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First Move with Julia Chatterley
Izium Residents Cope with Aftermath of Russian Occupation; Queen Elizabeth Laid to Rest after Solemn State Funeral; Germany: Gas Reserves at more than 90 Percent Capacity; 27 Killed in China as COVID Quarantine Bus Crashes; Philip Morris International Moves Away from Cigarettes; Leaks of New "Grand Theft Auto" Game Footage Emerge Online. Aired 9-10a ET
Aired September 20, 2022 - 09:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
(COMMERCIAL BREAK)
ELENI GIOKOS, CNN HOST, FIRST MOVE: Live in Dubai, I'm Eleni Giokos. I'm in for Julia Chatterley, welcome to "First Move".
Now U.S. stock futures are heading towards a lower start today and that's ahead of the Federal Reserve's September meeting. The central bank expected
to announce another big rate hike tomorrow, Dow Futures down six tenths of a percent NASDAQ down seven tenths of a percent S&P. Also under pressure as
well, like in New York, the U.N. General Assembly is underway right now, world Leaders are attending the very first in person gathering since the
pandemic began. Today's speakers include Brazilian President Jair Bolsonaro and France's Emmanuel Macron; U.S. President Joe Biden is also set to speak
tomorrow.
Now many of the people heading for New York are coming from the U.K., where they were guests at the funeral of Queen Elizabeth. Officials in London say
about a quarter of a million people fall past the Queen's coffin to pay their respects.
Meanwhile, Russia's invasion of Ukraine is expected to cast a shadow over this year's U.N.G.A. Ukrainian official saying Russia is escalating attacks
on civilian infrastructure, as its forces continue to be driven back by a Ukrainian counter offensive in the East Moscow's proxy leaders in the
Donbas region now calling for a referendum on becoming parts of Russia.
Ben Wedeman joins me now with the latest. Ben, the past few weeks Ukraine has had a very successful counter offensive, Russia incurring lessons. And
now Russia of course trying to bear down its power, its strength through referendums is giving you a sense of what's going on?
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, what we've seen today is the Luhansk People's Republic, which is this pro-Russian breakaway
Republic, the Donetsk People's Republic, as well as the Russian authorities in Kherson and Zaporizhzhia have all announced between the 23rd and the
27th of September, they will be holding referendum to decide whether to join Russia to basically make those areas part of the Russian Federation.
Now, the vote will either will be in person or online. The problem may be that in many of these areas, there's no internet. So it's questionable how
those votes are going to go ahead, but not in doubt is the outcome given that what we've seen in the past is that they always win.
The head of President Zelenskyy's office, has said that this announcement about referenda in these four areas, is what the fear of defeat looks like.
Of course, recently, we've seen Russian forces in disarray in this area, the Kharkiv region. And we were able to go to Izium, the other day, where
we discovered that those who lived under Russian occupation did not have warm memories of that period.
(BEGIN VIDEOTAPE)
WEDEMAN (voice over): Help arrives in Izium, bags of barley meal, tins of food. Waiting her turn Inessa (ph) shrugs off the tribulations of late
she's seen worse.
We survived World War II when I was little, she tells me.
Surgeon Oksana Karapetian hands out medicine, sedatives are in high demand.
OKSANA KARAPETIAN, SURGEON: They've got half of a year, six months, without any help. You can understand what to do they would just imagine what do
they feel?
WEDEMAN (voice over): Liberation from Russia isn't the end of Izium's troubles. Much of the city was severely bombarded before falling in spring
to the Russians. There's no running water, no electricity, no heat. Crowds gathered to charge cell phones off an army generator and make calls 10
minutes per person using internet provided by a satellite connection.
Lubov (ph) and her daughter Anzhela (ph) are calling relatives, they want to leave, winter is coming.
People will freeze Anzhela warns older people won't survive. They also fear the Russians could return. Nearby, the signs of their hasty retreat, helmet
strewn outside a house, Russian soldiers commandeered, bread crumbs still on the table. Insects make a meal of fruit, half eaten.
On the edge of town, the remains of Russia's once vaunted army, before a monument harking back to a different time, which now seems like the distant
past.
[09:05:00]
WEDEMAN (voice over): Natasha shows me a newspaper distributed during the occupation.
WEDEMAN (on camera): What does she think of him?
I haven't thought anything good about him since 2000, she says. He destroyed everything and Russia. The paper does, however, come in handy.
(END VIDEOTAPE)
WEDEMAN: Of course, the experience of these people under Russian occupation is very relevant to what's going on in those breakaway regions that are
going to hold a referendum now. It is anticipated that they will all vote in a great majority to join Russia. The problem is that once those areas
are as far as the Russians are concerned, part of the Russian Federation that brings in the possibility, the danger that Russia will declare this a
full war instead of this special military operation, Eleni.
GIOKOS: All right, Ben Wedeman, thank you so very much for that update on your report.
Ukraine is expected to dominate the 77th Annual U.N. General Assembly in New York. The debate begins this hour with the first speech from Brazil as
is the tradition. The U.N. chief warns the meeting comes at a time of "Great Peril" for the world with global divisions greater than they have
been since the Cold War.
And as you can see, these are pictures from the United Nations U.N. Secretary General Antonio Guterres addressing Leaders, Richard Roth; you
are a veteran and covering the U.N.G.A. And you know, when you hear the words the world is in a state of great peril, it just literally gives you a
sense of the uncertainty the issues that will lead us need to discuss and of course, the messaging importantly, to Vladimir Putin and importantly,
the messaging towards Volodymyr Zelenskyy.
RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Yes, it's year 77. For the General Assembly and following up on Ben's story the Ukraine crisis will
not be solved this week d the presence of over 140 Heads of Government and heads of state. The Russian Foreign Minister Sergey Lavrov will be in the
building no plan bilateral with major Western countries at this time. It would be a bit of a minor breakthrough if there was actually talk between
Secretary of State Blinken of the U.S. and Lavrov. They have avoided each other at two other international gatherings.
Coming into the building what we see as a feature of the U.N. General Assembly, a parade of Prime Ministers, Presidents, Heads of State, Foreign
Ministers, they all fall in with their delegations at the so called delegates entrance. Then they proceed to the general assembly hall where
many are now listening to the U.N. Secretary General Antonio Guterres.
He's got a big problem. Ukraine has really as one Western diplomat told us turned the place upside down. Permanent member of the U.N. Security Council
can't be removed. It's engraved in the charter, Russia versus much of the world.
However, there are African nations that feel too much attention has been paid to Ukraine. They're not getting enough food. The money, the donations
to help out from major powers has gone towards helping Ukraine, not to other nations. Climate was going to be a big topic this week education, a
whole barrage of other issues. But this war involving a permanent member of the Security Council has dwarfed all the other issues.
GIOKOS: Yes, exactly at a time where climate change should be high up on the agenda. Richard Roth, thank you so very much for that update.
All right, Jerome Powell, in the spotlight this week as the U.S. Federal Reserve kicks off a two-day policy meeting today. Just about everyone
expecting another significant interest rate hike all indications point to another increase of three quarters of a percentage point. III big one in a
row and the Feds rate hikes this year, policymakers of course, trying to rein in inflation, which is near a 40 year high. Rahel Solomon is going to
break it all down for us.
Rahel, I have to say after the inflation reading that we saw last week, a lot of people talking about a potential 100 basis point rate hike and also
a lot of criticism that the Federal Reserve didn't act quickly enough when we started to see inflation, rearing its head. Are they got? Do they have
enough tools in the box to try and temper what we're seeing at the moment?
RAHEL SOLOMON, CNN CORRESPONDENT: Well, I mean, interest rates certainly will work. The question is Eleni, how soon will we start to see it work?
And you're right now we're starting to hear some projections that might we see 100 basis points or a full percentage point, raise the interest rates,
which would be unprecedented in modern times.
And Eleni, to put this in perspective, if in fact, we do see three quarters of a percent today, you'd have to go back 40 years to see rate hikes go up
so consecutively so much, and so we are certainly living in historic times. I want to paint a picture for you of sort of where inflation is on a yearly
basis you can see.
[09:10:00]
SOLOMON: We actually are sort of trending directionally lower we can pull up yearly inflation for you now. And you can see 8.3 percent, certainly
better than the 9.1 percent that we saw posted earlier this year. But take a look, I mean, that is still historically high, 40 years, as you pointed
out, but take a look at monthly consumer inflation.
And that paints a slightly different picture; you can see perhaps some more encouraging news, right? I mean, you look at the last month, August,
monthly inflation came in at 1/10 of 1 percent, the prior month, it was actually zero so again, directionally moving in the right direction,
although a lot of this was because of energy.
Still, however, falling far short of what Jay Powell and the Federal Reserve have indicated that they are looking for, for clear and consecutive
evidence that inflation is lowering to their 2 percent target.
Eleni, I want to take you down memory lane a bit and go back to June. That's the last Federal Reserve meeting, where we actually got economic
projections from the FOMC Committee. And what we heard then are that they were expecting the unemployment rate here in the U.S. to hit about 3.7
percent by the year end, we're already there.
What I think will be really interesting today is where they see the federal funds rate ending by the end of this year, because back in June, they
expected that to end at about 3.4 percent. We know the market is expecting that to be much closer to 4 percent by the end of the year. So that will be
very interesting, not just what they do in terms of interest rates. That of course, is the big story, but also where they see rates going by the year
end.
GIOKOS: Yes, and the messaging around those rights Rahel, and just how much of this has actually been priced in. I know the markets were really spooked
last week. Any specific messaging very quickly, messaging that people is anticipating from Jay Powell.
SOLOMON: Look, I mean, I think as simple as I can make it much more hawkishness, right. I mean, I don't think the Federal Reserve Chairman
Powell was going to sort of take his foot off the brake or provide any indication that they're going to start with interest rate hikes. So I think
we're going to see more of the same and not sure that the market is going to like that already.
GIOKOS: Yes, Rahel, Solomon, so we have a lot more to talk about in the coming week. Thank you so much, always good to see you.
All right, everyday life is slowly returning to normal in Britain as the official mourning period for Queen Elizabeth ends. We heard today that
around 250,000 people filed past her coffin while she was lying in state in Westminster Hall.
Nina dos Santos is at Buckingham Palace for us, Nina Good to see you. You know, look, the last few weeks certainly have seen major turning points
politically and for the monarchy, as well. Police trusts now reality of day to day issues becoming so much more, you know, on the table, I guess, and
she needs to deal with quite a few issues at hand.
NINA DOS SANTOS, CNN CORRESPONDENT: Yes, absolutely. Well, first of all, she spoke to reporters on a plane over towards the United States to take
part of the U.N.G.A. that you were just discussing with Richard Roth a moment ago. And she acknowledged apparently, the huge contribution of
various members of Britain's civil service, the army etcetera.
This has been one of the biggest weeks that this country has ever faced to try and put on the logistical challenge. That was the royal funeral. And
what a spectacle it was yesterday, it's estimated that 4 billion people watch this event. That's 250,000 people, so that's a quarter of a million
people, Eleni stood in that famous line to see the Queen's coffin lying in state for the days that it was in Westminster Hall and about a million
perhaps even up to 2 million people converged upon the Capitol to line the streets and see her coffin go past.
Now, obviously, the period of national mourning in this country has ended. The period of royal mourning has not yet ended that ends on the 27th of
September. But the fact that the period of national mourning has ended is also important because it means as you said, that this country can get back
to the business of government.
And some really big decisions that need to be made. Remember that Liz Truss was only appointed by the late Queen, just 48 hours before she died. And
then now she has to forge a new relationship with King Charles III. And everybody's looking to try and understand exactly what kind of King he'll
be exactly what kind of relationship you'll have with the Commonwealth, which is well, it's crucial to this country's economic future.
Liz Truss and her government conservative led government have repeatedly stressed the importance of those Commonwealth countries, after of course,
the U.K. left the EU. Now, Brexit left a huge labor gap. It's left all sorts of economic lingering issues that they want to plug those types of
holes with stronger relationships with other countries, including the Commonwealth. But as you were just saying, now, the business of getting
back to the big deals is well and truly upon this country. And Liz Truss has reportedly acknowledged that when it comes to a trade deal with the
United States. Perhaps that special relationship isn't quite strong enough to kneel one down for now, Eleni.
[09:15:00]
GIOKOS: All right, yes, Nina dos Santos brilliantly said thank you so very much as for breaking that down for us thank you.
All right, well, Queen Elizabeth's great grandchildren were the youngest generation of royals to participate in the funeral Prince George and
Princess Charlotte formed parts of the procession behind the Queen's coffin, signaling the more prominent and evolving role they'll play as
descendants of the throne CNN's Anna Stewart reports.
(BEGIN VIDEOTAPE)
ANNA STEWART, CNN REPORTER (voice over): The youngest generation of the royal family joined the solemn ceremonies to say one last goodbye to their
great grandmother, Queen Elizabeth II Prince George and Princess Charlotte, both in attendance for the church services, mourning the beloved matriarch.
The pair remains close to their mother Catherine, the Princess of Wales throughout the day. That she participated in the procession, as the coffin
was escorted from Westminster Hall to Westminster Abbey, and after they attended a more intimate ceremony held at Windsor Castle.
MOST REV. JUSTIN WELBY, ARCHBISHOP OF CANTERBURY: We pray today especially for all her family, grieving as every family at a funeral. But in this
family's case, doing so in the brightest spotlight.
STEWART (voice over): The Queen's death comes at a time of change for the children. Her death was announced on the same day the children started at a
new school after the family relocated from London to Windsor in the summer.
The children often spent holidays with the Queen and attended her Platinum Jubilee celebration earlier this year. Both Princess Charlotte and her
mother paid tribute to her majesty by wearing symbolic items of jewelry. The Princess of Wales honors the Queen with her pearl necklace and
earrings, the same set she wore to Prince Philip's funeral.
Princess Charlotte wore a diamond brooch, a gift from the Queen and in the shape of a horseshoe, signifying her love for horses. That passion was
underscored as the procession passed Windsor Castle, where the Queen's beloved horse and corgis awaited.
The day holds particular wait for the young family. With the passing of the Queen, Prince William is now heir to the throne, making Prince George and
Princess Charlotte, second and third in line.
Now the youngest members of the family begin to bear responsibility representing the future of the British monarchy, Anna Steward CNN, London.
(END VIDEOTAPE)
GIOKOS: Well, straight ahead, Germany is working quickly to wean itself off Russian fuel before winter. I speak with the head of one of Europe's
biggest energy companies about the crisis. And new outrage over China's zero COVID policy after a fatal bus crash more after the break stay with
CNN.
(COMMERCIAL BREAK)
[09:20:00]
GIOKOS: On the sidelines of the United Nations General Assembly expect Europe's reliance on Russian energy to be a hot topic as we head into
winter. Germany, which is trying to wean itself off Russian gas, says its reserves are over 90 percent full. The country is getting its gas from the
Netherlands, Belgium and Norway.
Now as you'd expect, Enel, which is one of Europe's biggest energy companies is monitoring the geopolitics it operates in more than 30
countries across 5 continents.
Francesco Starace is Enel CEO, and general manager. Francesco, really good to see you thank you so much for taking the time! First question, do you
believe that Europe is going to be able to get through this winter with the current state of its gas reserves and supply?
FRANCESCO STARACE, CEO AND GENERAL MANAGER, ENEL: Yes, I think the winter might be passed with some probably some sacrifices, you know, lowering
temperature for the heating and making a little bit of savings in also some industrial sectors, we have been asked also to try and avoid use gas and
use alternative fuels, in this particular case, coal to just get through the winter.
So I think the winter might be passed, the issue is we will get at the end of the winter in the springtime with all the gas reserves, fully used or
well used. And that will put down the problem of what to do next, you know how we will be able to refill for the next winter. So I'm more concerned if
you want for the 2020 for winter, then 2023 one.
GIOKOS: You've also said that the energy crisis could be resolved if there was a cap on gas prices, which is interesting, because many people believe
that this is supply issue as opposed to just a price issue. But you know, give me a sense of what you're thinking about supply demand dynamics, and
how a ceiling could be formed?
STARACE: The price of gas is increased has been increasing over the last 12 months, partly only partly as supply and demand balance or imbalance. But
the large part of the price increase that we have observed in Europe is the result of an incredible volatility of the index with which gas is traded,
and to which prices of gas are anchored to across the European continent.
That index has moved not really because of clear supply and demand constraints. But rather, because of geopolitical anxiety and projecting a
risk perception on the gas supply, that so far has failed to break up.
So we are saying the index, think about that the index went up 10 times - throw without the prices of gas 10 times across the Eurozone. But supply of
gas itself would not only warrant that. So we think what needs to be done is let the index cool off and take a period of transient that will cap the
index to a certain level so that prices of energy would cap for a while. That's something that I think is necessary in many countries. I think that
we should try that for at least six to eight months.
GIOKOS: Yes, and I'm like you mentioned anxiety, there's a general sense of anxiety, you see so much speculation feeding through into energy prices,
which is a reality. Look, I want to talk about alternatives you mentioned firing up coal fired pipelines.
You've also been very vocal about like not saying goodbye to nuclear, as yet. Tell me what's on the table right now. And I have to say in the
background, we're talking about energy transition. We're talking about the climate change agenda, which seems that some of these issues are not
aligned with that overall strategy. It seems like we're being derailed.
STARACE: Well, I think we have to separate this these two moments, you know, we have a survival phase, which is this winter, which doesn't mean
that the trajectory we were going through to pursue was wrong. Actually, it's a proof that we would have to accelerate the transition rather than
rethink about it. Because if we had an accelerated strategy, we would probably get out of this gas crunch earlier and get off this this crisis
earlier.
[09:25:00]
STARACE: So what we need to do is number one, survive the winter. And number two, accelerate the investment on renewables and decarbonize at
least the energy sector to electricity sector and most of the heating sector.
Let's, think about that. About half in case in some cases, two thirds of gas consumption in Europe are linked to the use of gas for these two
sectors, electricity generation, in heating. Both can now with the present technologies be decarbonized fully.
And that would mean wean off the need of gas from the overall European demand in a large quantity. In excess, I would say to what today Russia has
been exporting so far to the U.S. to the EU. So it's a case in which the energy transition gets reaffirmed and reinforced. It needs to be
accelerated - not the country clearly--
GIOKOS: --renewable energy space. Yes, that's all. So this is where the next question comes in. You're big into renewable energy. I want to be
realistic here. We're talking about de-carbonization; we're talking about Net Zero, how big can renewable energy be in the energy mix to ensure that
we don't have any interruption in energy supply and electricity supply?
STARACE: I think today, it is possible in a short time, and I say short time for this for this industry is a 5 to 10-year period, to fully
decarbonize the electricity sector across Europe. And when I say fully decarbonized, I mean a mix of renewables and nuclear.
And that is something that is within reach, it is within technology reach. So we don't need special technologies to do that. We just need what we have
today. But the depth of thermal generation that needs to be shut down is huge. So the time it takes to do that safely, without having problems to
the energy supply is a period of 5 to 10 years. Now this crisis will probably accelerate it. But that's, basically possible within this time
period.
GIOKOS: Taxing oil and gas companies, energy companies, do you think this is the right approach?
STARACE: I think it is because, you know many companies today will try to find alternatives and find solutions to this. I think gas is a very
precious substance. We should use it for what it is a molecule that is needed for chemical applications and other very special industrial
processes, not burn it, to heat our homes and burn it to heat and to generate electricity that is a wasteful and expensive habit that we have to
forget.
GIOKOS: All right, Francesco Starace, thank you very much sir, good to see you. I know you are going to be doing a lot of work at the U.N.G.A. and
participating in some of those discussions sir, thank you so much for taking the time.
STARACE: Thank you, Eleni.
GIOKOS: And just ahead, a deadly crash in China triggers widespread anger and stinging criticism of Beijing's zero COVID policy. We'll be back with
the details after this stay with CNN.
(COMMERCIAL BREAK)
[09:30:00]
GIOKOS: Welcome back to "First Move". Now U.S. stocks opening lower as the Fed gets ready to begin a two day policy meeting. Policymakers expected to
raise interest rates by at least three quarters of a point again this month.
DOW Jones as you can see down nine tenths of a percent shares of Ford are falling after the auto giant warned about high costs from suppliers and
shortages of parts. Meanwhile, vaccine makers Moderna and BioNTech also down following President Biden's comment that the pandemic is over in the
United States. Meantime, in China, a bus crash in which 27 people died has sparked fresh anger over the government zero COVID policy. The bus was
taking people into mandatory COVID quarantine in the early hours of Sunday morning when it overturned in a ravine.
Authorities say the cause of the crash is still being investigated. Ivan Watson joins me now, Ivan, thank you so very much for joining us. Look this
bus crash again a reality check for authorities in terms of their zero COVID policy and what that means in terms of reality on the ground, but
also for the loss of life. Many people say it should have been done differently in terms of transporting those people. What do you have for us?
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, I mean, there's some important context here. This is the world's most populous country. And
according to government statistics, there were 629 confirmed cases of COVID in China on Monday.
And despite those relatively low numbers, the government is pursuing what it calls its dynamic zero COVID strategy, which involves very strict
lockdowns, impacting millions of people, carting off people by huge numbers to makeshift quarantine facilities, and imposing frequent mandatory testing
on populations.
And these kinds of measures have been in place for months now, and they are leading to situations and cases that are, frankly traumatizing parts of the
Chinese population.
(BEGIN VIDEOTAPE)
WATSON (voice over): A deadly bus crash in southwestern China sparking anger over the country's strict COVID policies. The vehicle carrying dozens
of residents from the City of Guiyang as well as their drivers seen dressed in a hazmat suit to a faraway quarantine center.
Hours later, the bus overturns killing at least 27 people and injuring at least 20. A worker later has seen spraying disinfectant on the wreckage.
WATSON (on camera): The bus departed the southwestern city of Guiyang shortly after midnight on Sunday, with the goal of reaching a quarantine
center in remote Libo County located within three hours' drive away.
Authorities say the vehicle tumbled into a ravine at 2:40 am raising the question, why it was so important to rush suspected close contacts of COVID
patients such a long distance so late at night, especially in a province where officially there have been only two deaths from COVID since the start
of the pandemic.
WATSON (voice over): The Chinese government is obsessed with eliminating all traces of COVID from the country locking down entire cities for weeks
and even months. Authorities can find nearly 2 million residents of the City of Guiyang in their homes starting on September 2.
[09:35:00]
WATSON (voice over): Days later trapped residents suffering from food shortages, voice anger and frustration. Where's the Communist Party, one
man yells. We've trusted the party and the government. Things are worse in more remote areas.
In the Western Xinjiang region, a desperate mother films her children sick with fever, and complains COVID restrictions prevent her from taking them
to a hospital.
Recording of another call for help to the authorities in Xinjiang's Capitol, this from a gastric cancer survivor who says he's dying from lack
of food. The man who we won't name for his safety shows CNN pictures of his empty refrigerator.
He says he needs frequent small meals since doctors removed most of his stomach for cancer treatment and says police detained and beat him after he
went out on the street looking for food.
In the capital of Tibet this month, officials marched residents off to quarantine camps. The Chinese government sends suspected COVID cases on
mass to sprawling makeshift facilities were some complain of wretched conditions.
After Sunday's deadly bus crash, a deputy mayor apologized and promised an investigation into the accident. But even on China's heavily censored
internet critics are chiming in.
What makes you think we won't be on that late night bus one day, one person writes, they have a point while the rest of the world moves on from the
pandemic, in China, there's no end to the campaign to eliminate COVID, no matter the cost.
(END VIDEOTAPE)
WATSON: And let's just stress again this city Guiyang in the south west of China, where the bus originated from it counted a total of 37 confirmed
cases of COVID on Monday.
And yet again, we're hearing about millions of people living under this very strict lockdown, and people being sent away in buses far away to
quarantine camps. We don't know the cause of this deadly accident which killed at least 27 people.
But there's a saying that's been going around China for months right now. You can die of anything in the country right now. But you're not allowed to
die of COVID, Eleni?
GIOKOS: Ironic, isn't it? Ivan Watson, thank you so very much. Now in the Caribbean, storm Fiona's strengthening and developing into a major
hurricane according to the U.S. National Hurricane Center.
It is bearing down on the Turks and Caicos Islands after ripping through the Dominican Republic on Monday. Now heavy rain and strong winds is
destroying buildings and homes, more than 1 million people are without running water.
In Puerto Rico at least two people died as rain floods and power cuts continue. CNN's Leyla Santiago reports from San Juan.
(BEGIN VIDEOTAPE)
LEYLA SANTIAGO, CNN CORRESPONDENT (voice over): Hurricane Fiona gaining strength and hammering the Caribbean with strong winds and intense rain.
The storm is heading toward Turks and Caicos today. Following landfall in the Dominican Republic Monday, on Sunday afternoon Fiona hit Puerto Rico
causing an island wide power outage.
PEDRO PIERLUISI, PUERTO RICO GOVERNOR: And by the time the tail lifts Puerto Rico we will have gotten roughly 35 inches of rain. That's a huge
amount of rain.
SANTIAGO (voice over): The governor says he hopes it would just be a matter of days to get electrical service back to most customers.
PIERLUISI: But one thing to keep in mind is that our grid is quite fragile still. It got fixed after muddy but not really improved since muddy.
SANTIAGO (voice over): The storm coming just as part of the island was finally recovering from Hurricane Maria's destruction five years ago.
JUAN MIGUEL GONZALEZ, BUSINESS OWNER: It's been rough, we've been just working to get back this neighborhood get back from Maria that everything
was destroyed. Restaurants, houses, everything was destroyed. And we just not all the way back but we just have way back. A lot of people more than
Maria lost her house have now lost everything on their houses because of the floating.
SANTIAGO (on camera): This is the backyard, the neighborhood where the National Guard had to come and rescue people, still a lot of flooding. I
can hear generators powering the home and it is still pouring down with rain.
Neighbors looking out wondering exactly what will come next as Hurricane Fiona the remnants of it continue to demolish this area.
SANTIAGO (voice over): The family rescued during the storm now safely in a shelter. She says this was worse than Maria. She's pointing out that
they've already been underwater for 24 hours and the rain is still coming down. So she's concerned about the 2500 families that she says are impacted
by this here.
[09:40:00]
SANTIAGO (voice over): At least 1000 people rescued from floodwaters more rescue efforts still underway as emergency responders try to navigate
through difficult to reach areas. In - the interior part of the island, 25 year old - watch this bridge come apart in just minutes and wash down the
river.
On the west side of the island, rainfall swelling the Guanajibo River in Hormigueros, surpassing its previous record height at 28.59 feet set during
Hurricane Maria now gauging to more than 29 feet. The National Weather Service said the damage from Hurricane Maria still looms large over the
island.
CARMEN YULIN CRUZ, FORMER MAYOR OF SAN JUAN, PUERTO RICO: We've wasted five years. So the fear of the Puerto Rican people is that history will repeat
itself.
(END VIDEOTAPE)
GIOKOS: Right and still to come an international tobacco giant announcing bold plans and big deals to move away from cigarettes. I'll be speaking
with the CEO of Philip Morris International right after the short break, stay with CNN.
(COMMERCIAL BREAK)
GIOKOS: The United Nations General Assembly is underway in New York. And one topic that's being addressed is the transformation of the tobacco
industry. Tobacco giant Philip Morris International which distributes cigarettes brands such as Marlboro to international markets is working on
moving away from cigarettes by investing in smokeless nicotine devices.
Its goal is to become a majority smoke free business by revenue by 2025 and recently announced major acquisitions in the pharmaceutical and healthcare
sector as it moves beyond nicotine.
Philip Morris International says many countries could end sales of combustible cigarettes within 10 to 15 years. Joining me now is Jacek
Olczak, the CEO of Philip Morris International, so good to see you. Thank you very much for joining us.
You're in New York for the UNGA talking about transforming the tobacco industry. I want to refer to the W.H.O report that was released a few
months ago that spoke about tobacco poisoning our planet. And it basically goes beyond than just the health issue. I think that's been dominating
headlines.
But the environmental impact of pollution of water usage and generally the tobacco value chain. So when you say transforming the industry, what would
that look like to you?
[09:45:00]
JACEK OLCZAK, CEO OF PHILIP MORRIS INTERNATIONAL: Well, first - most importantly is to finally put the cigarettes as we know them today well
behind us. And I do believe that if all the parties involved including mentioned by the W.H.O would act together with the industry with our
stakeholders; we could end the smoking in the very, very short period of time. Actually, the supply chain impact of tobacco growing is not as bad as
people would think. There's a lot of you know, good agronomic actions being taken, there's been no good stewardship, about the water use et cetera.
But the prime the impact of the industry, which will have the negative impact, is the combustible cigarettes. And I think is the high time today
to utilize the science and technology, allowing to take the smokers to the much better alternatives rather than to let them continuing smoking.
GIOKOS: And yes, I agree with you from the agro processing side of things. I've actually been to a few tobacco farms in Zimbabwe and seeing how
communities are aligned on this crop.
But interestingly, the pollution side of things is fascinating, because you're saying combustible cigarettes. And you know, that the, you know,
cigarette butts or the filter is actually one of the biggest polluters, globally.
And that's a big point of contention, where they're saying, can we get rid of it in the meantime, to cigarettes really needed. Would cigarette
companies be willing to take on the responsibility of clean up? Where would you plug into this, given that you're talking about transforming the
industry?
OLCZAK: Yes, I mean, we're working also on a biodegradability of the filters, OK, they will not improve the health, the negative health impact
of the cigarettes as we know them. However, they can address the environmental impact.
I mean, this solution is not really available. So they're not available, not scalable, but we're working hard on this. There's also a number of
initiatives we're taking in how to dispose of the cigarette butts in the way that they cannot, you know, directly go into the - water, rivers et
cetera.
It's you know, heart assignment for all of us. But again, I mean, the main cause or the main negative impact coming from a cigarette is the smoking is
the combustion.
This is where all of the negatives are, are being created when you know, consumers are smokers are exposed to all of the toxicants in this --. We
know today that they are better, much better forms of consuming nicotine.
You mentioned electronic cigarettes heat, not burn products, the overall category products. And I think that's the quickest fix, which could very
rapidly to change the harm trajectory of the cigarette smoking.
GIOKOS: And, of course, you've got a smoke free target drive by 2025. In terms of your revenues, you're getting closer to that through acquisitions.
It's been fascinating to see some of the, you know, companies that you've been acquiring there in the healthcare space.
And of course, you're also focusing on the Swiss company called Match. But importantly said that it's how do you consume nicotine in the best way
possible. I want to talk about your identity, what your company is going to stand for, given that your diet, you know, pivoting to healthcare products,
and yet still focused on nicotine as a substance that we know is still going to be consumed regardless of whatever policy might come into play.
OLCZAK: Now, let's make it very clear. It's not the nicotine which is the cause of the harm created by smoking, is the smoking and the - tar and all
the other constituents which are being released while you're combust the tobacco cigarette. So it's not the nicotine which really is an issue here,
the issue is all the other you know the compounds which are found in a small quantity burning a cigarette.
They are safer, they are better forms of a consumption of nicotine and human invention could not burn which is our general flagship platform, very
successfully taking people out of combustible smoking, some in the Americas whereby almost a third of the smokers already left their cigarettes behind
them.
The overall platforms, the electronic cigarettes, these are all much better much better forms of consumption of the nicotine. So we put fires for
ourselves a very ambitious target that by 2025, we should attain the 50 percent of the revenues coming from smoke free propositions.
And we are on the perfect path to reach the target. We already have 10 markets out of our global footprint that we are well above 60 percent of
the revenues coming from smoke free products.
So this is unstoppable transformation, which will continue. And I believe one day I will have to remind people that Philip Morris International was
the company which is to sell cigarettes. And we will just forget how the cigarettes look like. Like we, for example, forgot how the landline phones
were looking 20 years ago.
[09:50:00]
GIOKOS: Interesting analogy. Yes, very quickly. Sorry, Russia accounted for 6 percent of revenues last year. You still haven't exited Russia; it's
going to cost you a lot of money. What is the prognosis in terms of betting that, that sale down and exiting Russia?
OLCZAK: Yes, so I'm going to have about almost 30 years' experience in this industry in Philip Morris. And I work on a number of business development
measures, diverse tours and similar transactions. I never was confronted in such a complex situations as we now in Russia.
So we're working on the restructuring or arranging our presence in Russia. But you know, if you want to satisfy all the important stakeholders or
shareholders, there is a huge value which we have, which we have, we now have our business in Russia, at various regulators, governments, et cetera.
This is really a very, very, very complex situation. But also, you know, we were focusing in the meantime, on our operations in Ukraine, because let's
not forget that, you know, the real drama is happening in the Ukraine.
When I worked at the factory in Kharkiv, which was bombarded we need to support our people, the families and the other citizens of Ukraine. There
was a tremendous effort which we, which we're spending behind.
GIOKOS: Yes.
OLCZAK: You also mentioned, you know--
GIOKOS: Jacek Olczak, thank you very much. Good to see you.
OLCZAK: Thank you.
GIOKOS: We've run out of time, Jacek, but thank you so much. I'm sure we'll speak to you again very soon. Much appreciate it. We're going to short
break and a smash and grab at Rockstar Games, the maker of Grand Theft Auto remember that? Well, unreleased game footage is already online. We'll chase
the latest up next, stay with CNN.
(COMMERCIAL BREAK)
GIOKOS: The makers of Grand Theft Auto have suffered a grand theft of their own. Hackers help themselves to footage from the upcoming release of the
wildly popular game. In Game screenshots and videos have been splashed online. Paul La Monica joins me.
Paul. I mean, this is a twist of irony, isn't it? But a costly one tells me what the numbers say.
PAUL R. LA MONICA, CNN REPORTER: Yes, I mean the word theft obviously in the title of the game. And this is an issue for Take-Two Interactive, the
owner of Rockstar Games. Their stock briefly fell about 3 percent yesterday morning Eleni after the hack was discovered.
And publicize the shares did rebound by the end of the day and Take-Two and Rockstar are reiterating that. Yes, this is real. These are photos and
videos from the upcoming game that is yet to be released. But they do not say think that there any data was compromised for current game users and
that they're still working on the game and it'll be released when it's ready, despite this hack.
[09:55:00]
GIOKOS: Yes, I mean, I'm just looking at some of the footage. Is it a huge compromise in terms of the players looking at this and kind of getting some
insight?
MONICA: I mean, I think it is possible that players of the game may now have more to go on, if you will, in terms of scrutinizing what the new game
might actually look like. But I think it's important that since the game isn't released, yet, this may not be the finished product.
I think a bigger issue is that Uber which had a cybersecurity incident of its own over the weekend, they said in a blog post that according to them,
it's the same hacking group that was involved with the Uber cybersecurity incident that also is involved in this Grand Theft Auto League. So I think
this is just a bigger issue for corporate America writ large that serious, confidential data could get released.
GIOKOS: All right, Paul La Monica, thank you so much for footage we were showing you is from the previous game, not the new one. Thank you so very
much for joining us. That's it for the show today. "Connect the World" is up next, stay with CNN.
(COMMERCIAL BREAK)
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