Sale of port company worries lawmakers

THE BALTIMORE SUN

WASHINGTON -- Citing national security concerns, members of Congress from several states are asking the Bush administration to review its approval of a deal to allow a United Arab Emirates company to take over a business that helps run several U.S. ports, including Baltimore's.

Lawmakers, including some from Maryland, said yesterday that they want more information from the White House about whether the deal would put U.S. seaports at risk and whether the initial review, by a committee made up of officials from the White House and other federal agencies, looked carefully enough at potential security implications.

Government-owned Dubai Ports World announced a deal earlier this week to purchase Peninsular & Oriental Steam Navigation Co., a British company that is the terminal operator and stevedore for container cargo at the Seagirt and Dundalk marine terminals in Baltimore.

It employs about 65 workers at the port.

The company also provides services at other big U.S. ports, including New York; Newark. N.J.; Philadelphia; and Miami.

The administration panel that approved the deal, headed by the Treasury Department, examines foreign companies' efforts to invest in American industry for possible national security risks. A department spokeswoman said the only way the committee's review could be reopened was if one of the companies provided false or incomplete information.

Separately, Republican Sen. Richard C. Shelby of Alabama and Democratic Sen. Paul S. Sarbanes of Maryland said they were "deeply concerned" about the implications of the deal in a letter to Treasury Secretary John W. Snow that asked for thorough review of the matter.

"We do not believe that anyone could reasonably question the fact that the control of the corporations that operate the ports ... 'could affect U.S. national security,"' wrote Shelby and Sarbanes, the chairman and senior Democrat, respectively, on the Senate Banking Committee.

"Port security is a major component of our defenses against terrorism," they said, adding that while the deal might ultimately go forward, the previous "non-transparent cursory review" of the sale was "in no one's interest."

The committee plans a hearing on the sale when the Senate returns from a weeklong break for the Presidents Day holiday.

Other lawmakers who have expressed concerns about the deal include New York Sen. Charles E. Schumer and New Jersey Sen. Frank R. Lautenberg, both Democrats, and Republican Rep. Mark Foley of Florida.

Administration officials defended what they called a thorough review that included input from the nation's intelligence agencies.

"There is a rigorous review that goes on for proposed foreign investments for national security concerns," said White House spokesmanScott McClellan.

P&O; officials did not respond to a request for comment. Dubai Ports World said "we intend to maintain, and, where appropriate, enhance current security arrangements," the Associated Press reported.

Democratic Rep. C.A. Dutch Ruppersberger, whose congressional district includes the Port of Baltimore, said he was unwilling to take the Bush administration's word on the deal. He said he wanted to know what kind of intelligence review had been conducted, as well as what Dubai Ports World had told the committee about providing access to its facilities and the cargo that passes through them.

"I don't want to have a fox in the henhouse and find out that this fox is not a good fox," he said.

Ruppersberger noted that while the United Arab Emirates is a U.S. ally, one of the terrorists involved in the Sept. 11 attacks was born there, and others traveled through the area.

"We have a country that is considered to be an ally in the war on terror, but there's some history there," Ruppersberger said.

A top official at the Council for American-Islamic Relations, which works to promote a better understanding of Muslims and Arab nations, said the opposition appeared to be a "knee-jerk reaction" and was deeply troubling. Corey Saylor, the organization's government affairs director, said that on the surface, concerns about the deal appeared to be solely because Dubai Ports World is based in an Arab, Muslim nation.

"I wonder if other nations would make the same evaluation of our ability to provide security based on the fact that Timothy McVeigh is from the United States," Saylor said.

Local officials brushed aside the concerns in Washington.

F. Brooks Royster III, director of the Maryland Port Administration, which oversees the public marine terminals where Dubai Ports World would work, noted that the company will not own Baltimore's or any other city's port. At Baltimore, P&O;'s contract primarily involves loading and unloading containers.

Containers, the most common form of shipping, are monitored by Department of Homeland Security officials, but only a small percentage are physically inspected or X-rayed.

Still, Royster said, ownership by the deep-pockets Dubai Ports World could help the port.

"The expected purchase of P&O; Ports by DP World should infuse capital into that company [P&O;], allowing for larger private-public partnerships with the MPA that may not have been possible before," he said in an e-mail.

Kim Petersen, president of SeaSecure LLC, a maritime security company, and executive director of the Maritime Security Council, an industry group, said his firm's work with the company indicated that its involvement could improve security.

"The only concerns that we are hearing are coming from political circles, not from the shipping or ports industry, or even the defense or intelligence communities," he said.

gwyneth.shaw@baltsun.com meredith.cohn@baltsun.com

Sun reporter Julie Hirschfeld Davis contributed to this article.

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