| Senior staffers on Capitol Hill report rising concerns about foreign government influence over investments in security-related sectors of the US economy. They have noted recent announcements that Dubai International Capital, the investment arm of the Dubai government, will take a 3% stake in EADS, a major European defense firm, and that KazAtomProm, Kazakhstan’s national nuclear corporation, will buy a 10% share in Westinghouse Electric, a manufacturer of nuclear power stations. The investment in EADS comes on top of last September’s purchase by the state-owned Russian bank Vneshtorgbank of a 5% stake in EADS. These investments have led to new legislation – now close to approval in Congress – that will involve the Director of National within the Committee for Foreign Investment in the US (CFIUS) to monitor investment proposals – now expanded to include public infrastructure projects like airports – from investors with a significant foreign government shareholding. This legislation is intended to improve the review process following the controversial (and later blocked) February 2006 acquisition by Dubai Ports World of a number of US ports. The Administration has welcomed the legislation, as has US business. However, contacts in Congress are less certain that the changes will ease decision-making. “The involvement of the intelligence community will complicate things,” one Senate Banking committee member told us. “Foreign investors need to be careful about allowing government entities to invest in their shares if they want to do business in the US.” |
