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Republican lawmakers pledge to change ports review process

Monday, March 6, 2006

WASHINGTON -- The U.S. must overhaul the way it reviews foreign acquisitions of companies involving U.S. ports, two key GOP lawmakers said Sunday, calling the Bush administration's handling of the Dubai deal flawed.

The chief executive of Dubai Ports World, meanwhile, insisted his Dubai firm posed no security risk to the U.S. and said that he expected the proposed $6.8 billion purchase of London-based Peninsular and Oriental Steam Navigation Co. will be completed.

"All the authorities are comfortable with the security measures that we take," CEO Mohammed Sharaf said. "As far as we are concerned, the deal is going to go through, and the British government has approved it."

"There are big consequences for the British market if it doesn't go through because investors are waiting for the money," he said on CNN's "Late Edition."

The Bush administration, through a secretive board headed by the Treasury Department, initially approved DP World's purchase of the London company, which would let the company take over significant operations at several major U.S. ports.

In the wake of a bipartisan backlash, the administration agreed last month to a 45-day investigation of potential security risks. Under that review, the U.S. government could block the portion of the deal involving the takeover of U.S. port operations even if the British deal is completed.

The White House had hoped the investigation would quell a political uproar over the deal. But criticism still rages on Capitol Hill.

Lawmakers plan to continue pressing their concerns, starting today when Sen. Susan Collins, R-Maine, and Sen. Patty Murray, D-Wash., make a fresh push for their legislation that's aimed at improving the security of unchecked cargo containers that enter U.S. ports.

Hearings on the port deal also likely will continue this month.

On Sunday, lawmakers said reform of the review process was needed.

The problem is "the committee that conducts the review is weighed toward the Treasury Department," said Collins, who chairs the Senate Homeland Security Committee.

"I think we need to scrap the committee, start again, constitute it within the Department of Homeland Security," said Collins, adding that the panel should include a member of the intelligence committee. "The process now is deeply flawed."

Rep. Duncan Hunter, R-Calif., and chairman of the House Armed Services Committee, said he wants to scuttle the Dubai deal and then require foreign governments to divest from critical U.S. installations unless they pass a review by the departments of defense and homeland security.

"I trust President Bush, but I think he needs to get more information," said Hunter, calling Dubai a dangerous place. "I think they looked at it at a superficial level, and they didn't get those intelligence briefs."

Collins and Hunter, who appeared on ABC's "This Week," said they were introducing bills to revamp the review process to ensure bad actors aren't allowed to take control over major U.S. operations.

Hunter, one of the administration's most trusted allies, has been particularly critical of the deal, calling Dubai "a bazaar for terrorist nations." Collins says it's too early to tell under the current review whether Dubai is a terror threat.

The chairman of the Joint Chiefs of Staff, Gen. Peter Pace, on Sunday declined to say whether the ports deal should be approved but defended the United Arab Emirates as a vital military ally.

"I think the policy debate is going to continue in public, and that's outside of my lane," Pace said on "Fox News Sunday." "Everything we do with the UAE military is very positive, very friendly, very supportive, and they've been very, very good partners."

Democrats have sought to turn the public furor over the ports deal to their political advantage, using their weekly address Saturday to scold the Bush administration over national security.

Last week, House Democrats also tried to force a debate and vote on legislation that would require the 45-day security review and congressional approval of the takeover. That effort failed on a procedural, largely party-line vote.

"There is a great deal of dubiousness about how thorough this review will be, how careful it will be, and, most of all, how independent it will be," Sen. Charles Schumer, D-N.Y., said on CNN, noting that President Bush had already said he supports the deal.

Collins and Hunter downplayed the notion that Democrats could effectively capitalize on the controversy in November's congressional midterm elections.

"I don't think it's going to hurt our party," Hunter said. "I think the Republicans in Congress have a good record for security."


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