Tempest in a Sea Port

The United-Arab-Emirates-based company Dubai Ports World has graciously requested a new 45-day review in the hopes of allaying concerns about its proposal to take over the British-based company P&O, which if approved would allow DP World to operate 11 of the 43 terminals at the ports of 6 U.S. cities. Here I summarize a few of the issues that have been raised about this takeover.

Seagirt Marine Terminal, Baltimore
seagirt.jpg >

Michelle Malkin expresses the concerns that some Americans have:

The issue is not whether day-to-day, on-the-ground conditions at the ports would change. They presumably wouldn’t. The issues are whether we should grant the demonstrably unreliable UAE access to sensitive information and management plans about our key U.S ports, which are plenty insecure enough without adding new risks, and whether the decision process was thorough and free from conflicts of interest.

On the other side are those who wonder why this issue is deemed a greater threat than control of the port from which the ships originated and the full chain of influence before a vessel arrives in the United States. Eaglespeak notes this analysis from Meredith Cohn:

Just about any given time, it’s possible to find a Greek-owned ship flying a Liberian flag, employing a Filipino crew and carrying cargo from China into a U.S. port terminal managed by a British company that hires American longshoremen.

And Robert Block follows this point up in the Wall Street Journal:

Ultimately, U.S. ports to a large extent are dependent on security measures in foreign ports, making the issue a global problem, experts say. [Council on Foreign Relations Fellow Stephen] Flynn points out that Israel operates one of the most comprehensive security systems in the world, and yet found itself nearly facing catastrophe because it had no control over cargo security procedures at the foreign port where the suicide bombers smuggled themselves into a container.

Security issues aside, Nouriel Roubini makes a point worth repeating:

The current political saga and debate about the purchase by a Dubai-based company of the management of six US ports misses the most crucial point: with a US current account deficit running towards $900b this year and probably above one trillion dollars next year, in a matter of a few years foreigners may end up owning most of the U.S. capital stocks: ports, factories, corporations, land, real estate and even our national parks. This is basic accounting: if you run a current account deficit (import more than export, spend more than your income, save less than you invest) you need to borrow from the rest of the world to finance such excess of spending (on private and public consumption and investment) over your national income. And you need to borrow on net every year to the tune of the current account deficit. That is why countries that run current account deficits become net foreign debtors. There are only two ways in which this accumulation of foreign liabilities of a debtor country can occur: either debt (when you issue private or government bonds purchased by foreigners and when you borrow in the form of bank or other loans from foreigners) or equity that can take the forms of FDI (foreign direct investment when non-residents acquire a domestic firm or other domestic assets such as real estate or when they build a new factory in the US) or portfolio investment in the equity market. So, it is either debt or equity but in either case the foreign liabilities of the US go up and foreigners increase debt or equity claims against the US.

Brad Setser is eager to help us do the math:

So it is not at all unreasonable to say that financing the US current account deficit requires that the US raise $20 billion a week, whether by selling debt, selling stocks or selling off real US assets. 52 x $20b = $1040.
That is equal to selling one Unocal a week to China (CNOOC was willing to pay $20 billion). Or selling three companies the size of P&O to the Emirates a week.

It appears that Americans are not in favor of having U.S. oil companies owned by the Chinese or shipping concerns owned by Arab states. At a minimum, those preferences have now been brought to everyone’s attention in a way that could easily offend many of the people in two of the countries we really need to get along with in this world. One wonders also the degree to which such debates may undermine the attractiveness of U.S. assets (both debt and equity) to the foreigners on whose capital we are increasingly dependent. We don’t want their money, you say? I think things would quickly look different if foreign investors suddenly decided to shed dollar assets.

Perhaps given Brad Setser’s arithmetic it would be wise to take the current account deficit a bit more seriously before we find out whom we’re going to offend next.

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29 thoughts on “Tempest in a Sea Port

  1. Chris

    I wish the “twin deficits” argument would show up more. Currently, the Federal Reserve believes that an increase in the budget deficit by $1 increases the current account deficit by $0.40.
    Recently, my congressman complained about the loss of manufacturing jobs. Someone should tell him that the current account deficit, and hence manufacturing jobs losses, would have been a lot lower had he not voted for the Medicare drug benefit and tax cuts.

  2. Jack Morrison

    More left-wing Democrat drivel on this website. Foreign governments invest heavily in the U.S. because of our free markets and low taxes. Both of those are sorely lacking in most countries around the world. Hopefully the xenophobic Democrats (and many Republicans) don’t ruin this by raising taxes or foreclosing foreign investment in this country through their xenophobic idiocy. (Hello Hillary.) As Milton Friedman pointed out, the US doesn’t have a trade deficit problem; rather, the rest of the world simply has no other good place in the world to put their money. This concept is way too complex for most people on this site to understand. You advocate the very policies that drive capital and investment away – raise taxes, more government blah, blah, blah. Ugggh, why do so many nations and so many people have so little knowledge on how to create wealth?

  3. donv

    I don’t understand the point about the current account deficit. The ports are already managed by a foreign owned company.
    In this case, it’s one foreign owned company buying another one– what does that have to do with the US current account deficit?

  4. JDH

    Donv, the point is that unless the current account deficit improves, we should expect to see a lot more stories like this.

  5. Jack Morrison

    The port issue relates to our current account deficit in this way: nations (i.e. governments and foreign individuals) have to feel free to buy and sell bonds, port management, goods, services etc. without fear of having those items expropriated by our ignorant, savage natives. (Whipped up in a frenzy of hatred of foreigners by domestic politicians.) I don’t care if Chinese, Russian or Japanese people own “American” factories or land. Apparently the people who run this board think that somehow foreign ownership is bad. Who cares if GE owns a factory in Indiana or a Korean firm? Amazing that the people who run this Blog consider themselves to be “economists”. Everytime I visit this board, I am amazed at how little they know. They always post articles that are so biased to the left, so last century – government good, foreign ownership bad etc. What happened to free markets? (Republicans are hardly better..) Poverty is so infuriating, so easy to solve….free markets, strong government that stops corruption (That is NOT big government…that is strong government..)

  6. Barry P.

    While the “current account deficit = foreigners owning more US capital” is generally true, it isn’t true in this specific case: the US has a trade surplus with the UAE, which sells almost all of its oil and gas to Japan and Korea. And this is a case of them buying a British company.

  7. Robert Schwartz

    The sale of P&O to DPW would only impact the US balance of payments if P&Os shareholders are US residents and thye received and retained dollars in the transaction. I do not believe that P&O was listed on a US securities market.

  8. T.R. Elliott

    Great post. Those nations with which imbalances exist will not forever assume debt. They will want harder assets, equities or factories or real estate, etc.
    As far as this Jack Morrison commentor: he seems to be arguing with non-existent fictious strawmen. Left wing, right wing, democrat, republican: I vote for pragmatism and truth.
    This post seems to contain both.

  9. T.R. Elliott

    Barry and others: I really don’t think you can honestly look at the trade deficit that exists between the US and UAE. You have to look at the US trade deficit with the world and the UAE’s with the world. As always expressed here and elsewhere, markets are fluid and an excess savings in one place must find a home somewhere. Balancing can occur in many ways. It need not be directly between UAE and US. I think the issues brought up in this post are independent of the particules between UAE and US.
    I’ll stand corrected if I’m wrong of course.

  10. JDH

    Robert, again my point was not that the deficit caused the sale of P&O but rather to use the sale of P&O as a benchmark with which to measure the degree to which a surrender of U.S. assets lies ahead.

  11. JDH

    Jack, I discussed Milton Friedman’s view that a current account deficit could be viewed as an indicator of economic strength here.

  12. Movie Guy

    Jim,
    I believe that you need to update your original post. Recommend that you visit the P&O web site to confim the following.
    You stated – “…which if approved would allow DP World to operate 11 of the 43 terminals at the ports of 6 U.S. cities.”
    The number of terminals involved is not 11, it’s at least 21 if not actually 27 terminals. I believe that 27 may be the correct answer.
    While the number of ports that DP World will operate under contract is 6, their terminal operations will extend to 21 ports on the East Coast and Gulf Coast.
    Source:
    UAE terminal takeover extends to 21 ports
    By PAMELA HESS
    UPI Pentagon Correspondent
    http://www.upi.com/SecurityTerrorism/view.php?StoryID=20060223-051657-4981r
    “WASHINGTON, Feb. 24 (UPI) — A United Arab Emirates government-owned company is poised to take over port terminal operations in 21 American ports, far more than the six widely reported.”
    “P&O is the parent company of P&O Ports North America, which leases terminals for the import and export and loading and unloading and security of cargo in 21 ports, 11 on the East Coast, ranging from Portland, Maine to Miami, Florida, and 10 on the Gulf Coast, from Gulfport, Miss., to Corpus Christi, Texas, according to the company’s Web site.”

  13. StrategyUnit

    James,

    Thanks for always bringing up the economic varibles on important international affairs issues.

    On the question on foreign ownership, let’s not forget that a Saudi Arabiam company already has ownership in 9 US ports: NSCS America

    I do agree with both arguments: 1)feelings on security; and 2) the need to be anti-xenophobic and uphold free-market policies.
    However, the fact we already have Saudis operating our ports makes all the talk over the UAE buy look asinine.
    We must also be aware of the geostrategic implications of the UAE deal, concerning military bases etc.

  14. JDH

    Appreciate your efforts as always to help me keep the facts straight, Movie Guy. The 11-terminal figure that I used came from Ben Muse who in turn got it from a “fact sheet” put out by the
    Dept. of Homeland Security. I have not seen DHS issue an update. They do mention stevedoring as distinct from management operations at 5 terminals in Newark. If DHS has their facts wrong, it’s pretty embarrassing for the Administration. Presumably someone in the mainstream media is going to pick up on this discrepancy. Let us know if you come up with some more information.

  15. Barkley Rosser

    Jack Morrison,
    It is probably not worth wasting time responding to you (and JDH already has on his own account), however, as a pro-free market capitalism guy, does it not bother you that Dubai Ports World is a socialist company, that it is owned by the government of the UAE, a country that is an absolute monarchy and recognized the Taliban regime in Afghanistan? Furthermore, Strategy Unit notes that there may be implications of this deal for that government being willing to let US ships dock in the Persian Gulf. Do we really want to have our national security (already jeopardized enough by our idiotic war in Iraq) made worse by having to kowtow to this absolute monarchy even more?
    BTW, the poverty rate in the US declined sharply during the 1960s, but has been pretty flat since 1980. Not so obvious your prescription for eliminating poverty is all that great.

  16. The Glittering Eye

    Catching my eye: morning A through Z

    Here’s what’s caught my eye this morning:
    John Donovan of Argghhh! has the right end of the stick on the ports controversy: concentrate more on the security, less on the ownership.
    So, who do we offend next?
    Sad but too true: Microsoft…

  17. spencer

    Jack — maybe you can explain why the rise of the current account deficit has been accompanied by a sharp slowdown in percapita income growth.
    From WW II to around 1980 when the US consistenly ran a current account (trade ) surplus real per capita income growth averaged about 3% a year. But in the 1980s the growth of real per capita income fell to about 1.8%.
    during the Clinton years when the foreign capital inflow was used to finace the capital spending boom rather then a federal deficit real per capita income growth rebounded to the old 2.9% growth rate. But since 1980 when the capital inflow was used to finance the Bush deficits per capita income growth has only averged 0.8%. You think there might be some cause and effect here?
    You make a great argument for what happens to international capital flows when it is the private market driving these flows. But that is not what we have. We have the US government borrowing abroad to finance current consumption.
    On the other side of the coin the lending is done by foreign central banks to artificially minipulate the value of their currency and artificially make their goods more competitive.
    I just find it hard to understand why you right wing free market advocates find these major distortions of the free market by governments such a great thing. Could you explain this?

  18. Joseph

    “At a minimum, those preferences have now been brought to everyone’s attention in a way that could easily offend many of the people in two of the countries we really need to get along with in this world.”
    With regard to the Arabs, we have invaded and occupied an Arab nation, flattened entire neighborhoods, killed tens of thousands of innocent Arab civilians, incited a civil war, tortured Arabs in Abu Ghraib, stripped them naked, put black hoods over their heads, attached wires to their genitals and attacked them with dogs, in Guantanamo strapped them to boards, held their heads underwater to near drowning and smeared them with faux menstrual blood and we should be worried that the handling of this deal might offend them?
    I know that this is an economics forum and that events tend to be looked at through that microscope, but ignoring the bigger picture seems a bit much. But you are right that the U.S. is digging itself into a deficit hole that puts us at the mercy of some rather unsavory folks.

  19. Stormy

    About this debt-asset swap:
    So, it is either debt or equity but in either case the foreign liabilities of the US go up and foreigners increase debt or equity claims against the US.
    Hmmmm regardless of how much they buy, we still have the debt.
    While it may be cute to connect the two, the fact is: Selling assets does not lower the debt, unless they are government owned.
    But then again, our trade deficit has given them the wherewithal. Maybe the vaunted American competitiveness no longer cuts the mustard.
    Hey, I know a great navy that we could sell. Perhaps some private corporation would like to buy it. In selling it, we could pay off the debt.
    This slipperiness with assets and debt is really misleading.

  20. Movie Guy

    P&O Acquisition by UAE DP World – Setting the Facts Straight
    I appreciate that Jim Hamilton created a post to discuss the merits of the P&O acquistion and, more generally, the matter U.S. asset acquisitions going forward.
    Regardless of any positive or negative opinions that I may have regarding the sale, I am disturbed by the dissemination of false information by the U.S. Federal Government regarding the P&O acquisition by DP World.
    The U.S. Department of Homeland Security (DHS) and U.S. Customs and Border Protection (CBP) have issued fact sheets available on line pertaining to U.S. port security and the UAE/Dubai Ports World acquisition of P&O. These are:
    Fact Sheet: Securing U.S. Ports
    DHS Press Room announcement
    Feb. 22, 2006
    http://www.dhs.gov/dhspublic/interapp/press_release/press_release_0865.xml
    Securing U.S. Ports
    U.S. Customs and Border Protection
    U.S. Department of Homeland Security
    Updated 02/24/2006
    http://www.customs.ustreas.gov/xp/cgov/newsroom/fact_sheets/trade/securing_us_ports.xml
    The U.S. Department of Homeland Security has stated the following with regard to the UAE/Dubai Ports World Acquisition of P&O:
    “DP World will not, nor will any other terminal operator, control, operate or manage any United States port. DP World will only operate and manage specific, individual terminals located within six ports.”
    This Federal Government information is false and exceedingly misleading.
    I do not understand why such a “fact sheet” can contain so many supposed “errors”. I consider it an embarrassment and disservice to the American public.
    I have verified that the sale of P&O to DP World will include the acquisition of ALL existing operations of P&O Ports North America. My verifications include communications with Bell-Pottinger, the public relations firm handling this matter. There is no question that the acquisition involves all P&O North America activities and
    operations on the East Coast and Gulf Coast.
    Therefore, the aquistion will include the transfer of operations at 22 U.S. ports on the East Coast and Gulf Coast, not 6 ports as stated by the U.S. Department of Homeland Security. DHS, in its fact sheet as cited above, has failed to acknowledge the ongoing P&O North America operations at 16 additional ports located on the East Coast and Gulf Coast.
    The acquisition will involve, at a minimum, the transfer of P&O North America operations at 55 terminals, not 11 or 16 terminals as stated by the U.S. Department of Homeland Security. Eliminating from consideration the cruise ship terminals that P&O North America presently operates, the number of terminals accounted for in my calculation of 55 is reduced to 48 terminals. DHS has failed to acknowledge the sale and transfer of 39 to 44 of the East Coast and Gulf Coast terminal operations of P&O North America.
    Operations accounted for in the 55 identified terminals at existing P&O port terminal operations do not include all grain elevator operations, or additional terminals that appear to be necessary to support the stated operations of P&O at selected ports. This potential consideration is reflected in the P&O operations by port listing outlined below. See PORT And TERMINAL LOCATIONS for more details.
    No updates of the information released by DHS or the U.S. Customs and Border Protection (CBP) has been released as of the time of this comment post.

  21. Movie Guy

    UAE/Dubai Ports World acquisition of P&O and P&O North America involves the ownership transfer of terminal operations and activities at the following ports.
    Total Terminal Operations
    Port of Portland, Maine – 3
    Port of Boston – 3
    Port of Davisville, Rhode Island – 1
    Port of New York – 1
    Port Jersey & Port Newark – 5
    Port of Philadelphia – 2
    Port of Camden, New Jersey – 2
    Port of Wilmington, Delaware – 2
    Port of Baltimore – 6
    Port of Virginia – 5
    Port of Miami – 3
    Port of Tampa – 3
    Port of Gulfport, Mississippi – 2
    Port of New Orleans – 2
    Port of Baton Rouge – 1
    Port of Lake Charles – 3
    Port of Beaumont – 1
    Port of Port Arthur – 2
    Port of Galveston – 2
    Port of Houston – 4
    Port of Freeport – 1
    Port of Corpus Christi – 1
    Total Terminal Operations – 55 terminals
    * The total does not include some grain elevator operations and the potential for additional terminals which may be in use at some ports based on the P&O port operations addressed at the P&O North America web site.
    Cruise Ship Terminals
    Port of Portland, Maine – 1
    Port of Boston – 1
    Port of Davisville, Rhode Island – 0
    Port of New York – 1 (three piers)
    Port Jersey & Port Newark – 0
    Port of Philadelphia – 1
    Port of Camden, New Jersey – 0
    Port of Wilmington, Delaware – 0
    Port of Baltimore – 1 (not included in total terminals list)
    Port of Virginia – 1 (not included in total terminals list)
    Port of Miami – 1-7 (6 not included in total terminals list)
    Port of Tampa – 0
    Port of Gulfport, Mississippi – 0
    Port of New Orleans – 0
    Port of Baton Rouge – 0
    Port of Lake Charles – 0
    Port of Beaumont – 0
    Port of Port Arthur – 0
    Port of Galveston – 0
    Port of Houston – 1
    Port of Freeport – 0
    Port of Corpus Christi – 0
    Total Cruise Ship Terminals – 8 to 15

  22. Movie Guy

    P&O Ports North America
    http://portal.pohub.com/portal/page?_pageid=169,1,169_82827&_dad=pogprtl&_schema=POGPRTL
    P&O Ports North America Inc., 99 Wood Avenue South, Iselin, New Jersey 08830, USA
    Telephone +1 732 603 2630
    Facsimile +1 732 603 2640
    Email corporate@poportsna.com
    Website http://www.poportsna.com
    Overview:
    “P&O Ports North America, Inc is the P&O Ports company responsible for all port operations in North America as well as for pursuing development opportunities in the ‘Americas’ Region – incorporating North, South and Central America as well as the Caribbean.”
    “P&O Ports is a wholly owned subsidiary of the Peninsular and Oriental Steam Navigation Company (P&O), a name synonymous with the maritime and shipping industry since its incorporation under Royal Charter in 1837.”
    “P&O Ports is the P&O Group Company responsible for port development and investment, terminal operating and stevedoring activities. Originating with the creation of an Australia-wide stevedoring and terminal operating entity, its first international activity was the 1986 joint venture privatization and management of the Port Kelang container terminal in Malaysia. P&O Ports is an international company managing 21 [now 22 by my count] container terminals and has operations in over 85 ports in 19 countries around the world.”
    “P&O Ports North America is now the largest independent stevedore and terminal operator on the US East and Gulf coasts with operations in most ports from Maine to Texas.”
    “P&O Ports North America is a diversified port operator with operations ranging from pure container terminals to under the hook stevedoring, from bulk handling facilities to passenger ship terminals and from ro-ro terminals to intermodal facilities.”
    “The company is based in Iselin, New Jersey.”
    “POPNA was formed in 1999 with the acquisition by P&O Ports of International Terminal Operating Company, Inc. (ITO), a New Jersey based stevedore and terminal operator that had been established in the US since 1921, with operations along the East and Gulf coasts.”
    “P&O Ports is a wholly owned subsidiary of the Peninsular and Oriental Steam Navigation Company (P&O), a name synonymous with the maritime and shipping industry since its incorporation under Royal Charter in 1837.”
    “In January 2006, P&O Ports North America and Tampa Port Authority announced they had entered into a long-term contract to operate terminals at the Port of Tampa for general and refrigerated cargo.”
    “Additionally, P&O Ports North America, Inc. and Tampa Port Authority announced an agreement for P&O Ports North America to operate the recently completed Hookers Point Container Terminal with the long-term goal of substantially increasing container handling at the Port.”

  23. Movie Guy

    P&O North America Operations – Ports and Terminals Locations
    http://portal.pohub.com/portal/page?_pageid=169,1,169_82827&_dad=pogprtl&_schema=POGPRTL
    Port of Portland, Maine (P&O Ports New England)
    http://www.portofportlandmaine.org/
    P&O of New England is listed as one of two stevedoring companies services the Port of Portland, Maine. The other firm is Sprague-Merrill’s Marine Terminal. Ten terminals are listed at the Port of Portland, Maine web directory.
    P&O Ports Shareholding
    - 100%
    “P&O Ports New England provides terminal and stevedoring operations for a container feeder-service to and from the Port of Halifax, Nova Scotia. Portland International Terminal (PIT) is the home for this weekly container feeder service. P&O Ports also provides stevedoring, stores and line handling to the seasonal cruise vessels that visit Portland as a port of call.”
    Operations
    - Container Vessels/Barge
    - Cruise Line Vessels
    Terminals (3)
    - Portland International Terminal (PIT)
    - Marine Terminal
    - Portland Cruise Terminal
    Services
    - cruise line support services
    - terminal operations
    - stevedoring services
    Port of Boston (P&O Ports in New England)
    “The Port of Boston’s public facilities are owned and operated by the Massachusetts Port Authority, which is funded entirely by user fees and revenue bonds.”
    “The Port of Boston container cargo is carried via four different services; direct vessel call, barge via New York, feeder vessel via Halifax, and a small amount of over-the-road containers.”
    P&O Ports Shareholding
    -100%
    - “P&O Ports’ core business in the New England area is the damage-free and rapid discharge of automobiles.”
    - “P&O Ports and The Massachusetts Port Authority have teamed up to operate the Black Falcon Cruise Terminal. With more than 100 ship calls per year, the port is now considered one of the fastest growing high-end cruise markets in the country. The Black Falcon Cruise Terminal now serves over 125,000 passengers each year. Home Port services are provided to all major cruise lines including destinations to Bermuda, the Canadian Maritimes and the St. Lawrence River.”
    Operations
    - Automobiles
    - RoRo
    - Bulk
    - Cruise Line Vessels
    - Passenger Terminal Services
    Terminals (3)
    - Moran Automobile Terminal (RoRo)
    - Black Falcon Cruise Terminal – cruise ships (full operational control)
    - bulk cargo terminal
    Services
    - RoRo – Volkswagen and Subaru
    - stevedore services
    - cruise line and passenger terminal support services
    Port of Davisville, Rhode Island
    “The Port of Davisville is operated by the Rhode Island Economic Development Corporation (RIEDC).”
    “The port has three major piers with over 6,800 linear ft. of deep-water dockage with onsite rail tracks.”
    P&O Ports Shareholding
    - 100%
    - “P&O Ports handles approximately 80,000 units of import automobiles per year as well as export RORO cargoes.”
    Operations
    - Automobiles
    - RoRo
    Terminals (at least 1)
    - RoRo (possibly full operational control; not confirmed)
    - three major piers
    Services
    - RoRo stevedoring services
    Port of New York & New Jersey (P&O Ports North America)
    “The Port of New York/New Jersey is the largest port complex on the East Coast of North America and is located at the hub of the most concentrated and affluent consumer market in the world, with immediate access to the most extensive interstate highway and rail networks in the region. In addition, The Port Authority directly oversees the operation of seven cargo terminals in the New York-New Jersey region.” – http://www.panynj.gov/
    “Operation of the port is overseen by the Port Authority of New York & New Jersey, a bi-state agency formed to promote trade and commerce in the region.”
    “Over 3,000,000 TEU’s of container traffic are handled annually. That’s nearly half the North Atlantic ocean borne general cargo.”
    Port of New York
    P&O Ports Shareholding
    - 100%
    - “The Passenger Ship Terminal known as New York Cruise Terminal for passenger ship service is operated by P&O Ports North America for the City of New York.” – http://www.panynj.gov/
    - “Under a 20-year operating agreement with the City of New York, P&O Ports North America, Inc. is the exclusive provider of terminal management and stevedoring services for the New York Cruise Terminal. Among P&O Ports’ customers are Carnival Cruise Line, Cunard Line, Crystal Cruises, Holland America Line, Norwegian Cruise Line, Princess Cruises, Line, Seabourn Cruise Line, Silversea Cruises, NYK Cruise Co. Ltd, Hapag Lloyd and Clipper Cruise Line.”
    - “Each year, the terminal hosts the New York City Fleet Week with the U.S. Navy. It is also home to the Show Piers on the Hudson, which hosts an array of trade shows, corporate functions, fundraisers and special events. P&O Ports North America, Inc. also manages the Show Piers operation.”
    - “It [New York Cruise Terminal] consists of three, 70,000 sq. ft. finger piers with five, 1037 ft. long berths capable of docking five cruise vessels simultaneously, including the new mega-class cruise ships.”
    Operations
    - Cruise Line Vessels support
    - Trade Show Events
    Terminals (1)
    - New York Cruise Terminal (full operational control)
    – Piers 88 – 90 – 92
    Services
    - cruise ship terminal operations
    - trade show support operations
    Port Jersey & Port Newark (includes Elizabeth, “America’s Containership Capital” or the Elizabeth-Port Authority Marine Terminal)
    P&O Ports Shareholding
    - perhaps 100% RoRo on automobile cargo; not confirmed
    - joint venture on container terminal operations
    - “In Port Jersey, Jersey City and Port Newark, P&O Ports discharges or loads over 400,000 automobiles and RoRo vehicles annually.”
    - “Port Newark Container Terminal LLC (PNCT) is the joint venture company of P&O Ports and Maersk. It has a 30-year lease with the Port Authority of New York and New Jersey to operate a 178-acre container terminal in Port Newark, New Jersey.”
    - PNCT support includes “direct rail service by NS and CSX for tank cars, and box cars handling non-containerized cargo such as liquid and dry bulk and scrap metal.” – http://www.panynj.gov/DoingBusinessWith/seaport/html/pn_port_newark.html
    Operations
    - Containers
    - Automobiles RoRo – Military included
    Terminals (5)
    - Port Newark Container Terminal (joint operation)
    - Port Jersey & Port Newark operations
    – Toyota Auto Terminal
    – FAPS Auto Terminal
    – Northeast Auto Terminal
    – Bayonne Auto Terminal
    Services
    - RoRo – automobiles – Toyota, Hyundai, Kia, BMW, and other automobile manufacturer brands
    - container terminal operations
    - stevedoring services
    Port of Philadelphia – Philadelphia Regional Port Authority (Port of Philadelphia and Camden)
    P&O Ports Shareholding
    - 50% joint venture
    - “P&O Ports North America, Inc. is a 50% joint venture partner in Delaware River Stevedores (DRS), which provides stevedoring and terminal services in Philadelphia, PA, Camden, NJ, and Wilmington, DE.”
    - “Operated by DRS, Tioga is a multi-purpose, 96.5 acre facility, that is uniquely suited to handle containers and break bulk cargoes.”
    Operations
    - Cruise Line Services
    - Passenger Terminal Services
    - Container
    - Break bulk
    Terminals (2)
    - Philadelphia Cruise Terminal (Former Philadelphia Navy Yard) (possibly full operational control)
    - Tioga Marine Terminal (50% joint venture full operational control)
    Services
    - Delaware River Stevedores (DRS) provide luggage handling and storing services at the Cruise Terminal.
    - Stevedoring services for cargo
    Port of Camden, New Jersey (Port of Philadelphia and Camden)
    “Camden, New Jersey’s busy Beckett Street Terminal is a one-stop, full service break bulk and bulk facility that handles steel, project cargo, wood products, cocoa beans and bulk cargoes. Ranked #1 in the country for plywood.”
    P&O Ports Shareholding
    - 50% joint venture
    - “P&O Ports North America, Inc. is a 50% joint venture partner in Delaware River Stevedores (DRS), which provides stevedoring and terminal services in Philadelphia, PA, Camden, NJ, and Wilmington, DE.”
    - “DRS provides labor and equipment to service Del Monte’s year-round perishable business in Camden, New Jersey, Pier 5 Broadway.”
    Operations
    - Breakbulk
    - Bulk
    - Produce
    Terminals (2)
    - Broadway Terminal (Del Monte Fruit Terminal; Pier 5)
    - Beckett Street Terminal
    Services
    - Stevedoring services
    Port of Wilmington, Delaware
    P&O Ports Shareholding
    - 50% joint venture
    - “P&O Ports North America, Inc. is a 50% joint venture partner in Delaware River Stevedores (DRS), which provides stevedoring and terminal services in Philadelphia, PA, Camden, NJ, and Wilmington, DE.”
    Operations
    - Container
    - Breakbulk
    - Bulk
    - Produce
    - Automobile – RoRo
    - Cold storage
    Terminals (2 or more)
    - multipurpose
    - RoRo terminal
    Services
    - Stevedoring services
    Port of Baltimore
    “Port of Baltimore Operations include various stevedoring and terminal management services at Dundalk Marine Terminal, Seagirt Marine Terminal, North Locust Point and South Locust Point, and Chesapeake, Atlantic and Fairfield Automobile Terminals.”
    “Port operator P&O Ports North America (POPNA) has recently signed a contract with Nordana Line, a Denmark-based shipping company.” – P&O press release, May 3, 2005
    P&O Ports Shareholding
    - 100% at two terminals
    - others terminals share not stated
    - “The Port of Baltimore, on the north end of the Chesapeake Bay, is one of the largest operations in the [P&O] company portfolio.”
    - “P&O Ports has a contract with the Maryland Port Administration to operate Seagirt Marine Terminal and Dundalk Marine Terminal in Baltimore.”
    - “P&O Ports Baltimore offers Maintenance and Repair services of containers and chassis at the Seagirt and Dundalk Marine Terminals. P&O Ports maintain a mobile fleet that can travel between both terminals and offer roadability services as well as major repairs.”
    - “CSX Intermodal Inc., recently entered into an agreement with P&O Ports North America, Inc. awarding them a contract to perform lift operations at the CSXI facility in
    Baltimore, Md. CSX Intermodal is a transcontinental intermodal transportation service provider operating dedicated truck-to-rail and ship-to-rail services across North America. CSX Intermodal Inc. is a subsidiary of CSX Corporation (NYSE:CSX).” – P&O press release, January 6, 2005
    Operations
    - Containers
    - Breakbulk
    - Bulk
    – Steel
    – Forest Products
    - Automobiles – RoRo – Military included
    - RoRO
    - Cruise Vessels
    Terminals (6)
    - Seagirt Marine Terminal (full operational control)
    - Dundalk Marine Terminal (full operational control)
    - North Locust Point Marine Terminal
    - Fairfield Terminals (3)
    – Masonville Terminal (RoRo)
    – Chesapeake Terminal (RoRo)
    – Atlantic Terminal (RoRo)
    - unnamed cruise vessel terminal (not included in the total count)
    Services
    - stevedoring services
    - RoRo stevedoring services
    Port of Virginia
    P&O Ports Shareholding
    - 50% joint venture
    - “P&O Ports North America is a 50% joint venture partner in CP&O. CP&O performs stevedoring services at all major facilities in the Port of Hampton Roads. These include the three marine terminals operated by Virginia International Terminals, in Norfolk, Portsmouth, Newport News and Lamberts Point Docks, Inc., a Norfolk Southern Subsidiary.”
    - “P&O Ports and Cooper/T. Smith today announced a merger of their activities in Norfolk, Virginia. The business will be combined in a new limited liability corporation to be known as “CP&O”, and will include the cargo and cruise line stevedoring, warehousing, and maintenance activities that the two companies have heretofore conducted separately. The target date for the completion of the merger is October 1 of this year. Cooper/T. Smith Stevedoring is a division of century old Cooper/T. Smith Corporation, a multi-faceted maritime company with operations on all three coasts of the U.S. and in several foreign countries.” – P&O press release, September 7, 2004
    - “CP&O is the exclusive stevedore for Perdue frozen poultry, with export volumes of approximately 50,000 tons.”
    Operations
    - Containers
    - Steel
    - Forest Products
    - Rubber
    - Automobiles – RoRo
    - Reefer/Chill
    - Cruise Vessels
    - Passenger Terminal Services
    Terminals (5)
    - Norfolk International Terminal
    - Portsmouth Marine Terminal (Portsmouth, VA)
    - Newport News Marine Terminal (Newport News, VA)
    - Lambert’s Point Docks (Norfolk, VA) – break bulk marine terminal
    - Nauticus International Pier (Norfolk, VA) – cruise ship terminal (full operational control)
    - unnamed RoRo terminal (not included in the total count)
    Services
    - stevedoring services at major terminals
    - RoRo stevedoring services – Nissan and Subaru
    - cruise ship baggage handling services, line handling, and ship provision loading.
    Port of Miami
    P&O Ports Shareholding
    - 50% port ownership
    - 100% port operational control (according to news reports)
    - 50% joint venture on stevedoring services
    - “In Miami, P&O Ports is a 50% owner of the Port of Miami Terminal Operating Company (POMTOC), which operates the only multi-user container facility in the port, on 117 acres with 12 container cranes.
    - Stevedoring services are provided by Eller-ITO, a 50% joint venture company.
    - “In addition to container operations, P&O Ports, through its joint ventures, also services RoRo and general cargo vessels.”
    Operations
    - Containers
    - Breakbulk
    - Steel
    - Forest Products
    - Automobiles – RoRo
    - Cruise Vessels
    Terminals (3 or more) (full operational control of the container terminal)
    - POMTOC
    - Dodge Island
    - Cruise Terminals (possibly as many as 7) (counted as 1 above)
    - unnamed RoRo terminal (not included in the total count)
    Services
    - operation of the port
    - stevedoring and terminal operations
    - cruise line stevedoring, baggage handling and terminal services
    Port of Tampa
    http://portal.pohub.com/pls/pogprtl/docs/PAGE/PO_PORTS_NORTH_AMERICA/TAB82846/TAB83548/TAMPA%20PRESS%20RELEASE.PDF
    P&O Ports Shareholding
    - 100%
    - “In January 2006, P&O Ports North America and Tampa Port Authority announced they had entered into a long-term contract to operate terminals at the Port of Tampa for general and refrigerated cargo.” – Press release, 24 January 2006
    - “Additionally, P&O Ports North America, Inc. and Tampa Port Authority announced an agreement for P&O Ports North America to operate the recently completed Hookers Point Container Terminal with the long-term goal of substantially increasing container handling at the Port.”
    Operations
    - Container
    - Reefer
    - General Cargo
    - Container Port Terminal operations
    Terminals (3 or more)
    - Hookers Point Container Terminal (full operational control)
    - general cargo (number unknown) (full operational control)
    - refrigerated services terminal (full operational control)
    Services
    - not fully disclosed
    - will operate a container terminal on behalf of the port.
    Port of Gulfport, Mississippi
    “The Mississippi State Port Authority at Gulfport is ranked as the 3rd busiest container port in the Gulf of Mexico and ranked in the top 20 in the United States. Primary cargoes include tropical fruit, frozen poultry, ilmenite ore, livestock, aluminum and heavy lift cargoes.”
    P&O Ports Shareholding
    - 100%
    - “In Gulfport, P&O Ports performs stevedoring and terminal operations for Chiquita and Crowley containers, which total about 75,000 units annually. Two shipside freezers operated by P&O Ports accommodate poultry, poultry parts and other frozen cargoes and account for about 200,000 tons of export cargoes annually.”
    Operations
    - Containers
    - Breakbulk
    - Shipside Reefer
    - RoRo
    Terminals (2)
    - East/West Terminal
    - Chiquita Container Terminal
    Services
    - stevedoring services
    - terminal operations
    - warehousing
    P&O Ports Louisiana
    Port of New Orleans
    “The Port of New Orleans is the only deepwater port in the United States served by six class one railroads.”
    P&O Ports Shareholding
    - 100%
    “In addition to operating New Orleans’ largest indoor warehouse facility for general cargo, P&O Ports has an array of modern support facilities that are strategically located throughout the New Orleans port system with truck, rail and dock access. The P&O Ports Louisiana terminal infrastructure includes both waterside and city-side tracks with rail capacity in excess of 130 rail cars.”
    Operations
    - Containers
    - Breakbulk
    - Steel
    - RoRo
    - Sugar
    Terminals (2)
    - Nashville Avenue (full operational control)
    - Napoleon Avenue Container Terminal (full operational control)
    - unnamed RoRo terminal (not included in the total count)
    Services
    - stevedoring and terminal operating services
    Port of Baton Rouge
    P&O Ports Shareholding
    - 100%
    “P&O Ports Louisiana, Inc. (formerly Baton Rouge Marine) is the largest and most experienced terminal operator, stevedore, steamship agency and line handler in the Port of Baton Rouge. P&O Ports has been the ports primary general cargo stevedore and terminal operator since 1955.”
    “P&O Ports Louisianas Line Handling Division was established to provide mooring and unmooring services to all vessels calling at docks located on the Upper Mississippi River.”
    Operations
    - Breakbulk
    - Trucking
    - Line Handling
    - Agency services
    Terminals (1)
    - Baton Rouge Municipal Dock (primary operator)
    Port of Lake Charles
    “The Port of Lake Charles is located upriver from the Gulf of Mexico and is the 12th largest seaport in the U.S., 4th largest liner service seaport in the U.S. Gulf and a major West Gulf container load center. The facilities encompass 203 square miles in Calcasieu Parish and accommodates 5 million tons of cargo annually at its public facilities. The District owns and operates three marine terminals, the City Docks, Bulk Terminal No. 1 and the Industrial Canal, as well as 2 industrial parks.”
    UPDATE – January 6, 2006: “P&O Ports North America is pleased to announce that their Lake Charles division, formerly known as Lake Charles Stevedores, Inc. will now be known as P&O Ports Lake Charles. P&O Ports Lake Charles is the exclusive freight handler for the Port of Lake Charles, providing terminal operations, stevedoring, log-yard and rail operations. Additionally, P&O Ports Lake Charles is the sole operator of the Contraband Bayou Terminal’s automated bag loading facility, as well as the adjacent automated bagging facility.
    “We want to unify the P&O Ports brand throughout North America. The P&O Ports name and reputation are well known and widely respected and we want our operations in Lake Charles to be a part of that success,” said Dave Morgan, P&O Ports Senior Vice President Gulf Region. P&O Ports hopes the name change will enhance the corporate identity for the Lake Charles office now that it officially bears the P&O Ports name.”
    http://portal.pohub.com/pls/pogprtl/docs/PAGE/PO_PORTS_NORTH_AMERICA/TAB82846/TAB83548/LAKE%20CHARLES%20RELEASE.PDF
    P&O Ports Shareholding
    - 100%
    - 100% freight handler or operator for all port operations
    “P&O Ports operates as Lake Charles Stevedores, Inc., also known as LCSI. LCSI is the exclusive freight handler for the port. We offer terminal operations, stevedoring, log-yard and rail operations. Another subsidiary of P&O Ports in Lake Charles is Lake City Steamship Agency. Lake City Steamship Agency is the port’s oldest and largest steamship agency and shares offices with Lake Charles Stevedores.”
    Operations
    - Breakbulk
    - Containers
    - Bulk Grain
    Terminals (3)
    - City Docks (full operational control)
    - Bulk Terminal No. 1 (full operational control)
    - Industrial Canal (full operational control)
    - Grain elevator (?) (not included in the total count)
    Services
    - terminal operations
    - stevedoring services
    - log-yard
    - rail operations
    P&O Ports Texas – 6 ports
    “P&O Ports Texas is one of the largest and most experienced stevedoring contractors and terminal operators in Texas. P&O Ports Texas provides stevedoring and terminal operations at the ports of Houston, Beaumont, Galveston, Freeport, Port Arthur and Corpus Christi.”
    Port of Beaumont
    P&O Ports Shareholding
    - 100%
    Operations
    - Bulk
    - Grain elevator
    - other
    Terminals (1 or more)
    - multipurpose (possibly full operational control)
    - Grain elevator (not counted in the total count)
    Services
    - stevedoring services at all Port facilities
    - contract stevedore for the U.S. Army
    - bulk stevedoring services at the Dreyfus Grain Elevator
    - U.S. Military cargo movements
    Port of Port Arthur
    P&O Ports Shareholding
    - 100%
    “The Port of Port Arthur is equipped to handle all kinds of breakbulk products, including forestry and metal products, bagged and bale cargo, and military goods.”
    Operations
    - Containers
    - RoRo
    - Steel
    - Breakbulk
    - Heavy lifts
    Terminals (2)
    - multipurpose terminal (possibly full operational control)
    - RoRo terminal or facility
    Services
    - stevedoring and terminal services
    Port of Galveston
    P&O Ports Shareholding
    - 100%
    “In Galveston, P&O Ports operates at the container terminal at pier 10 and provides stevedoring and terminal services for the RoRo operation of Wallenius Wilhelmsen and at Pier 10 Container Terminal.”
    Operations
    - Container
    - Bulk
    - RoRo
    - Grain elevator
    Terminals (3)
    - Pier 10 Container Terminal (possibly full operational control)
    - RoRo operation
    - grain elevator operation
    Services
    - stevedoring and terminal services
    - On-dock Container Freight Station
    - bulk stevedoring services at the ADM Grain Elevator
    Port of Houston
    P&O Ports Shareholding
    - 100%
    “P&O Ports Texas is the Port’s assigned freight handler for wharves 25, 26, 27 and 28 at the City Docks Turning Basin Terminal.”
    Operations
    - Containers
    - Break bulk
    - Bulk
    - Steel
    - Automobiles
    - RoRo
    - Cruise Vessels
    Terminals (4)
    - Houston City Docks, Turning Basin Terminal, wharves 25, 26, 27, and 28
    - Barbours Cut Terminal
    - RoRo Terminal
    - cruise ship terminal
    Services
    - stevedoring and terminal services
    - On-dock Container Freight Station for stuffing and stripping intermodal equipment as well as a CCC-ILA approved subsidized Container Freight Station
    - full service container marshalling and storage facility
    - stevedoring, baggage handling, terminal services for cruise vessels at the passenger terminal berth
    Port of Freeport
    P&O Ports Shareholding
    - 100%
    “P&O Ports provides container and terminal operations in Freeport for the special requirements of Dole, Chiquita and Turbana.”
    Operations
    - Container
    - Multipurpose terminal operations
    Terminals (1 or more)
    - multipurpose terminal (?) (possibly full operational control)
    Services
    - stevedoring and terminal services. Commodities handled are containers, RoRo, steel, breakbulk and heavy lift palletized bananas.
    - On-dock Container Freight Station for stuffing and stripping intermodal equipment.
    Port of Corpus Christi
    P&O Ports Shareholding
    - “P&O Ports Texas operates in a joint venture, Dix-Fairway, in Corpus Christi.”
    Operations
    - Dry Bulk
    - Break bulk
    - Reefer
    - Bulk Elevator
    Terminals (1 or more)
    - multipurpose terminals (joint venture full operational control)
    - bulk elevator (not included in total count)
    Services
    - stevedoring and terminal services at all Port of Corpus Christi facilities, including ADM Bulk Elevator
    - dry bulk, breakbulk and reefer cargo stevedoring
    - P&O Ports Texas customers include the U.S. Army
    ====

  24. Movie Guy

    Jim — “If DHS has their facts wrong, it’s pretty embarrassing for the Administration.”
    The “facts” that the U.S. Government has presented are in need of immediate revision.

  25. Jack Morrison

    Barkley Rosser – We “right wing free market advocates” find the current government borrowing to be horrible. That is why we are “right wing free market advocates”, we don’t like what the government is doing to fund all of the left wing programs and our over funded, wasteful defense department. (Many Republicans love big government too.) But, if the government refuses to cut back on its spending, we are in favor of borrowing from the Chinese et. al. rather than taxing working Americans to pay for the goodies that the government professors, teachers, elderly and poor are receiving. But, if America scares off foriegners from buying our bonds…which are paying our elderly and our poor etc., then we have to either raise taxes on working Americans or pay higher interest rates to attract capital.
    The income growth figures you cite are simply wrong. You ignore healthcare benefits. Americans are receiving very expensive health benefits that are not counted in your income growth figures. (The treatment, care, pills etc. that workers receive today are far more advanced and expensive than they were 20 years ago…that must be incorporated into your figures…they aren’t..) Healthcare is another topic for another day, but the healthcare industry is hardly a free market. It is a government regulated mess…now we have this prescription drug mess…(Bush and the Republicans did this…yet, the only thing scarier than the Republicans are the Democrats…)

  26. Movie Guy

    Let me advise of a minor correction to an item in the first post of this series:
    Original:
    “Eliminating from consideration the cruise ship terminals that P&O North America presently operates, the number of terminals accounted for in my calculation of 55 is reduced to 48 terminals. DHS has failed to acknowledge the sale and transfer of 39 to 44 of the East Coast and Gulf Coast terminal operations of P&O North America.”
    That should read 49 terminals. I only accounted for 6 cruise ship terminals operations in the detailed rollup.

  27. Barkley Rosser

    Movie Guy,
    Excellent work. Hopefully people in Congress and elsewhere will pick up on this.
    Jack M.
    So, you are not bothered that this is a state-owned company, this Dubai Ports World, and owned by a highly questionable state? You are so worried about not being able to cut taxes for hard working Paris Hilton that we must turn over our ports to the likes of such?

  28. Movie Guy

    If you believe that the facts have not been fully released by the Federal Government, you can get involved.
    You can help write emails to Congressmen and Congresswomen. Or call them. Or both.
    Senators of the 109th Congress
    http://www.senate.gov/general/contact_information/senators_cfm.cfm
    House of Representatives
    Members names and telephone numbers
    http://clerk.house.gov/members/mcapdir.html
    House Democrats
    http://democrats.house.gov/about/member_pages.cfm
    House Republicans
    http://www.gop.gov/your_rep.asp

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