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.
And?
And since when being on a forum somewhere for seven years make someone more knowledgable?
It sure as hell makes me more knowledgeable about the people and their posts on this forum that got here before you did; unless, of course, you're a retread.
You don't KNOW me, and don't pretend you do.
Never said I did or wanted to.
No matter how many times you post it, there will NEVER be a mass roundup with people shipped back to Mexico.
It's an issue that will defeat every politician up there -- and they're all about votes.
Well, I for one am tired of hearing these cliches about them "helping us in the War on Terror" ---I'd like to know exactly HOW they have done this, and to what degree they HAVE done what they've done FOR THE SAKE of business deals like this one. I have heard many of the cons, but no real pros about this phantom "help"--but it is continually presented to us as a fait accompli, with the suggestion that "you shouldn't even have to ask"/ I'm not one to accept "the current wisdom" no matter which Party it comes from. And yes, I know creative isolationism is NOT our offical or unofficial policy, but it should be. I am tired of seeing American blood spilled and treasure squandered because we can't resist these continual fatal entanglements.
Yes, for thinking people. That, of course, let's you out.
:-)
cryptic..
Selling AWACS to Saudi was a standard way of dealing with allies. We also sold them advanced fighters and trained their pilots. Such actions helped prevent the takeover of the Kingdom by enemies. Saudi also has the same kind of port facilities the gullible have gotten so excited about.
Plane sales were beneficial to them and us but have no relation to this display of backstabbing the Party of Treason is leading.
Bush has failed at selling just about everything he apparently believes in. It is not a talent of his, he is not a verbal person the way Clinton was. That is the reason Bush continues to plummet in the approval ratings.
It is mistaken for arrogance, and even that misperception goes uncorrected by this Administration.
Oh, so you are one of those people who call people stupid because they don't agree with you. Okay - I and apparently many other people are stupid. But we won anyway.
"Putting nationalistic lipstick on that pig does not change the smell."
You have missed my, and other uncompliant conservatives, point. And I really don't know why I will reiterate it again, repeatedly in:
Lets have great trading partners. Lets have partners that we can trust. Lets spend time looking at deals that our administration approves. If things look okay and it our elected conservative brothers and sisters are not thrown under a bus, then so be it. Please don't tell me me there is no difference between the UAE and say,...Latvia. That dog doesn't hunt.
Since when did our nation's economic health, or security, become dependent upon one artificially created, not very democratic nation located in the Persian Gulf?
If our future were inseparable from that of the Arabs, then why does the Jewish State even exist, three decades after the fearsome Arab League boycott was initiated?
Interesting that you chose to edit that part out. BW got it wrong too.
"uncompliant"
whooops. "noncompliant"
Thanks for the ping.
Everyone, everywhere is always resistant to change. This does not mean that changes are all bad.
The world is getting to be much, much smaller, and businesses, communications and corporate structures are changing to accommodate the changes that are occurring.
In order to maintain our leadership roll, we must change as well, and we are.
some of these changes are painful, but the alternative is slow decay and the eventual deflation of our economy.
If that ever happens, the U.S. will be a bad place to be for a long time.
The future of our children in in our hands, and if we keep choose wrong, as we did today, the consequences will eventually damage every square inch of our domain. We will no longer have our dominant role and we will be stepped on like a cockroach by those who want revenge for past perceived and real wrongs that they hold us responsible for.
We can not achieve or maintain economic strength by disengagement or nationalism that affects economic and security decisions. We will kill our economy and subsequently our country.
Yeah.. seems reasoned to me. Yeah.. seem like great allies to me. Yeah.. gonna go buy a bridge now.
You seem to miss the point that the UAE royal family -- or ANYONE in that region -- has painted a huge bullseye on their butts by offering us any support or sympathy at all, never mind military bases and naval ports. It's not a case of "gimme more money because I'm a greedy fat-ass." More like, "I feel crosshairs on my neck every day and this is thanks I get?"
Not only that, but in the current climate of reflexive anti-Americanism both foreign and domestic, I think it would be hard to make a case that UAE people administrating a port would be ANY more likely to be a front group for terrorists than even an American company. There are so many Cindy Sheehan Moore types in power these days that we're as likely to get Johnny Taliban's from an American company as we would Arab terrorists from Dubai Ports World.
You said -- "Actually the UAE did not specify an American entity. They simply said the American portion of the deal would be divested to 'another party.' You may have read otherwise in an AP report or heard it on ABCNNCBS or somthing but it ain't true."
Well, it is a bit early to get all the details right. However, the idea of them selling their part is what will clear the deal. Whomever the other party is -- everyone is going to say that it's better than the UAE (no matter what their position was before). This will start to die down now, if the fact of their selling their interests bears out.
Regards,
Star Traveler
In a healthy GOP, the folks pulling out the race card and leveling those kind of sleazy attacks within their own party would be laughed off of the stage. The fact that this kind of rhetoric is not only tolerated, but semi-endorsed by the administration, indicates that we've got some serious problems (other than the fact that we're all racists of course).
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.