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Saturday, February 25, 2006

Experienced Shipper Answers Questions on UAE Controversy

I contacted a relative (through marriage) with a lot of experience in the shipping business. I asked him to comment on the UAE port takeover issue. Here is his response:

Hi Neal,

As a Coast Guard Port Security Officer, and with 43 years of export/import shipping experience, and having been to every U.S. port of any significance from Portland Maine to Seattle, I have a little knowledge of how ports operate.

I believe the media have confused the word "port" with the word "terminal" in that ports consist of various terminals, usually specializing in certain commodities or certain types of ships. Oil and other liquids are handles at specialized facilities, as are container vessels and bulk cargo vessels, such as grain carriers.

The P&O Company, a British firm, sold their terminal contracts to the UAE government firm. I don't know how extensive their holdings were, but they did not "control" any ports.

The security at U.S. ports is under the control of the Coast Guard and the Customs, as well as private security at the various terminals within the ports. Regardless of the ownership, nothing concerning security will change.

The Coast Guard website published an article from the Philadelphia Inquirer, which was the first intelligent reference to Terminals, and I'veattached an excerpt.

I don't like the idea of a UAE government -owned firm operating any part of a U.S. port, but the situation is by no means as serious as the media make it seem, by their constant references to "control" of U.S. ports.

Regards,

The excerpt:

Is an Arab nation taking over the Philadelphia port?

No. The port is run by a state agency, the Philadelphia Regional Port Authority. The agency, in turn, has contracts with companies that run terminals and load and unload ships.

So what is being purchased?

A company with one of those contracts.

Delaware River Stevedores Inc. has a lease to run one of the city's terminals - the Tioga Marine Terminal. It also loads and unloads ships in Camden and Wilmington.

Delaware River Stevedores is half-owned by SSA Marine in Seattle. Until last week, the other half was controlled by a North American unit of Peninsular & Oriental Steam Navigation Co. of London. That was the unit sold to Dubai Ports World, a government-run company in the United Arab Emirates.

Will the new partner in Dubai send workers here?

Not likely, said Robert Palaima, president of Delaware River Stevedores. When the partner was a British company, no British employees were based here, he said. He does not expect that to change now that the partner is based in Dubai. "I'm president, and I'm not hiring," Palaima said.

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