Kuwait-Maryland pact may lack commitment Heralded agreement does not guarantee any business for companies in Maryland


Maryland may not get any business at all from an agreement that has been heralded as granting the state "a unique and important role in the rebuilding of Kuwait," according to officials familiar with the document.

The agreement is the first step toward actual negotiations, but it does not require Kuwait to do business in Maryland and does not guarantee any business for Maryland, said Diego Portieles, former business development manager and trade specialist for the Maryland International Division, which worked on the agreement.

Portieles left his position a day after his interview with The Evening Sun.

"It is primarily a letter of intent, and a letter of intent implies a commitment to pursue and explore, but it does not imply a commitment to do," Portieles said.

But the draft memorandum is short on details, and there are indications that the agreement, which the Schaefer administration ballyhooed with a full-dress news conference but now is trying to keep secret, may not live up to its billing as a major economic boon for the state.

The so-called "memorandum of understanding" with Kuwait is light on details, Portieles said.

"This still has to be worked out in detail, and this still has to be negotiated," he said. "This is the gleam-in-the-eye stage."

Kuwait, in fact, may try to "shop the deal around" and see what kind of shipping and airport facilities and rates it could obtain in other U.S. states and nations, he said.

Gov. William Donald Schaefer announced the agreement last month. A news release said that "companies in the United States shipping cargo to Kuwait will be notified by Kuwaiti officials to route shipments through the Port of Baltimore or Baltimore-Washington International Airport whenever it is economically feasible."

Maryland-based companies, if they offered competitive prices, would receive first crack at filling orders for equipment that Kuwait needs to rebuild its war-ravaged country, Maryland officials said at the time.

Since then, the Schaefer administration has refused requests to make public the contents of the memorandum, saying it could jeopardize Maryland's competitiveness in international trade and upset the Kuwaiti government.

Asked about the agreement when he returned from a trade mision to the Far East last week, the governor said he would make it public if ordered to do so by the courts.

His administration filed a petition in Baltimore Circuit Court last month to keep the agreement secret after The Evening Sun and the Washington Post asked for copies under the state's public information law.

Until the court rules, Schaefer said, he intends to honor his commitment to Kuwaiti officials to keep it private.

One source familiar with the memorandum said the state sought to keep secret its negotiating strategy, as expressed generally in the document.

That source and others, however, said the main reason for withholding the agreement from the public is a desire to win favor with Kuwait, which requested secrecy.

Representatives from both governments may begin negotiations within 12 weeks, Portieles said earlier this month. "We're 12 weeks away from actually starting some very serious discussions on issues from port rates down to specific projects," he said.

"This is not a cakewalk. We have a very long, tough row to hoe because our competitors are not idle."

Still, he said, the memorandum signals the beginning of a relationship between Maryland and Kuwait that could lead to trade sometime in the future, if not immediately.

"The fact is that if we do not do business on this pass, we will do business on the next pass," Portieles said.

Maryland officials have said they would set aside space at the port, in addition to providing storage space, office facilities and ramp and aircraft-service areas at BWI Airport in Linthicum for Kuwaiti business.

Administration officials also have refused a request for a copy of the agreement from the Department of Fiscal Services, the financial services arm of the General Assembly.

"We haven't really pushed the matter right now," said fiscal services director William S. Ratchford II. "We'll let the matter sit for a couple months. By then, the concerns about making it public will lessen."

Fiscal Services also wanted to know how much the agreement with Kuwait would cost state taxpayers, but it has not yet received an answer.

Portieles said he did not believe the memorandum would cost the state anything at this point.

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