From the International Herald Tribune:
Dubai company vows not to sell 6 U.S. ports
Bloomberg News, The Associated Press
FRIDAY, FEBRUARY 24, 2006
DUBAI, United Arab Emirates
Dubai's government-owned port company said it would refuse to sell the six ports it is acquiring in the United States, despite intense criticism that the company's acquisition would undermine American security.
In Washington, President George W. Bush once again defended the sale, saying "people don't need to worry about security."
Speaking with reporters at the end of a cabinet meeting, Bush assured the American public that "the transaction that has been scrutinized and approved by my government."
The president said that people were not concerned about port security when a British company was running the port operation, but they felt differently about an Arab company at the helm. He said the United Arab Emirates was a valuable partner in the war in terror.
Dubai is part of the United Arab Emirates, from which two of the Sept. 11, 2001, hijackers came.
Dubai Ports World is to acquire operation of the six ports in its $6.8 billion takeover of the British-based Peninsular & Oriental Steam Navigation Co.
The company, owned by the government of Dubai, received takeover approval from 12 U.S. government agencies, including the Central Intelligence Agency, the Federal Bureau of Investigation and Homeland Security, Yuvraj Narayan, the company's senior vice president for corporate strategy, said in an interview in Dubai.
"We have not ever contemplated or considered selling the U.S. ports," Narayan said at a meeting with bankers as he tried to arrange a $6.5 billion loan for the takeover, which is to close on March 2.
The Dubai Ports World chief executive officer, Mohammed Sharaf, said in a telephone interview, "We haven't gone out to buy these ports just to sell them later,"
But political opposition in the United States is so strong that Bush again defended his administration's decision to let the Mideast company manage important American ports, including New York, Baltimore, Miami and New Orleans.
Under secret conditions of the agreement with the administration, the company promised to cooperate with U.S. investigations as a condition of the $6.8 billion deal, according to documents obtained by The Associated Press.
The U.S. government chose not to impose other, routine restrictions.
Administration officials were sent to Congress to explain the process, saying that the government had spent three months reviewing the deal and that all concerns about security had been satisfied.
"We're not aware of a single national security concern raised recently that was not part" of the multiagency, three- month review, Deputy Treasury Secretary Robert Kimmitt said at a hearing of the Senate Armed Services Committee.
Representatives of the main agencies that investigated the port deal - but not the heads of the various departments - sought to reassure senators.
Two senators, Robert Menendez and Hillary Rodham Clinton, both Democrats, have said they will introduce legislation to prohibit companies owned or controlled by foreign governments from running port operations in the United States.
Clinton called the approval process "a failure of judgment" because officials "did not alert the president, the secretary of the treasury and the secretary of defense" that several of our critical ports would be turned over to foreign country.
The Senate majority leader, Bill Frist, and other Republicans have also complained.
In approving the purchase, The Associated Press reported, the administration chose not to require Dubai World Ports to keep copies of its business records on U.S. territory, where they would be subject to orders by American courts. It also did not require the company to designate a U.S. citizen to accommodate requests by the government. Outside legal experts said such obligations are routinely attached to U.S. approvals of foreign sales in other industries.
Dubai World Ports agreed to give up records on demand about "foreign operational direction" of its business at the U.S. ports, according to the documents.
Those records broadly include details about the design, maintenance or operation of ports and equipment. It also pledged to continue participating in programs to stop smuggling and detect illegal shipments of nuclear materials.
"They're not lax but they're not draconian," said James Lewis, a former U.S. official who worked on such agreements, said of the terms. If White House officials negotiating the deal had predicted the firestorm of criticism over it, he said, "they might have made them sound harder."
Visiting Lebanon, Secretary of State Condoleezza Rice said Thursday that the U.S. government had thoroughly vetted the sale agreement. She described the United Arab Emirates as "a very good ally," adding, "If more details need to be made available, then I'm sure they will be."