The rapid growth of Dubai Ports World mirrors the swift expansion of Dubai into a commercial power that is less and less dependent on oil wealth, which is modest by Persian Gulf standards. The glittering city-state has the Middle East's leading airline, Emirates, and has been snapping up other foreign assets, including the Essex House hotel in New York.
I heard Barbara Boxer on Michael Krasney this morning describing the fear penetrating through Washington this morning. Where I can perceive the history, I am all for opening up agreements with Middle Eastern companies and promoting wealth, expansion, and global markets.
Fear is unnecessary at this point. Security also lies in the hands of other facets within the trading industry. If we are worried about terrorism, believe me only 5% of all cargo was checked even before this transaction took place. Security lies, at the point of debarkation as well.. it's a larger issue that needs to be solved outside (or rather now instigated) because of this business deal.
Although the U.S. ports are causing the current ruckus, they are in fact only a small piece of P&O's business. But they are an important part of the deal because they would give Dubai Ports World a presence in a critical market where the company currently has no assets. "It's a strategic value. That's what's important," Chief Operating Officer Edward H. Bilkey said on CNN on Wednesday night.
Last night, in an offer coordinated with the White House, the company said it would not exercise control over U.S. port operations until further talks have been held between administration officials and lawmakers. The company said the rest of its transaction with P&O will move forward as planned.
The explosive fight over port security, direct investment in the United States by Arab countries and the secretive process by which the federal government reviews foreign purchases of potentially strategic domestic assets caught the company and others in the industry off guard. Dubai Ports World and P&O executives and maritime industry analysts had expected that the deal, first reported and discussed in October, would continue its smooth and anonymous path to completion on March 2.