were more interested in making money.
Dem four-en-ers don't belong herr...ya knaw. git 'im all outta herr. save my job en all.
Nope....I won't need to. Never would anyway, because what will happen is that many will simply be fed up and stay home for the congressional elections, and as I said, You won't like the candidate that gets through the primary for president, so then you will either stay home or vote third party.
This gives a great gift to the rats who only need to sit back and watch.
But I'm not going to stop it any longer. I'm convinced now that the right wing of the party has no business running this country.
So I will vote accordingly, as will the majority of the public. The message will be clear, and unfortunately this is not the first time it has been taught!
Ask Pat Buchanan.....
:)
You think the U.S. Military is UN-American. That's all I need to know about you to ignore anything further you say.
(And the 'cool-aid' [sic] comment put an exclamation point on the worthlessness of your comments to civil discourse).
Pat Buchanan has been politically irrelevant for a while, but he seems to have earned a special place in the psyche of the true Bush loyalists. He's like the boogeyman in the closet to you guys.
SSA Marine is named the number one Marine Terminal Operator by Marine Digest's Readers Poll, as voted on by Shipping Lines.
***
Howard Terminal in Oakland, CA is re-opened to accommodate growing container volumes. SSA Terminals signed a 25 year lease with the Port of Oakland. Matson Navigation Co. will be the sole customer on the 50 acre facility.
***
A five year contract with the Port of Stockton to handle the stevedoring and terminal operations for the port was awarded to SSA Marine.
***
Who's pretending and telling lies to whom?
It appears that composite support for this deal is no longer a majority. Member support, in the high 50s a couple of weeks ago, is now 50.6% and sinking fast."
IF the poll was run again, I'd venture to say with the latest "facts" the numbers would once again be reversed.
"I also love watching so many people who up to now have claimed to be 'Reagan conservatives' proudly blowing off Ronald Reagan's fundamental faith and belief in the wisdom of the American people."
Yep. According to some sychophantasmic Freepers, suddenly the King and his Court know better than us dummies about EVERYTHING, and thus we should just "shut up."
Because P&O and DP World had an agreement in place that gave them the right of first refusal.
Incrementalism is creeping in. What is wrong with saying "no"? We have no obligation to these despots. Look where appeasement got us with Saddam. We looked the other way while he slaughtered the Kurds that WE encouraged. Isolationism is bad. Supporting miscreants is worse.
And the irony is, that they hurt America to get themselves re-elected.
Poll-driven hysteria rules the day.
LOL!!! Preach it, Jesse!
The self loathing are those, absent the full facts, who sought to block this deal. They showed contempt for our laws, fair hearings and an ally that has far more at risk with the US military on their land than we do with a few terminals in their ownership. We showed ourselves as weak, unable to trust the outcome of a fair process.
Freepmail! :D
I see. I missed the subtle, untagged sarcasm amidst all the gross stupidity here. But...we humiliated a very macho bunch who have sacrificed a great deal of prestige in their own world to work with us for peace and progress. They may find ways to heal this new rift but we just made it far harder for them and far, far harder for other nations on the fence with us to trust us.
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