Congress deems Mid-East control of US ports as a security risk
There is disconcertedness amongst many key politicians and Wall Street figures amid the quagmire of the attempted acquisition of P&O by the United Arab Emirates-based company Dubai Ports World (DP World). The apparent protectionism is because many US law-makers regard the deal, an infrastructure security risk. P&O control five US container terminals and other port operations. The Whitehouse has approved the deal, with George W. Bush insisting UAE is a strong ally of the United States.
The deal has sparked Congress to question whether a change in the current legislation that reviews foreign acquisition of US assets by state-controlled companies, is needed. Under current law, the Committee for Foreign Investments in the United States - or CFIUS - vets foreign takeovers but can only conduct a probe that lasts a maximum of 45 days and usually gives the go-ahead to most transactions after 30.
Critics have pointed out that the bulk of US port concessions are already owned by foreign countries and view the move as protectionist and bigoted. No congressman has volunteered a sensible argument as to why denying the deal would in fact help national security and merely assigning blame to the Middle Eastern countries, is unwise given the vast amounts of petrodollars they have pumped into the US economy.
The Miami based company Eller & Co. asked the High Court in London to block the deal, but, is a case lasting only a few minutes as a formality, the bench rejected the request. The Court of Appeal in London, subsequently prevented Eller & Co. from appealing DP World's clearances for the legal and financial clearances necessary for the implementation of the takeover.
Most maritime managers in the US fail to see any problems with the deal and are relaxed about the takeover, accusing politicians of failing to understand the issue, revealed in a survey conducted at the start of a maritime conference. 58 per cent of those who took part said they saw no threat to national security.
Former president Bill Clinton has been advising top Dubai officials on dealing with US concerns contrary to his wife, Hilary, who has been a staunch opponent of the deal. Consequently, DP World released a formal statement containing a voluntary, formal commitment to separate P&O's U.S. operations held through P&O's wholly owned U.S. subsidiary P&O Ports North America, Inc. (POPNA). Congress are now beginning investigations in a second attempted acquisition of Doncasters Group, by DP World.
