Int. Herald Tribune: U.S. fails to halt Emirates' dangerous trade

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U.S. fails to halt Emirates' dangerous trade
By Eric Lipton
Tuesday, April 1, 2008

WASHINGTON: Roadside bombings of American troops in Iraq were occurring with bloody regularity when military investigators made a disturbing discovery: American-made computer circuits sold to a trading company in the United Arab Emirates had turned up in the bomb detonators.

That finding set off a clash with Washington last year when the Bush administration cited the diversion of the computer circuits to Iran, and eventually Iraq, as proof that the United Arab Emirates were failing to prevent American technology from slipping into the wrong hands. Administration officials said other so-called dual-use goods - including aircraft parts, specialized metals and gas detectors that have a potential military use - had also moved through Dubai, one of the emirates, to Iran, Syria or Pakistan.

The diplomatic face-off, which drew little public attention, prompted the United States to threaten tough new controls on exports to the United Arab Emirates, an important ally. The restrictions would have deeply embarrassed a nation that had invested billions of dollars to become a global trading hub and had just begun a campaign to burnish its image in the United States after the uproar in 2006 over a proposed deal that would have allowed a Dubai company to manage some American ports.

The Bush administration backed down only after the United Arab Emirates promised to pass their own export control law. But nearly a year after the confrontation, it is unclear that much has changed.

Yousef al-Otaiba, an adviser to the crown prince of the United Arab Emirates, said his country was more closely monitoring goods that it re-exported while blocking items that might help Iran build weapons systems. But trade experts, a Commerce Department investigator and Iranian traders in Dubai said evidence was scarce that the new export control law was being broadly enforced.

"It has virtually had no effect, to be honest," said Nasser Hashempour, deputy president of the Iranian Business Council in Dubai. "If someone wants to move something - get it to Iran - it is easy to be done."

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