Bush To Visit UAE Sunday, Boost Ties With Oil-Rich Nation-AFP
January 12, 2008: 06:50 AM EST http://money.cnn.com/news/newsfeeds/articles/djf500/200801120650DOWJONESDJONLINE000331_FORTUNE5.htm
DUBAI (AFP)–U.S. President George W. Bush will be heading to the United Arab Emirates Sunday on a visit aimed at cementing ties with a booming oil-rich nation wooed by U.S. officials, businessmen and the defense industry.Bush, the first sitting U.S. president to visit the federation of seven Gulf emirates, will come from Bahrain as part of a week-long Middle East tour that is also aimed at isolating Iran over its contested nuclear program.
Despite a long-standing territorial row, the UAE is Iran’s largest trade partner, with up to 10,000 Iranian firms operating in Dubai, making the city state Iran’s main business hub.
Dubai equally serves as a U.S. listening post on Iran, hosting one of five offices Washington has set up to contact ordinary Iranians in the absence of diplomatic relations with Tehran.
Bush will deliver a speech in the UAE capital Abu Dhabi that is expected to focus on economic achievements and the progress of the “freedom agenda” in the Gulf.
A free-trade pact has eluded Washington and Abu Dhabi, and their friendship suffered a setback when U.S. congressional opposition forced Dubai’s giant port operator to offload U.S. operations in 2006.
But the U.S. and the UAE – touted as a model of economic progress in an unstable region – have steadily forged closer links.
U.S. firms have scrambled to secure a foothold in the country while Emirati companies and funds snap up prized U.S. assets.
During a fleeting visit to Dubai Monday, Bush will take a glance at the meteoric rise which has made the city state an instantly recognizable name in his own country, with such grandiose projects as a world-shaped cluster of man- made islands and the world’s tallest skyscraper.
Bush had backed DP World’s (DPW.AI) acquisition of operations at six U.S. ports in the face of fierce congressional opposition because of security concerns.
But the Dubai government had to relinquish the U.S. assets after Bush failed to sway U.S. lawmakers to back the deal.
Despite the debacle, Dubai has gone on to acquire major U.S. assets, including an investment by the Borse Dubai in Nasdaq Stock Market Inc. (NDAQ).
Late last year, the government-run Abu Dhabi Investment Authority bought a 4.9% stake in Citigroup Inc. (C) for $7.5 billion, making it one of the largest shareholders in America’s second-biggest bank by market worth.
The two countries are far more discreet about their military links and only held the first meeting of a Joint Military Commission in January 2005.
Neither side speaks publicly about logistical accords dating back to the 1991 Gulf War whereby U.S. aerial refueling tankers and C-130 transporters have used facilities in the UAE.
The UAE prides itself on its “balanced” international relations and is keenly aware of the potential threat from al-Qaida-linked extremists operating elsewhere in the troubled region.
In December, the Pentagon notified Congress of its intention to sell the UAE sophisticated weapons as part of arms sales to Gulf states to beef up their defenses against Iran.
The proposed sale included a Patriot missile-defense system worth as much as $ 9 billion, and three early warning aircraft for $437 million.
In March 2000, the UAE bought 80 US-built F-16 Falcon fighters at a cost of $ 6.4 billion.
On the political front, the UAE has so far held only indirect elections to an advisory federal council, but its rulers – chiefly in high-flying Dubai – have promoted a greater role for women in public life.
Mindful of the scrutiny that comes with fame, UAE rulers have also made efforts to improve the country’s record in dealing with hundreds of thousands of mostly south Asian workers amid criticism from human rights groups.