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Bush: No need to worry about port security
President tries to calm uproar over planned UAE takeover

Thursday, February 23, 2006; Posted: 11:12 a.m. EST (16:12 GMT)

President Bush said Thursday the deal with Dubai Ports World would not compromise U.S. security.

WASHINGTON (CNN) -- President Bush on Thursday defended his administration's decision to allow a company from an Arab country to operate six major U.S. ports, saying, "People don't need to worry about security."

"This deal wouldn't go forward if we were concerned about the security of the United States of America," Bush told reporters during a Cabinet meeting.

Next month, the United Arab Emirates-based Dubai Ports World is set to finalize a $6.8 billion purchase of the British firm Peninsular and Oriental Steam Navigation Co., which manages the six U.S. ports, which includes New York and Miami, Florida. (See where the ports are)

The administration's blessing of its purchase by the state-owned UAE firm has triggered an avalanche of criticism on Capitol Hill.

Bush on Thursday questioned whether a double standard was being applied to a Middle East company, saying, "It's OK for a British company to manage ports, but not OK for a company from a country that's also a valuable partner" in the war on terror.

Bush added, "It's really important that we not send mixed messages to allies."

He said that administration officials will continue talks with members of Congress so that "people understand the logic of this decision."

Critics of the deal have raised concerns about the company's status as a state-owned venture, accusing the UAE of having ties to terrorism. Two of the hijackers involved in the September 11, 2001, attacks came from the Persian Gulf country, and most of the money for the plot was funneled through the banking center of Dubai.

Critics also note that Dubai was a key transfer point for illicit nuclear technology sales to North Korea, Iran and Libya that were led by Pakistani scientist A.Q. Khan.

"At a time when we're faced with this terror threat, we should not be surrendering any port to any foreign government, let alone the UAE," said Baltimore, Maryland, Mayor Martin O'Malley, whose city is one of the ports involved in the deal.

The dispute pits Bush against many of his allies in the congressional leadership, including House Speaker Dennis Hastert, R-Illinois, and Senate Majority Leader Bill Frist, R-Tennessee.

Top Democrats have opposed the deal as well, calling on Bush to rescind his administration's approval pending further review. (Watch how members of both parties oppose deal -- 1:14)

Bush has threatened to veto any congressional attempt to block the deal. White House spokesman Scott McClellan said Wednesday that critics are misinformed but conceded that members of Congress should have been consulted earlier.

On Thursday, the president emphasized that "port security will be run by U.S. customs and the U.S. Coast Guard."

Dubai firm: 'Security ... is a marketing tool'
Ted Bilkey, chief operating officer of Dubai Ports World, said the company "will fully cooperate in putting into place whatever is necessary to protect the terminals."

"We're going to do anything possible to be sure that this deal goes through," Bilkey said. (Watch a company official defend the deal -- 7:39/)

Senior officials in the Department of Homeland Security said late Wednesday that Dubai Ports World was being held to a higher standard than other international companies that operate in U.S. ports.

Foreign-owned companies operate many ports in the United States. For example, in Los Angeles, California, companies from China, Denmark, Japan, Singapore and Taiwan lease operations.

Bilkey said U.S. customs officers in Dubai inspect cargo containers headed for American ports as part of a port-security effort his company supports.

"We have given them the sovereign right to inspect any container they wish to before it's loaded on a vessel," he said, calling fears that officials would turn a blind eye to terrorists "nonsense."

"Security now in our business is a marketing tool," he said. "The shipping companies want to know that you run a secure operation."

Company hires Dole to lobby
The UAE has a high-level delegation in Washington to garner support for the deal, and the company has hired former Senate Majority Leader Bob Dole to lobby for it. Dole was the Republican presidential candidate in 1996, and his wife, Elizabeth, is a U.S. senator from North Carolina.

Bush picked up support Wednesday from Sen. John McCain, R-Arizona, who urged his fellow lawmakers not to rush to judgment.

The chairman of the Senate Armed Services Committee, Sen. John Warner, R-Virginia, said the UAE is a vital American ally in the Persian Gulf, a frequent stop for the U.S. Navy and Air Force, and a supply station for U.S. troops in Iraq.

Treasury Secretary John Snow, whose department chairs the review panel -- known as the Committee on Foreign Investment in the United States -- said any shortcoming in the committee's work "was in explaining this process and in having this process understood by our critics."

'This is scare politics'
Abdel Khaleq Abdullah, a professor at UAE University, said the opposition appears to include "a bit of bigotry."

"If it was an African country or a European country or an Asian country, it would not have been subjected to this kind of scrutiny," he said.

"But since this is just purely an Arab country, I think it just stopped some of the lawmakers who are making a big deal out of a purely legitimate business transaction."

Edward Kelly, executive director of the Maritime Association of the Port of New York and New Jersey, also said, "I think this is scare politics. The business community had no problem with this."

CNN's Jeanne Meserve contributed to this report