Dubai company to run security in major U.S. ports

Published 13 February 2006

We have heard of American companies doing security work in Middle East countries. In what must be a first, a Middle Eastern company is about to take over significant operations at six American ports, including Baltimore. A Dubai company is about to do so as a result of a sale: Dubai Ports World’s has purchased London-based Peninsular and Oriental Steam Navigation, which runs Baltimore’s public terminals and other ports. The $6.8 billion sale will be approved tomorrow. Peninsular and Oriental Steam Navigation is the fourth-largest ports company in the world, and its sale would affect commercial U.S. port operations in New York, New Jersey, New Orleans, Miami, and Philadelphia, in addition to Baltimore. The company’s P&O Ports unit has about sixty-five employees in Baltimore, and predominantly handles containerized cargo for the state-owned port at Seagirt and Dundalk Marine terminals.

DP World for its part said it won approval from a secretive U.S. government panel that considers security risks of foreign companies buying or investing in American industry. The U.S. Committee on Foreign Investment in the United States “thoroughly reviewed the potential transaction and concluded they had no objection,” the company said in a statement to the Associated Press. The committee, which could have recommended that President Bush block the purchase, includes representatives from the Departments of Treasury, Defense, Justice, Commerce, State, and Homeland Security.

The Department of State says that the UAE is “a staunch ally” in the fight against terror, but there are few who take this statement at face value. The UAE is a loose federation of seven emirates and sheikhdoms on the Arabian Peninsula best known for feudal social structure in which most of the work is done by foreigners, typically from the Indian subcontinent, who live in designated enclaves. Corruption and smuggling are rampant. The FBI found that it was an important operational and financial base for the 9/11 hijackers. More recently, UAE banks served as facilitators in Pakistani renegade nuclear scientist A. Q. Khan’s stealth campaign to sell advanced nuclear bomb and centrifuge designs to Iran, Libya, and North Korea. Fifteen years ago the BCCI bank affair made the headlines, ensnaring U.S. politicians and companies, and ruining the reputation of Clark Clifford, Harry Truman’s close adviser and Lyndon Johnson’s secretary of defense. BCCI, this most corrupt of all corrupt banks, was located in Abu Dhabi, the largest of the UAE emirates, where Agha Hasan Abedi, the smooth-talking Pakistani who founded the bank, found ideal conditions to nurture his criminal enterprise.

Sen. Charles Schumer (D-N.Y.) is not amused. “America’s busiest ports are vital to our economy and to the international economy, and that is why they remain top terrorist targets’. Just as we would not outsource military operations or law enforcement duties, we should be very careful before we outsource such sensitive homeland security duties.”

We note the following: 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.

Does this pose a national security risk? I think that’s pushing the envelope,” said Stephen Flynn, who studies maritime security at the New York-based Council on Foreign Relations. “It’s not impossible to imagine one could develop an internal conspiracy, but I’d have to assign it a very low probability.”

-read more in this Baltimore Sun report