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.
You are now employing the slippery slope fallacy into your argument.
I see; asking you a flat out question is now characterized as "slipper slope."
Ignorant.
Buchanan failed in his protectionist efforts in the early 90's. But it gave birth to the modern day Mexican bounty hunters who oppose anything having to do with something other than a lilly-white foreigner.
Recognize yourself?
;-)
While never a big fan of Bush (except first run for Texas govenor) I've voted for him every time (in the general). So no I don't vote third party and I don't stay home, that seems to be your thing.
Hate America first. Disgusting. Just because we played better hardball. This thing is far from over, and the UAE sellouts and dhimmi's got sour grapes.
They can buy all the Crashbuses they want.
Certainly the LAST thing we want is to listen to someone who might actually KNOW something. That would interfere with joining the rampaging mob.
This is what our Country gets for listening a bunch of arsewipe scardey cat nancy girls and allowing so many inexperienced idiots into offices which they are not qualified to hold.
Better hang on, folks, it's gonna get worse than this.
:O)
P
Apparently we were satisfied with the results.
Yes, I do know what they do to camel jockeys.
It is an age old practice and they were failing to completely control it.
Now they are and I wonder if they are now questioning their cooperation with us.
Just a thought..........
Cool! Neither you nor I can change what has just happened but there's no reason we can't enjoy what we're doing. ; )
Well, George, it looks like the "people" have spoken and you have listened. Thanks!
You said -- "We have the ability to stop them. It has nothing to do with a port in Dubai."
I'm not entirely sure about that from a political standpoint. I already see what trouble it was to go to war in Iraq and I wonder if people would see another war as something necessary. Iran is probably counting on it not being politically viable. And that's why it's important to have the UAE in the equation. It makes it much more of a politically viable situation if we are protecting our interests and the interests of those who are supporting us. That's much better than going into some sort of an Iran conflict with no other "interests" in the region (plus the support that those interests give us).
And also you said -- "It's not working, if that's the case. Iran magically circumvented our steel curtain in Dubai and is building nuclear weaponry anyway."
They were going to attempt that no matter what -- because of the radical and rabid nature of Islam and how dedicated they are to it. In fact, I would say that us going into Iraq probably made their attempt more certain.
If they didn't make a move towards "the bomb" -- they would be minimized as a regional power and also in their ability to "take out" Israel -- which seems to be the whole aim of their religious government. I think the only way we're going to stop this now is militarily -- and that's why we need to be in the UAE.
And, you said -- "How will this stop Iran from launching a nuclear missile at Israel? And how does NOT having it prevent us from firing off a nuclear missile from a sub outside the gulf if Tehran decided do just that?"
The U.S. (and Israel) will be attempting to stop Iran before it gets to that point. That seems to be the stance of both the U.S. and Israel. And the fact of the matter is that the U.S. does not want to find itself launching a nuclear missile at Iran. That would open up a firestorm around the world and in Islamic countries. That would be a doomsday scenario and that's not going to happen from the U.S. side.
And -- "I understand what you're saying, but we have a massive base of operations in Baghdad already. You think Iran isn't a little queasy about that? Dubai won't make them any queasier. We can drive our tanks right over the border and go straight to the Capital."
I think Iran is looking at what we're doing in Iraq as "tying us down" rather than anything else. Where do you think all these attacks are coming from in Iraq? It's coming from Iran. Iran is the one who is stirring up the trouble in Iraq. They're doing this to tie us down and give us a big headache. And they seem to be doing a pretty good job of it, too.
The more they tie us down in Iraq, the less they have to worry about any of those units being free to roll into Iran.
Soooo... I take it you're against racial profiling at the airport?
What about direct flights from Tehran? That could bring a lot of business to our airports and maybe even give us an entirely new trading partner who could use our ports.
So Arabs won't trust us? LOL That's funny.
Florida was the "home" of many of the 911 terrorists. Florida had financial institutions which aided their ability to move funds within this country and to receive funds from their terror bosses abroad. Terrorists traveled at will within the United States. Bin Laden has relatives within the United States.
So how exactly is the UAE different?
I read your post. I'm merely referring to countries in the region we can transfer our associations to easily.
Then, I went on to state that the UAE will not go through the divestment because they couldn't stand the hit from losing multiple billions from the US.
Did you read that last point before you wrote to me?
I wouldn't say every person.
It looks like you live as far away from the Mexican border as possible. I wonder if you might feel differently living in a border state and seeing with your own eyes the results of the one million illegal aliens who have crossed over each year since Bush entered office.
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