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Last Updated: Wednesday, 22 February 2006, 15:39 GMT
Bush threatens veto in ports row
Miami port
The deal covers six major US ports
US President George W Bush says he will veto any law blocking a deal giving an Arab company control of six US ports.

The threat came as Bill Frist, leader of the Republican Party in the Senate, said he would move a blocking law if the government did not delay the deal.

The deal would put six of the largest ports in the hands of Dubai Ports World of the United Arab Emirates.

Some lawmakers fear it will make the US more vulnerable to terrorism and have vowed to force Mr Bush to use his veto.

Administration officials are to address an unusual session of the Senate Armed Services Committee on Wednesday on the planned takeover of the ports - New York, New Jersey, Philadelphia, Baltimore, New Orleans and Miami.

The BBC's Justin Webb says the issue has developed into a very serious political standoff between Mr Bush and senior Republicans.

The ports are currently run by British ports and shipping firm P&O, which has agreed a $6.8bn (3.9bn) takeover by DP World.

'Terrible signal'

The White House said on Wednesday that counterterrorism experts had looked at the deal and concluded there was no threat to national security.

But the administration did admit it should have briefed Congress sooner about the deal.

It also said President Bush was unaware of the sale until the deal had been approved.

Nevertheless, the president said he believed it should go ahead.

It would send a terrible signal to friends and allies not to let this transaction go through
President Bush

He called on opponents to explain why they opposed a Middle Eastern firm taking over when they did not oppose a British company being in control.

"It would send a terrible signal to friends and allies not to let this transaction go through," Mr Bush said.

But lawmakers reacted defiantly.

Republican Congressman Pete King, chairman of the Homeland Security Committee, said: "I will fight harder than ever for this legislation, and if it is vetoed I will fight as hard as I can to override it."

Democrat Senator Bob Menendez said he would urge colleagues to force Mr Bush to wield his first veto in his six-year tenure.

"We should really test the resolve of the president on this one," Mr Menendez said.

Senator Frist, the majority leader in the Senate, had said the deal "should be put on hold until the administration conducts a more extensive review of this matter".

If it did not call a delay, he said he would introduce legislation to ensure the postponement.

Security risk

Senior Republicans believe Mr Bush should have paid more attention to the way the deal would be perceived in the US, our correspondent says.

Critics fear an increased risk of terrorist attacks, pointing out that the UAE was the home of two of the hijackers involved in the 11 September 2001 attacks.

The administration rejected the concerns.

Defence Secretary Donald Rumsfeld said: "Nothing changes with respect to security under the contract. The Coast Guard is in charge of security, not the corporation.

"We all deal with the UAE on a regular basis. It's a country that's been involved in the global war on terror."

P&O and DP World say they are confident the deal will go ahead, the latter insisting that security was "at the forefront" of its business.

The implications of the takeover

US lawmakers criticise ports deal
21 Feb 06 |  Americas
P&O confident of Dubai takeover
20 Feb 06 |  Business
P&O shareholders back Dubai bid
13 Feb 06 |  Business
Dubai firm raises stake for P&O
26 Jan 06 |  Business
P&O agrees bid from Dubai Ports
29 Nov 05 |  Business

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