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Gaffney: Who Is Financing Ports Deal?
Dave Eberhart, NewsMax
Monday, Feb. 27, 2006

Although beleaguered Dubai Ports World has agreed not to exercise management over U.S. ports pending further discussions with Washington, one national security expert told NewsMax that as key questions are raised and answered, the deal will likely be scuttled.

Among the key questions being asked by Frank Gaffney is where the billions of dollars needed to close the transaction for DP World will come from.

Gaffney, president of the Washington, D.C.–based Center for Security Policy and former assistant secretary of defense for International Security Policy during the Reagan administration, suggests the temporary delay will fix nothing in the raging public relations war over the recent purchase of a British company by DP World, which is owned by the United Arab Emirates - a deal that gives it control over operations at several vital American sea terminals.

"The issue for the administration is not going to get any better or smoother with time, as the public seems so dead set against it," said Gaffney.

In his column published in the Washington Times on Feb. 14, Gaffney was among the first to warn about the security implications of the deal.

Since then, he told NewsMax, he has been digging for the real facts surrounding the secretive transaction that went down without the knowledge or consent of either President Bush or Secretary of Defense Donald Rumsfeld.

Gaffney, who spoke to NewsMax from Phoenix, Ariz., where he will be speaking at David Horowitz's perennial "Restoration Weekend" at the Biltmore Resort, said that the permutations of the deal are much bigger than originally reported.

"I keep learning about yet more ports that are caught up - like Houston and Port Arthur (Texas). The count of port facilities affected by the deal has gone from six to eight, and now to 10 if the information I am getting is correct."

Gaffney also noted that much is still unknown about the financing for the deal.

"DPW has got to raise between $6.5 billion and $6.8 billion on the capital markets to finance the deal. When investors put up that kind of money, there's bound to be some quid pro quo. Likely included, for instance, would be a demand to have more involvement in the affairs of the company. Where exactly is this money coming from – Iran, Saudi Arabia? When you factor this in, it compounds an already worrisome potential.

Gaffney had more to report:

Gaffney's take on the public's perception: "I've been searched and researched with my shoes off during my travel here. This is what the American public is most knowledgeable about – airport security. They don't, however, know much about ports. What should become more apparent as time goes by is that the (administration's) argument that it will just be the Coast Guard or Homeland Security that wholly oversees security at a port is unsound. Those owners in the U.A.E. would by necessity have to become knowledgeable (of sensitive and classified security measures)."

On Dave Sanborn, the former DPW executive being vetted by the Senate as maritime administrator: "He is going to find himself caught up in this; the Commerce Committee will rake him over the coals."

On the issue of the ports deal not being on the president's radar screen: "Well, the deal certainly wasn't on the president's radar at the time the decision was being made. You know, it wasn't just this deal. CFIUS (Committee on Foreign Investment in the United States, which approved the deal) suffers from a problem with its process. The administration has been blindsided, as it has been in the past. CFIUS is more concerned with the financial-benefit side of things - they are not out to recognize foreign policy problems. There's a conflict of interest, and they keep getting away with it."
NewsMax asked Gaffney if he was sticking to his prediction recently published in the National Review. He answered in the affirmative.

In that article, Gaffney wrote these points:

Legislation will be enacted by veto-proof margins in both the House and Senate to block the DPW takeover of the port terminal and other management contracts currently held by the British company, P&O. If so, the president will be unlikely to cast his first veto in a futile attempt to block the legislation. The deal will, therefore, be aborted.

Relations with the U.A.E., which has been helpful in some aspects of the war for the free world post-9/11 - the factor that seems to have trumped all others in the secretive CFIUS deliberations about the DPW takeover - will be damaged unnecessarily.
Gaffney added that this unnecessary damage will be particularly so in light of the fact that the promised congressional investigations of the transaction would probe the nature and conduct of DPW.

The security expert hopes that the president does as he did with withdrawn Supreme Court nominee Harriet Miers - recognize that a strategically and politically insupportable mistake has been made and cut his losses.

As he styled it to NewsMax: "The U.S. has a quiet word with the company."


U.A.E. Terminal Takeover Extends to 21 Ports
NewsMax.com Wires
Monday, Feb. 27, 2006

WASHINGTON -- The controversial takeover of U.S. ports is much greater in scope than has been widely reported. Twenty-one ports would come under control of a United Arab Emirates government-owned company, not six.

The Bush administration says it will accept an offer by DP World to submit to a second — and broader — U.S. review of potential security risks in its deal to take over significant operations at American ports. DP World would assume control of the facilties from British-owned Peninsular & Oriental Steam Navigation Co.

According to United Press International, P&O is the parent company of P&O Ports North America, which leases terminals for the import and export and loading and unloading and security of cargo in 21 ports, 11 on the East Coast, ranging from Portland, Maine to Miami, Florida, and 10 on the Gulf Coast, from Gulfport, Miss., to Corpus Christi, Texas, according to the company's Web site.


Well-known member
Feb 13, 2005
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Wildwood New Jersey
Make that 22,....

This brings to 22 the total number of American ports where DPW will be acquiring P&O operations. On Jan. 24, P&O Ports North America and the Tampa Port authority announced they reached an agreement to enter into a long-term contract permitting P&O to operate terminals at the Port of Tampa for general and refrigerated cargo. By acquiring P&O internationally, DPW will pick up all P&O operating agreements, including this one just concluded in Tampa.

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