Feb. 24, 2006 – News that an Arab-owned company would assume control of several US seaports prompted outcry from politicians in both major parties over national security concerns. In the background, additional fears emerged when administration critics learned of the less-than-transparent process by which the deal met with easy approval.
Last week, the United Arab Emirates-owned company Dubai Ports World (DPW), took over a British company that currently manages six US ports. When news of the $6.8 billion deal â€“ which has DPW poised to begin operating US ports on March 2 â€“ broke in the US media, several lawmakers noted that terrorists, including Al-Qaeda operatives, have been connected to the UAE.
Democratic and Republican members of Congress alike used arguments exaggerating both the extent to which the UAE has been connected to terrorism and the role its company, DPW, would play in inspecting cargo at the ports under its control. Senator Chuck Schumer (Dâ€“NY), for instance, repeatedly claimed the UAE has had a "nexus of involvement with terrorism" and also insisted DPW would be responsible for inspecting shipments entering US ports.
But many other countries, including the United States and the United Kingdom, have had far more known connections to Islamic terrorists, such as the provision of residence and even citizenship, access to weaponry, issuance of legal identification and the use of banks.
Dubai Ports World, one of the largest port operators in existence, already manages terminals in eleven countries, including the UAE. There have been no reported incidents of the Emiratesâ€™ monarchy or DPW itself supporting terrorism.
Other foreign operators handle terminals at all of the six US ports DPW is poised take control of. Furthermore, DPW, like the Oriental Steam Navigation Company (P&O) it is poised to acquire and the many other foreign companies doing business at the nationâ€™s seaports and airports, would not be in charge of security. That remains the purview of US law and border enforcement agencies.
In official statements and comments to reporters, a number of Arab-American groups and public figures accused concerned lawmakers of xenophobia and said the immediate criticism sparked by the deal wouldnâ€™t have come about had the company not been owned by an Arab nation.
"The anti-Arab impetus behind these protests is impossible to ignore, certainly doesn't make us safer, and trumps any positive message our public-diplomacy efforts seek to portray," Arab-American Institute President James Zogby said in a statement Wednesday. "The concern we have is that if an ally of the United States like the UAE can be smeared in this manner, simply because it's an Arab country, then our relations with the broader Arab world may be irreparably damaged."
Zogbyâ€™s comments were echoed by others, including American-Arab Anti-Discrimination Committee (ADC) and the Council on American-Islamic Affairs (CAIR).
CAIR spokesperson Ibrahim Hooper told the Baltimore Sun that US political leaders were "falling over one another trying to determine who's going to have the most anti-Arab, most anti-Muslim attitude."
In a statement released by the Institute for Public Accuracy, ADC spokesperson Laila Al-Qatami charged: "Those who purport that ports can be securely run by a British company, but not an Arab one, are engaging in racial profiling on the corporate level."
Still, other questions about the deal remain over the manner in which the port contract was approved. Just last month, the White House nominated a former DPW executive, David Sanborn, to head the US Maritime Administration, where he will oversee the countryâ€™s seaports. His role in the acquisition approval is unclear.
Wednesday, the Associated Press reported it had received confirmation that the administration and DPW reached a somewhat routine arrangement regarding the companyâ€™s cooperation in future US investigations prior to the P&O stockholder vote. Experts consulted by the AP said the arrangement lacked safeguards typical of such understandings, including any insistence that the company keep paperwork in the United States.
The discord over the deal did not surprise Corpwatch director Pratap Chatterjee, who explained his view of the problem to the Institute for Public Accuracy: "On the one hand, it's protectionist and racist to prevent this because the company is based in an Arab country. But there clearly are factors of government secrecy and cronyism involved in this, as with so much of what the US government does."
The Bush familyâ€™s business ties to the United Arab Emirates and the extensive use of UAE ports and airspace for US military operations have drawn suspicion to what appears to be a fast and smooth approval for such a deal. The secret cabinet-level committee tasked with investigating security concerns involving foreign investments opted to forgo the standard 45-day review mandated in such arrangements.
Nevertheless, skeptical observers suggest, such criticisms more readily highlight shortcomings of existing US policy and politics than they expose a particular threat posed by Dubai Ports World. Washington Post columnist E.J. Dionne Jr. points out today that, until the DPW deal came to light, "most Americans had no idea that our government's process of approving foreign takeovers of American [assets] through the Committee on Foreign Investmentsâ€¦ was entirely secret."
According to the White House, the president had not been involved in reviewing the deal between P&O and Dubai Ports; he learned of it only after news of the story broke, despite the Committee on Foreign Investmentâ€™s mandate to seek explicit presidential approval.
Just the same, less than a month before DPW first sought US approval of the ports deal, the UAE sent $100 million in relief funds for victims of Hurricane Katrina.
With congressional leaders threatening legislation to prevent DPW from assuming control of the domestic terminals, President Bush has vowed to veto any such measure. Were Bush to follow through on the veto, it would be the only one used since he assumed power in 2001.
However, White House Deputy Chief of Staff Karl Rove told Fox News yesterday that the administration is open to a delay in the deal, and DPW has expressed willingness to delay the acquisition of US ports until Washington backs the deal with more confidence.
Also yesterday, the State of New Jersey filed a lawsuit in federal court seeking to stop the DPW deal. The Port Authority of New York and New Jersey also said it would file a lawsuit on Friday seeking to terminate the lease for management of its busy shipping center.