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News

DPW no new threat for U.S.

Professors weigh in on concerns about firm in America

by ZACH HAVERKAMP
The Daily Cougar

Safety problems in U.S. ports have more to do with the nation's shortcomings in security rather than changes brought by the United Arab Emirates-based Dubai Ports World's acquisition of major American ports, UH professors said.

Though DPW's $6.8 billion purchase from British company Peninsular and Oriental Steam Navigation is currently going through a 45-day congressional review process, the acquisition is all but complete, economics professor Thomas DeGregori said.

"DPW is completing the deal … All they're doing is that they are leaving the British management in place for 45 days, giving them autonomy while this is further investigated. And, in fact, much of that (POSN) management may end up staying if the whole thing clears," DeGregori said.

Though domestic UAE ports have been connected to a variety of illegal activities -- including trafficking of guns, drugs, humans and black market electronics -- it is not realistic to assume that this will translate into American security problems, Thomas O'Brien, a UH history professor who teaches a course on international smuggling, said.

"They've got experience managing ports around the world, so I doubt it's going to change very much," O'Brien said. "I doubt people working at the ports here in the United States ... (are) going to notice much change at all, except for the logo on their paycheck. 

"And most of the security process is the ultimate responsibility of the government to be overseeing that and making sure that security is properly enforced," O'Brien said.

DPW, which recently became the second-largest port company in the world, is on the cutting-edge of technology and port management, DiGregori said.

"(DPW is) a very sophisticated operation," DiGregori said. "The Emirates in their airlines, their port management, their airport management -- all the rest -- have a long history of going into the area and investing in the latest … technologies and trying to hire the best people. 

"There are a lot of Americans who have key positions in their company. In other words, they are truly multi-national, in the sense that they scour the world to get the top talent," DiGregori said.

The main danger U.S. ports face is not from other countries, but from U.S. weakness in customs screening, O'Brien said. 

"You also have to say that customs enforcement in the U.S. ports is always very limited," O'Brien said. 

"What happens inevitably as world trade has been growing is that the customs services are never kept up in terms of their expansion to meet the growing demands of the world trade," O'Brien said. "So as a result, (few) goods -- often only 5 to 10 percent of the goods coming in and out, particularly coming in — are inspected; they simply don't have the personnel to do it.

"So this is why, aside from any port deal, no matter who is running the ports, the ports are seen as extremely vulnerable, because there is such limited inspection and there has been for years," O'Brien said.
 

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