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Leaks fuel anger at White House over ports deal
Times Online (UK)
By Sam Knight and agencies
February 23, 2006

The Bush Administration sought to calm the controversy over the proposed Arab takeover of six American ports today as leaked details of the transaction threatened to aggravate the latest row to envelop the White House.

The US Secretary of State, Condoleezza Rice, was the first senior official to speak about the deal on a lightning visit to several countries in the Middle East, including the United Arab Emirates, whose Government owns the company poised to buy the British shipping firm, P&O, and take control of the ports.

Dr Rice called the UAE "a very good ally" in America's War on Terror and said that a Middle Eastern company should not be treated any differently to a British company seeking to do business in the US.

President Bush followed Dr Rice's comments with yet another defence of the transaction, which is due to be completed on March 2 unless Congress intervenes.

Mr Bush said that "people don&'t need to worry about security" with regard to the £3.9 billion deal, which is expected to hand control of the ports, including New York harbour, to Dubai Ports World.

"The more people learn about the transaction," said Mr Bush, "the more they'll be comforted that the ports will be secure."

But the White House, already surprised by the ferocity of the argument over the sale, which has seen senior Republicans question the judgment of the Bush Administration, could face another round of questions after leaked documents showed intimate details of the negotiations that led to the sale.

According to the Associated Press, Dubai Ports World has offered full co-operation with American security programmes as part of the takeover. But the company will not have to keep its business records on US soil, where they would be subject to orders by American courts, a routine requirement for foreign firms.

"There is a very serious question as to why the records are not going to be maintained on American soil subject to American jurisdiction," said Peter King, the Republican chairman of the House Homeland Security Committee, and a leading critic of the deal.

Senator Charles Schumer, a New York Democrat, who has joined forces with Mr King, also from New York, to oppose the transaction, said: "These new revelations ask more questions than they answer."

The controversy, which has seen Republicans question Mr Bush's security credentials for the first time, has been read by many observers as proof of the isolation of the President.

Mr Bush is dogged by low approval ratings in the run up to this year's mid-term congressional elections, when Republicans are expected to distance themselves from the White House.

In response, Mr Bush has threatened to use the presidential veto to assure the deal goes through, something he has yet to do in five years in the White House.

Rank and file Republican politicians, such as Sue Myrick, a Congresswoman from North Carolina, have launched unusually explicit attacks on Mr Bush. On her website, which shows Ms Myrick smiling in a photograph with the President, she wrote: "In regards to selling American ports to the United Arab Emirates, not just NO — but HELL NO!"

Dubai Ports World has also been surprised by the backlash: several Senate hearings are due to consider the deal and Senator Schumer has threatened to table emergency legislation to block it altogether.

The company's chief operating officer, Edward Bilkey, an American, told the Associated Press: "We're disappointed... We're going to do our best to persuade them that they jumped the gun. The UAE is a very solid friend, as President Bush has said."

The deal will see Dubai Ports World take over the running of two container terminals in the UK - Southampton and Tilbury.

Original Text