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Chinese Stocks Close Down After Government Programs End; U.S. President Visits Ethiopia; U.S. Releases 2014 Trafficking in Persons Report; Despite Fall in Price, UAE Still Gold Obsessed; Turkey Calls Emergency NATO Meeting. Aired 11a-12p ET

Aired July 27, 2015 - 11:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[11:00:57] GEORGE HOWELL, CNN GUEST HOST: Standing up for the victims of modern-day slavery, the U.S. moments ago releasing its latest report on

human trafficking. Coming up, we'll look at what Washington says must be done in the fight against modern-day slavery.

Also ahead, greeted with fanfare, but is the U.S. President Barack Obama out of step with his hosts in Ethiopia? We take a look at that question.

(BEGIN VIDEO CLIP)

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(END VIDEO CLIP)

HOWELL: We look at gold fever in the UAE as prices plummet worldwide.

ANNOUNCER: Live from CNN Center, this is Connect the World.

HOWELL: Good day to you and welcome. We begin this hour in Ethiopia, which is getting its first ever visit from a U.S. president. It is the

second and final stop on Barack Obama's trip to a section of Africa where concerns about terror groups are enormously high.

The issues of human rights and good governance were also part of his talks with the prime minister there, Hailemariam Desalegn.

But security efforts could dominate the agenda, that's because Ethiopian forces are playing a vital role there in weakening al Shabaab militants who

have been terrorizing that region now for more than a decade.

Mr. Obama talked about this historic trip. Listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I'm proud to be the first U.S. president to visit Ethiopia, and tomorrow the first U.S. president to

address the African Union. So my visit reflects the importance the United States places on our relationship with Ethiopia and all the nations and

peoples of Africa.

(END VIDEO CLIP)

HOWELL: For more on this, let's turn to our CNN correspondent Michelle Kosinski traveling with the president and now joins live from the Ethiopian

capital.

Michelle, good to have you with us.

So, you know, the president has been criticized for visiting Ethiopia. Those who argue that he is legitimizing this -- what many call an

oppressive government. But he didn't not shy away, though, from talking about touchy subjects like the need for political openness and the curbing

of the crackdown on freedom of press.

MICHELLE KOSINSKI, CNN CORRESPONDENT: Yeah, he didn't go so far as he did when he was in Kenya. Remember, bringing up gay rights issues, which was

an extremely controversial subject there. So, it didn't go to that extent.

But, yeah, the White House has faced a lot of questions about the visit to Kenya and to Ethiopia. I mean, when you look at Ethiopia, just this year

their parliamentary elections, the ruling party claimed a 100 percent victory. One organization has ranked Ethiopia as the second worst jailer

of journalists. So, those questions are going to continue to come up.

What President Obama said was, yes, there are differences of opinion there. But engagement is what the U.S. government tries to do. Even when you look

at other countries that the U.S. has disagreements with on human rights, China was mentioned. Engagement is at least a starting point. And

supporting democracy in these countries so that human rights can evolve within and that the U.S. can use that kind of diplomatic pressure from

without.

And President Obama said that while there is more work to do, there are certain values that must be upheld.

So, he did issue something of a strong statement there.

I think it was even more interesting, though, to hear what Prime Minister Desalegn said, almost making excuses in some ways, saying, well, you know,

this country is coming out of centuries without democracy. There have only been a few decades of democracy. And it's hard work.

You can look at that and say, well, a couple of decades is sort of a long time. And more progress could have been made.

But he did seem to be acknowledging that, yes, there is room for progress there.

And on the issue of the jailed journalists, I mean, he was asked that question directly. And Desalegn said, well, we need journalists. They're

very important. But, we need civilized journalists and we need them to conduct themselves accordingly.

So, it's hard to know exactly what he meant by that.

But, in a way, he seemed to be saying that journalists are great as long as I agree with what they're saying.

So, obviously, there are some differences of opinion, and strong ones, between the U.S. and Ethiopia here. But what they agree to do was to work

together, and of course that's what these visits are all about, George.

[11:05:25] HOWELL: Civilized journalists. You know, sometimes journalists ask those questions that, you know, they just don't want to have asked.

But that is the job.

The other question, when it comes to the fight against terror groups like al Shabaab, that was certainly on the president's agenda, but also concerns

about South Sudan and the crisis there.

KOSINSKI: Yeah, definitely.

I mean, what the president said on al Shabaab was that the U.S. has been involved for a long time, and would continue to stand with Ethiopia.

Similar to what he said with Kenya. You know, that the U.S. stands shoulder to shoulder in that fight against terror and acknowledging that it

is a very difficult fight for these countries.

But at the same time he said that U.S. marines don't have to come in here and conduct that fight themselves, that there's no need for U.S. boots on

the ground, as Washington likes to term them. In fact, he complimented Ethiopia's army saying that it's one of the most effective on the

continent, that they are an effective partner in fighting terror. And again the U.S. is partnering with them on that, continuing and trying to

expand that, especially in intelligence sharing and trying to prevent these attacks.

I mean, this comes one day from the terrible al Shabaab attack just across the border in Somalia -- George.

HOWELL: Reporting live from Addis Ababa, our CNN correspondent Michelle Kosinski. Michelle traveling with the president. Thank you.

A senior U.S. official tells CNN there is no agreement with Turkey to establish a formal no-fly zone in the country. But, the official also says

Turkey has granted the U.S. access to its air bases in the push against ISIS. According to the official, it has nearly the same effect as a no-fly

zone.

Let's turn now to our Pentagon correspondent Barbara Starr who is following these developments there. Barbara, good to have you with us.

So, let's first talk about Turkey allowing U.S. forces to use its airbases. How significant is that in the fight against ISIS?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, it's very significant because it puts U.S. warplanes much closer to those ISIS targets in

northern Syria and Iraq than where they had been striking from hundreds of miles away in the Persian Gulf. So this is step number one.

But by putting the warplanes there, what officials are saying is it essentially begins to establish, if you will, a safe zone on the ground

from ISIS. If war planes are overhead, the hope is that they can keep ISIS out of there on the ground.

Now an official no-fly zone, that would be a very specific military operation, but the U.S. hopes that they can now use all of this, and they

say that they will begin discussing this with the Turks how to establish that safe area, that ISIS-free area along that border.

But there's a lot of complications here. The Turks clearly going after ISIS. They feel it is a threat to their country, but also going after

Kurdish forces, which the U.S. believes are some of the most effective fighters on the ground.

A lot of this expected to come to a head tomorrow in Brussels where Turkey has called for an emergency meeting of NATO to discuss all of this --

George.

HOWELL: Turkey concerned with security.

Barbara Starr reporting for us. Barbara, we appreciate your reporting

The United States has just issued its annual global report card on the fight against human trafficking.

The Trafficking in Persons report was formally unveiled in Washington by U.S. Secretary of State John Kerry just in the last hour. It is the U.S.

measure on how 188 nations are addressing the issue of trafficking.

This year, 18 countries were upgraded and another 18 were downgraded.

CNN's Isha Sesay is at the State Department and now joins us live. Isha, good to have you with us.

So...

ISHA SESAY, CNN INTERNATIONAL CORRESPONDENT: Hi there, George.

HOWELL: Good to see you.

The question that many have looking at this report, Malaysia upgraded this time, which it had not been -- that could have been a barrier for that

country with regards to the TransPacific Partnership. What more can you tell us about it?

SESAY: Yeah, indeed, George. And it's a big, big talking point from this year's report. The fact that Malaysia, which was just downgraded last year

in 2014 alongside Thailand and The Gambia in Venezuela has this year been upgraded to the tier two watchlist. This is a list which, you know, is

kind of like putting people on notice, so to speak, this tier where you say you have a big problem, the problem is growing and there's insufficient

evidence to see whether you are actually tackling it efficiently. But they have moved from tier three, which is the lowest tier to this tier two

watchlist.

Now the reason a lot of people are raising eyebrows about this is just that, the trade pact that you mentioned. They are asking the question

whether politics played a role in the ranking of Malaysia this time around. It's worth point out that both Thailand and Malaysia were downgraded, as I

said, just last year.

And Thailand and Malaysia form part of that route that Rohingya migrants are often trafficked along. And we know that we've heard of the discovery

of scores of graves along that area, graves believed to contain the bodies of Rohingya migrants.

So, many poeple looking at this and saying well hang on, how is it that Malaysia has been upgraded? Is this to do with this trade pact that the

United States just signed, a trade pact, which if they had remained in tier three, they could not have been fast tracked as part of that agreement.

Many, many questions being asked.

Also worth pointing out that Thailand, which was downgraded alongside Malaysia, still remains at the bottom in this ranking system of the

Trafficking in Persons report.

So many, many questions being asked, George, about what this all means.

But, George, I also want to point out that alongside the release of this report, this annual report, the State Department also recognizes the

efforts of individuals for their fight against modern-day slavery, human trafficking. This year, eight individuals were recognized, including this

network, this very network, CNN.

CNN's Freedom Project was on it for its longrunning commitment to this issue. Accepting the certificate, accepting the award, is our -- on stage

at the time, was our executive vice president and managing director of CNN Tony Maddox, who joins me now.

First of all, congratulations, Tony.

[11:11:59] TONY MADDOX, CNN VICE PRESIDENT: Thank you, Isha.

SESAY: You have the certificate there. Can I read a little bit of it for our viewers, because I think it's important to take a moment and just share

this with everyone as I try not to break your brand new award.

So this 2015 Hero acting to end modern-day slavery -- modern slavery award is presented to Tony Maddox in recognition of his sustained commitment to

raising public awareness and understanding of human trafficking a global scale. His passion and advocacy on behalf of victims of modern slavery and

his extraordinary dedication to amplifying the voices of survivors around the world.

What does this mean to you, Tony?

MADDOX: It means a great deal. I'm enormously flattered. I'm obviously proud -- this is an award for CNN. I mean, I do recognize that I was

singled out. And this is cause which is very close to my heart, as you know.

But I think an organization like CNN can make a difference. And we are a powerful organization, we know that. And when CNN highlights a story, we

can change and impact that story. And I'm very proud of how across the news organization we've embraced this cause and we've highlighted these

stories. And we will continue to do so. And I'm deeply honored that we were singled out for this. Very surprised and deeply honored.

And within the CNN family there are literally hundreds of people who have been strong, loud proponents for this. I would include you. But I would

also want to single out Leif Coorlim and Lisa Cohen who are two producers at CNN International who really have drive this forward with tremendous

enthusiasm, energy and endeavor. I'm very proud of them.

I'm very proud of CNN. And I'm very proud to receive this award.

SESAY: It's worth poiting out that this isn't just a story for us employees of CNN, this is also a story beyond this network, because this is

the first time a media organization has been recognized as a trafficking in persons hero by the U.S. State Department.

It's important to point out the longrunning commitment to this because the Freedom Project started as a one year intiative.

MADDOX: It did. And interestingly when I first put the idea around and said, look, let's have a staff meeting and see if people want to get behind

this. I don't know if you remember this, but the first meeting was like standing room only. The second meeting we couldn't get everyone in the

room. I mean, just really tapped into a common cause within the company.

And also five years ago -- I don't think the issue was as front and center as it was now.

I think what I would point out with CNN, and this was particularly true when I was thinking about the other heroes on the stage today, is that

these are the people who work on this 24/7. And one of the things that we have been able to do is to tap into the groups that were already out there

fighting this fight and continue to fight it on a day to day basis and highlight and publicize their efforts. We've used them very much in

helping to find stories for us and then helping us with logistics and getting things set upon the ground.

I think Secretary Kerry mentioned today that this is a partnership, and it is, but there are many different groups of different types, of different

places, all with the same common cause that human trafficking exists, that human slavery exists today is awful. It is truly terrible.

And you watch CNN, and there are many bad things in the world, but that human beings take the decision to trade other human beings and to treat

them like that is abhorrent. And we as a collective human society, a human group, we have shared values and we all need to just say this is just

wrong, and we're all going to work together to stop it.

[11:15:24] SESAY: Well, Tony, we thank you for your leadership on this issue that you continue to fly the flag and to keep us committed to this

issue here at CNN. So we thank you for that.

George, I'm just going to toss it back to you. It is a remarkable day. As Tony said, it's not just about CNN. We are one of eight. And this network

recognized for the effort to fight this terrible, terrible crime. The international labor organization, George, pointing out there's a minimum of

some 20 million people ensnared in human trafficking. If you look at some other statistics, they put the number as high as 38 million.

This is the issue of our time. And we remain committed to it here at CNN as do thousands of people right around the world, George.

HOWELL: That's right. As the Secretary of State even mentioned, the report not about naming and shaming, but rather about shining a light on

where this is happening. And CNN, as you say, mentioned dedicated to telling those stories.

Isha, Tony, thank you so much.

And join Isha a little later for a special edition of News Center. She will have more on the fight against human trafficking live from Washington.

That starts at 7:30 p.m. in London, 8:30 central time in Europe, only on CNN.

You are watching Connect the World. Still to come, we get the view from Turkey as the NATO member gathers the alliance for talks on its security.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JOHN KERRY, U.S. SECRETARY OF STATE: That is why this TIP report needs to be read as a call to action. Governments need to strengthen and enforce

the laws that they have on the books and prosecutors must take pride in turning today's traffickers into tomorrow's prisoners.

(END VIDEO CLIP)

HOWELL: You are watching Connect the World. I'm George Howell at the CNN Center in Atlanta.

The U.S. Secretary of State John Kerry says the country's latest trafficking in persons report is not about naming and shaming, but rather

about putting attention, putting the spotlight on this issue.

Let's bring in Elias Chatsis from the United Nations office on drugs and crime. He is the chief of the human trafficking and migrant smuggling

section joining us live now from Vienna. Elias, good to have you with us.

So, given this report that it's been released, what is the scale of the problem with human trafficking worldwide?

ELIAS CHATSIS, UNITED NATIONS OFFICE ON DRUGS AND CRIME: Thank you very much, George.

First of all, I want to congratulate the small office at the State Department that's working on trafficking in persons for another which looks

to be a very interesting report. And I didn't have a chance to read yet, but we all know that human trafficking is a global problem. It's a crime

of a global scale. One-third of the victims are children victims, 74 percent of the victims are women and children.

And our data, we have our own global report issued last year, and the member states themselves, 140 of them, reported (inaudible) which came from

153 different countries. (inaudible) the UN has 193 member states, 153 members have basically (inaudible).

HOWELL: What trends would you say that you have seen in human trafficking in recent years?

CHATSIS: I think the most worrying trend is increase in the children victims. Another worrying trend is the increased connection with other

crimes, especially (inaudible) regions of the world. And now you know what it's really necessary for a lot of attention to the victims of this crime

to follow the crime. Nothing (inaudible) reports as the State Department always (inaudible).

HOWELL: And just when you talk about the victims of human trafficking, you're talking about people who, you know, many times you don't hear from

their voices. They don't speak out. These things happen in plain sight, but we don't see it. So what key tools would you say governments need in

order to address the problem and to have people come forward?

CHATSIS: Absolutely.

First of all, there needs to be (inaudible) there needs to be criminal accusation of human traffic (inaudible) needs to be designated as a crime

and needs to be punished, because then the victims will feel more comfortable, they would come forward because the people who perpetrated

these crimes will go behind bars.

The second one is that member states need to have protection and assistance programs in place. This is not an easy task to do. You need resources.

You need knowledge, needs expertise. And there are lot of no resource countries that don't have this.

This means (inaudible).

The United Nations has established the human trafficking and (inaudible) human trafficking trust fund in 2010, a general assembly resolution. And

since 2011, every year it helps more than 2,000 victims around the world through close work with NGOs and private sector, with individual persons as

well as with governments.

HOWELL: And Elias, I do want to ask you about one aspect of the report -- Malaysia upgraded in this report, and some are questioning why that

happened. What are your thoughts?

CHATSIS: Well, it's (inaudible) individual countries. And of course I haven't seen the report yet. I cannot comment on it. But I think one

thing that -- I was listening to your broadcast a bit earlier. And I think watching that piece quite important -- I (inaudible) report as well is that

(inaudible) member states do make efforts. They do make an effort to fight human trafficking.

There is a lot of problems that we have made in the last seven years since the chronicling this human trafficking came into force. We have now 167

member states that are (inaudible) protocol. There is a lot of effort that's been done. And this also needs to be recognized.

HOWELL: Elias, and as you mentioned, yes, there are countries like Malaysia that are taking efforts to change the tide there.

Elias Chatsis joining us from Vienna. Elias, thank you so much.

Live from the CNN Center, this is Connect the World. Coming up, one for all and all for one, Turkey says its fears for security and they questioned

the role that other NATO states will play in beefing it up. That story in 10 minutes.

But first, we take you to the heart of Hong Kong's creative boom. That's in transformations next.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

[11:25:35] ANDREW STEVENS, CNN INTERNATIONAL CORRESPONDENT: Hong Kong's central district, known for its incredible skyline and nonstop commercial

activity. But at the center of this financial hub stands a snippet of the old city, now dedicated to Hong Kong's young, creative sector, PMQ.

PAUL CHEN, SECRETARY FOR DEVELOPMENT, HONG KONG: It has become an icon and become a landmark in this part of the city.

STEVENS: The site has a long history started as a public school over a century ago. After World War II, it took on a second life as a dormitory

for married police officers. Then in 2009, after years of sitting empty, renovation work began.

CHEN: It is an aspiration of the Hong Kong people to conserve our (inaudible) heritage so that we can have a better understanding of the

past.

STEVENS: The revitalization of PMQ is part of Conserving Central, the government's initiative set up to preserve historical buildings in the

area.

CHEN: It gives additional character to this area, because it is no long just skyscrapers, but there's a way of life.

UNIDENTIFIED MALE: We're seeing there's another so-called economic pillar coming up is the creative industry. And this is the place where we nurture

what we call the creatpreneur of the future.

STEVENS: PMQ hopes to be the center of that pillar. The biggest challenge: attracting new and returning visitors.

UNIDETIFIED MALE: We have invented a sustainable mode of operation. We can stand on our own financial.

STEVENS: Through subsidies, rents alone, ranging from around $1,500 to $3,000 a month, unheard of in this central part of town.

But in order to stay, PMQ requires tenants to develop sustainable business models.

UNIDENTIFIED MALE: Those who cannot suit the means of the market, they have to go.

STEVENS: PMQ is now home to more than 100 local designers and businesses, and a revolving door of popup shops and markets.

For young designers like Hugo Young, PMQ gives him a chance to interact with his customers and colleagues.

HUGO YOUNG, DESIGNER: We used to hide in our studio and work on our own design pieces. It's great because there's a platform gather a lot of

different designers and different disciplines and then we can share ideas with them.

STEVENS: New generation of products with the Made in Hong Kong label.

YOUNG: I think it's good to show them like Hong Kong does something more than this kind of commercial stuff going on here.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

[11:31:04] HOWELL: Welcome back to Connect the World. I'm George Howell at the CNN world headquarters in Atlanta. The top stories we're following

this hour.

The U.S. Secretary of State John Kerry has unveiled the U.S. State Department's annual report on the global fight against modern-day slavery.

It says 18 countries have improved in their efforts to fight human trafficking, including Cuba, Kenya and Saudi Arabia. 18 other nations,

though, have fallen behind.

Fear is back in China's stock markets. The Shanghai composite closed Monday's session down 8.5 percent. That is the biggest daily percentage

decline since 2007.

The Taliban say they have released more than 100 Afghan police officers who surrendered in northern Afghanistan. A local commander says the officers

surrendered after days of heavy fighting.

U.S. President Barack Obama is urging the African Union to keep up the pressure on the militant group al Shabaab. Mr. Obama spoke from Ethiopia,

which is playing a key role in the campaign against that terror group.

Mr. Obama is the first sitting U.S. president to make a trip to Ethiopia. Robyn Kriel reports on the motives behind the visit and why Ethiopia is

uniquely positioned to be the lynch pin in the battle against al Shabaab.

(BEGIN VIDEOTAPE)

(SINGING)

ROBYN KRIEL, CNN CORRESPONDENT (voice-over): Al Shabaab militants wait to ambush an African Union convoy in southern Somalia. The attack went largely

unnoticed until this gruesome terror video appeared online. The al Qaeda- linked group claims they've killed dozens of Ethiopian troops. Identity documents purport to show the dead.

The Ethiopian military is regarded as the most disciplined, effective and battle hardened among the 22,000 troops of the African Union's mission to

Somalia. Their mandate is peace enforcement. Their contribution to fighting al Shabaab hasn't gone unnoticed.

U.S. President Barack Obama thanked Ethiopia for its leadership and cooperation last year.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Our counterterrorism cooperations and the partnerships we've formed with countries like Ethiopia

will be critical to our overall efforts to defeat terrorism.

KRIEL: Those efforts have ramped up just this month with a new ground offensive by African forces and U.S. airstrikes.

MATT BRYDEN, SOMALIA SECURITY EXPERT: Obama traveling to Ethiopia, I think, is an indication of continued U.S. Engagement, possibly some increase and

also signaling awareness that more needs to be done. That the last few years of combined regional and international efforts to contain al Shabaab

haven't done enough, and it is time to step up both campaign against al Shabaab and to support the countries that are on the front lines.

KRIEL: The Ethiopians believe they can teach the Americans a thing or two about achieving that.

GETACHEW REDA, ADVISOR, ETHIOPIAN GOVERNMENT: The United States has to do some learning as to how on the ground and understanding on the ground would

better inform whatever decisions they make.

KRIEL (on camera): He adds that the two countries have a long way in addressing what he calls their differences in approach. When pressed on

that, it said that the African Union's war against al Shabaab in Somalia is the cheapest, most effective war against militant Islam in the world. But

the countries fighting that war, including Ethiopia, need more support, in terms of financing training and equipment. As one Western diplomat told us,

it's our treasure, but it's their blood.

(voice-over): A high price to play for the long-term goal of peace in Africa.

REDA: Peace in Somalia would also have dividends to the rest of the region.

KRIEL: And the rest of the world. Ethiopia wants to be more than a military enforcer. It wants to be the regional power broker too. And it wants the

U.S. to listen, understand and support it.

(END VIDEOTAPE)

[11:35:09] HOWELL: Back to one of our top stories this hour. Turkey has requested talks with NATO's 28 member states about concerns over its

security. It comes after an ISIS suicide attack near the Syrian border last week, that attack that killed 32 people, the killing of two policemen

by the Kurdish PKK group also infuriated Turkey which is now bombing the group in northern Iraq.

Meanwhile, Turkey has arrested more than 800 people since Friday in an anti-terror sweep. Dozens of suspects were detained in early morning raids

this Monday.

NATO will now meet on Tuesday to discuss the situation. This is only the fifth time in the alliances history that it is gathering for such talks.

CNN's senior international correspondent Nick Paton Walsh now joins us live from Beirut covering the events there and the need for this meeting. Nick,

good to have you with us.

After a week of violence in Turkey, the country is now concerned with security, so explain what more the country is looking for from other NATO

members by requesting this emergency meeting.

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: Well, the talks you refer to are under article four of the NATO treaty, which is about a member

state -- a treaty signatory asking for consultations to discuss a threat to its security. It's not like, for example, the Americans invoked article

five after 9/11 where they basically said this is a collective threat, we have to bind ourselves together. It's slightly one stage less than that.

But it's a substantial move by Turkey, I think, to -- now they've decided they're very much part of the fight against ISIS and consider them to be a

direct threat to them to get NATO in behind them as well.

It may also be a bid to put NATO's stamp on the other part of the violence now in that area, which is Turkish jets bombing the PKK, their Kurdish

adversaries who the U.S. and Turkey proscribe as a terrorist organization.

So, an extraordinarily complex battle that Turkey has now undertaken, because it's facing two key adversaries on two fronts. And those

adversaries actually one of them has an ally, which is the awkward ground troops doing the fighting against ISIS when there are U.S. coalition jets

in the sky bombing ISIS positions.

They are in an extraordinarily complex situation, but it is a mark, I think, of the complexity of where they are that they wish to see a broader

NATO meeting to discuss that.

What we're hearing from U.S. officials at this stage is not talk really of a no-fly zone to assist any Turkish missions, perhaps more the notion that

they, too, are discussing what the Turkish, the idea the Turkish floated at the weekend of creating some sort of safe haven, effectively a piece of

territory at this stage it looks, according to media reports to be pretty much to the north directly of Aleppo across where the Kurds already hold,

which is near Tal Abyad along the Turkish-Syrian border pushing ISIS out of that area.

And then the hope would be once it's peaceful, once it's properly policed, allowing refugees in Turkey from Syria back into that area.

A very complex ambition, and one key plank is missing, George, the U.S. talk about the need for ground partners to come in and push ISIS out.

Nobody seems to know who they are at this stage. Yes, it will be moderate Syrian rebels, but the U.S. have struggled to find enough of those for

their training program. I think those we're talking about that question we're saying, it could be a number of candidates, but there's not a readily

made force willing to step in to that hole, George.

HOWELL: Senior international correspondent Nick Paton Walsh live for us in Beirut. Nick, thank you so much for your reporting there.

Now let's bring in Suat Kiniklioglu for more inside on this story. He is a former MP for the ruling party, the AKP, and now the head for the Center

for Strategic Communication, a think tank in Ankara.

Good to have you with us, Suat. So, in your estimation, what is Turkey looking for out of this NATO meeting?

SUAT KINIKLIOGLU, CENTER FOR STRATEGIC COMMUNICATION: Well, Turkey wants, first of all, its allies to acknowledge that it is facing two threats at

the same time. Although the YPG has been fighting IS in the past with the U.S. support, the situation is rather complex given the YPG is tied to the

PKK and as was earlier indicated this secure zone that's being planned obviously requires some sort of agreement among the allies. And a

potential attack by the Syrian regime or by IS against Turkey would obviously necessitate a NATO response, or at least a response that would be

condoned by the allies.

HOWELL: The U.S. has said that there is no connection between these airstrikes against the PKK and recent understandings to intensify U.S.-

Turkey cooperation against ISIL. How are these two military operations seen, though, in Turkey?

KINIKLIOGLU: Well, in Turkey this has a very strong domestic political component. The government was until very recently engaged in a peace

process with the PKK, which pretty much broke off in the last week after the Suruc bombing exactly a week ago.

And the killing afterwards of two police officers and the number of soldiers on the front and in the eastern Turkey has created a situation

where the government is actually using the IS operation as some sort of cover to simultaneously attack PKK targets in northern Iraq.

It also has some sweeps inside Turkey. But the situation is very tense, because the expectation here was for a long time that the government and

the PKK will be able to come to some sort of agreement eventually ending a three decade old conflict.

Now, with the fighting resuming, all bets are off. And many Turks are concerned that in the event of an early election, which is highly likely,

Turkey could see a very violent election period.

[11:41:07] HOWELL: So, talk to us just a bit about your understanding of these safe zones that Turkey would like to create. How effective would

that be?

KINIKLIOGLU: Well, the safe zone has been an idea that Turkey wanted for some time. It was more pronounced as a no-fly zone, but given the Obama

administration's opposition this has not been possible so far.

I think the difference now is Turkey opening its air bases to the coalition fighting against ISIS has created a new dialogue with Washington that would

foresee firs the clearing of this zone, which is about 100 kilometers wide and 40 to 50 kilometers deep, first clearing IS members out of these, then

let this region be governed by more moderate opposition forces that are supported by Turkey and others.

But there are obviously complications, first to identify who these moderate forces could be. The number that have come so far that have been vetted by

the United States are rather limited. Secondly, Turkey is also looking for a future Syrian refugee as being relocated back into Syria.

Turkey has now more than 2 million refugees, which is a huge economic cost, but also a social and political cost. Turkey is looking forward for this

secure zone to be able to host or send some of these refugees back.

Obviously, Turkey's first priority is to get rid of President Assad. And this has been a disagreement between Washington and Ankara for quite some

time. But I think although the Turkish government has not been articulating this, a -- you know, a second spot behind this secure zone is

really to have the allies agree first and foremost the United States in the future to establish more secure zones that would eventually bring about the

fall down of President Assad.

HOWELL: Suat Kiniklioglu joining us live from Ankara. Suat, thank you so much for your insights as the policy there shifts in Turkey.

KINIKLIOGLU: Thank you for having me.

HOWELL: Thank you.

Our chief international correspondent Christiane Amanpour just finished an interview with Turkey's prime minister. Here what he has to say about

recent strikes against ISIS. That's coming up on Amanpour. It starts at 7:00 p.m. London, 9:00 p.m. in Istanbul only on CNN.

And you can find the latest on this story and others, of course, on our website. Go to CNN.com to watch reports from our correspondents in the

field bringing you all of the details from the heart of the action -- videos, articles and analysis only on CNN.com.

Live from the CNN Center here in Atlanta, this is Connect the World. Coming up after the break, Shanghai freefall: China's start market resumes

its precipitous drop.

Plus, gold values may be disappointing investors, but it's still maintaining its shine with customers.

(COMMERCIAL BREAK)

[11:47:23] HOWELL: Welcome back to Connect the World. I'm George Howell at the CNN Center in Atlanta.

It is just before lunchtime on Wall Street. And investors have been in a selling mood thus far. China, the key concern this day.

Let's have a check of the numbers right now, a quick look at the big board. The Dow Jones Industrial Average trading down at this hour. This after a

frenzy of selling in Shanghai.

The selloff came despite Bejiing's intervention in the markets, an intervention that was widely criticized. CNN's Andrew Stevens has more

(BEGIN VIDEOTAPE)

STEVENS: If Beijing thought it had calmed China's out of control stock market plunge by throwing unprecedented amounts of money at it, well events

on Monday have forced it to think again. Trading went right back to its recent head spinning past with another rout. The Shanghai Composite

falling almost 8.5 percent, that's the biggest fall in more than eight years. And it means that billions more dollars have now been wiped off the

value of stocks held by small retail investors.

But most worrying for Beijing is that this no selloff comes just three weeks after authorities took unprecedented steps to stop this happening,

this big fall here -- a plunge that wiped 32 percent off the value of the Shanghai market in just 18 trading sessions, that's a little more than

three weeks.

Those steps banning big shareholders from selling, ordering state owned institutions to buy, pumping money into the market, cutting interest rates,

all of them designed to stop that rout.

And it actually worked. As you can see here, it bottomed out here and the market rebounded 16 percent over the past three weeks until Monday.

Why today? Well, it's not yet clear. One catalyst may have been that there's new data showing that profits at Chinese industrial companies fell

in June by a third of one percent. That wasn't expected. And it underlines just how weak, in Chinese terms at least, the world's biggest --

the second biggest economy is becoming.

But the more likely story is, and one that's more difficult to quantify, is that the authorities stepped back from the market this Monday. Perhaps

they were lulled into a false sense of security that after three weeks of gains the worst was over.

Investors, though, had other ideas. Many of them are holding stocks they bought with borrowed money. It's called margin lending. And they want to

get out of the market, get rid of that debt.

And that leads to the big question. Will the authorities now let this bear market run its natural course or will they step in aggressively once again

to shore the market up?

Investors made it pretty clear on Monday, they want out. But in China, it's the government that decides how this story will play out.

Andrew Stevens, CNN, Hong Kong.

(END VIDEOTAPE)

[11:50:11] HOWELL: Andrew giving us the take there in China.

Let's go now back to Wall Street where that big selloff in China has investors worried. Paul LaMonica is watching the action from New York and

now joins us live from the New York bureau. Paul, good to have you with us.

So, for awhile, you know, every major component on the Dow has been in the red.

PAUL LAMONICA, CNN CORRESPONDENT: Yeah, we have the Dow down more than 100 points at last check. Let's put this in perspective, though, it's not that

dramatic when you look at it on a percentage drop, clearly not nearly as bad as what's going on in China.

But investors are nervous about what is happening in the Chinese stock market, and more specifically what this might mean about the Chinese

economy. If China's economy is slowing down, that will be a bit of an issue for corporate America. There are a lot of big bluechip companies

that are increasing their presence in China, so they're watching very carefully.

HOWELL: Right. And you know these losses, they follow a rough time on Wall Street just last week.

LAMONICA: Yeah, last week was not a pleasant one. We had disappointing reaction to earnings such as Apple. Part of that could be due to worries

about what's going on with iPhone sales in China. Definitely there is a sense that fear is back in the market right now.

Even though stocks are still near all-time highs, there is nervousness, a lot of people are questioning the health of the global economy and just how

strong companies around the world can do what their earnings will be like if the economy is really slowing down.

HOWELL: Paul LaMonica, CNN Money digital correspondent. Paul, thank you so much for your take on what's happening. We'll have to keep an eye on

it.

Live from the CNN Center, this is Connect the World. Coming up, we turn to the United Arab Emirates to look at why despite its falling value,

customers can't seem to get enough gold. Stay with us.

(COMMERCIAL BREAK)

HOWELL: Welcome back to Connect the World. I'm George Howell at CNN World Headquarters in Atlanta.

All that glitters is not gold, even if it seems that gold is in the market. It's value sunk to a five year low last week despite hope among some

investors that it would hit $2,000 an ounce. It's now languishing closer to half that amount.

While that's bad news for some investors, it's giving gold a new shine in places like the country of India. Shoppers there have been stocking up on

the precious medal while prices are low. And the same is true for buyers in the UAE.

Amir Daftari reports.

(BEGIN VIDEOTAPE)

AMIR DAFTARI, CNN CORRESPONDENT: Low, low and lower still: the price of gold is sliding. The reasons are varied, but as the precious medal loses

its luster for some, there are others who are flying high over its fall.

While it's all sell, sell, sell on the gold markets, here in the UAE it's all buy, buy, buy. Riyad is the owner of this fine jewelry store, and Riad

(ph) what kind of increase in sales have you seen due to the fall in price?

RIYAD MUSBAH, OWNER, AL-RIYADH JEWELRY: Certainly, we have noticed an increase in sales, probably I would say a 30 percent increase in the past

two week since the gold had started dropping to its all-time lows.

DAFTARI: And what makes the UAE such a good place to buy gold

[11:55:01] MUSBAH: I would say Dubai being the hub of gold coming in from the east and the west -- it's the center, really of all types of jewelry,

diamonds, ornaments, everything comes through to Dubai, so the diversity of products available, and the diversity of the customers that come to us.

DAFTARI: And speaking of customers, what kind of people are buying all this gold?

MUSBAH: The UAE nationals, they are a big customer base. You've got the Indian, the south Asians and even Arab nationals they're into gold. It's

part of the culture, really, buying gold.

DAFTARI: And that cultural connection goes beyond jewelry.

Just to prove how gold obsessed the UAE is, I've come to the prestigious Emirates Palace Hotel where not only can you get a cappuccino sprinkled

with 24 carat gold dust, but so a desert with a giant gold leaf across the top. Let's have a little taste.

Pricey.

And or those of who want gold on the go, then naturally the world's first gold ATM where prices are updated every 60 seconds in real-time, so now

you're on for a bit of a bargain.

Amir Daftari, CNN, Abu Dhabi.

(END VIDEOTAPE)

HOWELL: And you can always follow the story the Connect the World team follows throughout the day by going to our Facebook page. It's

Facebook.com/CNNConnect. And get in touch, or tweet me if there's a story you want to chat about. My Twitter address @GeorgeHowellCNN.

I'm George Howell, this is Connect the World. We thank you for watching.

END