First, initial media reports stated there were six US terminals affected: Baltimore, Miami, New Jersey, New Orleans, New York and Philadelphia, a listing rooted, I believe, in the P&O map of its “terminal operations.”
However, I pointed out earlier in the week that P&O operates seven facilities in Texas, for example, and says on its website that it is “the largest independent stevedore and terminal operator on the US East and Gulf coasts with operations in most ports from Maine to Texas.” (emphasis added)
DHS has dropped New York but added Norfolk and Houston. Huh?
Let’s look at these.
DHS says that DPW will operate “4 of 12″ terminals in Houston. The P&O website says that it is the “assigned freight handler for wharves 25, 26, 27 and 28 at the City Docks Turning Basin Terminal.” But wait – P&O also provides services at Houston’s Barbours Cut Container/ RoRo Terminal. So, who will pick up this P&O contract if not DPW?
In addition, the DHS statement begs the question: What happens to P&O operations in the Texas ports of Beaumont, Corpus Christi, Freeport, Galveston and Port Arthur?
What happens to P&O operations in Maine, in New York City, in Mississippi?
The DHS statement also ignores the fact that in many of these facilities, P&O is in an ownership position with US firms. For example in Miami, P&O is in a 50% ownership arrangement with Eller & Company. Ditto a 50 percent shareholding arrangement in Newark. And “Philadelphia” is a 50% joint venture in Delaware River Stevedores (DRS), which provides stevedoring and terminal services in Philadelphia, PA, Camden, NJ, and Wilmington, DE.
Ditto Norfolk, where the firm is in an 50 percent shareholding arrangment with CP&O. “CP&O performs stevedoring services at all major facilities in the Port of Hampton Roads. These include the three marine terminals operated by Virginia International Terminals, in Norfolk, Portsmouth, Newport News and Lambert’s Point Docks, Inc., a Norfolk Southern Subsidiary.” This is more than being “[i]nvolved with stevedoring activities at all 5 terminals” in Norfolk.
The DHS statement about New Orleans also understates the P&O reach in Lousiana – it ignores operations in Baton Rouge and Lake Charles. And “2 of 5″ terminals sounds a lot less impressive than this, from the P&O website, which states P&O manages four facilities: P&O has more than two miles of contiguous deep water berth space, more than 1 million sq. ft. of covered shed space, 400,000 sq. ft. of open wharf in four facilities.”
There are additional discrepancies between the DHS statement and the P&O website. The DHS statement comes no closer to reflecting what P&O states is its US contracts/ownership than initial press reports.
Is DP World buying only a portion of P&O North American assets? If so, who is taking over the other contracts? If not, why is this information absent from the DHS website?
Question number two has to do with timing/review.
DP World was formed at the end of September 2005. The US government (Treasury Department’s Committee on Foreign Investment) approved the purchase under Exon-Floria review at the end of January. Four months.
Yet the White House says the review took about three months. One month after the merger?
The US review began before the bidding. It also began before the financing, which is covering $6.5 billion of the $6.8 billion deal. Is this a normal process?
Third, port management seems to be global infrastructure. DP World (#6), a state-owned firm, was fighting with Singapore (#2), a state-owned firm, over the purchase of P&O (#4, a privately owned firm). The US is the home numbers eight and nine, but without the clout of government ownership, will they, too, succumb to foreign ownership? After all, P&O bought US firms in 1999 and 2000.
Do we want to “help” our US firms stay “competitive” in this global business, which seems dominated by state-dollars?
US Liberals Guide Deborah White reports that there are oddities in the US review/contract with DPW. The questions she raises need answers.
She also advises of a CNN report: The United Arab Emirates — which owns DPW — “is a major investor” in The Carlyle Group, a “global investment company” that sports among its employees ex-presidents and former presidential advisors as well as UK leaders.
It is also part of the military industrial complex, according to Hoovers. And the Guardian writes: “Among the companies Carlyle owns are those which make equipment, vehicles and munitions for the US military, and its celebrity employees have long served an ingenious dual purpose, helping encourage investments from the very wealthy while also smoothing the path for Carlyle’s defence firms.”
How do those monies run from the US to UAE back to Carlyle owners?
Finally, this purchase would give the UAE firm control over 40 percent of our shipments to soldiers in Iraq.
Since when do you want your supply line managed by folks next-door to the fighting — but who aren’t fighting on your side?
Lots of people are saying “money is money,” and because the UAE firm just wants money, it will do a good job.
I think money is power. Is this deal good for the world? Do we want to live in a world where corporations are the nation-state, but some of them are nation-owned? Or is it to late to stop the snowball?
Arab Port Deal Grows in Controversy,