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Dubai Gives Up On Ports Deal – Terrorists Win

From a disappointed Associated Press:

Dubai Firm to Give Up Stake in U.S. Ports


WASHINGTON – A Dubai-owned company said Thursday it is giving up its management stake in some U.S. ports, a move made as congressional leaders warned President Bush that both the House and Senate appeared ready to block the takeover.

It was not immediately clear whether the announcement would be enough to cool widespread sentiment in Congress to pass legislation blocking the deal, which has become a burdensome election-year problem for Republicans.

Sen. John Warner, chairman of the Armed Services Committee, took the Senate floor to read to colleagues a company press release disclosing its new stance.

"Because of the strong relationship between the United Arab Emirates and the United States and to preserve that relationship, DP World has decided to transfer fully the U.S. operation of P&O Operations North America to a United States entity," DP World’s chief operating officer, Edward H. Bilkey, said in the statement that Warner relayed to other senators. The announcement did not specify which American company would be involved.

The move came as the White House, facing a Republican rebellion in Congress, played down President Bush’s veto threat and said he was trying to find a compromise to resolve the uproar over the company’s plan to take over significant operations at several U.S. sea ports.

DP World said it will transfer all interest in U.S. port operations to an American-based company, but it was unclear immediately how DP World would manage the divestiture. The company indicated that details of the surprise deal were still being worked out.

Warner said that Sheikh Mohammed Al Maktoum, prime minister of the United Arab Emirates, "advised the company … that this action is the appropriate course to take." Dubai is in the emirates.

Just after Warner’s announcement, Sen. Charles Schumer, D-N.Y., a chief critic of the deal was cautious.

"This is obviously a promising development, but the devil’s in the details," Schumer said. "Those of us who feel strongly about this issue believe that the U.S. part of the British company should have no connection to the United Arab Emirates or DP World."

Republican congressional leaders had told Bush at a White House meeting earlier Thursday that both the House and Senate appear ready to block the takeover, GOP officials said.

In softening the White House’s previous stand, presidential spokesman Scott McClellan said, "Our emphasis is not on trying to draw lines or issue veto threats. It’s on how we can work together and move forward."

He said Bush did not mention his veto threat during his talks with the GOP leaders. "It doesn’t mean the president’s position has changed, it means our emphasis is on how we can work together to move forward," McClellan said.

House Speaker Dennis Hastert, R-Ill., said the leaders told Bush they want to protect the American people. "We will maybe have our differences, but we think we’re going to continue to do that," the speaker told reporters.

The fast-moving developments came one day after a GOP-controlled House committee voted 62-2 to block the transfer, which has prompted a GOP revolt — made all the more striking because it is related to the war on terrorism.

Senate Democrats also demanded a vote on the issue, and while Republicans struggled to prevent one, they conceded they were on the political defensive.

"I admire what the House did," said Senate Democratic Leader Harry Reid, D-Nev. "They said we know the president feels strongly about this. We know he said he’s going to veto this. But we’re going to do it because we think we have an obligation to our constituents."

Senate Republican GOP leaders had been hoping to prevent any votes until the conclusion of a 45-day review of the deal. At the same time, administration officials were using the time to try and ease the concerns of lawmakers.

That strategy collapsed in dramatic fashion on Wednesday, when the House Appropriations Committee overwhelmingly signaled its opposition to the deal.

Increasingly, it appeared the controversy was headed in one of two directions — a veto confrontation between Bush and Congress, or the decision by the company to shed its plans. The company had arranged to hold the rights as part of its takeover of Peninsular & Oriental Steam Navigation Co., a British company that holds contracts at several U.S. ports.

Bush has defended the deal, on grounds of open, free trade, and, he says, because the United Arab Emirates has been a strong ally in the war on terror.

By a 62-2 margin, the House Appropriations Committee on Wednesday attached the ports legislation to a $91 billion bill providing funds for hurricane recovery and wars in Iraq and Afghanistan.

Not that they really were going to manage any US ports, anyway. But the AP can’t give up that fantasy.

This article was posted by Steve on Thursday, March 9th, 2006. Comments are currently closed.

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