In a deal similar
to one that led to the Dubai ports furor in the US
earlier this year, Dubai International Capital has
purchased for US$1.24 billion Doncasters Group
Ltd, a private British aerospace manufacturer that
works on sensitive weapons programs such as the
Joint Strike Fighter (JSF).
The
administration of US President George W Bush is
conducting a security review of the takeover, and
then it will present its findings to Congress,
where many of the same factions that
expressed concern and outrage
over the ports deal are beginning to grumble about
the Doncasters takeover.
Democrats and
Republicans alike lambasted the Bush
administration's approval of the sale of British
P&O Line to Dubai Ports World, since it would
place terminal operations of six US ports in
foreign hands - worse, in the hands of a
government that many in Congress labeled as being
an unreliable partner in the "war on terrorism".
The failed ports deal forced Washington to
postpone talks with the United Arab Emirates on a
free-trade agreement. The proposed pact is part of
a greater US goal to create a Middle East Free
Trade Area by 2013.
The White House and
others that support deals with the UAE warn that
restricting trade over putative security concerns
would turn away investors in Arab states awash
with petrodollars and ultimately harm the US and
global economies. However, Dubai seems to have
taken the matter in stride. In a conciliatory
move, Dubai Ports World agreed to sell its stake
in US port operations, which allows the firm to
turn its attention to more profitable port
operations in emerging markets, such as India.
During a visit to Washington, Sheikh Lubna
al-Qasimi, minister of economics in the UAE,
stated, "We are long-standing allies of the United
States. Our relations are larger than that. This
is global trade." US trade with the UAE has
increased steadily in recent years, punctuated by
major deals involving Boeing, ExxonMobil and
Lockheed Martin.
While not yet garnering
much attention in the media, certain Congress
members have challenged the proposed Doncasters
deal. Two members of the House Armed Services
Committee, Democrats John Barrow and Ike Skelton,
have raised questions about national security.
"I'm not against foreigners investing in
this country as long as we don't sell them
something we are not supposed to sell them,"
Barrow said. "But I am concerned about selling off
our national-security infrastructure. We are
selling off the military-industrial complex bit by
bit."
The $250 billion F-35 Joint Strike
Fighter program is intended to create a
next-generation stealth fighter that would replace
several current strike aircraft. While most of the
jets will be used by the United States, other
countries such as the United Kingdom, Italy,
Australia, Canada, Denmark, Turkey and Norway also
intend to purchase the aircraft. The JSF is
scheduled to be operational by 2009.
As
was the case with the ports deal, Democrats will
surely capitalize on another opportunity to paint
Republicans as being weak on national security as
the mid-term congressional elections draw near.
Republicans, despite controlling both the House of
Representatives and Senate, are increasingly
finding themselves on the defensive, caught
between a White House mired in political scandal
and poor approval numbers and emboldened Democrats
looking to regain control of Congress.
The
Doncasters deal will certainly fall under
increased scrutiny in the coming weeks. After the
Dubai Ports World debacle, the Bush administration
will find itself at the center of another
complicated national-security debate that will go
beyond party lines and standard economic
discourse. However, an expensive, experimental
weapons project will likely elicit a less visceral
public reaction than did the issue of port
security.
Lawmakers must decide whether to
embrace economic nationalism or uphold the
free-trade principles that they typically
champion. While Dubai has ostensibly looked past
the criticisms raised in the failed ports deal, a
similar outcome in the current matter could very
well scare away foreign investors, Arab and
otherwise, and signal that the United States is
not necessarily open for business.
Published with permission of thePower and Interest News
Report, an analysis-based
publication that seeks to provide insight into
various conflicts, regions and points of interest
around the globe. All comments should be directed
tocontent@pinr.com
.
