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Debate over Ports Deal Shows Complex Reality of Arab Boycott

March 7, 2006
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Outrage at the United Arab Emirates’ participation in the Arab boycott of Israel is buzzing through the halls of Congress, spurring the debate over the Bush administration’s Dubai ports deal. Once you get off Capitol Hill, however, the buzz sputters to a few muted objections among the pro-Israel community, and once you get to Israel — there’s virtual silence.

What seems to politicians like a crystal-clear case — how can you entrust the nation’s ports to a regime that harbored terrorist money? — gets murkier the closer you get to the realities of Israel’s dealings in the Middle East.

That hasn’t stopped the Bush administration from getting a blast of anti-boycott rhetoric from the Hill.

“We should not be rewarding companies that support discrimination against our key strategic ally and the Middle East’s only democracy,” Sen. John Kerry (D-Mass.) said in a statement.

David Welch, the top State Department envoy to the Middle East, found himself handling UAE questions during a congressional session this week that was meant to address how to deal with the Palestinian Authority in the wake of Hamas’ landslide win.

“The United Arab Emirates government has no relation with Hamas,” Welch protested.

Israel is reluctant to join the Dubai drubbing because it has informal relations with the emirates. Israel and the UAE have intensified efforts in recent months to establish formal relations, insiders say.

Israeli businessmen also are wary of any tendency toward U.S. isolationism, and the danger it poses to the many Israeli security companies working in the United States.

One of the only pronouncements from Israelis came from Zim, Israel’s premiere shipper — and it was in favor of the deal with Dubai Ports World, the management company owned by Dubai’s government. Zim said it regularly called at ports managed by DP World, including those in the UAE — but the company skirts the Arab boycott by running ships under other nations’ flags.

“We are very comfortable calling at DP World’s Dubai ports,” Idan Ofer, chairman of Zim, wrote in a letter to Sen. Hillary Clinton (D-N.Y.), who has led criticism of the Bush administration for making the deal with a country that allegedly banked Al-Qaida money in the past. “We have not experienced a single security issue in these ports.”

Israeli businessmen say UAE hardly enforces the boycott. DP World spokesmen tout its business relationships with Israeli companies.

“We’re going to follow the laws wherever we’re domiciled,” Michael Moore, a DP World senior vice president, said in a conference call with Jewish reporters. “We operate under different rules and regulations in Hong Kong, for instance, in Korea.”

The Bush administration, scrambling to fend off bipartisan disdain for the deal, quickly countered that the UAE allegedly was about to end the primary boycott of Israel. It had long ago abandoned the secondary and tertiary boycotts, which targeted companies that dealt with Israel or its clients.

“The United States wants to see the boycott against Israel dropped completely by everybody,” Adam Ereli, the State Department deputy spokesman, said last week. “We are working toward that, frankly, with the government of the UAE.”

Under the agreement, the UAE would drop its boycott in exchange for a free trade agreement with the United States, Ereli said.

Linking free trade with ending the boycott of Israel has been a focus of the American Israel Public Affairs Committee; one such deal was successfully negotiated with Bahrain last year.

AIPAC released a statement saying, “No company should be participating in the boycott, which undermines American policy in the region, unfairly singles out Israel and lessens the chances for peaceful resolution of the many Middle East conflicts.”

The statement did not mention Dubai or DP World, and the controversy hardly registered at AIPAC’s annual policy conference this weekend.

The only major Jewish group out front on the UAE boycott issue has been the Anti-Defamation League, which issued a statement Feb. 28 saying that UAE’s adherence to the boycott “should torpedo any deal with the United States on port operations.”

Abe Foxman, the ADL’s national director, said UAE violated U.S. law as recently as last year by asking American companies to prove that goods entering the emirates were not of Israeli origin.

“The fact that the UAE has an inconsistent policy, it eases it where it fits them, doesn’t assuage me,” Foxman told JTA. The issue was an American one, Foxman said, because it impacted American companies, whatever the concerns of Israeli companies.

“It is discriminating against American citizens who deal with Israel,” Foxman said.

Some Israelis were irked by the ports controversy because the administration approved the deal within a month, while Israeli companies often have to wait months for approval of deals with U.S. companies that deal with the national security sector.

Check Point, an Israeli software security firm that manufactures a popular firewall, has been waiting since October to finalize its purchase of Sourcefire, a Maryland firm. Some of its clients are government agencies.

Ramat Gan-based Check Point would not comment except to point to a statement on its Web site announcing the review by the Committee on Foreign Investment in the United States, the same government agency that rushed through the Dubai deal. The statement concluded, “Check Point solutions are sold, integrated and serviced by a network of more than 2,200 Check Point partners in 88 countries and its customers include 100 percent of Fortune 100 companies and tens of thousands businesses and organizations of all sizes.”

Privately, however, Israelis say such delays are par for the course, and are infuriating.

“The question is why all foreign companies aren’t treated the same. Did they feel they have a greater threat from Israeli high-tech than Arab countries doing port security?” said one businessman who works with Israeli companies.

The concern among Israeli businesses is that the increased scrutiny generated by the Dubai deal could further inhibit deals. In the United States, the businessman said, “there’s tremendous appreciation of Israeli know-how, and a tremendous reluctance to contract with Israelis.”

One group that deals with security in Israel and the United States suggested that increasing scrutiny across the board was the answer.

Arab companies buying into ports management should come under the same scrutiny as Israeli companies buying into U.S. security software, said Shoshana Bryen of the Jewish Institute for National Security Affairs.

Scrutiny of the Sourcefire purchase “is a case of somebody doing it right,” Bryen said. “The same should be done to the ports. Ports are critical infrastructure.”

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