DP World Says It Works With Israeli Firms

Published March 02, 2006

| Associated Press

Dubai's government may formally subscribe to the Arab boycott of Israel, but a state-owned company at the center of a controversy over its bid to take over some U.S. port operations says it routinely works with Israeli firms.

It's a contradiction increasingly apparent in the region: Several Persian Gulf states, especially ones entering international markets, mostly ignore the boycott even though they haven't formally ended it and don't recognize Israel.

Countries like the United Arab Emirates, of which Dubai is a part, have also ended secondary boycotts, meaning Israeli products not shipped directly from Israel are allowed to enter their markets.

Several U.S. senators raised the question of the boycott this week as a new twist in the uproar over whether allowing Dubai Ports World to run port facilities in several American cities posed a security risk. U.S. law prohibits companies from cooperating with the boycott.

DP World is owned by the government of Dubai, which on its books supports the decades-old boycott. But the boycott has crumbled over the decades, and the UAE does not force DP World to bar Israeli goods and companies from the European, Asian and Mideast ports it manages.

CNN reported Thursday that a prominent Israeli shipping company, ZIM Integrated Shipping Services Ltd., wrote to a U.S. senator noting it does business with DP World and supports the U.S. deal.

"As an Israeli company, security is of the utmost importance to us and we require rigorous security measures from terminal operators in every country in which we operate, but especially in Arab countries. And we are very comfortable calling at DP World's Dubai ports," ZIM chairman Idan Ofer wrote, the cable news network said.

The letter said ZIM is allowed to operate at Dubai ports despite the formal boycott and that DP World handles ZIM operations in Dubai, according to CNN. Ofer did not specify if those ZIM operations were subsidiaries or directly owned.

Under UAE law, trade between its seven emirates and Israel is banned, and Israeli passport holders are not allowed into the UAE. Any company owned by the governments of the emirates also is supposed to abide by the boycott, although that clearly is not enforced.

DP World now runs 15 port facilities outside the Arab world -- in Asia, Europe and Latin America -- and no reports have surfaced of its preventing Israeli-owned ships, goods or firms from operating there.

"Our company has long-standing business relationships with Israeli companies among our diverse international clients," DP World Senior Vice President Michael Moore said in a statement Tuesday.

"DP World does not discriminate and has not been charged with violating any anti-boycott statutes. DP World, as a global port management company, facilitates trade with many nations," he said.

Moore's office did not immediately reply to a request Thursday for more information on which Israeli companies work with DP World.

DP World's office in Dubai refused to comment on the boycott issue Thursday, as did a senior UAE government official in the capital, Abu Dhabi.

Moore released the statement after Senate Democrats grilled DP World's chief operating officer, Edward Bilkey, about the firm's adherence to the Israeli boycott. Bilkey acknowledged that the Dubai government formally respects the boycott.

"We should not be rewarding companies that support discrimination against our key strategic ally," Sen. John Kerry said during the Senate Commerce Committee hearing.

The Arab League launched the boycott of Israel in 1951, setting up an office in Damascus, Syria, to identify foreigners doing business with the Jewish state and ban them from operating in the Arab world.

At one time, more than 8,500 companies and people, such as Coca-Cola and Ford, were blacklisted. But the boycott frayed as first Egypt and then Jordan made peace with Israel and the Palestinians embarked on the still faltering peace process. All three now trade with Israel.

The UAE, Qatar, Tunisia and Morocco are among other Arab nations that have flirted with relations and trade with Israel in recent years -- although they do not formally recognize Israel.

Syria and Lebanon still stick strictly to the boycott, and the Damascus boycott office regularly issues blacklist statements.

"The importance of (the boycott) is more political and diplomatic than it is financial today," said Michael Oren, visiting professor of Jewish and Middle Eastern studies at Harvard and a senior fellow at the Shalem Center, a Jerusalem-based research institute.

URL

http://www.foxnews.com/story/2006/03/02/dp-world-says-it-works-with-israeli-firms