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Dealing with Dubai Ports World

Protectionism is the wrong solution to the port threat in the United States.

| Fri Feb. 24, 2006 4:00 AM EST

This piece first appeared in the Baltimore Sun.

Criticism of a proposed merger that would give a United Arab Emirates company control of operations at six U.S. ports, including Baltimore, misses the point.

The deal between Peninsular and Oriental Steam Navigation Co. and Dubai Ports World (DPW) merits close scrutiny, but strategically should be viewed as a long-term security asset, not a liability.

Gov. Robert L. Ehrlich Jr. and Democrats and Republicans in Congress are right to ask tough questions about the merger. The Bush administration must demonstrate that it has performed due diligence through the Committee on Foreign Investment in the United States (CFIUS) process. But while there are many reasons to be concerned about port security, which company writes the checks for American longshoremen is the least of those worries.

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In fact, the merger should not pose national security concerns because maritime security is a global challenge. The real solution is not protectionism, but to build a truly integrated and effective global system that secures supply chains from the point of manufacture through foreign and U.S. ports all the way to local store shelves. That requires making maritime security a higher homeland security priority.

Our economy, and therefore our security, depends on the free and secure flow of goods to and from our shores. About 90 percent of the manufactured goods we import arrive by sea. About 9 million shipping containers each year flow through 361 U.S. ports. Baltimore, for example, is the 14th-largest port in the United States in terms of tonnage and seventh in cargo value.

Any interruption in the global movement of goods, whether because of terrorism, a storm or a dockworker strike, can instantly cause billions in economic losses. If a nuclear or radiological device were smuggled into the United States through one of these shipping containers, it could shut down the world economy.

There are shared incentives among governments, port authorities, the maritime industry and the private sector to ensure this does not happen. Maritime security standards have been strengthened nationally and internationally since 2001. Success depends upon cooperation among a wide range of players -- manufacturers, freight forwarders, port operators, ocean carriers and insurers; most are foreign-owned.

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