Dubai backs out of port deal

CNN:

WASHINGTON (CNN) -- A United Arab Emirates-owned company has agreed to turn over all of its operations at U.S. ports to an American "entity," Sen. John Warner said Thursday.

Reading a statement from DP World on the Senate floor, Warner, a Virginia Republican, said the reason is "to preserve" the strong relationship between the UAE and United States.

The announcement comes after congressional leaders reportedly told President Bush that the deal for DP World to assume some operations at six U.S. ports appeared dead on Capitol Hill.

Senator Warner addressed this issue on a recent episode of Meet the Press:

MR. RUSSERT: Senator Warner, you were the first United States senator to express some support for the president on this. You’ve been deeply involved in the discussions, in the negotiations. What can you tell us?

SEN. JOHN WARNER (R-Va.): Well, first, I think the president has taken the right steps. And I have carefully gone back and reviewed all the intelligence that was given to the CFIUS panel. I have, yesterday, spent a good deal of time in the Department of Defense with the Joint staff on the issues of intelligence, the impact and talked to my leader, Bill Frist. And I see there’s a coming together within the Congress now of a consensus that we’re going to take a good look at this for 45 days. And last night, I was contacted by the chief operating officer of this company, and he asked to see me. So I went over and I spent about two hours with him and his lawyers, and I talked again this morning. And this is a copy of the agreement which is now being delivered to the administration and to members of Congress. And it really spells out unequivocally the willingness of this country—excuse me, this company, to give every means of support to help work this thing out.

It says, “DP World and POPNA,” that’s the British, “jointly request,” now, they’re requesting, that’s a key thing, “that the CFIUS process on a nonprecedential basis to conduct an aview—review full and 45 days for the acquisition.” So there it all is. And I...

MR. RUSSERT: So the company is requesting a 45-day review investigation ...

SEN. WARNER: That’s correct. Mm-hmm. Mm-hmm.

MR. RUSSERT: ... before the deal would go forward?

SEN. WARNER: Well, the deal—now, you’ve got to make certain, the deal is a very large one. You know, this company ...

MR. RUSSERT: The U.S. component of the deal.

SEN. WARNER: That’s right. It’s about 10 percent of a deal. This company’s doing business, Tim, with over 30 nations. It has an excellent record. It was selected last year among its peer group as the most outstanding terminal operator in the world. And I want to point out, this is a bigger issue for our country than just this commercial agreement. We’re in a global situation, it is diplomacy, it is our economic standing in the world, and it is the military security. Let me address the latter. As I said, I read the reports to the intel, which went to the CFIUS under the previous and will obviously be a part of this new review. I talked with the Pentagon, and the Pentagon views this as follows: We are using facilities in the UAE today, docking over 500 ships, American warships, last year, using their air fields to perform support missions for both Afghanistan and Iraq. We cannot treat this company as a second-class citizen. In the past, as the Congress mentioned, there were problems, but since 9/11 they’ve been a full partner in the war on terrorism. We as the United States are dependent on countries like the UAE, Qatar, Bahrain, Kuwait, all of them there, to give us the support to fight this war on terrorism. We cannot mess this deal up. And in the eyes of the world...

MR. RUSSERT: You said there—Senator, you said there are problems.

SEN. WARNER: Yeah.

MR. RUSSERT: I think the American people are quite concerned with those, quote, “problems.” This is how the Associated Press reported it: “Critics of the proposed purchase say a port operate—operator complicit in smuggling or terrorism could manipulate manifests and other records to frustrate Homeland Security’s already limited scrutiny of shipping containers and slip contraband past U.S. Customs inspectors. Since the September 11th attacks, the FBI has said the money for the strikes was transferred to the hijackers primarily through the United Arab Emirates’ banking system, and much of the operational planning for the attacks took place inside the UAE. Many of the hijackers traveled to the U.S. from the UAE. Also, the hijacker who steered a United Airlines flight into the World Trade Center’s south tower born in the UAE. After the attacks, the U.S. Treasury Department officials complained about a lack of cooperation by the United Arab Emirates and other Arab countries trying to track down Osama bin Laden’s bank accounts.” The September 11 Commission report.

SEN. WARNER: Sure.

MR. RUSSERT: The chairman, Tom Kean, says this is not a good deal, a good idea. And in this report it suggests that when we had a chance to take bin Laden out, that UAE official may have tipped bin Laden off to get out of the hunting camp that he was staying in and to avoid our strike.

SEN. WARNER: Tim, those facts in large measure were before the CFIUS that reviewed this.

MR. RUSSERT: The government board that looks into these things.

SEN. WARNER: That’s correct, which has already reviewed it. They will be rereviewed under the 45-day process. And let’s say that the concern across America is legitimate. In all of our hearts is 9/11 and the losses we sustained. But also in our hearts are the men and women of the armed forces—over 2,000 have been killed, some 25,000, 30,000 wounded. We need to continue to give them the support they need to finish this battle. Whether it’s in Afghanistan or Iraq, and the utilization of the facilities in UAE and the other Arab areas is essential. Absolutely essential. If the UAE felt that they’re being mistreated and were to pull back that support, where would it shift? We know not. Would other Arab nations—given the fact that it looked like we used a double standard here, would they step up and take that excess? I don’t know. Let us be very cautious. Remember, we’ve got to look at this thing from a global perspective. Those facts are important. They were taken into consideration in the previous review. They’ll be subject to rereview in the 45 days forward.