March 02, 2006

Crapo: Port Case Raises Larger Security Issues

Calls for delay to investigate Dubai deal; examine overall reforms

Washington, DC â?? Idaho Senator Mike Crapo told colleagues on the Senate Banking Committee today that the deal to transfer operations of some U.S. ports to a United Arab Emirates firm should be delayed and raises red flags for overall oversight regarding such transactions. Crapo noted his opposition to the February agreement under which Dubai Ports World, a state-owned business in the United Arab Emirates, purchased Peninsular and Oriental Steam Navigation Company, a British firm, which currently runs the operations at six of the largest U.S. ports--New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia. The proposed transaction would affect management of the ports. Security at all of the ports will continue to be managed by the Bureau of Customs and Border Protection and the U.S. Coast Guard. But many in Congress, including Crapo, are concerned. Todayâ??s hearing of the Banking Committee was intended to review the transaction. It had been reviewed and approved by the Committee on Foreign Investment in the United States (CFIUS), which is made up of 12 representatives of different federal departments and agencies. The president may reverse or approve CFIUS decisions. The Treasury Department chairs CFIUS, which reviews foreign purchases of U.S. firms for their national security implications.â??Frankly, itâ??s hard to understand why the 45-day review and the more thorough process was not initiated with regard to this transaction from the outset,â?? Crapo said. â??And then itâ??s hard to understand why, when the issue became one of public concern, there was so much resistance to a 45-day review and to taking the time to have the extra-thorough scrubbing of this issue that the public, my constituents, and I think the vast majority of the American public are asking for.â??While Crapo said many are mindful about potential legislation to stop the transfer of port terminal operations to Dubai-owned DP World, Congress should, at minimum, use the issue to reopen how such transfers in general are overseen by the legislative branch. â??I agree with my colleagues who have said that if the security of the United States is compromised by this transaction, the transaction should be stopped,â?? Crapo said. â??A much larger issue faces the committee, though, and that is how we in the Congress are going to deal with the transactions of this type that we face relating to our security in the future; the question of process. I, for one, believe that itâ??s very evident that the process needs to be fixed.â??A satellite feed of Crapoâ??s remarks relating to the port deal and security issues is available:1:45 p.m. Mountain Time / 12:45 p.m. Pacific TimeC-Band AMC 1Transponder 20 VerticalDownlink 4100Audio 6.2/6.8.# # #