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Prince Alwaleed bin Talal, Rupert Murdoch and the United Arab Emirates

Reported by Marie Therese - February 24, 2006

News Hounds Editorial

As we News Hounds have been reporting for the past week, many of the FOX News Channel hosts, like Bill O'Reilly, for example, have been forcefully arguing in favor of the UAE port acquisition deal while at the same time offering copious rationalizations for the Bush administration's lack of awareness about the true feelings of the American people on the topic of port security. Now that there is a delay in place, FOX has increased the intensity of the coverage, constantly driving home the message - through numerous "experts" both military and civilian - that the UAE is the best thing since sliced bread.

When I read the following, from the respected financial journal The Economist, I was intrigued.

The Dubai International Financial Exchange (DIFX), the emirate's new stockmarket, received some much-needed good news when Prince Alwaleed bin Talal, a Saudi billionaire, announced plans to list one of his companies, Kingdom Hotel Investments. Kingdom executives praised the exchange's strong regulatory environment, and bankers estimate the listed company could have a market capitalisation close to $1 billion.

Since its launch in September, the exchange has been something of a damp squib. Investcom, the only stock listed, did not trade for months. Nine index-tracking funds received similar short shrift from investors. Privately, investment bankers and chief executives were growing concerned about this lack of trades.

But matters have improved since late January, when two high-profile bonds were listed on the exchange. This included the world's biggest Islamic bond, a $3.5 billion sukuk (which pays a profit rate, rather than an interest rate) from the state-owned Dubai Ports, Customs and Free Zone Corporation to help finance a planned acquisition of P&O ferries (bold face is mine).

Then Barclays Capital, one of the world's leading investment houses, got a licence to be a broker on the bourse, and HSBC [Hongkong and Shanghai Banking Corporation] traded Investcom on the DIFX for the first time. Bourse officials admit the exchange has a long way to go before it achieves critical mass, but crow that about 15 companies have firm plans to list by the end of 2006.

According to the publication Trading Places (not to be confused with the movie of the same name), which offers news and commentary about "exchanges and trading values worldwide," Shadi Sadeek Sanbar, Special Advisor to Kingdom Holding Company, joined the Board of Directors of the DIFX on September 1, 2005.

In addition to Kingdom Holding Company and Kingdom Hotels Investments, Prince Alwaleed bin Talal owns 5.5% of News Corporation stock.

News Corporation owns FOX News Channel.

As Ellen and other outlets have reported, the Saudi Prince has indicated in past statements that he believes his investment in News Corporation will allow him to influence news.

For example, as reported by Think Progress

During last month's street riots in France, Fox News ran a banner during a news segment, reading: "Muslim riots." Billionaire Saudi Prince al-Walid bin Talal, who owns 5.5% of Fox News, was unhappy with the tagline:

"I picked up the phone and called Murdoch (and told him) these are not Muslim riots, these are riots out of poverty. Within 30 minutes, the title was changed from Muslim riots to civil riots."

Talal gained notoriety after 9/11 when he blamed U.S. policies for the terrorist attacks.

Fox News spokeswoman Irena Briganti refused to confirm or deny that the call took place but "acknowledged the network changed the banner after receiving complaints." (Think Progress, 12/12/05)

Here are my questions to our stock market gurus:

Would the delay of the DPW-P&O port deal in the United States affect the profit potential of the Dubai Ports sukuk? If so, would that affect the DIFX negatively?

In the event that the DIFX faltered, would the value of Prince Alwaleed's Kingdom Hotel Investments be affected?

If his investments were at risk, do you think the Prince would pick up the phone and make another call to Rupert Murdoch?

Given the House of Saud's documented connection to the House of Bush, do you think Prince Awaleed bin Talal might also have made a few other calls? Perhaps to his good friend George? Or Dick? Or Don? Or Condi?

Other questions:

What do you think of the new revelations about the UAE's $100 million donation made for Hurricane Katrina relief in the weeks just before the port takeover deal was approved (CBS Channel 47)? Why has FOX News Channel not mentioned it?

Where do you think that $100 million went to? Is there a paper trail? Was a quid pro quo deal struck between the administration and the UAE, i.e., in exchange for a $100 million donation to offset federal expenditures on the hurricane, the UAE would be granted certain exemptions from our laws?

On Thursday morning's FOX & Friends show, the hosts discussed just such a special deal made between the UAE and the Bush administration, in which the UAE would agree to adhere to our tough inspection regulations in exchange for a mitigation of paperwork requirements, e.g., the UAE would not be required to keep copies of every bill of lading, etc. filed here in the United States. The reason given? It would reduce the possibility of an American lawsuit against the UAE if pertinent documents were not on American soil!

Also announced several times yesterday & this morning on FOX & Friends was the report that John Snow, Donald Rumsfeld and Michael Chertoff all claim that they knew nothing about the UAE deal because the final decision was made on the Deputy Secretary level. Apparently, because no red flags came up, these lower level bureaucrats were allowed to finalize the deal.

One must assume, then, that these same lower echelon guys made both the final call on the $100 million donation and the final decision to weaken our own port regulations. Isn't that an awful lot of power for underlings to wield, especially when it concerns our national security?

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