Increasing discomfort in Congress with Dubai-based company running U.S. port security
We wrote a few days ago how Dubai-based Dubai Ports World (DP World), having acquired London-based Peninsular and Oriental Steam Navigation (P&O), the world’s fourth-largest ports company, for $6.8 billion, would now run the operations, including security operations, in the ports heretofore managed by P&O. DP World would now run significant operations at six major U.S. sea ports (New York, New Jersey, Baltimore, New Orleans, Miami, and Philadelphia). The chairman of the House Homeland Security Committee, Representative Peter King (R-N.Y.), is questioning administration approval of the sale authorized Monday by shareholders in a London-based company. King said he spoke to senior White House officials and urged them to review national security concerns over DP World’s purchase of P&O. Another New York Republican, Representative Vito Fossella, has called for hearings. Representative Mark Foley (R-Florida), said: “If our ports are the most vulnerable targets for terrorism and if we are at war, as the president says, we should be overly critical of handing over management of our ports to any foreign countries, post 9/11.”
The Committee on Foreign Investment in the United States (CFIUS) 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. “The White House can stop this deal ultimately, and I’ve asked them to go very slow and look at it very carefully,” King told the AP. “The thing to do is find out if any of our departments have security concerns.” King added, “It was obvious to me that the White House is taking (the sale) very seriously and will look into it.”
CFIUS is one of the more secretive organizations of the U.S. government, with its deliberations held in strict secrecy. Its critics says that whatever else it does, being an effective guardian of U.S. national security it is not. They point to the one fact which is known about the panel’s work: As of summer 2005, CFIUS had, since its creation in 1988, formally rejected only one of 1,530 transactions submitted for its review.
There is another issue here, especially sensitive in the post-Jack Abramoff era: Last month, President Bush appointed David Sanborn of Virginia to be the new administrator of the Maritime Administration of the Transportation Department. Before his 16 January appointment, Sanborn worked as DP World’s director of operations for Europe and Latin America.
-read more in this AP report; and see the critique of Frank Gaffney, a former Reagan administration’s defense official
