Dubai Ports Deal to Haunt U.S. Overseas Business Interests?

It’s entirely possible that there will yet be hell to pay for our Congress’ short-sighted, bilious cave-in to political grandstanding and xenophobia in the Dubai ports imbroglio. The Hill, in an article published Thursday, just before the deal collapsed indicated that the UAE leadership was furious for its treatment at the hands of congressional solons:

Dubai is threatening retaliation against American strategic and commercial interests if Washington blocks its $6.8 billion takeover of operations at several U.S. ports…

A source close to the deal said members of Dubai’s royal family are furious at the hostility both Republicans and Democrats on Capitol Hill have shown toward the deal.

“They’re saying, ‘All we’ve done for you guys, all our purchases, we’ll stop it, we’ll just yank it,’” the source said.

UAE Dreamliner deal: will Boeing lose out to Airbus & feel Emirates’ ire? (photo: USmarkets.nl)

Boeing is the company that could suffer the most damage if UAE feels unkindly toward U.S. interests:

Retaliation from the emirate could come against lucrative deals with aircraft maker Boeing and by curtailing the docking of hundreds of American ships, including U.S. Navy ships, each year at its port in the United Arab Emirates (UAE), the source added.

The Emirates Group airline will decide later this year whether it will buy Boeing’s new 787 Dreamliner or its competitor, Airbus A350. The airline last fall placed an order worth $9.7 billion for 42 Boeing 777 aircraft, making Dubai Boeing’s largest 777 customer.

Dubai in mid-February also established the Dubai Aerospace Enterprise, a $15 billion investment to create a company that will lease planes, develop airports and make aircraft parts to tap into growing demand for air travel in the Middle East and Asia.

The family-ruled sheikhdom may buy as many as 50 wide-body aircraft from Boeing and Airbus during the next four years, according to Aerospace Enterprise officials.

The UAE military also bought Boeing’s Apache helicopters. Meanwhile, Boeing has been in talks with the emirates to try to sell its AWACS planes.

The Hill noted that if Boeing is hurt then a mighty powerful member of Congress might just have a whole lot of scrambled eggs on his face:

Any repercussion to Boeing could put House Speaker Dennis Hastert (R-Ill.) in a delicate position. Boeing’s decision to move its headquarters to Chicago has been seen as calculated to facilitate a close relationship with Hastert. He is against the ports deal, and his office did not return calls by press time.

Several businesses have expressed concern that the controversy over the $6.8 billion ports deal could damage trade with the UAE…The American Business Group of Abu Dhabi…said that Arabs may hesitate to invest into the United States, according to a report by Reuters.

This report is quite weakly sourced so I have no idea how likely any of this is to come to pass. But if it does we have only ourselves to blame. Where do we get off thinking that our ill-informed decision to kill this deal and insult the world’s Arabs into the bargain will not be thrown up in our face at some later date by those whose interests we have damaged?

A hat tip to Villainous Conspiracy and Emirates Economist.