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.
Why stop there? Let's run ALL foreign investment out of the US!
LOL.........I'd like to take the first swat!
LOL, keep fooling yourself. You should hear the GOP candidate in Texas bash, in radio election adds, Bush's open borders policies, spending, etc. I've never seen anything like it, GOP candidates are running from Bush as fast and as far as they can. The chickens of failed policy after failed policy are comming home to roost. This UAE deal is just the tip of the ice berg, expect the GOP to take a hard right turn and left Bush all alone in left field.
Then we can run the entire country like one big happy plantation. ;-)
LOL! Polls!
70% is wrong, but there was no time to educate, and the determination was that it had become too hyperbolic to address.
Mob rule! A very dangerous predicate.
[ F U L L B O D Y S H U D D E R ]
There are still sub-Saharan slaves being peddled in order to satisfy rich Muslim princes.
There are still prostitutes from Eastern Europe and China being imported in order to satisfy the sexual curiosity of rich foreigners and natives.
In fact, there was a segment on NPR's "The World" yesterday exploring this very problem.
The fact that they've taken some minimal steps to address these problems-after a firestorm of negative publicity-doesn't impress me any more than the CYA maneuver by Sheik Nayhan to close his anti-Semitic, anti-American center after it was exposed by the David Project.
"are you O.K. with a massive global trade war"
Based on the latest reports, no massive global trade war on the horizon. Of course, anything remains to be seen.
I don't like some pissant country trying to financially blackmail the greatest nation this world has ever seen. Without us, there would be Hitler Holidays. Without us, the Soviets would have europe, without us, the state of Israel would be a state of mind.
LOL That's a good one. China alone has over 3 billion people and probably less than five percent of them are currently automobile owners or in other ways consumers of petroleum products. But they are in the process of changing that. Both the people and the government want that change. Same in India albeit they have a comparably small population.
If we are going to base national policy on racist know-nothing nonsense, why shouldn't it be. Being subject to Mau-Mauing by a bunch of idiots in Congress makes the US a very unattractive place to do business.
This is a predictable response, and makes perfect sense from the UAE point of view. It is a big World, with plenty of places to spend all that money. There is no reason to deal with the US if we're going to be a bunch of jerks.
This is what happens when Congress plays to the cameras and acts like a bunch of Ritalin-deprived children. Utterly predictable.
Want to know just how BAD this deal is?
The spokesman for the "Dump DWP Deal," none other than Harry Reid, is on TV right now DEMANDING A VOTE ON THIS DEAL!
Talk about USEFUL IDIOTS!
hreatens Against Boeing and US Bases Support), Rutles4Ever wrote:
One more note: Dubai, as a financial capital, would suffer greatly if Iran blocks Hormuz.
They will NOT ask our military to leave.
BTW, what exactly is my agenda?
Inquiring minds...
It was the straw that broke the camels back.
In fact, I have little better to say for all the knee-jerkers on the forum who have been against this.
Do some research, look at the friggin' MAP for pete's sake.
Then tell me why it is a good idea to pi$$ off one of our few friends in the region.
How one shipping company purchasing another shipping company's interests in 6 ports got this blown out of proportion would be beyond me were it not the pet project of the anti-Republican crowd in the MSM and on Capitol Hill.
We lose a strategic ally. How else is the ruling family to take this but as a personal insult? I'd be pi$$ed off, too!
The possibility of any operation against Iran succeeding without major problems getting tankers through the Straits of Hormuz is now lower than the odds of winning the Powerball jackpot.
Of course, any failure by the current Administration to stop Iran from obtaining Nukes will be touted as a "FAILURE", any problems encountered, such as a 10% drop in available oil supply during such an operation (should it occur) will be touted by the Socialists worldwide (including our pet Democrats and RINOS at home) as "BUSH'S FAULT" and 10% would set oil prices at easily $100 or more per barrel.
STUPID, STUPID, Stuck on STUPID!
As for the Pubbies who voted against this without doing any d@mn homework, they should be cashiered right along with the Dems, just for being suckers. To me that demonstrates that they will jump to make decisions without facts, and right now, that is one thing this country can d@mned well do without.
Do you think I'm interested in what somebody running for election has to say about George Bush?
If you do, you're dumber than I thought.
Your leader, Harry Reid, is on TV right now, demanding a VOTE BE TAKEN. You need to ask yourself WHY he wants that.
Agreed. Congress just shot America in both feet.
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