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First Move with Julia Chatterley

The O.E.C.D. Lifting its Forecast and Warning of Uneven Growth; Population Push in China as the Country Announces a Three-Child Policy to Boost the Birthrate; The First Team of Athletes are Heading to Tokyo for the Games. Aired 9-10a ET

Aired May 31, 2021 - 09:00   ET

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

[09:00:17]

RICHARD QUEST, CNN BUSINESS ANCHOR: Live from New York, I'm Richard Quest. Julia is off today for Memorial Day. This is FIRST MOVE and here is your

need to know.

On the road to recovery. The O.E.C.D. is lifting its forecast and is warning of uneven growth.

There's a population push in China as the country announces a three-child policy to boost the birthrate.

And the Olympic arrival. The first team of athletes are heading to Tokyo for the Games.

It is Monday, the start of a new week. Let's make a move.

A very warm welcome to FIRST MOVE.

U.S. markets are closed today. It is Monday. It is Memorial Day. The start of the summer holiday season, at least in the United States. It's a long

bank holiday weekend in the U.K., too, the start of the summer there as well.

Europe, though, which is trading and doing businesses, you've got four markets there to whet your appetite, three down and one up on the last

trading day of the month, and there are some set and tracking to rise for a fourth straight month overall even though there are some small losses for

today.

The biggest test for global market this week comes on Friday. The U.S. releases its May jobs numbers and investors are hoping to see an

improvement in hiring after that disappointing number that we saw in April.

In Asia today, mostly higher. Japan fell after weaker than expected factory and retail sales numbers and a lackluster report of the Chinese factory

activity on hiring, too. Consequently, of all the major markets in Asia, the Nikkei was the only one down.

And so are our dear friend, Bitcoin, it is above $37,000.00 again, but it is still heading for its worst month in a decade. It is down under

$36,000.00. Well, you get the idea. It's bouncing around at the moment, so even 2.5 percent gain hasn't managed to get it over $37,000.00.

And the reason of the weakness or the continuing weakness is there are hints that the U.S. government is to beef up its crypto oversight. We will

talk crypto later in the program.

And so straight to our drivers. The O.E.C.D. says global economic output is close to its pre-pandemic levels. It is nudging 2021 growth forecasts up to

5.8 percent and it is crediting robust U.S. stimulus and widening vaccine rollouts.

There are lots of frictions that remain, which is the warning and our Anna Stewart is here.

The O.E.C.D.'s positive gain, if you like, showing that things are getting better, is borne out by the World Bank and the I.M.F. I think I'm more

interested not in the growth, but in those frictions ahead.

ANNA STEWART, CNN REPORTER: And there always are frictions, Richard, and of course, any recovery was not going to be really equal, but this one

looks particularly patchy. I'll bring you the chart of growth.

You can see China absolutely roaring ahead, its economy rebounding much faster than pre-pandemic levels. The U.S. just touching pre-pandemic levels

largely on the back of stimulus and the vaccine rollouts. And then, Europe really lagging behind.

And this is where the interesting point comes. So much being put on this forecast revision being based on the vaccine rollout. The O.E.C.D. is

saying that of course, the economy is able to reopen or returning to some sort of normal level of activity, but also pent-up consumer spending.

That's why we see a little bit of inflation coming in as well.

But the bad news from this, despite the global growth picture looking good is so many economies are slowing until the vaccine is of course, equitably

rolled out, which won't likely happen, you're not going to see equal economic growth or recovery -- Richard.

QUEST: So, what is the concern here? Because in the United States, there is a concern of inflation. The E.U. is finally getting its, if you like,

its vaccination policy together and moving forward quite quickly now.

So, the biggest concern for O.E.C.D. countries, which is essentially the wealthy countries of the world, is what?

STEWART: Well, if we look at the G-20, it actually depends. I mean, some nations very worried about inflation. You mentioned the U.S.

The O.E.C.D. in this forecast not actually that concerned when it comes to inflation. They see these as a natural reaction really to economies opening

up and all of that consumer spending. Blockages in the trade system are expected to ease.

In Europe, part of the problem is of course the slower vaccine rollout. We are seeing that very much in those numbers, but also, Richard, some of the

nations which are so much more reliant on tourism and when tourism is going to return to any kind of normal.

[09:05:00]

STEWART: Also, some of the nations, particularly in the south, companies which needed help were given loans rather than grants. They may be extra

burdened and they may struggle in the recovery in the year to come.

So a bit of a mixed picture, but the overall message from the O.E.C.D., very much about the rollout of the vaccine.

QUEST: Gorgeous weather where you are. Where are you?

STEWART: The economy is ticking along nicely around here, Richard. Everyone is outside in the pub. It is finally, I think, sunshine in the

summer.

QUEST: That's absolutely beautiful. Anna Stewart in London there, thank you.

Now, China is announcing a new three-child policy, a major shift for the world's most populous country. The government there is looking to combat

the effects of an aging population.

David Culver is with me from Beijing.

So, for decades, one child and then you go to two. I'm interested that they actually put a number on it. They actually say three and don't just say

have as many as you like.

DAVID CULVER, CNN CORRESPONDENT: Yes, they're capping this, Richard, but they also expect this to lead to a baby boom as they thought when they

changed it from one child to two back in 2016. However, it didn't result in that. In fact, it continued to decline.

And so now, here we are in a situation where China is really at a dire situation for its aging population because what you have is this decline in

birthrate. Add to that this increase in life expectancy, and you have got a workforce here that is youthful, is young, but likewise is aging out, and

so they're not sure how they can sustain it long term.

I think the other thing you have to separate from all of this is this is not just about the economy and prosperity, which are two very important

things here in China, because both of those are rooted in social stability here.

So if you don't have that prosperity factor, social stability could falter, and the government, the central government at that, certainly sees that.

I think the other thing that is very interesting to note is the timing of this, Richard. This came weeks after the 2020 census showed the slowest

growth in decades here in China, but it also comes as an announcement from the top leadership of the party outside of a national gathering, the

National People's Congress in particular. That's generally when you have some of these major announcements being put forth.

Instead, this comes weeks after the census. It shows that it is something that is immediately needed to be handled, that it was urgent, and that's

why it comes from the top here.

The question is: is it really going to have a substantive impact? Is it going to encourage people to have children? That remains to be seen. There

are realities on the ground here, Richard. This is an advanced society that is becoming increasingly expensive to live in. Families are looking at

that, moms and dads are starting to see the housing costs, the education costs, general cost of living going up and so to balance those demands and

the thought of having more children, well, for them it's about maintaining a certain lifestyle, too.

And so, it is a challenging tradeoff and it is not one that is likely to be resolved easily here -- Richard.

QUEST: David Culver in Beijing, thank you.

The first Olympic athletes are making their way to japan for the Tokyo Summer Games. The Australian women's softball team are on their way as the

country remains under a state of emergency because of COVID-19.

Blake Essig is in Tokyo. Just clarify one point. The fact that teams are now arriving, does that mean that questions about the future of these games

are now off the table?

BLAKE ESSIG, CNN CORRESPONDENT: You know, Richard, after several weeks of what seems like endless criticism and calls from Japan's general

population, doctors' groups, and even an Olympic sponsor for the Olympics to be canceled, earlier today, we were offered the clearest sign yet that

these Games are likely going ahead as scheduled just like the IOC and local organizers have been saying for months.

Now, the Australian softball team boarded a plane in Sydney on its way here to Tokyo. Once they arrive, they will be the first international Olympic

team to enter the country other than the track and field team from South Sudan who have been here training since before the pandemic even started.

Now, the team from Australia will be staying and training in Ota City which is located just outside of Tokyo for about six weeks. It is part of a host

town initiative. Now, during that time, the team will only be allowed to move in between their hotel and training field.

And because of the COVID-19 pandemic, this team hasn't played together since 2019. Now despite admitting to a little trepidation before heading to

Japan, players say that they have no problem with the rules and regulations put in place knowing that sacrifices must be made for the opportunity to

compete.

(BEGIN VIDEO CLIP)

JADE WALL, AUSTRALIAN OLYMPIC WOMEN'S SOFTBALL TEAM MEMBER: We're going to go through lots and lots of COVID testing. But look, we're all prepared for

it. We want to do everything that we can to make sure that we're safe when we get there and we are safe while we are in Japan as well.

(END VIDEO CLIP)

[09:10:03]

QUEST: All right, so Blake, we're just at the beginning of June, give or take, and one imagines teams will now be arriving, more teams -- the pickup

will begin. There will come a point, won't there, when it is simply not possible to even consider canceling these games.

ESSIG: Yes, Richard, I mean, look, when you look at what's at stake here, specifically, the financial, the monetary value of everything, you know,

for the IOC television rights, Tokyo and Japan as a whole, it seems unlikely that these games are going to be canceled.

That being said 78 out of 528 of these towns on the Olympic teams that were scheduled to participate in these host town programs have pulled out citing

the COVID-19 concerns. There's lots of talks about 80 percent of the people that will be in the Olympic Village being vaccinated. But that doesn't take

into account the 78,000 foreign delegates that will be coming to Japan, where they'll be staying and whether or not they will be vaccinated. We

just don't know those answers yet.

So there are still a lot of questions to be answered. I think that as we get closer, again, the calls for these Games to be canceled will continue

to be voiced. But given everything that the IOC has said to this point, the Japanese government, local organizers, it seems like these Games are moving

forward.

And beyond just moving into the operational aspect of these Games, you have, as we talked about, the team from Australia, coming in to start

training. There's viewing sites that are starting to be built June 1st.

So lots of movement here in Tokyo as we move towards these Games.

QUEST: Blake in Tokyo, thank you.

Those are the drivers of the day. These are the stories making headlines around the world. Rivals of Israel's Prime Minister trying to finalize

their coalition deal that could oust Benjamin Netanyahu from power.

A day after the right-wing politician, Naftali Bennett said he would join a unity government to prevent another round of elections. They only have a

few days to hammer out this agreement.

Hadas Gold joins me.

Can they do it? Is this the end of Netanyahu's dozen years in power?

HADAS GOLD, CNN CORRESPONDENT: Well, with Netanyahu, Richard, you can never say never. He is definitely a political survivor in Israeli politics.

However, there is a feeling here that Israel may be days away from seeing the end of Prime Minister Benjamin Netanyahu as Prime Minister, perhaps he

will then become the opposition leader.

Last night, Naftali Bennett, actually a former Netanyahu aide and lieutenant, a former ally of his announced that his small right-wing party,

Amina, will be joining this potential new unity government, this new coalition that is being spearheaded by the centrist leader, Yair Lapid.

Now, it is widely understood as part of this coalition agreement that Naftali Bennett will actually become Prime Minister first followed by Yair

Lapid as part of a rotating leadership deal.

Now this coalition, if it comes to fruition, will be made up of a wide swath of political parties from the left all the way through the center to

the right and would likely need the outside support of a small Islamist party called the United Arab List. And they will have a lot of differing

views across the ideological spectrum. But the one thing that is uniting all of these parties is their desire to oust Prime Minister Netanyahu.

Now, Naftali Bennett said in his speech last night in a televised address that he was willing to sit with people that were opposite the ideological

spectrum and says in order to avoid sending Israelis to a fifth election. Netanyahu, in his own speech lashed out at Bennett saying that he was

committing the fraud of the century saying that this new government would be left-wing, would be a danger to Israeli security.

But so far, the talks seem to be ongoing, but there are still a few days, a few more obstacles before this government can be sworn in. The final

coalition agreements have to be formally signed before they can be presented to the Israeli President, then the Israeli Parliament. The

Knesset has to actually vote on this new government before the government could be sworn in.

And this coalition has a pretty thin margin. So a couple defections could cause this entire coalition to crumble, and as with everything in Israeli

politics, things can change very quickly, but we may be heading towards the final days of Benjamin Netanyahu as Israel's longest serving Prime Minister

-- Richard.

QUEST: All right, we will leave it there. Hadas Gold, thank you.

Police in Nigeria's state of Niger say gunmen on motorcycles abducted a number of children from an Islamic school on Sunday. They said the

attackers shot one person dead. The latest in a string of mass kidnappings in Nigeria and the authorities say they're still trying to ascertain

exactly how many students were taken.

On Sunday, President Biden paid tribute to Americans who have died serving in the military delivering remarks during a Memorial Day service at a

Veterans Memorial Park in Delaware. The President spoke about his son, Beau, a veteran who died six years ago of brain cancer.

He urged Americans remember those members of the Armed Services who had fallen.

[09:15:08]

(BEGIN VIDEO CLIP)

JOE BIDEN (D), PRESIDENT OF THE UNITED STATES: We must remember the price that was paid for our liberties. We must remember the debt we owe those who

have paid it, and the families left behind.

My heart is torn in half by the grief to communities never whole again.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[09:17:57]

QUEST: New cases reported were more than 3,000 new cases of COVID -- coronavirus -- for the fifth straight day. The variant first detected in

India is driving the increase. Some European countries have now re-imposed restrictions on travelers from Britain.

Bianca Nobilo is with me from London. This rise of up to 3,000 -- is it sufficiently worrying that it calls into question any part of the

reopening?

BIANCA NOBILO, CNN CORRESPONDENT: So, scientists have been saying today that the country is on a knife's edge. It could go either way. Frankly,

that's the situation that we're in.

Last week, the government was saying that there is no data to suggest that the 21st of June date to relax all restrictions would be in jeopardy. This

week, things look a little more precarious, Richard, as you mentioned, a 25 percent increase of cases over the last seven days, so it's a critical

moment.

And as you know, it's bank holiday in England today and the weather is good for the first time in a month. So it's pretty bad timing when we --

whenever we agree to behave ourselves.

QUEST: Well, that's a good point. We will talk travel in just a second. I just want to know, what fallout has there been in Britain over the fairly

devastating comments by Dominic Cummings about the Prime Minister and his handling. I mean, in other times, this would have done him in, but I sort

of see they've all just disappeared off into the ether.

NOBILO: Yes, it's peculiar. I mean, it was a seven-hour long evisceration of the Prime Minister and the Health Secretary in particular. I think he

came out of it worse, in fact.

Boris Johnson is being referred to as Teflon before and Dominic Cummings isn't exactly a figure that's trusted by the British public. In fact, as

polls were showing, he has trusted about half as much as Boris Johnson. But some of what he said is sticking particularly about the fact that the

government had zero plan in the critical early stages of the pandemic and the fact that elderly people weren't protected.

So Boris Johnson's approval rating has taken a hit if polls are anything to go by -- Richard.

[09:20:10]

QUEST: And we saw Anna Stewart enjoying some spectacularly good weather outside, I think next to the river, and you're alluding to the fact that

it's a bank holiday and it is a nice one, you're not alluding, you said straight out. It's a nice one and everybody's out.

So there is a real feeling isn't there of a summer to be enjoyed and rescued?

NOBILO: Yes, there is, and people don't want to lose that. But also, it's a balance because this bank holiday, people have planned to see their

family because some restrictions have been relaxed. But on the other hand, they're being cautioned by the government and scientists not to enjoy it

too much.

It is beautiful, and this was a concern throughout the pandemic that whenever there is good weather in Britain, people, you know, according to

the government can't seem to control themselves and congregate on masse in ways that are very unhelpful in terms of virology.

And also, because people can't look forward to holidays abroad like they ordinarily could. There are very few places that British people can find to

go to on holiday, and there is no real sense that even if they plan to go there now that they'll still be able to go there in a couple of months'

time.

QUEST: Bianca, thank you. You have neatly and nicely taken me on to Tom Jenkins, who is the Chief Executive of the European Tour Operators

Association.

Well, I mean, there are two competing things going on in Europe. There is a reopening both within the Schengen area or within the E.U., and then there

is the ability to attract third party or third country visitors like the United States and the U.K. Where are we at the moment?

TOM JENKINS, CHIEF EXECUTIVE, EUROPEAN TOUR OPERATORS ASSOCIATION: Well, I mean, we're in a fog, frankly. If I knew what was happening, I'd be a much

happier man than I am now, notwithstanding the good weather that we're having.

I think the first thing to point out is that we are Europeans, alas, at the moment, a set of independent sovereign states and acting as such. So, it's

very short notice.

Germany and France have closed their borders to English nationals. At the same time, of course, as England prevented their English nationals from

returning from either France or Germany without any quarantining. They have to quarantine up to two weeks.

So intra-European traffic, certainly, if you're a non-E.U. member is heavily restricted. There's no way of getting around it.

QUEST: And how realistic is the Green Digital Pass that the E.U. is putting forward? I understand, I mean, both from a practical standpoint,

can they --

JENKINS: Well, I mean, it is realistic insofar as it is happening.

QUEST: Right, but can they get it up and running smoothly? Will the technology work?

JENKINS: We have a slightly bad line, I think that the -- I think the technology will work. There's nothing much to this technology. What is --

the real issue is whether people suddenly feel that they need to introduce border controls as a result of variants, and they've got to have -- they've

got to balance the need to introduce border controls as a result of variants with the enormous impact that the lack of tourism is having on

their service economies.

If we go back to the U.K., which you were talking about just now, the fact that there are no tourists -- foreign tourists coming into the U.K. is a

savage blow to the service economy.

If you look at somewhere like Oxford Street, Oxford Street relies for 50 percent of its turnover on foreign visitors. It will not have any foreign

visitors until really August-September at the earliest.

So it's in a really sticky position, as are most cities in Europe.

QUEST: What is the solution here? Bearing in mind the variants. There are the vaccinations. There is going to be the Digital Green Pass. You will

have I.A.T.A'S Travel Pass, but maybe not just yet. You know, you don't want more restriction. So what is the solution?

JENKINS: If I had a magic wand, I think, you know, the short answer is that, all one can say is that this is not going to be a rapid return to

normality. There was a school of thought that we would see a return rather than like the sun bursting out from behind the cloud at midday. I think the

return to normality is going to be like a long, slow, gradual door.

How we can accelerate that? I just don't know. I think we can hope that governments start persuading their populations that banning inbound traffic

is not the way forward, but with public opinion strongly in favor of blocking foreigners from coming in, even within Europe, politicians are

likely to lead where the psephologist tell them to go. I don't have much optimism for things returning before September.

QUEST: You see, I'm going -- I'm going on assignment on Friday to Croatia, and I can tell you, just to do the transfer on the way out London and then

come back via Frankfurt. And first of all, there aren't that many flights to begin with. And secondly, the logistical problems. It's very difficult

now, isn't it to travel and it's not going to get much easier?

JENKINS: Well, I think it will get easier. The answer is this will be over and when it's over, it is going to be a great time to travel to Europe. You

know, there's no -- one, you will be guaranteed of a welcome. And secondly, there is no problem with space and overcrowding at the moment. Over tourism

was last year's story.

QUEST: Well, you wait. You wait, it will be 2022's story. Please, God.

All right, Tom, lovely you to talk to you, as always. I'm grateful for your time. Thank you.

JENKINS: Thanks a lot. Bye-bye.

QUEST: Now, the stock markets in Europe, they are -- the countries may be closed, but the markets are open, or at least some of them are, and they

are mixed, which is a bit like the travel experience you'll have.

Investors are digesting reports showing inflation quickening in several countries. It's an otherwise quiet day. Deutsche is weighing heavily on the

Xetra DAX and the Fed has expressed concerns about the German banks anti- money laundering practices.

London is closed for a public bank holiday. U.S. equity markets are closed for Memorial Day.

India has reported that its GDP rose greater than 1.6 percent in Q1. But let's take that with a hefty dose of salt because it's before the second

wave of COVID infections really hit the country. I will be surprised to see if that revision isn't a revised downwards, and the next number truly

reflects.

As we continue as is next, it is fast, but no reason to be furious. Lamborghini says one of its best years despite the challenges of the

pandemic. The Chief Executive on going electric. Can you get the roar and the pop with an electric or a hybrid Lamborghini? It's a question we're all

asking after the break.

(COMMERCIAL BREAK)

[09:30:25]

QUEST: The pandemic has dented the prospects of countless businesses. It is not necessarily the case in the case of luxury cars. Lamborghini says it

has had its most profitable year in 2020, the second best in sales in the brand's history. The company is now pushing ahead with plans to make every

model it offers a plug-in hybrid by 2024.

The CEO, Stephan Winkelmann, he joins me now. This is really interesting, isn't it? That the -- across the board, we are seeing luxury items, luxury

sales, luxury cars, luxury goods having extremely good years because those people with money still have it, and they have not many things to spend it

on during the pandemic.

STEPHAN WINKELMANN, CEO, AUTOMOBILI LAMBORGHINI: Yes, somehow, they had time enough to think about what is next. So in these times where we had the

shutdown, people are reflecting about their selves about their lives. The stock market is one of the things which was an indicator was pretty fast

back up, and this was also happening to us. And it would have been a record year, if we would not have let's say the shutdown in the month of March and

April because this was also due to our dealers which were shutting down and our partners.

So as soon as this was back open, we had a boom of order coming in. And also today, by the end of May, we have a rock solid order bank, which is

covering almost 10 months of sales.

QUEST: The hybrid car, the plug-in hybrid, the batteries aren't -- today's batteries aren't large enough or powerful enough, in a sense for your --

for the performance that you wish. Is a Lamborghini -- is a hybrid Lamborghini going to be less than satisfying? Are you doing it as a

compromise because it's something you have to do by regulation?

WINKELMANN: No, we would never compromise. We would look for a different solution if we would go for a compromise. What we're doing with the

hybridization, this is actually a plug-in hybridization of our cars from 2023 to 2024. It is something which is, yes, reducing emissions, but it's

also increasing performance, and these two things have to work together. And we are watching very carefully that our future cars will be more

performing, will be still fulfilling the dreams of our customers.

And I can tell you that the first plug-in hybrid which we are going to launch, which will be the follow up of our Aventador, so our V-12 engine

car, will still have a 12-cylinder engine. And this is something which we are very proud of and we will have a car which is combining a lot of

emotion with less CO2 emissions.

QUEST: But is it trying to do the impossible? Is it trying to -- or square the circle -- whatever analogy you want to do, to make, to get a car that

is the definition of high performance and shoved into the category of hybrid?

WINKELMANN: No, I don't think so because the technology is up to a point where we can say when we arrived, there was no need to be the first one

doing something like this. But when we go, we have to be the best, and this is the commitment we are taking.

And the combination of let's say, a battery and an internal combustion engine can work and we will prove it. Now, let's say to speak about it

without driving the car is not making a lot of sense but trust me, we are very careful with our DNA, with our customers, with our fans and we will be

extra careful in doing the right thing.

QUEST: VW had to claim -- had to admit or had to clarify, I should say, that they -- there's no intention to sell Lamborghini. These rumors come

out periodically. They get slapped down.

I wonder where they're coming out of pandemic, there is something more here. Can you assure us you're not for sale?

[09:35:10]

WINKELMANN: You know, this is not up to me. I'm the CEO of the company, I'm not the owner. But there was a clear statement, and I trust that the

statement is the right one.

QUEST: And as CEO, you've sort of regained responsibilities, specifically for Lamborghini. When you came back in December, what did you find? I mean,

you found a company that was exceptionally successful, no question about it. What tweaks to that company do you now need to do to take it to the

next level?

WINKELMANN: Now, you know, when I first joined the company, we were a two- model company. It was in 2005. We were selling approximately 1,600 cars. And at that time, we said we are too much exposed to economic crisis, which

might come up and we need something to stabilize the company for the future.

So our idea was a third model, which was not a typical super sports car, because also the history of Lamborghini is not only about super sports

cars, but there's a variety of cars, which were not only in this niche.

So when the all saw our SUV, our super sports car SUV came out, it was the right move. And the success we're having also today is, let's say, the

proof that we are ready now for the second step. And the second step for sure is to go into the hybridization -- plug-in hybridization by

maintaining the DNA of the brand, and then maybe down the road, in the second half of this decade, so between 2025 to 2030, also do a step

further.

QUEST: Right. And I gather from that, because there is that -- it is a hybrid, a plug-in hybrid, the question -- reading the various message

boards and reviews and all of those things, people always say the hybridization, will the engine still have a roar and a pop when you drive

it? And judging by your smile, I am guessing the answer to that is an affirmative yes.

WINKELMANN: Yes, for sure. For sure. If you ever V-12, you will have the roar and you will have the pope as you are saying. You will have the sound

which our customers and our fans love.

QUEST: Sir, it is a treat and a pleasure to have you on our program today. I'm grateful. Thank you, sir.

Now, as we continue today, the theory that the current virus originated in a lab is becoming more mainstream. So whys and the origins of the pandemic

is crucial, because of course, we want to prevent another one. After the break.

(COMMERCIAL BREAK)

[09:40:23]

(BEGIN VIDEO CLIP)

DR. SCOTT GOTTLIEB, FORMER U.S. FOOD AND DRUG ADMINISTRATION COMMISSIONER: That's right. These kinds of lab leaks happen all the time. Actually, even

here in the United States, we've had mishaps; and in China, the last six known outbreaks of SARS-1 have been out of labs, including the last known

outbreak, which was a pretty extensive outbreak that China initially wouldn't disclose that it came out of a lab.

(END VIDEO CLIP)

QUEST: That is the former U.S. Food and Drug Administration Commissioner, Scott Gottlieb speaking on CBS on the theory that the virus that causes

COVID-19 may have originated in that Wuhan lab.

Questions about the origin have put the World Health Organization under further pressure, and the agencies agreed today to study independent

recommendations to reform.

My next guest says we will have COVID-26 and COVID-32, unless we understand how 19 came about. It is of course, Dr. Peter Hotez, Dean of Tropical

Medicine at Baylor College of Medicine, with me via Skype from Houston.

Doctor, we need really -- for my weekend reading, we need to know blood samples from those at the lab. We need to know what they were working on.

We need to know the genetic makeup of everything there.

We don't know those things, and the Chinese aren't going to tell us, ergo, we'll never know.

DR. PETER HOTEZ, DEAN OF THE SCHOOL OF TROPICAL MEDICINE, BAYLOR COLLEGE OF MEDICINE: Yes, that's exactly right, Richard. You know, there's been a lot

of talk about how we have to step up our Intelligence and the Biden administration has asked for a new Intelligence report. And my premise is,

you know, we've had Intelligence all over this for the last year and a half. They've been doing everything we can from several thousand miles

away, and you can only get so far with that.

Ultimately, we need to do what's called an outbreak investigation, which is knowing that there's some evidence that COVID-19 may have actually started

as early as late in the summer of 2019. We need to send a team of qualified epidemiologists and virologists into Hubei Province and collect virus and

blood samples from wild animals such as bats and domestic livestock and laboratory animals, and people in the area, interview patients, interview

the scientists.

This is not a quick fix. This is a slow process that could take six months to a year. And the reason we need to do it, Richard, is this is our third

major coronavirus epidemic/pandemic of the 21st Century.

We've had SARS in 2002-2003. We've had Middle Eastern Respiratory Syndrome in 2012. That's why we started making coronavirus vaccines because we said

it's only a matter of time before we have our third major coronavirus epidemic and right on cue, COVID-19 hit and we have every reason to believe

unless we could better understand the origins and now two major coronavirus pandemics coming out of China, we need to understand this mix that's going

on in places like Hubei Province where you have kind of mixing bowl of various livestock and ducks and chickens and high density populations. This

is why we see regular influenza viruses arise out of China as well.

QUEST: So since we are unlikely to get that information, and the W.H.O. did send a team in and their report, which said it can't be proven one way

or the other. The W.H.O.'s own reputation is on the line here, isn't it? Because the more evidence that suggests it might have been something

untoward, and they come out sort of saying we don't think it is untoward.

HOTEZ: Yes. And the point is, we have to do this and the world needs to demand it because if we don't understand how COVID-19 first originated, and

I think the more -- it is probably more likely that it is natural origins and a lab leak, we're destined to repeat this and this and we're destined

to repeat horrific tragedies.

So I think we have -- I think there is a way to convince the Chinese to allow a team of scientists in. What the W.H.O. did was send the team in to

interview individuals, it was not an in-depth investigation. And Chinese scientists could participate in the collection of samples and their input

is going to be very important as well. We need to look at this as an international resource that has to get done.

QUEST: Since geopolitical considerations, things may not go as well as we'd hoped. And the Chinese may not cooperate. At the same time, do we not

also need to put in place better protections globally, which will be on a national basis frankly, that when COVID-20, COVID-23 COVID-27 or whatever

it is comes along, we are we are more prepared and take action quicker.

[09:45:12]

HOTEZ: Yes. And in fact, this is what happens after every major pandemic, we do get a little bit better. So after SARS in 2002-2003, we implemented

International Health Regulations, I.H.R. 2005, after H1N1 pandemic flu in 2009, we implemented the Global Health Security Agenda, then CEPI, after

the Coalition for Epidemic Preparedness Innovation after Ebola in 2014.

So, it is not that we don't learn things. It is just now, this is the mother lode of all pandemics. Now, we've really got to add an extra

infrastructure. But remember, international governance will also only take us so far.

Let's look at the places where the most people lost their lives from COVID- 19. It's the United States, it's Brazil, it's India and arguably Russia, although Russia is terribly undercounting. A lot of this was internal

failings by leaders who denied the severity of the epidemic and tried to obfuscate and refused to take action.

So even the best international governance mechanisms is not going to be a substitute for leadership at the national level.

QUEST: There is a -- and I ask this question, bearing in mind, it's a U.K. bank holiday, it's Memorial Day. It is to a large extent the sort of the

kickoff of the summer. There's a feeling that things are almost over, out and about in this country over the weekend, there is just about every --

people think it's all done and dusted.

And yet you've got India, which is still in trouble. You've got Latin America, Central America, and ASEAN, in Asia, which is in a dreadful state.

We are heading to a bipolar world in the world of COVID.

HOTEZ: Yes, we are and quite honestly, we're even headed towards a bipolar United States because you know, while everyone is being self-

congratulatory, the truth is, our vaccination rates in the southern U.S. are at half of what they are in the north.

And remember this time last year, we were at our nadir in our epidemic, then we had that horrible surge over the summer. So we're not out of this

yet in terms of the southern states that are underachieving so profoundly in terms of vaccination, number one; and number two, the rest of the world

is not in good shape.

As you rightly point out, Latin America is having the steep acceleration right now, the fastest growing COVID epidemics are occurring in places like

Colombia and other Latin American countries, and India still in terrible shape and we're just holding our breath waiting for Africa.

So we're doing very poorly in terms of vaccinating the world, and we need to have the Biden administration have a greater role in actually scaling up

producing vaccines. We need six billion doses of vaccines. We're not even close to that yet.

QUEST: Peter, it is always good to talk to you, even in such difficult circumstances. Sir, allow me to wish you a good Memorial Day as best we all

can in the circumstances we face. Thank you, sir.

Now to Brazil where protesters have taken to the streets over President Bolsonaro's handling of the pandemic.

[VIDEO CLIP PLAYS]

QUEST: Tens of thousands of people marched across the country over the weekend. They are demanding better access to vaccines. COVID-19 has been

raging out of control there and Brazil has reported more than 43,000 new cases on Sunday alone.

The death toll is above 460,000. CNN's Rafael Romo has more.

(BEGIN VIDEOTAPE)

RAFAEL ROMO, CNN SENIOR LATIN AMERICAN AFFAIRS EDITOR (voice over): Screaming at the top of their lungs, people on the streets say the leader

of their country must go.

It was just one of the massive multi-city protests held across Brazil this weekend against President Jair Bolsonaro.

"It's our duty to fight for democracy," this protester says. "This government is no use to us. It doesn't serve the people and its political

project is to kill us."

The demonstrations against Bolsonaro in cities like Rio de Janeiro, Sao Paulo and Brasilia are some of the largest since the beginning of the

pandemic. Demonstrators had two main demands, calling for the President's impeachment and getting better access to COVID-19 vaccines.

"Impeachment now. Bolsonaro must go," this protester said adding that more people will die if he stays in power.

Early in the pandemic, the controversial right-wing former military officer downplayed COVID-19 as a "gripe zena," a little flu. The President also

questioned the effectiveness of vaccines and was often seen greeting crowds of supporters without a mask before contracting the virus himself.

ROMO (on camera): Brazil has been one of the hardest hit countries in the world and is now facing a possible third wave of COVID-19, vaccine nation

has been slow. Less than 10 percent of its total population of 210 million is fully inoculated and the South American country currently has the third

highest number of infections after the United States and India.

ROMO (voice over): Some protesters say Bolsonaro's lack of action is tantamount to genocide. "Cemeteries are full, refrigerators empty," this

banner reads. The Brazilian Senate has opened an investigation into the President's handling of the pandemic.

The protests happened only a week after a maskless Bolsonaro led a motorcycle rally where he once again questioned the usefulness of measures

to prevent the spread of COVID-19.

Rafael Romo, CNN.

(END VIDEOTAPE)

QUEST: As you and I continue this Monday, Bitcoin is heading for its worst month in almost a decade. Investors are hearing of new U.S. regulation

after China's sweeping crypto crackdown.

(COMMERCIAL BREAK)

[09:52:59]

QUEST: One of the rare moments in the history of Bitcoin is drawing to a close and as the widely held cryptocurrency is a tad higher today, two and

a half percent but still under $37,000.00 after a weekend plunge, a top U.S. currency official is hinting that tighter crypto regulation is on its

way.

Clare Sebastian is with me. Clare, if we take the fact that the $60,000.00 was an aberration, how much of the true price we're seeing now is because

of fear of greater regulation.

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Richard, I'd say a good amount. This has been a fair regulation from China. Last week, we saw a

real step up in Chinese rhetoric around this. The Vice Premier talking about cracking down on trading and mining and of course, between two-thirds

and about three-quarters of all Bitcoin mining happens in China, so that was a big one.

Now, we're seeing more chatter from the U.S. This was an interview that the acting Comptroller of the Currency did with "The Financial Times" saying

that the banking agencies, the F.D.I.C., the O.C.C. and the Federal Reserve are in talks to sort of create what he called a regulatory perimeter around

cryptocurrencies. There's a real sense that they're trying to sort of take control of this situation as it becomes more and more popular.

So that was part of what led to the blip over the weekend. But we've seen that the value come down off the back of regulation, but also the energy

pressure, the pressure around the energy usage of Bitcoin that stemmed from the Elan Musk flip-flop where he decided against letting people pay for

Teslas using Bitcoin. That pressure has really stepped up that's behind some of these regulatory crackdowns.

We saw Iran banning Bitcoin mining for four months last week because of concerns about blackouts. So it's a combination of those two things and of

course, amplified by the leverage that is in this market, people borrowing money to buy Bitcoin -- Richard.

QUEST: Enticed perhaps by things like Bitcoin sponsoring a racecar, which debuted at the Indy 500 this weekend where we saw the car. It's a strange

one, isn't it? I mean, who is doing it in a sense with Bitcoin since Bitcoin doesn't really exist as a solid organization?

[09:55:12]

SEBASTIAN: Yes, this is an interesting one. We are actually seeing a bit of crossover between sports and Bitcoin, but this is a car that was entered

into the Indy 500, which is one of the biggest events in motorsports. It was entered by Ed Carpenter Racing, which has a couple cars in the race,

and it was sponsored by contributions from the Bitcoin community in partnership with the Bitcoin payments app called, Strike.

So, apparently people who owned Bitcoin, who are a part of that community have contributed to this car and that's how it ended up in the race. It

was emblazoned with the logo. It was driven by an up-and-coming driver and it came in eighth, Richard. So, not a bad showing. Number 21, that's the

amount of total Bitcoin that can be mined. Don't forget the scarcity built in to that network.

QUEST: Clare Sebastian. Thank you, Clare.

U.S. markets are closed for Memorial Day. I will be back with "Quest Means Business" in a few hours from now.

That's it for the moment. "Connect the World" with Becky Anderson is next.

(COMMERCIAL BREAK)

[10:00:00]

END