DP DQ'ed

DP World tried to soothe US waters

Two days before the Bush administration asked Dubai Ports World to sever its US operations, the company gave three Republican senators an extraordinary package of proposed security measures meant to seal off management of its US subsidiary and to pay for screening devices at all 51 ports it operates around the world. The four-page offer, titled "Proposed Solution to the DP World Issue," promised to give the Department of Homeland Security nearly complete say over the company's US corporate affairs and to install "state-of-the-art radiation-detection and gamma-ray inspection devices" at company expense at all current and future DP World-managed ports overseas. Experts estimate that step alone could have cost DP World as much as US$100 million, though some ports where DP World operates already have some radiation-detection devices. But the March 7 offer was largely dismissed as a good effort that came too late. On Thursday, Republican congressional leaders told President Bush the deal faced inevitable collapse in Congress. Bush then sent word to Dubai requesting that DP World shed the US assets it had acquired. The government-owned company agreed, and announced within hours that it intended to sell its concessions and various assets at five US ports, though details on how or when that will happen remain sparse. The company had planned a news conference that afternoon to announce its package of security offers.

Supporters of the DP World deal said the fact that the last-minute offer went nowhere shows how the cards were stacked against DP World, no matter what assurances the company put forward. Security experts say the March 7 offer, which hasn't previously been made public, far exceeds anything that other US port operators have agreed to, including ones operated by other foreign government-owned companies. Some Republican Senate staffers now believe that if DP World advanced these proposals earlier, the deal may have held. Homeland Security Secretary Michael Chertoff said last week that having DP World run operations in New York/New Jersey, Philadelphia, Baltimore, Miami and New Orleans would have enhanced US security by giving US law enforcement a better handle on security at US terminals. Yet those assertions were based on a package of commitments, hailed within the government as unprecedented, that the company put forward in January as part of an interagency security review. The March 7 offer, on the other hand, went beyond what was put forward in January. Meanwhile, the political firestorm the purchase caused in the US persists. House Republicans said yesterday that they still planned to vote on an amendment as early as this week to officially kill the deal, despite the company's promise last week to shed its US assets.
(Wall Street Journal 060314)

It's too bad the American politicians freaked out on this one, but is not surprising considering the knee-jerk reactions everyone's having to everything these days. DP World manages facilities all over the world and obviously has to uphold a certain acceptable level of security in order to maintain their reputation, which apparently they go to great efforts to exceed. I'd think that with the scrutiny over this deal, DP World would've made the American port facilities the most secure in the world, but now it will be pushed onto a bumbling American company that may or may not screw things up, including security. Ah! Who am I to say? I still believe this was a Bush Administration decision made long ago to appease the rulers of Dubai to maintain a very strong relationship IF (when) a need to secure the Straits of Hormuz becomes a necessity in the near future. The decision to abort this deal, whether or not there were ulterior motives, appears to be motivated by fear, racism, and hypocrisy.