Sale of Ports to Arab Company Gives Rise to Security Concerns

WASHINGTON_U.S. lawmakers formally asked the Bush administration Thursday to reconsider its approval of a sale giving a company in the United Arab Emirates control over significant operations at six major American ports.

The lawmakers, including four senators and three House members, sharply criticized the UAE as inconsistent in its support of U.S. anti-terrorism efforts.

They also said the country was a key transfer point for shipments of nuclear components sent to Iran, North Korea and Libya and was one of only three nations that had recognized the Taliban as Afghanistan's legitimate government.

"Outsourcing the operations of our largest ports to a country with a dubious record on terrorism is a homeland security and commerce accident waiting to happen," said Sen. Charles Schumer, "The administration needs to take another look at this deal."

The Bush administration defended its approval of the sale. A spokesman for the White House National Security Council, Frederick Jones, said Thursday that security implications of the deal were "rigorously reviewed."

The Associated Press reported Saturday that government-owned Dubai Ports World had won approval for the $6.8 billion (€5.7 billion) deal from a secretive U.S. panel that considers security risks of foreign companies buying or investing in American industry.

Since then, a growing faction in Congress wants the White House to reconsider its approval of DP World's purchase of the London-based Peninsular and Oriental Steam Navigation Co., which British shareholders approved Monday.

The British firm, the world's fourth-largest ports company, runs commercial operations at shipping terminals in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

The Committee on Foreign Investment in the United States reviewed the transaction and did not object. The committee, run by the Treasury Department, also includes officials from the departments of Defense, Justice, Commerce, State and Homeland Security.

Although it declined to comment on the committee's decision last week, the Treasury Department said Thursday the consensus of the panel's 12 members was that the sale did not present national security problems. The review included an assessment from U.S. intelligence agencies, the department said.

"Clearly no responsibility of government is more important than protecting the national security," the department said in a statement.

Critics have complained that control over port operations by DP World could endanger U.S. security. They cite the UAE's history as an operational and financial base for the hijackers who carried out the Sept. 11, 2001, attacks against New York and Washington.

<<Associated Press WorldStream -- 02/17/06>>