In this photo taken July 4, 2011, shows the Trump Ocean Club International Hotel and Tower, third building from left, in Panama City. U.S. business magnate Donald Trump will open his new hotel on Wednesday July 6, 2011. Arnulfo Franco AP
In this photo taken July 4, 2011, shows the Trump Ocean Club International Hotel and Tower, third building from left, in Panama City. U.S. business magnate Donald Trump will open his new hotel on Wednesday July 6, 2011. Arnulfo Franco AP

Nation & World

Foreign governments are finding ways to do favors for Trump’s business

By Anita Kumar

akumar@mcclatchydc.com

January 02, 2018 02:00 AM

WASHINGTON

In Indonesia, a local government plans to build a road to shorten the drive between the main airport on the island of Bali and the new high-end Trump resort and golf course.

In Panama, the country’s federal government intervened to ensure a sewer system around a 70-story Trump skyscraper shaped like a sail in Panama City would be completed.

And in other countries, governments have donated public land, approved permits and eased environmental regulations for Trump-branded developments, creating a slew of potential conflicts as foreign leaders make investments that can be seen as gifts or attempts to gain access to the American president through his sprawling business empire.

The White House dismisses these concerns, as does the Trump Organization’s attorney. But when foreign governments that provide gifts to the Trump Organization, even those that benefit other businesses, it puts President Donald Trump in possible violation of the U.S. Constitution’s emoluments clause that states officials may not accept gifts from foreign governments and that no benefit should be derived by holding office.

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“If you have a foreign government providing a benefit to the Trump company that is going to violate emoluments clause of the Constitution,” said Noah Bookbinder, executive director of Citizens for Responsibility and Ethics in Washington.

Quite simply, Bookbinder and other ethics experts say, a gift to the Trump Organization is a gift to the president of the United States.

Trump’s name adorns resorts and golf clubs in two dozen countries around the globe, including those in the United Arab Emirates, India and Ireland.

At least half a dozen groups have been researching Trump’s foreign businesses, including CREW, Public Citizen and the left-leaning Center for American Progress. But few beyond American Bridge 21st Century, a Democratic opposition research group, have examined what foreign governments have given the Trump Organization overseas. The organizations say it’s difficult to determine what is being given because foreign governments often don’t have databases and information publicly available, they have different political and regulatory cultures and their workers might not speak English.

Some of those same groups are involved in several lawsuits accusing Trump of violating the emoluments clause in other ways. In December, a federal judge dismissed two such lawsuits because those suing did not show how they were harmed, arguing Congress and not the courts should look into the president’s conduct.

Yet watchdog groups accuse Trump of violating the law in big and small ways in many of the nearly two dozens countries that his family business has developments, including Uruguay, India and the Philippines.

In Indonesia, where Trump is constructing two projects, Bali’s government plans to build a toll road to cut the time it takes to get from the airport to the six-star Trump International Hotel and Tower Bali roughly in half. The project, which will include an 18-hole golf course designed by golf great Phil Mickelson, will be located next to a sacred Hindu temple and overlooking the Indian Ocean.

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“According to the local Government’s master plan, there is now a plan to develop a toll road extension that will shorten the distance between the Ngurah Rai International Airport and MNC Bali Resort,” according to the 2016 annual report by the developer MNC Land, Trump’s partner. “When the work is completed, the travel time from the airport to MNC Bali Resort or vice versa will only be about 25 minutes.”

An Indonesian state-owned firm, PT Waskita Karya Tbk, is building another toll road at a second Trump project in the country, Lido City, that includes a Disney-like theme park and a golf course but the developer, also MNC Land, expects to pay for construction, according to news reports. That road will reduce hours-long travel time from Jakarta to 60 minutes, according to a press release. MNC’s annual report boasts its development will be “within easy reach from Jakarta.”

In Panama, the government has stepped in to finish sewer and water pipes that would benefit the Trump Ocean Club International Hotel and Tower after the company that received the contract went bankrupt, according to Sarah Chayes, senior fellow in the Democracy and Rule of Law program at the Carnegie Endowment for International Peace who researched Trump developments as part of a brief filed in an emoluments lawsuit.

An investigation by the organization Global Witness in November accused Trump of making millions of dollars by allowing Colombian drug cartels and others to launder money through his Panama development, which includes condos, a casino and stunning views of the Pacific Ocean. It was Trump’s first international hotel development when it opened in 2011.

An attorney for the Trump Organization said the president’s business empire receives no benefit from these foreign government expenditures. “Because the developments you are referring to are all license deals owned and developed by others, any improvements made to the local infrastructure provide no benefit to the Trump Organization or any of its affiliates,” said Alan Garten, executive vice president and general counsel for the Trump Organization.

While in most cases, the Trump Organization does not own the overseas developments, it earns money by licensing its name and managing the properties.

And its payout is likely tied to the development’s success. For example, the business earned royalties between $1 million and $5 million in Bali and between $100,000 and $1 million in Panama City while the Panama City management fees came to $800,000 in 2016 and the early months of 2017, according to financial disclosure statements filed with the federal government in June.

MNC and representatives of the Indonesian and Panamanian governments did not respond to questions.

Chayes, a former adviser to Chairman of the Joint Chiefs of Staff Admiral Mike Mullen, argues that emoluments clause violations can be much broader than just infrastructure improvements and include benefits such as donated public land, approved permits and eased regulations, which is occurring in every country Trump has a development.

Prior to the election it was well known that I have interests in properties all over the world.Only the crooked media makes this a big deal!

— Donald J. Trump (@realDonaldTrump) November 22, 2016

Trump, for example, applied for new trademarks for a variety of businesses from hotels to apparel in China in June 2016 when he was a presidential candidate. They were granted in the weeks after he became president.

Robert Weissman, president of the watchdog group Public Citizen said Trump’s decision to retain his business meant he would have numerous conflicts of interests. “That’s why he shouldn’t have holdings,” he said.

Trump did not fully separate from his business interests when he was sworn in as president. Instead he placed his holdings in a trust designed to hold assets for his “exclusive benefit,” which he can receive at any time. He also retains the authority to revoke the trust.

The Trump Organization announced it would not be involved in new foreign deals or transactions with a foreign entity — country, agency, official, sovereign wealth fund or member of a royal family — other than “normal and customary arrangements” made before inauguration. It withdrew from some foreign projects but kept others.

McClatchy has reported that a construction company owned by the Chinese government was awarded a contract to build a road as part of the residential piece of a Dubai development and that a construction company owned in part by the governments of Saudi Arabia and South Korea expects to build the Lido City development.

In December, Trump downplayed potential conflicts of interests with his business. “It’s not a big deal — you people are making it a big deal, the business...” he told reporters at his Florida resort Mar-a-Lago. “They all knew I had big business all over the place.”