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Wife of British Scholar Jailed in UAE Speaks to CNN; France Sanctions 18 Saudis Over Khashoggi’s Murder; U.S. Republicans Subpoena

November 23, 2018



<Date: November 22, 2018>

<Time: 16:00:00>

<Tran: 112201cb.k27>

<Type: SHOW>

<Head: Wife of British Scholar Jailed in UAE Speaks to CNN; France

Sanctions 18 Saudis Over Khashoggi’s Murder; U.S. Republicans Subpoena

Former FBI Director Comey and Attorney General Lynch; Cyril Ramaphosa

Promises a “New Dawn” for South Africa; Microfinance Revolution Boosts

African Entrepreneurs; Artificial Intelligence Robot Works as a Fashion

Model; EU Lawmakers Want Amazon to Ban Soviet-Themed Goods. Aired 4-5p ET - Part 1>

<Sect: News; International>

<Byline: Paula Newton, David McKenzie, Richard Quest>

<Guest: Antanas Guoga>

<High: Wife of British scholar jailed in UAE speaks to CNN. France

sanctions 18 Saudis over Khashoggi’s murder. U.S. Republicans subpoena

former FBI Director Comey and Attorney General Lynch. Cyril Ramaphosa

promises a “new dawn” for South Africa. Microfinance revolution boosts

African entrepreneurs. Artificial intelligence robot works as a fashion

model. EU lawmakers want Amazon to ban Soviet-themed goods.>

<Spec: Matthew Hedges; France; Saudi Arabia; Jamal Khashoggi; GOP; James

Comey; Loretta Lynch; Cyril Ramaphosa; Microfinance; Africa; Artificial

Intelligence; Soviet-Themed Goods; Amazon>

<Time: 15:00>

<End: 16:00>

PAULA NEWTON, CORRESPONDENT, CNN: All right, we might all be thankful because there is no trading on Wall Street today for the Thanksgiving Holiday, but here’s what’s driving today on Thursday, November 22nd. The pound is surging after Theresa May gets the draft deal on Brexit.

There is a political battle brewing between France and Japan, now that Carlos Ghosn is out at Nissan and Facebook’s outgoing head of comms takes one for the team as he takes the blame for recent scandals. I’m Paula Newton and this is “Quest Means Business.”

Good evening. A deal that delivers, that’s the latest message from the British Prime Minister on Brexit. Theresa may has agreed on a draft declaration on the UK’s post Brexit relationship with EU powers. She also says she is confident she’ll be able to deliver on agreement at a summit in Brussels this weekend.


THERESA MAY, BRITISH PRIME MINISTER: The deal that will enable us to do this is now within our grasp. In these crucial 72 hours ahead, I will do everything possible to deliver it for the British people and I commend this statement to the House.


NEWTON: So here is a quick look at the major points in the draft post Brexit deal. Aren’t you glad we did this for you. Trade is the top priority, of course. Mrs. May’s political declaration calls for quote, “No tariffs, fees, charges or restrictions across all sectors.” That is very significant. Then there is freedom of movement, a key issue with referendum voters in 2016. The blueprint aims to provide visa free travel, very important here, for short-term visits to the UK. This deal also kicks the can down the road, way down the road, on certain issues, including Gibraltar, Ireland and a new agreement on fisheries quotas.

These topics could dominate what is sure to be a high stakes summit in Brussels this weekend. Our Nina dos Santos has been following all of this from London and she joins us now. You know, Nina, still a lot of confusion as to whether or not this is a deal that at the end of the day Theresa May can get actually get through her own parliament.

NINA DOS SANTOS, CORRESPONDENT, CNN: Yes, you’re right. And then after her Parliament, if she manages to get through that, then of course she would have to go back to the European Parliament, too. And then we have potentially the House of Lords having a say on things, too.

So this is by no means a deal that has been agreed to by all the parties that need to agree to it before, of course March 29th. And in the meantime, it is looking increasingly likely that many people on the opposition side of the aisle, but also within her own party are opposed to elements. The real problem that they have with it, Paula, is this is part of a two-stage process.

The first stage having been last week’s very detailed 585-page withdrawal agreement that is legally binding. This one being the political declaration of the future relationship that the UK would have with the EU that is nonbinding. But the problem that some people have with it is that it is also rather vague as you pointed out.

NEWTON: Yes, it is that vagueness that a lot of people are talking about today. Nina, thanks so much. Good to see you. We’ll continue to follow the outcome of this deal really in just the hours to come. Appreciate it.

Carl Bildt is the former Prime Minister of Sweden, he is also the co-chair of the European Council on Foreign Relations and he joins me now from Stockholm via Skype. Thank you for joining us. When we get to the spectrum of this, we talked about hard Brexit, we talked about blind Brexit, we talked about soft Brexit, we’ve talked about so many things. You argue this is the best deal that Britain could ever expect no matter how you categorize it.

CARL BILDT, FORMER PRIME MINISTER OF SWEDEN: In the worst possible situation. I think they withdraw the agreement, which is really a controversial one, it is probably the best possible deal in the worst possible situation. Clearly bad for the UK, bad for Europe, but in a bad situation probably the best that can be done now. Whether that be that empowers the UK Parliament, but that remains to be seen, but if that happens, then we have the prolonged debate of negotiating all of the issues of the final relationship.

NEWTON: You know, at least one EU Commissioner told me quite a few weeks ago that he always expected that the UK would not be able to pass this. Do you think that that’s changed now? Do you think that the UK will find a way to make this work and also it has come up as an issue that all 27 EU members will also accept it?

BILDT: I think that is a problem of the EU side at least so far.


BILDT: I think the withdrawal agreement - the withdrawal agreement I think is set in stone by now, whether it will be accepted to the UK, it remains to be seen. On the political declaration, I understand the 36 pages, I understand there are some outstanding minor issues. But that’s not necessarily that significant because that shows the political declaration. And all of those issues, really long list, is what needs to be sorted out in the negotiations over the course of X numbers of years ahead.

So if hard Brexit can be avoided, let’s hope, by no means it should, there is going to be a prolonged exit, prolonged Brexit, so that’s was a difficult one.

NEWTON: You say a difficult one, you know, you often sought that Theresa May has one of the toughest jobs on the planet right now. At the end of the day, no matter how much they have been really debating her future, do you still think she is the person for the job here, that if anyone is going to get a deal now, it will be Theresa May?

BILDT: That is not for me to watch, but any Prime Minister of the United Kingdom in this particular situation will be in a bad situation because the referendum result is a very difficult one. And if there is not a way to get out of it, which I doubt, but anyhow, it will be the task of any Prime Minister of the United Kingdom to deal with a distinct and comfortable and difficult situation.

And that is the immediate talk in the House of Commons in the next few weeks, but the years in which it would be bound by the European Union in which it will have to negotiate all of the issues that I indicated in the 36 pages of this political declaration. It is not easy.

NEWTON: Definitely not easy. The people who would prefer a hard Brexit that say this is what they voted for say that this deal actually - that it in fact amounts to the UK remaining a vassal state of the EU. Do you, as obviously a proponent of the EU, have any counterpoint there? Because at the end of the day, they’re still saying this deal does not go far enough.

BILDT: Well, the choice of the world is by them. But, of course during the period of the next few years, when the UK was in fact to be bound by sort of the customs union and all of the regulatory alignment, it loses control to a very large extent. It will be dependent upon the decisions taken in Brussels by many of them taking the view of being a part of it, but without having any say.

There will not be any UK representative around the table in Brussels where the other European countries are deciding the rules of the game.

NEWTON: And the more the Brexiteers here people like you speak, the more they say they’re going to fight harder to make sure Theresa May never gets this deal through Parliament. We will continue to watch and learn, Carl Bildt. Thanks so much for your time. Really appreciate it.

BILDT: Thank you.

NEWTON: Now one of the biggest alliances in the auto industry is now facing uncertain future after Nissan ousted the man behind it. The company has removed Carlos Ghosn as its Chairman. He spent nearly two decades at the Japanese carmaker, turning its fortunes around. The Board has unanimously now voted him out after his arrest for an alleged financial misconduct.

Now, Nissan is in the alliance with another Japanese carmaker of course and that would be Mitsubishi and France’s Renault and it say remains committed to that partnership. French and Japanese economy ministers have now met in Paris to try and work out where out where these companies actually go from here.

There are fears that Ghosn’s removal could see the power shift between France and Japan clearly going from France to Japan at the moment, it is not a relationship of equals as Renault owns almost half of Nissan. Nissan only owns 15% of Renault and key here, it has no voting rights.

Our Melissa Bell has been watching all of this from Paris. You know, Melissa, we’re talking about this as an economic story, but I’m sure what you have been covering today is very much a political story at this point.

MELISSA BELL, CORRESPONDENT, CNN: That’s right and that was bound to happen, Paula, because of the size of this giant as a result of that alliance. But also because France is a 15% stakeholder in Renault. So of course what happens to Renault is of huge interest and importance strategically, economically to the French government.

And hence this meeting today with the two economy ministers, without going to the detail of how this is going to work out because we’re really at the beginning of a process. I mean, after all, as France’s economic minister has pointed out, Carlos Ghosn has not yet been charged and the French authorities are very much wanting to know more about the kind of proof that has been amassed to back these charges that hang over his head as a result of this several months long investigation within Nissan, now, handed over to the Japanese authorities.

So we’re at the beginning of a process, many unanswered questions. But I think all the economy ministers could do today after their meeting was repeat what they had done in a joint statement on Tuesday, which is reaffirm ...


BELL: ... their commitment to the - commitment to this alliance. The big question is really whether that stands? Can it continue after Carlos Ghosn, the man who is not only after all, Paula, its architect but it was believed the man who wanted to see that alliance go even further. Now, how worrying was that on the Japanese side as you say with that imbalance between Nissan and Renault? That’s one of the great unknowns as well.

I think something that will be the subject of a lot of speculation going forward. But clearly, clear calls from French authorities for the time being for Japanese authorities to provide great clarity around what the proof is that might allow Carlos Ghosn to be charged.

NEWTON: Yes, and it is so interesting about that, because many have wondered, look, if the Japanese have come up with this kind of evidence, what did French authorities know? What did they know at Renault? Is that making waves there in France or really has it all been overlooked considering the kind of jobs and investment that is at stake right now?

BELL: Well, I think for the time being, it is a bunch of questions really on the side of the French. It has been such an extraordinary story over the course of the last few days on a human level. This mighty giant and how he appears to have fallen, how his fate has been transformed really so publicly and in the course of a matter of days with all these questions hanging over precisely what the wrongdoing was and how extensive it was.

So questions really for the time being. And, of course, as you say, more broadly on the question of this alliance, can it survive and how can the French who are very keen that it should, given their stake in Renault ensure that it does. But that balance of power, of course, we come back to that, between French authorities and now the Japanese who rather hold more of the power perhaps over this than they did when this all began.

NEWTON: Melissa, something I’m wondering about very curious about, we’ve seen many pictures of Emmanuel Macron with Mr. Ghosn and obviously, he was held up as really one of the titans of French industry, specifically manufacturing and the jobs that go with it. Is there going to be any political collateral damage here for Macron and his government?

BELL: I think it will depend very much on whether those charges are brought on the nature of the charges, on how they stand up to international scrutiny and to whether if this can be shown to have taken place, how the Renault took it or takes it or failed to spot what it might have spotted, how endemic if there was corruption, that corruption was and how widely shared the responsibility of not spotting it should have been and perhaps was not.

So, again, these are all unknowns around the immediate fate of Carlos Ghosn himself, around the broader fate of this alliance and then, of course, for countries like France, as implicated as they are in the fortunes of Renault with 15% stake, how they then react to what went on at Renault, what they should have known and what they might have done to prevent it from taking place.

But for the time being, I can’t stress enough the extent to which we are at the very early stages and really until the charges are brought, this is all the subject of speculation. Of course, so many questions around such a marked leader, such a giant of the automobile industry are bound to mean unsettling times for the industry itself.

NEWTON: Yes, absolutely. But as you point out, these are allegations at this time and there’s still a lot more questions than answers. Melissa Bell in Paris, appreciate it.

Up next, Facebook’s outgoing comms chief takes the blame for hiring a PR firm targeting its critics. Among them, George Soros. We’ll have more next.


NEWTON: All right we call this strategic, right? It was a good old fashioned news dump from Facebook. Yes, on the night before Thanksgiving holiday here in the United States. The social media giant’s outgoing communications chief says he and he alone was responsible for hiring a PR firm which the “New York Times” says targeted Facebook critics, including billionaire inventor and philanthropist George Soros.

Now, a man who has been vilified by the far right, he has faced explicitly anti-Semitic criticism. In a statement released by Facebook, Elliot Schrage seemed to vindicate Mark Zuckerberg and the firm’s COO, Cheryl Sandberg saying, “Responsibility for these decisions rests with leadership of the communications team, that’s me, Mark and Cheryl relied on me to manage this without controversy.”

Our business correspondent, Clare Sebastian joins me now. I mean, look, obviously the whole release and the timing was suspicious. Also is the fact that he’s absolving at the end of the day Mark Zuckerberg leads Facebook, not the communications team.

CLARE SEBASTIAN, BUSINESS CORRESPONDENT, CNN: Right, I mean, this is management 101. What we’ve heard from Mark Zuckerberg and Cheryl Sandberg throughout is that they didn’t know anything about definers, that they were looking into it. Now, whether or not they knew, I don’t know which is worse. Frankly, it’s new work that they didn’t know. I think it creates the impression that they’re not completely in control of this platform. And I think we’re still going to see leadership questions despite the fact that this does smack of an attempt to inoculate them from this, A, because of the way it was done on the night before Thanksgiving; B, because Elliot Schrage was outgoing anyway. He was already planning to leave.

So this doesn’t really count, someone falling on their sword for this whole affair. Secondly, he’s really only taken responsibility for one section of that explosive “New York Times” report, the fact that they hired this Washington PR firm called Definers to dig up dirt on critics and then competitors frankly. There are other parts of it as well that Facebook tried to downplay Russia’s involvement in the 2016 election.

And that, you know, they ramped up and tried to deflect controversy on to competitors after Cambridge Analytica. So there was more to that report and this only really tackles one part of it.

NEWTON: And they seem so incredibly ill prepared to answer any of these questions even when they finally apparently finally figured out what was actually going on within their own company. Our Laurie Segall as you know, did an exclusive interview with Mark Zuckerberg. Let’s listen Clare to what he told Laurie when Laurie asked him specifically about what he would say to George Soros.


MARK ZUCKERBERG, CEO AND CHAIRMAN, FACEBOOK: Well, I know that George Soros has been the target of a lot of really horrendous attacks. And I think that is terrible. And I certainly wouldn’t want anyone who is associated with our company to be a part of that.


NEWTON: You know, that is an incredibly weak response to a man that they know has been vilified and perhaps in some way the company they hired has now contributed to that.

SEBASTIAN: Yes, to be fair, Sheryl Sandberg did go a little further. She published a memo alongside that memo from Elliot Schrage and she said - she found the whole idea that their work could have contributed to any kind of anti-Semitic content deeply abhorrent and deeply personal because of course, she is Jewish as is Mark Zuckerberg.

But, you know, this is still Facebook trying to do damage control after the fact. They still are being criticized for the fact that they seem unwilling to be completely transparent with the public.

NEWTON: And I think people perhaps will say, okay, these are two people who are Jewish, clearly, they would never support anything this anti- Semitic. But at the end of the day, it seems to be a win at all costs, you know, within Facebook.


NEWTON: Which basically validates the “New York Times” story. That they’ll do anything at this point to survive and win in their apparent structure the way it is without regulation, that the critics are getting the better of them.

SEBASTIAN: I think there is still a lot of debate around the company as to how willing they step up with who they are, willing to countenance more regulation, clearly that is something that is coming, but I think there is some debate around that and certainly, the way this whole announcement came out on the eve of Thanksgiving, as we said someone who is outgoing does raise those questions.

Again, I will say that to Facebook’s credit they are saying that they need outside help, they talk about their new hire of Nick Clegg who is going to conduct an audit of all of their relationships with outside consultants. They are talking about setting up a board that will handle some of the appeals process full of independent members. All of that is positive, but I think there is still a lot of suspicion around how far it will go and how committed they are.

NEWTON: Yes, and Clegg the former Deputy Prime Minister in the UK, they’re thinking perhaps will have the authority, the gravitas not just within Facebook, but outside as well to try to get some of this done. Thanks for following the story. Really appreciate it and Happy Thanksgiving to you.

SEBASTIAN: Happy Thanksgiving. The trade war strikes again. This time it is Tesla, the car company is slashing prices in China for the second time this year. The announcement came out Thursday in an effort to make its cars more affordable. It is also about market share, obviously, all this week we’re looking at the fierce competition between the Chinese and American tech sectors. Today, Matt Rivers shows us the Chinese electric carmaker hoping to take over Tesla’s place at the top.


MATT RIVERS, CORRESPONDENT, CNN: In the race to dominate the global electric vehicle market, you might think that American carmaker Tesla is leading the pack, but several Chinese competitors are catching up, if not already ahead.

And if you believe the snazzy car ads, one of them might just win.


RIVERS: This is a high quality video.



RIVERS: This is one of the hopefuls - BYD or Build Your Dreams. The company launched here in Shenzhen 23 years ago. While you might not have heard of it, investors have.


RIVERS: It’s a big milestone when Warren Buffet invests in a company.

GU: It is, it is.


RIVERS: Mia Gu is one of the brand managers here.


MIA GU, BRAND MANAGER, BYD: This BYD’s car showroom.


RIVERS: And she shows us their latest models, most aren’t that flashy, cheaper designed with the average consumer in mind. But some are slicker than others. Mia called them sexy.

Only one way to find out, we take their so-called new generation Tang out for a spin. So quiet. This sells for about half the price of Tesla’s popular Model S and that’s their big pitch. It’s just like a Tesla, but for less.


GU: Tesla’s price now is still a little bit expensive for many people.


RIVERS: China is the world’s largest automobile market and it’s also the world’s biggest polluter. No wonder perhaps that authorities want two million electric vehicles sold here by 2020 and they offer subsidies to car buyers to help.


GU: One of the biggest I think, the killer of people’s health is the exhaust.


RIVERS: They produced over 100,000 electric vehicles per year. Sold in China, California, and everywhere in between with a global work force that’s 220,000 strong. Clearly, China is going all in on new energy. Now, Tesla wants in here, too.

Elon Musk’s company recently announced, it would open up a plant in Shanghai, not that BYD is worried.


GU: We’re quite open to competition. We welcome more and more industry players.


RIVERS: Of course, the ride could be bumpy. After years of explosive growth, BYD’s profits dropped 20% in 2017. Some now wonder if the dream of electric vehicles here is too dependent on those government subsidies and what happens if they go away? But for now, the company is confident the future is electric. Matt Rivers, CNN, Shenzhen.


NEWTON: Okay. Anything Trump can do, Trudeau can do better. We’ll be very careful there, that might get the Prime Minister in trouble again. But Canada has unveiled a raft of new tax breaks to try and stay competitive with the United States. The move will allow businesses to write off capital investments for tax purposes in response to aggressive tax cuts as we have all heard about from the Trump administration.

Richard Carleton, CEO of the Canadian Securities Exchange, joins me now from Toronto and you are working, sir, because to define once and for all for everyone Canada has Thanksgiving, but it is in October. So that’s why --

RICHARD CARLETON, CEO, CANADIAN SECURITIES EXCHANGE: That’s right. We enjoyed our turkey, some weeks ago.

NEWTON: Oh, god, and did we ever. Okay. So let’s move on to what the Canadian government did here. This has been a call from CEOs as you and I both know for months and months in Canada. Is it going to do the trick? Because I know that a lot of Canadian companies have been very concerned that innovation and productivity can’t keep pace with US.


CARLETON: Well, it is very much a start, but I think that, you know, it is not clear that this is going to address two I think of the big issues that Canadian business leaders are concerned about. The first one, and I think this is front page news, not just in Canada, but in several other markets around the world, is the fact that we have Alberta Oil stranded, and as a result is basically selling at a gigantic discount to the world price.

That’s costing not just the energy companies significant to revenues and profits, but obviously because of the royalty programs and so on, it is costing governments and frankly Canadians from coast to coast a tremendous amount of money.

So making progress and seeing leadership from not just the Federal government, but the provincial governments involved on the pipeline issues and other transportation issues is something I think that businesses are clearly looking for.

The other component of this is, again, addressing taxes at the business level is fine. But we still have a considerable difference in tax rates at the personal level. When you combine provincial and Federal income tax in Canada, we’re at a considerable disadvantage to our peers in the United States.

And so, again, business I think is looking for leadership from both levels of government on this issue to begin to really address the concerns that we face vis-a-vis the United States.

NEWTON: Yes, and it will take several quarters to figure out if anything the Canadian government is doing is actually working. I want to move on to - I don’t know, did you know you have this labeled the king of cannabis listings? Did you know that, Richard?

CARLETON: Yes, I think that’s first thing that pops up in my Google search.

NEWTON: It likely it does. I think everybody is talking about the fact that Canada is the exchange. Your exchange is where you go, not just if you’re a Canadian cannabis company, but even if you’re an American cannabis company trying to raise capital and list.

Do you worry, because some critics have said that look, it is leading to a reputation of Canada of being in some way, shape or form contributing to this cannabis bubble and although that is not a very good analogy. But most people have been putting the cannabis stocks in the category of Bitcoin, really. And saying is this really prudent to be going down this road, especially when you see, you know, how much cannabis stocks, the volatility in them and how far they have fallen in the last few weeks.

CARLETON: Well, anytime you have a new industry, there is bound to be a lot of speculation that takes place. And I think it is fair to say that investors that are active in this space should be regard it as risk capital that they putting up. But I think again, everybody understands that this is go to be a considerable business, not just in Canada and the United States, but globally in the coming five to ten to 15 years.

And so what we’re seeing really is the birth of an entire new industry, and the names that will come to dominate this space in fact are being born literally as we speak. So, yes, there is - and you would expect to see considerable volatility, and as you mentioned, we have become a home for US companies which have sought to raise growth capital in the Canadian public markets, which is I think a testament not just to what we do, but to the ability of the Canadian public equity markets to raise money for early stage businesses.

But as I say, we’re - you will see a lot of volatility, but at the end of the day, there is real business here. There are going to be substantial revenues associated with not just the recreational use of cannabis, but my own view is that we’re going to see medical applications that probably outstrip the recreational market in terms of absent revenue and profitability potential for the industry.

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