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.
"I hope you remember saying that when Boeing has to lay off workers because of the lack of contracts."
You mean the NEXT time they layoff workers. After 9/11 they laid off close to 50,000 people...some of whom lost their homes.
The really serious thing about this is the revelation of this suicidal streak of utter stupidity within the GOP and at FR.
I personally believe the destruction of the influence of the FR would be deadly to conservativism. The emergence of this strong wing of Ultraism has been poisonous since the Schiavo madness. Protecting this site is the most important thing we can do. Depressing as it can get at times.
Every intelligent person is.
"True "friends" stick with/by you whether they get what they want or not. Sure this deal fell through and with good reason as far as I am concerned."
They were sticking with us when they were not getting what they wanted. They gave in and agreed to the investigation.
Also, the deal did not fall through, some people pushed it over a cliff (a committee in congress voted to block it before any investigation was even started). This was congress hi-jacking foreign policy and commerce from the executive branch. It is not oversite, it is hi-jacking.
Are you for preventing investigations? That is what 1 committee in congress did.
When it's all added up, this is a monumental loss.
Can you believe what he has said? And he TOLD that to Congress -- and they ignored him!
The "war on terror" is really a war of ideologies. America's is most vulnerable because it is tolerant of these radicals. The majority of them come here with one desire in mind...to kill Americans even though Americans are a composition of many nationalities. It doesn't matter. If you don't worship their prophet, you're a dead man.
Unfortunately, there is but one venue to register my dismay. I reckon they will feel it sometime between '06 and '08, but from what I've seen in the last couple years, they still won't get it.
It's like talking to my dog.......but he is smarter....:-)
Devastating ... the outcome was planned before the first word of testimony was taken. They were foaming at the mouth at the first revelation of the deal ... and, sickenly, CFIUS's ignorant silence in not logically referring it up the chain made their day. How many Clinton operatives are still screwing us in govt. positions??
We just have to remember what Churchill said about democracy.
Think of the fighting our fathers had to do slog through the mud in New Guinea facing suicidal Japanese or storming the beaches at Normandy knowingly charging a hail of bullets which were predicted to kill 50% of you or more. Or holding the Little Roundtop at Gettysburg. This is a walk in the park that personally just hurts our feelings.
That is why it is so critical to support those who do not act that way and there are millions fighting by our side and dying in far greater numbers than our boys.
This hands Osama a tremendous propaganda victory (as you should expect from ANY Party of Treason action). "See the infidel takes what you offer then treats you like a Dog. By the Beard of the Prophet they are your enemy."
I agree. They need us for protection . They are not as important as some would lead you to believe.
Reminiscent of the Doestoevsky short story wherein mankind is given a perfect society wherein all his needs are relieved but sets his mind to destroy it as soon as possible.
I was depressed last night then watched the Johnny Cash movie and it reminded me of where I came from. Then later this afternoon I logged on and put the blues on, old timey blues Blind Lemon, Blind Willie (Mctell and Johnson), Big Bill. And like they always do steeled my spirit and inspired me.
I only wish Bush employed as capable advocates as he has around here.
LOok at the fricking MAP.
We must never think that FR has not been targeted. There were those who deliberately drove the idea that the US actually SOLD the ports to Dubai. Then along came the idea that Dubai would be handlng security. Mix in mass hysteria and you have ill-formed opinions. However it goes down in DC, we must continue the fight here to encourage those who can, to research the F-A-C-T-S. And many of you are doing just that and I thank you for it.
"Why is it so important for them to have a hand in American port operations?"
It is not important for them to have a hand in American port operations.
It is about being stabbed in the back after spending money and working hard to finalize a business venture.
If I was Soros I would make this site my principle target. His millions would do far more damage to the conservative patriotic movement by attacking this site than by funding idiots like DU and Moveon.
Fortunately I do not believe he is politically astute.
Yeah you're right!
Looking back, my feeling have been hurting for about two years or more. Aspirin ain't helping!
Wish I could fix it with a wave of the hand, but it's going to take a bit longer.
I figure it's on auto pilot now. Did you hear the some of the statements made by O'Connor today? Hmmmmmmm
I figure this is just the beginning of a major revolt within the party. What was once referred to as a conservative, is now called a rat moderate, RINO or often worse. These folks have had enough of it and will take the party back. They are the party loyalists but will put the foot down during the primaries. The candidates that emerge will not be to the liking of the right and they will defect, as usual.....
We could lose the presidency because of the party split perhaps, but it is too early to tell if the democrats can pull their base together. My guess is that they can, because they want it far too bad.
Hopefully, we can gain in the senate or hold what we have, and maybe barely hang on to the house as America returns to a divided government. That is what they seem to be wanting now, because regardless of how stupid the Dem's have been, the republicans have one upped them.
That is my assessment of the special tea leaves I look into and try to read the future. It's one I have had for a while now.
I spend far more time in the future than the present these days. The present sucks.:-)
Funny that you mention it...I posted the same thing to another thread. But facts no longer appear to matter. :-(
Companies are NOT required, in America, to stay in one place.
But the lose of business, now, due to the utter stupidity of the masses and the venal posturing of politicians, is something quite different. Think on that!
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