By  on March 10, 2006

WASHINGTON — Dubai Ports World, the Arab-owned company seeking to operate terminals at six major U.S. ports, offered Thursday to transfer those properties to an American-owned company.

The proposal, announced on the Senate floor amid efforts to scuttle the ports deal, didn't immediately appear to satisfy Congressional critics and led to a showdown in the Senate. It occurred hours after Republican leaders in Congress met with President Bush, who has vowed to veto any bid to stop the Dubai Ports World acquisition. Many of Bush's GOP allies have abandoned him on the issue.

"Where we are in the process now is working with Congress to try to find a way forward," White House Press Secretary Scott McClellan said at a press briefing.

The House Appropriations Committee on Wednesday voted 62-2 to prohibit Dubai Ports World from moving ahead. Rep. Jerry Lewis (R., Calif.), chairman of the panel, added an amendment blocking the deal to a $91 billion emergency spending bill for the war in Iraq and Hurricane Katrina recovery efforts. The House could take up the issue as soon as next week.

Before the offer by Dubai Ports World on Thursday, Sen. Charles Schumer (D., N.Y.) was seeking a vote on an amendment to another bill to block the deal. But majority leader Bill Frist (R., Tenn.) tried to use a parliamentary procedure known as cloture to limit the debate and halt balloting on Schumer's plan. Minutes prior to action on Frist's maneuver, Sen. John Warner (R., Va.) read a press release on the Senate floor announcing the offer by Dubai Ports World to transfer ownership of the terminals to a "United States entity."

The company's statement said: "Because of the strong relationship between the United Arab Emirates and the U.S., and to preserve that relationship, DP World has decided to transfer fully U.S. operations ... to a United States entity." The Dubai government owns the company.

Schumer said lawmakers would need more time to examine the compromise and he continued to press for a vote on his amendment. "This is a promising development, but of course the devil is in the details," he said. "We would have to examine this proposal. The bottom line is, again, if the U.S. operation is fully independent in every way, that could indeed be promising. If, on the other hand, ultimate control is still exercised by DP World, I don't think the goal will be accomplished."Frist then pushed for a vote to cut off debate, but couldn't get the two-thirds majority necessary. After that effort failed, Frist pulled from the Senate's agenda a lobbying reform bill to which Schumer's amendment had been attached.

"Unfortunately, some of my Democratic colleagues chose to hold this [lobbying] bill hostage for a totally unrelated issue ... what we are opposed to is considering an amendment that is totally outside the scope of the bill at hand, just so [some lawmakers] can score partisan political points in one way or the other on the port security issue."

Critics maintain the deal is a potential security risk because the UAE at one time recognized the Taliban government in Afghanistan and was the home of two of the hijackers involved in the Sept. 11, 2001, terrorist attacks, as well as a source of terrorist financing.

Frist suggested that he would not consider a vote on any Dubai Ports World-related bills until a new 45-day review of the deal is completed.

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