WASHINGTON – The Bush administration, reeling from a recent ruckus over ports security, will work with Congress to bolster national security reviews of foreign companies and others that want to invest in the United States, Treasury Secretary John Snow said Tuesday.
Snow emphasized the importance of maintaining a climate that still encourages foreign investment in this country but suggested that security procedures warranted closer scrutiny in a post Sept. 11 world.
"As we enter into the debate over its reform one point must stand clear: National security is our top priority and the only consideration in the CFIUS process," Snow said, referring to the Committee on Foreign Investment in the United States, which approves foreign ownership deals.
"CFIUS includes, with equal standing, the arms of government charged with protecting America's national security, homeland security and law enforcement. This is not a question of a trade-off between investment and security. We have never made that trade-off and the CFIUS review process exists to make sure that there never is such a trade-off," he said.
Congress is considering various measures to revamp the way the federal government reviews foreign proposals to do business in the United States, like the Dubai Ports World's proposal to oversee significant operations at six major U.S. ports.
The ports deal had been approved by CFIUS, a panel headed by Snow. But the Dubai-owned company later pulled out of the deal in the face of massive political protests over the transaction, and said it would transfer the port operations to a U.S. company.
The administration will work to "strengthen scrutiny of CFIUS cases involving state-owned companies" and "strengthen the president's authority to enforce CFIUS actions," Snow said.
The Treasury chief also said that the administration would make sure that lawmakers in Congress are in the loop.
"We will work to ... expand notifications of decisions to Congress so that it can fulfill its important oversight responsibilities," Snow said.
Snow said it is of utmost importance that policy-makers — concerned about national security — take action that would stifle foreigners from investing in the United States.
"It is vital that we avoid taking steps in the name of national security that instead are isolationist, having the effect of choking off vital investments in America," he said. "For example, some have called for automatic investigation of any investment that could affect 'economic security' — that's a very vague concept and would create uncertainty, which would chill investment."
Senate Majority Leader Bill Frist said he was pleased with Snow's remarks.
"Congress has an important oversight role in these and other foreign commerce issues, but we must strike a balance that allows appropriate congressional review while preserving the integrity and independence of the CFIUS process," Frist, R-Tenn., said. “We must balance the need to maintain an open and welcome environment for foreign direct investment with the duty to protect the American people and our nation’s security."