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Connect the World
S. President To Unveil Immigration Plan; Both Sides Present Roadblocks To Nuclear Deal With Iran; Mexican Activists To Hold Protests On Country's National Holiday; Egyptian Group Pledges Allegiance to ISIS; Obstacles to Reaching Iran Nuclear Deal; Iran Talks: Obstacles and Opportunities; Parting Shots: Mexico's Masses Turn on Government; Fast Money; Next Generation of Emirati Racers; Soaring Strategy
Aired November 20, 2014 - 11:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
JOHN KERRY, U.S. SECRETARY OF STATE: We hope that those gaps that exist -- and they do exist -- can be close.
(END VIDEO CLIP)
JONATHAN MANN, HOST: False hope or cautious optimism? We'll know in the next four days whether Iran will agree to a nuclear deal with six world
powers, or at least agree to keep talking.
As U.S. Secretary of State John Kerry rejoins the conversation, we've got the story covered from Washington, Vienna and Tehran.
Also ahead, overrunning the streets on revolution day. Thousands of Mexicans prepare to vent their anger over what they call an epidemic of
corruption.
While millions of people living illegally in the U.S. anticipate a controversial lifeline from President Obama.
ANNOUNCER: Live from CNN Center, this is Connect the World.
MANN: Thanks for joining us.
Arab workers in Israel are being told they're now prohibited from building bomb shelters in daycare centers in one Israeli city.
The move by Askelan's mayor comes two days after a horrific attack on a Jerusalem synagogue that left four rabbis and a police officer dead.
Guards are being posted at other construction sites. The controversial move is drawing criticism from senior Israeli government officials. They
say it discriminates against Israel's Arab citizens.
Atika Shubert has been covered the aftermath of the synagogue attack and joins us now live from Jerusalem.
Atika, we have to start, of course, in Jerusalem. Israel has endured so many attacks, so much violence. Do things get back to normal is that
what's going on now?
ATIKA SHUBERT, CNN INTERNATIONAL CORRESPONDENT: Well, unfortunately this is a city that's quite used to seeing this kind of violence, these attacks,
but having said that the nature of the attacks in the last few weeks has been much more spontaneous and that is the kind of attack that is much
harder to prevent.
So the city is on edge, even though people are trying to get back to normal life, especially in the neighborhood where the attack occurred.
(BEGIN VIDEOTAPE)
SHUBERT: Blood on sacred texts and prayer shawls, this is the image seared in the minds of so many Israelis today.
But at the scene of the attack, a determination to return to prayers and normal life despite a lingering fear that this attack may change this
already bloody conflict for the worse.
DAVID HERSHCOVITZ, HAR NOF RESIDENT: It's a huge shock for us. In a synagogue, predetermined, premeditated slaughters coming in with slaughter
swords like butchers.
We don't feel revenge is something that we need to do. We believe god runs the world and god will do what he needs to do to take care of whoever did
something.
SHUBERT: Religion has always been a key element of this conflict, a fight for holy land, none more so than Jerusalem's Haram al-Sharif for Muslims,
Temple Mount for Jews, sacred to both.
But violent attacks on places of worship has been relatively rare. In the last few weeks, two mosques have set ablaze in arson attacks in the West
Bank, copies of the Koran, Islam's holy book, lett in ashes.
In Har Nof, the neighborhood of the synagogue attack, a nervous tension. Local media reports say one of the attackers worked at a neighborhood
store. Freshly pastered signs now say Jews employ Jews.
After school, children come to Shimon Shores (ph) grocery store just a few meters from the synagogue. He insists that the attackers did not work
here. But three of the victims, he says, did shop here. And he recounts what happened when the young son of one of the rabbis walked in just hours
after the attack.
SHIMON SHOR, GROCER: You couldn't see him in anything -- any sign that his father -- it really, he didn't grasp it. I feel that he didn't grasp what
happened to him, the tragedy.
SHUBERT: Shimon says he let the boy pick his favorite candy and urged him to go home, the only solace he could offer a child unable to fathom the
horror so close to home.
(END VIDEOTAPE)
SHUBERT: Now it's a very different scene in east Jerusalem where we were earlier today. It's quite tense. There's a number of police out there.
They've set up a few road blocks here and there and doing sort of random stop and searches. So, very much still a city on edge, Jonathan.
MANN: Now Prime Minister Netanyahu has promised harsh measures and we have heard the mayor of Ashkelon has his own measures in mind. Is that going to
stick? I mean, what are Israelis saying about that?
SHUBERT: Yeah. I mean there's clearly now a public push to respond in some way. Netanyahu says he will do it with a heavy hand. We've already
seen, for example, the demolishing of the home of a previous attack. And in fact we were in that neighborhood today and we saw riot police up and
down there and very nervous residents as well.
So, it's that feeling that people are bracing for the worst, but so far it's remained calm.
In the meantime, you have places like in Ashkelon, very far from Jerusalem, it's in -- on the Gaza border, where they build shelters for rocket attacks
coming from Gaza. And the mayor there is saying he's not going to allow any Arab employees to actually help build in these because of the attacks
that have been happening in Jerusalem.
Now clearly that's an overreaction and a lot of the politicians here are saying this is frankly a racist sort of statement and policy.
But it's that kind of reaction that is coming out of this attack and unfortunately is likely to continue in the days ahead.
MANN: Atika Shubert live in Jerusalem. Thanks very much.
Whether it's Israel or ISIS, North Korea or Ukraine, these are dangerous times. And right now world leaders are tackling an issues that's
incredibly difficult and yet potentially crucial for helping reduce tensions in the Middle East: it is Iran's nuclear program and the west's
insistence that it be reigned in.
Diplomats from six world powers and their counterparts in Tehran are now just four days away from a self-imposed deadline for reaching an agreement.
They've been meeting in Vienna to try to hammer out a compromise deal that all sides can live with. U.S. Secretary of State John Kerry will be
joining those discussions today. He addressed the media after meeting with French foreign minister Laurent Fabius in Paris.
(BEGIN VIDEO CLIP)
KERRY: With the partnership of France, the United States, Great Britain, Germany, China, Russia has been solid. Even with differences on other
kinds of issues, we are all working in concert on this. And we hope we can define the finish line and get there.
(END VIDEO CLIP)
MANN: CNN's Nic Robertson is watching for signs of a breakthrough in the talks. He joins us now from Vienna.
Nic, what should we read into John Kerry's decision to come to Vienna. Is that sign a deal may be close?
KERRY: Well, it's certainly a sign that he feels it's important for him to be here and add his weight to the process. There have been a number of
bilateral meetings, the Iranians meeting pretty much meeting every delegation so far apart from the Chinese.
Right now we understand a senior U.S. diplomat, William Burns, is now in meeting with the Iranian foreign minister along with Catherine Ashton, the
UN -- the EU coordinator on this particular issue.
So, at the moment the talks, if you will, sort of slowly going up gears and perhaps that's an indication for Secretary Kerry it's time for him to come
here.
But there's still skepticism that there can be a possible deal. We heard from the head of the International Atomic Energy Agency authority that
overseas the current agreements with Iran, he's very skeptical at the moment that the conditions are right. This is what he said.
(BEGIN VIDEO CLIP)
YUKIYA AMANO, IAEA DIRECTOR GENERAL: I called up on Iran to increase its cooperation with the agency and provide timely access to all relevant
information, documentation, sites, material and personnel.
(END VIDEO CLIP)
ROBERTSON: But obviously for a diplomat of Secretary John Kerry's standing and the importance that this deal has for him and for the U.S.
administration at the moment, getting his weight behind the process here while it is still not a done deal by any stretch, clearly an important
issue, John.
MANN: Nic Robertson, in Vienna, thanks very much.
We are exploring the Iranian nuclear talks from a number of angles this evening. Iran's supreme leader will have the final say on any agreement.
But any accord will also have to pass muster with Iranian lawmakers. And CNN's Reza Sayah spoke with some who are wary. The same can be said for
many in the U.S. congress where the politics are just as complex.
We'll have more on the view from Washington as well as some expert analysis from Reza Mirashi (ph) of the National Iranian-American Council.
And while the obstacles are enormous, the same might be said for the payoff if a deal can be reached on Iran's nuclear program. Our John Defterios
will join us with some perspective on the opportunities that could open up if a deal gets done.
U.S. Secretary of State Kerry visited Israel and the Palestinian territories seven times last year. This year, just three times. The Iran
talks, taking place in Austria, appear to have taken precedence.
The U.S. capital has been a house divided on most issues these days. And this one offers another source of disagreement. Come January, Republicans
will control both the House of Representatives and the Senate and some have promised new sanctions against Iran unless an agreement is reached on its
nuclear program this week.
That could put even more pressure on Kerry and President Obama who is looking for a significant foreign policy achievement as his presidency
winds down.
CNN White House correspondent Michelle Kosinski is with us now with more from Washington.
Let me ask you, is an Iran deal going to bolster this administration if it can reach a deal? Or is it just going to set up another battle with the
Republicans in congress do you think?
MICHELLE KOSINSKI, CNN CORRESPONDENT: Well, this would be huge. I mean, this is something that the U.s. has been working on for such a long time.
The disappointment after it failed, working with other countries, even unexpected allies where we disagreed in other ways, but agree on this. So,
of course this would be something of a jewel in the crown, or a crowning glory.
And then you look at the other foreign policy issues that have come up that have been far more touchy and you know are being worked on, but are either
at a severe impasse or it's going to take a long time.
I mean, the U.S. didn't even expect some of these to take such a long time when you're looking at things like the TTIP trade deal, or the TPP, the
Asian trade deal, really held up. Those would be big for foreign policy as well.
But then you look at the other things that Americans have really been concerned about. If the U.S. were to put a significant dent early in ISIS
for example, or bring the Palestinians and Israelis to the table and forge that. Well, that, took, looks like it's not going to happen.
So, now that we're on the brink of possibly achieving this -- and the White House says that the Iranians have been truly ready and willing to negotiate
here -- you know, people are looking at this very closely as a real possibility, however the White House may be tempering that to some extent
has said repeatedly, too, that they would have rather have no deal than a bad deal -- John.
MANN: We're waiting to see. We're also waiting for something a little closer. In about nine hours from now, the president is going to address
the nation to explain what he plans to do unilaterally on immigration reform. Let me ask you about that without getting into the fine points of
the reform we're expecting.
Is he just planning to govern without the congress for the rest of his presidency? Because clearly congress is not being invited to have its say
tonight.
KOSINSKI: Yeah, it's really interesting from a legal standpoint too. I mean, that's been debated heavily.
And we were just talking about Iran. I mean it seems like America isn't even really paying attention to these negotiations over Iran, because the
focus has been so much on this immigration deal.
So, the president says that they have looked at -- he ordered a comprehensive review of what could be done under the law. And they say,
the White House if feels confident that this has a strong legal foundation.
And we asked the question, well, if congress then takes other votes, for example to defund this so that the executive action on immigration can't
even really work. Is what the president is planning on doing, is it defund proof? Does it have sort of built in safeguards that make it able to stand
up to those kinds of attempts in congress as well.
They wouldn't really say. They don't want to get into the details. Some have leaked out. So we already know some of the parameters.
But basically the legal justification that we expect the White House to take is that the president can allocate resources that exist and, you know,
can change priorities.
What Republicans are saying is that he's not upholding the laws on immigration that exists, that he would basically say we're not going to
enforce immigration, namely deportation, for certain groups. And Republicans argue that that is the law and under the constitution the
president does have to take care, is the wording, that the laws of the land are in force.
So, really, it's a question of how that law is interpreted. And we see that fiercely divided as are many other things surrounding this, John.
MANN: It's a very shaky basis for a reform that's going to affect millions of people. But we'll be watching tonight. Michelle Kosinski, thanks very
much.
CNN will have live coverage followed by analysis of Mr. Obama's immigration speech. That starts at 1:00 a.m. in London, 5:00 a.m. in Abu Dhabi right
here on CNN.
Still to come, instead of a traditional parade, Mexico City is bracing for protests to mark its Revolution Day. We'll tell you what's at the center
of the unrest.
Also ahead, a militant group in Egypt pledges allegiance to ISIS and carries out ISIS style terror in the Sinai. Detailed report coming up.
(COMMERCIAL BREAK)
MANN: You're watching CNN. This is Connect the World. I'm Jonathan Mann sitting in for B Becky Anderson Welcome back.
The U.S. coordinator of the coalition against ISIS says the militant group is effectively committing suicide in the northern Syrian city of Kobani.
Retired General John Allen told a Turkish newspaper that an estimated 600 ISIS fighters have been killed in air strikes so far, but they still
continue to send in more reinforcements. Allen says they would rather die than retreat.
Earlier this week, we featured a report on the influence of ISIS in Libya. It's all part of how the extremist group is spreading its message of terror
beyond Syria and Iraq. Ian Lee has details of another militant group joining with ISIS in the Sinai.
(BEGIN VIDEOTAPE)
IAN LEE, CNN CORRESPONDENT: A demonstration of power by ISIS aligned militants in Egypt's northern Sinai. This video posted on social media
shows Ansar Betl Maqtas (ph), or ABM's, attacks growing more sophisticated, highlighting firefights with security forces, drive by shootings and
suicide bombings.
ABM has slaughtered hundreds of police officers and soldiers since 2013. One of their more recent and brazen attacks killed at least 30 soldiers.
In the aftermath, militants looted weapons and killed survivors.
Among the dead, an ABM militant proclaims, "tell the leader of ISIS al- Baghdadi the leader of the faithful that you are coming here and we are your soldiers," an ominous warning fresh off ABM's pledge of allegiance to
ISIS in which they change their name to the State of Sinai.
H.A. Hellyer monitors the group's activities.
H.A. HELLYER, CENTRE FOR MIDDLE EAST POLICY, BROOKINGS INSTITUTION: First thing is that any Egyptians who are currently fighting with ISIS and DASH
(ph) in Syria or Iraq now have a second arena that they can go and fight in without actually leaving the group. And they will add that expertise, they
will add that training to the capacity of ABM, of Ansar Betl Maqtas (ph) within Sinai.
LEE: ABM justifies their attacks, pointing to government abuses like this video, which allegedly shows Egyptian soldiers torturing two Sinai
Bedouins.
Showing off captured weapons, ABM's presumed leader, his face hidden by the group, warns we told you before the war hasn't started yet. And what's
coming is worse and bitter. This is only the beginning. You opened a door you won't be able to close.
Even Cairo hasn't been spared ABM's reach.
But despite the brutality, until now they've almost exclusively targeted the government.
And yet another video, ABM allegedly beheads these civilians they accused of spying for Israel.
In a war conducted over social media, Egypt's military fired back, releasing a video that shows troops armed and ready along with successful
Sinai operations.
Egyptian President Abdel Fattah el-Sisi supports the global war against ISIS. And at home, he remains resolute saying, "they assume that we are
incapable of confronting them. They started the fire. We were very careful that no blood is shed. But unfortunately they wanted the exact
opposite."
President Sisi pledges to defeat the Sinai militants. ABM has a pledge, too, to eliminate borders, passports, visas and to expand their corner of
ISIS caliphate beyond Sinai.
(END VIDEOTAPE)
MANN: And Ian Lee joins us now live from Cairo.
Ian, after the turmoil of the Arab Spring and the crackdown by the military, people are going to be watching those images and thinking that
Egypt is still too dangerous to venture into. The tourism industry was hoping, the entire economy was hoping for something of a rebound. What
would you tell people watching trying to figure out what's happening in Egypt?
LEE: Well, Jonathan, until now Ansar Betl Maqdas (ph) has almost exclusively targeted the government and there's nothing to indicate that
they're going to change the way they operate. They even have said that they have changed the way attacking in the morning to minimize any sort of
civilian casualties. So til now, it just seems unlikely that they're going to go after any sort of civilian or tourist sites, although I talked to one
analyst who says that if they become desperate that they might then turn to going after these targets. But he says he doesn't see that in the near
future, Jonathan.
MANN: Ian Lee live in Cairo, thanks very much.
A programming note, CNN's Ivan Watson brings us the story of how ISIS was formed as well as the motivation behind its brutality. That ISIS: New Face
of Terror 8:30 p.m. Friday if you're watching from the United Arab Emirates only on CNN.
This is Connect the World. Coming up, western sanctions on Iran have been punishing and many lawmakers there insist they be abolished as part of any
nuclear agreement in Vienna. Our Reza Sayah spoke with members of Iran's parliament about their reluctance to get behind a dael with the west.
Plus, Mexico's annual Revolution Day will bring thousands to the streets of Mexico City, but not all of them are celebrating the anniversary. We'll
take you there live.
(COMMERCIAL BREAK)
MANN: You're watching Connect the World. Welcome back. I'm Jonathan Mann sitting in for Becky Anderson.
In Mexico, a public holiday to celebrate the anniversary of the revolution is turning into a day of protest. The traditional Revolution Day parade
will not be held in the heart of Mexico City. Instead, plans for a massive anti-corruption protest fueled by outrage over the disappearance of 43
college students and other scandals hinging on corruption.
Shasta Darlington joins us now live from Mexico City.
This is a day that isn't really a national holiday anymore, it's taken on an outsized importance to a lot of opponents of the government. What's
going on around you?
SHASTA DARLINGTON, CNN INTERNATIONAL CORRESPONDENT: That's right, Jonathan.
You know, what you should be seeing right behind me is that parade. It was canceled at the very last minute. The barricades were taken down at
midnight last night. And that's because they were worried that there would be clashes with protesters who are already gathering across the city.
There are busloads of people coming in from other towns and from other states. And this is going to be a protest against political corruption,
but really focused on the disappearance of 43 college students in a case that shocked the nation accustomed to a certain level of violence.
A lot of people presume those 43 students are dead and that's because they disappeared at the end of September after a clash with police. Authorities
now think the police handed them over to a drug cartel on the order of a local mayor, that the cartel killed them and burned their bodies.
This is just shocking. And it's really angered a lot of people.
So what a lot of the relatives have done, they don't believe that story. They say they want proof of what happened to their loved ones. So they've
organized these marches. They've been going all across the country trying to galvanize people. And they're expected to march from three different
locations in the city, converge right here at this main square, the Zotolo (ph) later today. They'll be demanding a thorough investigation, but also
demanding solutions to the corruption, the impunity, the state of lawlessness that clearly reigned free here in Mexico, Jonathan.
MANN: Shasta Darlington in Mexico City, thanks very much.
The latest world news headlines just ahead. Plus, the human faces of a country's shared pain. A Mexican photographer gives us his take on why the
case of those 43 missing students has united so many people there in protest
Parting shots in just over 10 minutes time.
(COMMERCIAL BREAK)
MANN: Welcome back. This is Connect the World. I'm Jonathan Mann in for Becky Anderson with the top stories this hour.
Campus police at Florida State University have killed a gunman after he shot and wounded three students. The gunman opened fire at the campus
library, which was filled with students preparing for their exams. Two of the wounded are hospitalized. The third was treated at the scene and
released.
The early snow storms in the northeastern U.S. show little sign of slowing. An additional one meter of snow is expected to fall on the city of Buffalo
Thursday. It is already buried under two meters, that would be three in all. If he forecast holds, it would pass the city's yearly snow average in
just three days.
Eight people have been killed as a result of all that snow.
The UN's top nuclear watchdog said Iran is continuing to deny the International Atomic Energy Agency access to a sensitive military complex.
The facility is suspected of being a site for nuclear activity. That word as world leaders meet in Vienna over Iran's nuclear future, facing a Monday
deadline for a deal. U.S. Secretary of State John Kerry said Thursday that the U.S. would not accept just any agreement with Iran.
The outcome of those talks in Vienna will depend a great deal on the political will in Tehran and Washington, that's because both U.S. and
Iranian leaders face key domestic hurdles to signing a deal. Reza Sayah reports now from the Iranian capital Tehran.
(BEGIN VIDEOTAPE)
SAYAH (voice-over): Inside Iran's parliament, under the gaze of the Supreme Leader, sit what may be key obstacles to a nuclear agreement
between Iran and the world powers. Dozens of hardline Iranian lawmakers who don't trust Washington and don't want to give an inch.
"We don't trust them," says lawmaker Mohammad Ali Bozorgvari. "We have no trust for the West, especially the Americans and the British."
"We trusted them in the past and we paid a heavy price," says lawmaker Mo'ayed Hosseini Sadr. "We're only after the interests of our country."
For the past year, ever since the administration of moderate president Hassan Rouhani started negotiating with the West, some hardliners have
criticized him, suggesting he's appeasing the enemy and compromising Iran's interests.
In a statement this month, lawmakers warned Rouhani's negotiating team not to sign a deal that crosses Iran's red lines, which include keeping intact
Iran's nuclear program and accepting nothing less than the lifting of all Western sanctions.
"We expect the sanctions imposed by Europe and America to be lifted right away," says lawmaker Ismail Jalili.
"We can't back down more than this," says Bozorgvari. "We give the West even one inch, they'll take ten."
"Even though we want peace and good relations with the world, rest assured, we're not willing to do it at any price," says Hosseini Sadr.
SAYAH (on camera): What's remarkable is how warnings by hardliners here in Iran mirror those in Washington, where a Republican-led Congress is warning
US president Barack Obama against a bad deal. The warnings drive home the political tensions surrounding the talks in both capitals.
SAYAH (voice-over): In Washington, analysts say Republicans in Congress don't want Obama to score what could be seen as a foreign policy victory
with an agreement. In Tehran, it's hardliners who see a nuclear deal by moderate president Rouhani as a potential blow to their political
aspirations and a threat to Iran's 35-year-old anti-American establishment.
"Some of them are playing politics," says Bozorgvari, "but I think the West wants an agreement. So do we. But only if it's fair."
SAYAH (on camera): If there is an agreement in Vienna, it won't be finalized without Parliament's approval here in Iran. So technically,
hardliners could scuttle an agreement. But it's widely believed that here in the Iran, the final say rests with the Supreme Leader, and if he
approves, it's very unlikely Parliament will complain.
Reza Sayah, CNN, Tehran.
(END VIDEOTAPE)
MANN: But will domestic pressures in Tehran and Washington scuttle an opportunity for Iran and the US to reset their ties, or will the two sides
reach a deal that can help open up Iran's untapped economic potential?
From Vienna, we're joined by Reza Marashi from the National Iranian- American Council and a regular guest on CONNECT THE WORLD, and from Abu Dhabi by CNN's emerging markets editor, John Defterios. Gentlemen, thank
you both for being with us.
Reza Marashi, let me ask you the most important question. Do you think there's going to be a deal? Or do you think there's just too much
suspicion on the two sides?
REZA MARASHI, NATIONAL IRANIAN-AMERICAN COUNCIL: Well, the suspicion is very real, but that is not an insurmountable obstacle. The amount of
progress that they've made over the past year since the interim nuclear deal was signed is historic and unprecedented.
There are some outstanding issues that remain. The hurdles that they need to get over, if you will. But it's well within the realm of possibility.
Right now, what it comes down to is not finding the solutions. The solutions are in front of them and known. It's about absorbing and selling
compromise. Political leaders have to make painful concessions, and I think they're almost there.
MANN: Well, let me ask John Defterios about the gains, because obviously, Iran would gain an enormous amount if sanctions were to be lifted. Would
the other parties gain anything? Reza Marashi's group suggests that the US alone would make billions of dollars from an end to sanctions.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Well, in fact, Jonathan, Iran's one of the more promising economies around the world right now. Jim
O'Neill of Goldman Sachs has put it in his basket of the next 11 most promising developing countries around the world.
But that potential has not been realized. But unlike a Myanmar or Zimbabwe, we're not starting from scratch here in Iran. They have a very
strong industrial sector that the outside world hasn't focused on. For example, it's the 15th-largest fuel producer in the world and consumes more
steel than France, which is a G8 country, as you know.
It is also an industrial player when it comes to other products, including oil and gas. And this is where the real potential is for the US and
European companies who are looking at the numbers.
This is a country that has a 157 billion barrels of reserves, Jonathan. That puts it number two in the Middle East, just behind Saudi Arabia, about
9 percent of proven reserves. Even more promising when it comes to natural gas: 33 trillion cubic-meters, and that means about 18 percent of global
reserves. That puts it ahead of Russia and Qatar.
But the reality is, though, these are sectors that are starving for investment. They're not starting from scratch in the industrial sector,
like steel, or in the auto sector. But oil and gas has been shut out for the last 15 years. And particularly painful over the last five, when the
US Treasury and the Europeans had shut down the ability for Iran to trade in dollars.
We're not going to see the light switch go on here and the sanctions lifted overnight. But the US and European companies see a lot of promise.
I remember back in Davos when I was at the World Economic Forum, President Rouhani met with about seven energy companies, the chief executives and
said, look, here's the potential -- one, you come on my side, lobby on our behalf so we can open up this economy again.
I think it's worth also noting, Jonathan, this is a far cry where we were 18 months ago, when we had a rial drop 80 percent, had hyper inflation, and
we also had food shortages in Iran. The conversation has changed dramatically in the last 18 months.
MANN: That may be so, but Reza Marashi, I'm wondering, can Iran afford the status quo? Everyone in Tehran keeps saying that Iran will not be forced
into a deal, but when you think about unemployment, when you think about inflation, when you think about the unrest, when you think about the
exchange rate John Defterios just mentioned, can Iran afford to say no?
MARASHI: Iran can muddle through, but that's far from the most attractive option. At the end of the day, Iranians know better than anyone else just
how serious and how harmful that past couple of years have been politically, economically, and socially.
That's one of the biggest reasons why they're here negotiating, trying to solve this problem once and for all.
That being said, it's not as though the P5 plus 1 countries will have a cakewalk if the diplomatic process does not succeed, because the options
available to them should diplomacy fail are very dangerous and very unattractive.
So, it's really sharpened the focus of both sides to try and make unprecedented compromises to solve this issue once and for all and shift
more permanently to a peaceful track that solved conflict, really, across the region.
MANN: If they do -- let's assume for the moment they succeed -- John Defterios, you alluded to this a moment ago. Is money going to start
suddenly pouring into Tehran, especially if, as it looks, the deal involves only a gradual end to sanctions?
DEFTERIOS: I think there's a couple of tiers that get through here, Jonathan. Number one, the European sanctions here are temporary by nature.
They can come off rather quickly.
The US sanctions are written into law. We have a dozen on the law books. Even if you had the most friendly Congress in place right now, there's
going to be a lot of confrontation between the White House and the Republican-controlled both houses, both chambers coming coming into January
2015.
That will not happen overnight. So, the climate has to change in terms of the dialogue with Iran right now. But again, this is a market of 80
million consumers, a very highly-educated population. It ranks very high on the developing growth market potential. But we have these hurdles to
get across right now.
And many believe, look, we'll get to the P5 plus 1. If we get an agreement, is it going to be an agreement that can move quickly to allow
investment to come in. The answer is probably not so.
But it could transform the Middle East. Think about relations where you don't have a Sunni-Shia divide in the broader Middle East and North Africa,
and you could have potentially Saudi Arabia and Iran working in the same direction. We don't have that right now. It could be a profound change if
we come across with a win-win in Vienna late on Monday.
MANN: OK, let me give the last word to Reza Marashi, which is, it doesn't look like there's going to be deal right now. There may be a breakthrough.
What seems just as likely is that there's going to be an extension.
So, let me ask you, is time anyone's friends? If the don't get a deal in the next few days, will another few weeks or another few months help, or is
just going to make things harder, do you think?
MARASHI: Well, it depends on how they leave things on the 24th. If they announce a framework of a deal and say that they need another month or two
to dot the Is and cross the Ts, if you will, that's essentially what they did in Geneva when they signed the interim deal. That's a success.
But if they extend the talks for the sake of more negotiations, that's fraught with political risk, both in Tehran and in Washington, and arguably
the other P5 plus 1 capitals as well. And it's really unnecessary, because the technical solutions are known to both sides now. All that remains is
the ability of political leaders to taker risks for peace and take yes for an answer.
They need to get there now, so they have enough leg time to sell the deal to the skeptics across the world. I think they can get there, but time
will tell.
MANN: The deadline is just days away. Reza Marashi of National Iranian- American Council, and our own John Defterios, emerging markets editor. Thank you both for being with us.
In tonight's Parting Shots, we take you back to Mexico, where a national holiday looks likely to become a nationwide day of protest against the
government. The abduction of 43 students was the sparked that set long- smoldering frustration flaring across the country.
That's what today's featured photographer, Carlos Cazalis told us. Listen to his take on the turmoil that's gripping parts of his nation.
(BEGIN VIDEOTAPE)
CARLOS CAZALIS, MEXICAN PHOTOGRAPHER: People have identified with who these students are. Because they come from a low spectrum of the social
class, and they're students who are to become teachers.
I think in some respects that this is -- the students have become sort of the last straw in what many have seen as an endless series of not only
disappearances, but violent disappearances.
And the fact that it's from the very start we've know or we've seen that the state has been involved directly with the disappearance, has really
just sparked endless frustration, and for people to come out and express their indignation with the whole affair.
The younger generation today, because of the access, possibly, that they have to information and to the historical corruption that we've seen
throughout the country, has finally looked into their future and seen that if they don't do something about this, then their future and the future of
their children is going to be, of course, encroached every time smaller and smaller, especially economically.
So, I think they're looking out, and because they're young, they have the enthusiasm, the force, the strength, to come out and fight for something
that they really believe in, which is, of course, their country.
When we were listening to relatives speak out for their missing children, some of them completely aware that their children are alive, or feeling
that they are alive. Just listening to their words that are so full of frustration, anger, sadness.
I remember particularly hearing one of the brothers of the disappeared screaming out in front of the National Palace directly and swearing at the
president and demanding his resignation.
That -- there is just something that just comes down to you and goes all the way to the pit of your stomach that makes you realize that this is
something that we finally need to draw a line at at some point. And hopefully -- it will take a while, but hopefully we will reach that point.
(END VIDEOTAPE)
MANN: A new security breach in the UK has targeted people where they usually feel safest: right at home. Britain's privacy watchdog warns a
Russian website has been hacking into people's webcams. That includes their close-circuit cameras and even baby monitors. What's worse: the
footage is being streamed live online.
Coming up: cyber security and how you can keep from becoming a victim. "The International Desk" with Robyn Curnow, we'll have that starting in 15
minutes' time.
I'm Jonathan Mann, you've been watching CONNECT THE WORLD, thanks for joining us. MARKETPLACE MIDDLE EAST with John Defterios is next.
(COMMERCIAL BREAK)
DEFTERIOS: This week on MARKETPLACE MIDDLE EAST, fast cars, big money. How a half decade of Formula 1 in Abu Dhabi is fueling investment.
Plus, a soaring strategy to boost business. We speak to the chief executive of Boeing about their regional expansion plans.
Welcome to MARKETPLACE MIDDLE EAST. Now in its fifth season, the F1 circuit has helped put the UAE capital on the global map, with thousands of
fans flocking to this circuit each and every year. It has been a nail- biting season. But long-term, are the financial results as exhilarating? Amir Daftari takes a look.
(BEGIN VIDEOTAPE)
AMIR DAFTARI, CNN INTERNATIONAL CORRESPONDENT (voice-over): As capital cities go, Abu Dhabi can be pretty muted. But once a year, the volume gets
turned way up.
(FORMULA 1 ENGINES RACING)
DAFTARI: Concerts. Parties. Fandoms. All doing their very best to draw in as many paying customers as possible. Little wonder, then, that major
companies want to associate themselves with an international brand that's worth around $10 billion.
PETER BAUMGARTNER, CHIEF COMMERCIAL OFFICER, ETIHAD AIRWAYS: Formula 1 is certainly on the global stage. Can give you overnight fame when you
activate it correctly, as Abu Dhabi had done so brilliantly with the race, and thus being associated with that fantastic race.
DAFTARI: Etihad Airways has been the main sponsor of the Abu Dhabi Grand Prix since its first race five years ago. As well as offering companies
exposure to a global audience of millions, the Grand Prix is also a hive for networking. David Sanderson is in the business of helping companies
build relationships around the F1.
DAVID SANDERSON, REGIONAL DIRECTOR, FAST TRACK MIDDLE EAST: What these businesses are looking to do is to engage with partners, both ones that
they're currently doing business with, and ones that they are looking to do business with over a weekend where they can showcase what Abu Dhabi has to
offer.
DAFTARI: And that's what it really comes down to, positioning Abu Dhabi as the biggest brand of all, something it has struggled to do in the shadow of
its northern neighbor.
AL TAREQ AL AMERI, CEO, YAS MARINA CIRCUIT: We are very pleased so far with F1 events and the value that brings to Abu Dhabi, and we hope to
continue that into the future.
DAFTARI: And bringing value to Abu Dhabi means bringing value to sports fans, concertgoers, and business leaders alike.
(END VIDEOTAPE)
DEFTERIOS: As Amir explained, having the F1 racing circuit here has broadened the range of investment into Abu Dhabi, but there's a lesser-
known impact on the UAE capital, and that is breeding the next generation of Emirati racers. Let's take a look.
(BEGIN VIDEOTAPE)
(CHILDREN TALKING)
DEFTERIOS (voice-over): In the classroom, Rashid al Dhaheri is like any of his fellow students.
RASHID AL DHAHERI, CHILD RACE DRIVER: I -- want -- two -- GO-karts.
DEFTERIOS: But upon closer inspection, it's clear, even with his schoolwork, that he is wild about Formula 1 racing.
R. AL DHAHERI: Driving -- until -- I -- got -- tired.
(GO-KART ENGINE RACING)
R. AL DHAHERI: Hello, my name is Rashid al Dhaheri. I'm six years old, and I look forward to be an F1 driver.
DEFTERIOS: This compact UAE national spends all his waking hours on a mission to be behind the wheel.
(GO-KART ENGINE RACING)
DEFTERIOS (on camera): So, what are your three favorite things about a race car?
R. AL DHAHERI: How fast it goes, how technical is it, and how -- the sound of the gears.
DEFTERIOS (voice-over): Rashid's father, an oil and gas executive, said his son just adores engines.
ALI AL DHAHERI, RASHID'S FATHER: Sometimes when we drive our car, we are going into a tunnel, he just says, "Put, Daddy, the window, OK?" And "I
just want to hear the engine inside the tunnel."
(LAUGHTER)
DEFTERIOS (on camera): Rashid got the F1 bug very early in life. He saw his first race in 2011 when he was just three years old. After visiting
the pit stop, he asked his father and his mother if he could be an F1 driver.
DEFTERIOS (voice-over): It was on that day Rashid met his idol, Ferrari's Fernando Alonso. Around the Al Forsan track, the GO-kart driver is known
as Little Alonso, sporting his idol's helmet. Paul Chatenay has been coaching him since he was five.
DEFTERIOS (on camera): You see a child on the outside, but what happens to him when he goes into the car?
PAUL CHATENAY, RASHID'S MANAGER: For me, when he comes into his GO-kart, he just focuses on his line, knows exactly what he has to do, and switches
off from each and every outside element.
DEFTERIOS (voice-over): Rashid is advancing quickly, graduating to a 60 cc engine after his first year, a category where he has to stay until he's 12.
(GO-KART ENGINE RACING)
DEFTERIOS: He scored four wins during the six-month Italian karting season.
R. AL DHAHERI: I like Italy because there's more people and it's a big crowd. And it's more competitive. In Abu Dhabi, it's like nothing.
(GO-KART ENGINE RACING)
DEFTERIOS: The young talent is backed by five UAE sponsors, and his father tells me he was already approached by a racing team to sign Little Alonso.
Al Dhaheri said he and his spouse are determined to have Rashid enjoy a normal childhood. And they of course share real concerns for his safety,
but they have a lot of trust in their little racer.
A. AL DHAHERI: It's very important to strike a balance, and we as parents, we never pushed Rashid into it. I have to say, he's also not a big risk-
taker. He's a very careful, very gentle with his driving.
(GO-KART ENGINE RACING)
DEFTERIOS: It did not feel that way when he raced yours truly around the track.
(GO-KART ENGINE RACING)
DEFTERIOS: After a gingerly start, he left me in the dust.
(GO-KART ENGINE RACING)
DEFTERIOS (on camera): Nice job.
DEFTERIOS (voice-over): More than a half minute later, I roll in.
DEFTERIOS (on camera): Beaten by a six-year-old.
DEFTERIOS (voice-over): Beaten badly by this energetic but kind six-year- old.
R. AL DHAHERI: One more time?
(END VIDEOTAPE)
DEFTERIOS: A look, there, at Abu Dhabi's future racer. Well, this is a region that's made its name through airport connections. When we come
back, I speak to the chairman and chief executive of Boeing on how to make money in a region that is growing but remains very volatile.
(COMMERCIAL BREAK)
DEFTERIOS: Welcome back to MARKETPLACE MIDDLE EAST. This F1 circuit has been part of a massive five-year build-out here in Abu Dhabi, which
continues. By mid-2017, Abu Dhabi will have a new midterm terminal at a cost of nearly $3 billion, the home of Etihad Airways.
It's another reason why Boeing remains very bullish on the region. Orders of nearly 3,000 planes over the next two decades. Here's our interview
with the chairman and chief executive of the aircraft maker.
(BEGIN VIDEOTAPE)
JIM MCNERNEY, CEO AND CHAIRMAN, BOEING: The Emirates growth -- Emirates broadly speaking, the geographic area -- has been an incredible driver of
growth, and the business model is all about becoming the Hong Kong of this century.
DEFTERIOS: It's interesting, if you look at the passenger growth of the airlines, it's more than double -- in some cases, much more than that, in
the Gulf states. Do you see, for example, the drop in oil prices dislocating this growth that we've seen, particularly in the last five
years?
MCNERNEY: I don't think so. I think the band of expectation on oil prices -- it depends upon who you talk to -- could be $40 up to $120. I don't
think that dramatically changes the requirement for new, more fuel- efficient airplanes that we're seeing right now, particularly in this part of the country.
DEFTERIOS: Is it your assumption now, though, that you've been able to break this link between GDP growth and actual orders for Boeing as a result
of this?
MCNERNEY: Yes. I think if you look at our order book, close to 50 percent is riding with GDP growth, and the other 50 percent is replacement,
obsolescence, because new technology is that much better than the technology it replaces at virtually any contemplatable oil price. So, it's
-- it's a big driver of our growth.
DEFTERIOS: I looked at your recent study that was suggesting that you're looking at almost 3,000 plane orders over the next 20 years, about a half a
trillion dollars. Does that factor in the geopolitics, the dislocation we've seen as a result of the Arab Spring?
MCNERNEY: Part of the answer is, a lot of the turmoil is in the lower growth parts of this region, and therefore not really impacting the parts
around it that are the high-growth parts, like right here, and in Saudi and some other places.
DEFTERIOS: In fact, for the first time in 35 years, Boeing has sent some parts -- limited parts, with the agreement of the US government -- to Iran.
This is a huge market. Can you factor in normalization within 12 to 24 months?
MCNERNEY: Well, it's -- I realize there's a lot of forces moving in the right direction. I think we're all hopeful that it does get resolved, that
you're right, that we can have a normal economic relationship with a that country.
It would add to growth. It would add to growth. If Iran became a totally normal relationship where an otherwise very productive with a big
population, there's a lot of airplanes and aerospace services to be sold there, and could put some upward pressure on that number that we mentioned.
DEFTERIOS: You've had a reputation as an innovator, but there was an internal conversation about being a little bit more like Apple in the
approach for Boeing in terms of constant innovation and not big bang -- not a big product, a big airplane.
MCNERNEY: Yes.
DEFTERIOS: What do you mean by that?
MCNERNEY: Well, it's -- what I meant by that was we have a history of sort of hoarding technologies and then every ten years or so, introducing a new
model that has all these accumulated technologies plus some new one's we're thinking of at the time into a dramatic leap.
My view is that that's a riskier approach than is spiraling into existing platforms, extending existing platforms by spiraling in new technologies as
they occur. And so, I'm trying to change the headset a little bit at Boeing.
(END VIDEOTAPE)
DEFTERIOS: Boeing's chairman and chief executive during his visit here to Yas Marina in Abu Dhabi. And that's all for this edition of CNN
MARKETPLACE MIDDLE EAST. I'm John Defterios, thanks for watching. We'll see you next week.
(COMMERCIAL BREAK)
END
