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February 24, 2006
Getting up to speed on the Dubai port deal
I was recently talking to my friend, Jon. He has been one of my closest friends for almost eight years and I know him very well. He reads the Wall Street Journal every morning before listening to National Public Radio's Morning Edition on his way to school. When I realized that Jon, one of the most informed citizens I know, did not have a complete picture of the Dubai port deal, I felt obligated to get the public up to speed.
The Connecticut Post recently devoted an entire page to the deal, something no other newspaper I know of has. Below are some of the highlights, all information comes from the Associated Press.
Arab port company agreed to disclose internal records
WASHINGTON (AP) — The Bush administration secretly required a company in the United Arab Emirates to cooperate with future U.S. investigations before approving its takeover of operations at six American ports, according to documents obtained by the Associated Press. It chose not to impose other, routine restrictions.
As part of the $6.8 billion purchase, state-owned Dubai Ports World agreed to reveal records on demand about “foreign operational direction� of its business at U.S. ports, the documents said. Those records broadly include details about the design, maintenance or operation of ports and equipment.
The administration did not require Dubai Ports to keep copies of business records on U.S. soil, where they would be subject to court orders. It also did not require the company to designate an American citizen to accommodate U.S. government requests. Outside legal experts said such obligations are routinely attached to U.S. approvals of foreign sales in other industries.
Dubai Port’s top American executive, chief operating officer Edward H. Bilkey, said the company will do whatever the Bush administration asks to enhance shipping security and ensure the sale goes through. Bilkey said Wednesday he will work in Washington to persuade skeptical lawmakers they should endorse the deal; Senate oversight hearings already are scheduled.
Under the deal, the government asked Dubai Ports to operate American seaports with existing U.S. managers “to the extent possible.� It promised to take “all reasonable steps� to assist the Homeland Security Department, and it pledged to continue participating in security programs to stop smuggling and detect illegal shipments of nuclear materials.
Bush faces a potential rebellion from leaders of his own party, as well as a fight from Democrats, over the sale. It puts Dubai Ports in charge of major terminal operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.
Senate and House leaders urged the president to delay the takeover, which is set to be finalized in early March. Senate Majority Leader Bill Frist of Tennessee said the deal raised “serious questions regarding the safety and security of our homeland.� House Speaker Dennis Hastert, R-Ill., asked the president for a moratorium on the sale until it could be studied further.
Bush personally defended the agreement on Tuesday, but the White House said he did not know about it until recently. The AP first reported the U.S. approval of the sale to Dubai Ports on Feb. 11, and many members of Congress have said they learned about it from the AP.
At the White House, spokesman Scott McClellan said Bush learned about the deal “over the last several days,� as congressional criticism escalated. McClellan said it did not rise to the presidential level, but went through a government review and was determined not to pose a threat.
Opposition to deal seen as bias
DUBAI, United Arab Emirates (AP) — To many in this booming financial center, the American backlash over Dubai running U.S. ports boils down to something simple — and ugly: “This is Arab-phobia,� says one Arab security analyst. “I can see no other reason behind it.�
As the U.S. secretary of state heads here for talks, many Arabs go further, saying the very basis of American policy toward the Middle East may be at stake: If the United States can’t work with a moderate, friendly and socially liberal Arab ally like Dubai, it may not be able to work with any Arabs at all.
“If the American politicians were smart, they would hold Dubai up as a role model,� said Abdul Khaleq Abdulla, a political scientist at Emirates University. “Punishing us sends the wrong message.�
President Bush said basically the same Tuesday, threatening to veto legislation aimed at blocking the port deal.
“This is a company that has played by the rules, that has been cooperative with the United States, a country that’s an ally in the war on terror, and it would send a terrible signal to friends and allies not to let this transaction go through,� Bush said.
Among other things, the United Arab Emirates, of which Dubai is one part, allows the United States to base U.S. Air Force spy planes and refueling flights here and allows U.S. warships to visit. It also has handed over to the United States terrorism suspects arrested on its territory, including the alleged mastermind of the USS Cole bombing in Yemen.
U.S. lawmakers pledged to try to head off the deal. They allege Dubai has been a financial and operations base for terrorists and say that means state-owned Dubai Ports World should be blocked from its $6.8 million purchase of Britain’s Peninsular and Oriental Steam Navigation Co., which now operates six U.S. ports.
Two of the 19 hijackers who carried out the Sept. 11, 2001, attacks on the United States were from the United Arab Emirates. Eleven of the hijackers — all Saudis — entered the United States on flights from Dubai, a common way for a person to travel from Saudi Arabia to the United States. All the Saudis had been issued U.S. visas by American officials.
U.S. government reports also have said that Dubai, a freewheeling banking hub that operates the Mideast’s busiest airport, served as a transit and money transfer center for al-Qaida. The city’s port also was used by a Pakistani nuclear engineer to ship uranium enrichment equipment to Libya.
Yet people here point out that the country has created a joint task force with the United States that investigates terror funding and nuclear proliferation. Above all, many say the tone of U.S. critics has shocked them: Dubai styles itself as a Mideast Switzerland, steering clear of conflict and focusing on business.
“We don’t like the tone of this,� Abdulla said. “Many of us see a hint of racism there, disguised as security concern.�
U.S.-based private intelligence firm Stratfor noted that “the government of the UAE is about as pro-American as you can get� in the region. “If the United States can’t do business with the UAE, then the United States cannot do business anywhere in the Islamic world,� it said.
Stratfor also said “a British company previously was managing the (American) ports, and there are plenty of jihadists traveling on British passports these days who are at least as dangerous as anyone in the UAE.�
The Emirates foreign minister thanked Bush for his support, saying he was relieved the president had spoken out forcefully. But Secretary of State Condoleezza Rice is certain to face tough questions when she arrives for talks Thursday.
Rejecting the deal would not only tarnish relations between the UAE and Washington, but also set the wider Arab world — including other moderate allies like Jordan — on edge, said Mustafa Alani, a security analyst with the Dubai-based Gulf Research Center.
He called the opposition to the deal “Arab-phobia, Islamophobia ... I can see no other reason behind it.�
Terrorism dollars present in Dubai
(AP) The United Arab Emirates has not had a major terrorist attack. But its largest city, Dubai, is a banking center that is believed to attract funds from groups such as al-Qaida. Some of Dubai’s brushes with terror groups:
* The father of Pakistan’s nuclear program, Abdul Qadeer Khan, has acknowledged heading a clandestine group that, with the help of a Dubai company, supplied Pakistani nuclear technology to Iran, Libya and North Korea. The head of U.N.’s nuclear watchdog agency, Mohamed ElBaradei, has said the UAE had with a role in the nuclear black market.
* A 2004 report from the U.S. commission investigating the Sept. 11, 2001, attacks found 11 Saudi hijackers had traveled to the U.S. via the airport in Dubai.
* Osama bin Laden’s alleged financial manager, Mustafa Ahmed al-Hisawi, received a Dubai bank transfer of $15,000 two days before the Sept. 11 attacks.
* Marwan Al-Shehhi, a UAE citizen and one of the Sept. 11 hijackers, received $100,000 via the UAE. Another Sept. 11 hijacker, Fayez Banihammad, also was from the Emirates.
* About half the $250,000 spent on the Sept. 11 attacks was wired to al-Qaida terrorists in the United States from Dubai banks, authorities said. Al-Qaida money in Dubai banks also has been linked to the embassy bombings in Kenya and Tanzania.
Posted by Jamie on February 24, 2006 10:00 PM

