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First Move with Julia Chatterley
UK Government Drops Plan to cut Tax Rate on High Earners; CNN Visits Lyman after Ukraine Control of Key City; Liz Truss Inherits a Troubled Economy; Nationwide Protests over Admin's Death enter Third Week; Travel Industry Booming after Hong Kong Lifts Restrictions; Royal Mint makes First Coins Bearing King Charles' Face. Aired 9-10a ET
Aired October 03, 2022 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
(COMMERCIAL BREAK)
ZAIN ASHER, CNN HOST, FIRST MOVE: Coming to you live from New York. I'm Zain Asher in for my colleague Julia Chatterley. Welcome to "First Move".
Ukrainian forces we taking more territory as they're successful counter offensive continue our report from Ukraine in just a moment.
On Wall Street, meantime, let's take a look at U.S. futures. They are certainly higher and the first trading day for October, September, as we
all know, was a brutal month for U.S. stocks for Wall Street, the DOW, the S&P 500 and the NASDAQ all lost about 10 percent the DOW dropping below
29,000 for the first time since November 2020s. It's the first time in two years.
Meantime, oil prices on the rise as OPEC plus reportedly considers a major cut in production the group is scheduled to meet on Wednesday. The British
Pound also rising after the U.K. Government cancelled a controversial plan to cut the tax rate for the wealthiest people off the proposal sparked a
huge backlash and turmoil in financial markets. Futile is a major setback for Prime Minister Liz Truss, and her Finance Minister Kwasi Kwarteng.
(BEGIN VIDEO CLIP)
KWASI KWARTENG, BRITISH CHANCELLOR: I've said that I've listened, I get the reaction. I've spoken to lots of people up and down the country. I've
spoken to constituents. I've spoken to MPs and Councilors and other people in a political system. But most importantly, I've listened to voters. And
I'm really convinced that the best thing to do now is not to proceed with the abolition of 45p rate.
(END VIDEO CLIP)
ASHER: Alright, Bianca Nobilo joins us live now from Birmingham, England, where the Conservative Party's annual conference is underway. So Bianca, we
just had Kwasi Kwarteng. Let's say listen, I've spoken to people I've listened to what people have to say. And I get it. That's why I'm changing
my mind when it comes to this 45 percent tax rate certainly a much welcome reversal. But how much does this hurt his credit credibility and also the
credibility of the Prime Minister as well.
BIANCA NOBILO, CNN CORRESPONDENT: While the former Chancellor George Osborne has said recently that he's not sure whether or not Kwasi Kwarteng
can come back from this. Kwarteng said that he owns the humiliation and contrition of this reversal.
Now the MPs that I've spoken to today, and party faithful who were here for conference said that he may well say that he's listened and he gets it. And
the Prime Minister says that too. But it took a long time. This is 10 days after the announcement of this policy. And it was something that wasn't
telegraphed in the leadership campaign, the idea of tax cuts for the rich for those that earn more than 150,000 pounds a year.
And it also raises a lot of questions about the Chancellor and the Prime Minister's political judgment, because as you know, Zain, this particular
controversial part of the economic package was worth 2 billion of a 45- billion pound, package.
But it's the idea that the government felt that at a time when the cost of living crisis isn't biting people throughout the country. They don't know
if they can afford their food and fuel, that the government thought it was a good idea to send a message saying, well, we're going to cut taxes for
the wealthiest we're going to remove that EU cap on bankers, bonuses, that is leading people to question their judgment.
There's also the communications of this, both the Prime Minister and the Chancellor have accepted that they didn't lay the groundwork for the
announcement of his package that markets were even more spooked because of the fact that there wasn't a communication strategy or really any
communication at all.
So Zain, then in answer to the question as to whether or not you can survive beyond this, I think it really is a precarious point, both the
Chancellor and the Prime Minister, because even though they've U-turned, a lot of damage has been done. There are questions about their political
judgment; they've now lost so much momentum to the Labour Party who's soaring ahead in the polls.
And they've done damage to the party brand, at on the one hand, by undermining the conservative reputation for economic credibility, because
they sent the markets into a spiral, and on the other hand, playing into one of the most toxic narratives against the Conservative Party. That it's
one rules for them another for the rest of the country, that they're on the side of the rich, the bankers and not ordinary people, Zain.
ASHER: And how divisive overall have these policies, these sort of tax cuts combined with huge amount of spending, how divisive have these policies
been within the Conservative Party overall?
NOBILO: A hugely divisive in fact, I'm not sure even divisive is the word because there's not a huge amount of people that think this was a good
idea. And even the people that believe in these economic policies that you can't tax your way to growth. Do admit that the way this has been handled
is basically, you know, a book, the first chapter of a book on how not to start a new government because it has been an unmitigated political
disaster.
The people I've spoken to today from within the party who might be standing as future candidates or MPs themselves are embarrassed by this.
[09:05:00]
NOBILO: They're frustrated they're also annoyed that the Prime Minister didn't consult her cabinet when devising these economic policies. And it
was a decision taken by her and the Chancellor. There's a huge amount of frustration there. In fact, the mood saying reminds me of around 2016, 2017
in the aftermath of Brexit. It's that level of political division and uncertainty within the party.
And given that they're in such a difficult political situation that the brand has been so tarnished by the Boris Johnson years and party gate. The
idea that they've slumped double digits further in the polls, is obviously making all these MP he's here today concerned that they will last after the
next election.
I think they all feel like they're in deep political Jeopardy. The divisions are very deep. And a lot of people don't think that the Prime
Minister has the charisma has the emotional political intelligence to rebuild the party and to remake her position after being in these dire
straits just a month into the job.
ASHER: That's an important reminder; she's only been on the job for about four weeks. Bianca Nobilo live for us there, thank you so much. Alright,
oil prices are surging on reports that OPEC Plus is considering cutting oil output by more than a million barrels per day at its meeting later on this
week.
Prices have been recently falling on fears about the health of the global economy markets around the world have been flushing warning signs that the
world is headed towards a recession. The question now is when is that going to happen?
Marc Stewart joins us live now. So it's interesting because the Biden Administration has actually been pushing and trying to encourage the Saudis
to increase oil output. Just walk us through what this potential change will mean for the global economy.
MARC STEWART, CNN CORRESPONDENT: Right Zain, as you well know, oil by nature is very volatile. It's a very volatile commodity. And even a whisper
of some change to production, especially a reduction in supply can cause prices to rise. Put that with this backdrop of the war in Ukraine.
And as you mentioned, please buy the Biden administration to increase production.
So as you can see, we are moving into a very unpredictable environment. I want to point out this involves OPEC Plus, so this involves the cartel
nations, plus Russia and other allies. There is some reporting by Reuters, I do want to point out one source felt that Moscow in particular would like
to see a cut of 1 million barrels. But other sources have said that these cuts could exceed that.
Some context here, if this happens, it would be the biggest cut to supply since 2020. At the beginning of the pandemic, when basically we saw the
world slow down, people didn't move, people didn't drive as much; they didn't fly as much therefore prompting that cut. Zain though we should get
some clarity, by midweek by Wednesday, that is when OPEC is scheduled to meet.
ASHER: OK, so clarity in about two days from now. But the expected oil production cuts, is really the last thing the global economy needs,
especially when you factor in what inflation has done to the global economy as well just walk us through that.
STEWART: Right, it is almost like a grocery store list of signs of problems that we have been witnessing in the economy. Let's take for example, the
U.S. dollar right now the U.S. dollar is very strong. It's good for Americans traveling abroad. But if you are a company in Europe, for
example, depending on trade for business that will cause your cost to raise that doesn't necessarily help in this potential narrative of a global
slowdown, perhaps a global recession. We've seen American consumers fall back we have seen the markets, especially in the U.S. see declines we're
clearly in many days into a bear market, that's less money changing hands.
And then as Bianca was reported on the turmoil in the United Kingdom that has caused many investors to look twice the notion of a global recession
Zain based off the economist I'm hearing with there are many different perspectives that if or when that would happen. But clearly the signs that
we are seeing right now are troubling for the future, at least in the short term.
ASHER: Alright, Marc Stewart live for us there, thank you so much, we appreciate it. Right Credit Suisse shares have had record lows down around
7 percent early today. And then speculation about the Swiss banks financial health, the shares have actually lost around 60 percent of their value so
far this year. Paul La Monica joins us to break this down. So Paul, just walk us through what prompted initial concerns about the state of the
bank's finances in the first place?
PAUL R. LA MONICA, CNN REPORTER: Yes, Zain I mean obviously we have seen concerns about the health of the global economy and Europe in particular,
and that is a big problem for Credit Suisse.
[09:10:00]
LA MONICA: But make them mistake Credit Suisse has been struggling for several years now you go back to the - probably a family office that
collapsed and Credit Suisse had a lot of exposure to that financial meltdown that has hurt the bank. But right now what's going on is that you
have credit default swaps, which are widening, which is suggesting that there is a lot of financial stress at the bank.
And that is harkening back to painful memories of when we saw credit default swaps, widening it, places like Bear Stearns and Lehman Brothers in
2008. So obviously, anytime you are in the same boat as some of those banks from 14 years ago, those of us that remember the global financial crisis,
it was not a lot of fun for big banks.
This is not to suggest that Credit Suisse is in that type of dire straits Zain, but the company obviously is worried enough that the CEO is trying to
reassure employees that things are under control.
ASHER: And when you hear news like this, I mean, what does it mean for the U.S. Federal Reserve? Is it likely that the U.S. Federal Reserve is going
to ease off pressure, given sort of the stress and the strain that some banks are coming under?
LA MONICA: Yes, that is a fantastic question Zain. And when you look at what futures are doing this morning, it's interesting that the U.S. stock
market is set to open with a pretty healthy game, right, and we could lose those gains as the day goes on. But there might be this somewhat
counterintuitive, perverse sort of notion that investors in the U.S. might be taking the news about Credit Suisse as a sign that the Fed will have to
pivot.
And that they won't be able to raise rates as aggressively in order to try and combat some of the financial stresses that might come in. If you were
to have Credit Suisse or other European banks go under. Again, I think it's a bit strange that investors will be celebrating because as we know,
inflation is hasn't gone away yet.
The Fed probably needs to raise rates to get inflation under control. But there are worries about the Fed going too far and causing a recession. So
if you do have a financial crisis, causing the Fed to pause, U.S. investors might at least temporarily cheer that.
ASHER: Alright, Paul La Monica live for us there, thank you so much. I want to turn to Ukraine now where President Zelenskyy forces say they're
retaking more territory from the Russians. It follows the liberation of the Eastern City of Lyman just hours after Moscow illegally claimed it from
there, Nick Paton Walsh has more.
(BEGIN VIDEOTAPE)
NICK PATON WALSH, CNN INTERNATIONAL SECURITY EDITOR (voice over): It may not look like much. But this is where Putin's defeat in Donetsk began a
prize from the last century perhaps. But trains and tracks are still how Russia wages war today. Lyman what's left of it now freed of Russia?
WALSH (on camera): This is what it was all about the Central Railway hub here now in Ukrainian hands and devastated by the fighting. And this was
such a seminal part of Russia's occupation of Donetsk and Luhansk. The concern for Moscow is the knock on effect this is going to have for their
forces all the way to the Russian border.
WALSH (voice over): On the town's edges, we saw no sign of the hundreds of Russian prisoners are dead. That had been expected to follow Moscow
strategic defeat here, nor inside it either. Perhaps they have already been taken away. Instead, utter silence only local bicycles on the streets.
Several residents told us the Russians actually left in large numbers on Friday.
TANYA, LYMAN RESIDENT (ph): We left in the night in the day people said I didn't see it myself. But they say they sat on their APCs and their bags
were falling off as they drove. They ran like this, to call it luck.
WALSH (voice over): It would be remarkable timing that Russia fled Lyman in the very same hours that Putin was signing papers, declaring here Russian
territory and holding a rally on Red Square. A similar story in the local administration, where the only signs of Russia left are burned flags.
They ran away without saying a word to anybody, he says. Was bad, no work, no gas, no power, nothing. The shops didn't work. It truly feels as if
there is nobody left.
WALSH (on camera): Ghostly silence here apart from occasional shelling and small arms fire. And it is so much of this town utterly destroyed. So many
locals were told leaving when the Ukrainian push towards it began. But now it's just this utter ghostliness in a place that's such a strategic defeat
for Russia.
[09:15:00]
WALSH (voice over): Gunfire in the distance they're nervous some Russians may be left. Outside what's left of the court the constant change and via
gunfight in the distance they're nervous some Russians may be left outside what's left of the court? The constant change and violence is too much for
some. Her husband just arrested.
The Ukrainian troops we did see had already stopped celebrating. There is little time there on the move again. Another Russian target further East
Crimea in their sights. And those left in Lyman, a town cursed to have these bars of rusting steel running through it. A gathering the ruins to
burn for fuel with winter ahead. Left in the wake of Russia's collapse here a town they took weeks to occupy only hours to leave.
(END VIDEOTAPE)
ASHER: Nick Paton Walsh reporting that. The results come here on "First Move" Liz Truss as U.K. Government is already off to a rocky start. I'd
discuss more about the decision to reverse those controversial tax cuts that Kallum Pickering from Berenberg bank, after the break. Also a royal
reveal, the new coins featuring King Charles the CEO of the Royal Mint joins us later on in the show. Stay with us.
(COMMERCIAL BREAK)
ASHER: Welcome back to "First Move" as we discussed earlier on the show, the U.K. is making a U turn on its decision to give a massive tax cut to
its wealthiest citizens after nationwide outrage. The pound hitting historic lows and chaos in financial markets the U.K. Finance Minister
Kwasi Kwarteng, said the plan had become a distraction Prime Minister Liz Truss said that she stands by her economic policies.
[09:20:00]
ASHER: But admitted that mistakes were made Nina dos Santos has more.
(BEGIN VIDEOTAPE)
NINA DOS SANTOS, CNN CORRESPONDENT (voice over): To some they were the dynamic duo bold enough to unleash the U.K. stymied potential to others, a
dangerous combination, risking it all to stave off a recession that may prove inevitable either way.
After crushing the currency by unveiling billions of tax cuts funded by billions more borrowing, Britain's new government made a sharp U turn on
Monday morning, abandoning its plan to abolish the highest rate of income tax of 45 percent.
KWARTENG: I've said that I've listened, I get the reaction, and the best thing to do now is not to proceed with the abolition of 45p rate.
SANTOS (voice over): In the days that followed the announcement of Britain's mini budget, pension funds have nearly collapsed. And the Bank of
England has had to shore up sovereign debt.
SANTOS (on camera): What is the reasons this budget was so badly received, as per Downing Street's newest occupants initially declined to have their
finger scrutinized by the usual fiscal watchdog. The scant detail provided only sparked further outrage. And although the government has said that
they'll provide more information before the end of November, many fear that with the economy on the brink, there's no time to spare.
SANTOS (voice over): And as members of their own Conservative Party gather for their annual conference, the pressure is mounting. One way they can
balance the budget and reassure markets is by slashing spending, a risky move given an acute cost of living crisis.
PAUL JOHNSON, DIRECTOR, INSTITUTE FOR FISCAL STUDIES: Lots of people are saying that if you want to get to some sort of fiscally sustainable
position, having had all these tax cuts you need to cut spending and that arithmetically is true. I find it quite hard to see where you get big
spending cuts. Remember, we've had a decade through which we've had really, really tight spending.
SANTOS (voice over): Other policies like reversing a moratorium on fracking have also stoked ire, as have reports in British media of a cozy
relationship between the Chancellor and hedge funds that have made millions betting against the pound. A survey by Survation last week gave the
opposition Labour Party a 21-point lead. Should an election be called tomorrow, the widest that margin has been at in 12 years of Tory rule?
DAVID GAUKE, FORMER BRITISH CONSERVATIVE MP: I think Conservative MPs are in despair in truth. The Conservatives have generally won election
victories on the basis that they are more competent on the economy. It's very hard to see how the Conservative Party can recover.
SANTOS (voice over): But it didn't have to be this way. Truss was picked by her party's members over Former Chancellor Rishi Sunak, who had advocated
fiscal prudence, and warned that Sterling would suffer under her proposals. Now that it has inflation is worse, rates are rising and among Tories times
are suddenly pensive than they have been in decades Nina dos Santos, CNN in London.
(END VIDEOTAPE)
ASHER: Liz Truss has inherited a number of problems including a cost of living crisis with inflation at 10 percent, the highest by the way of any
G7 economy. Joining me live now is Kallum Pickering. He's a Senior Economist at Berenberg Bank Kallum, thank you so much for being with us
first of all, your thoughts on this reversal by Kwasi Kwarteng.
KALLUM PICKERING, SENIOR ECONOMIST, BERENBERG BANK: Well, it was a political on goal to introduce this tax change in the first place from an
economics point of view. Actually, the market reaction to this news matters more than the impact of the tax on the underlying economy, even though it's
of course, a big cut for the very well off, it actually only represents about 2.5 billion pounds, which is a very small number relative to the size
of the economy both so far the market reaction has been. I would say cautiously positive on the basis that it looks as if the government is
heading towards a more sustainable fiscal path.
ASHER: Liz Truss for here, we can said that one of her mistakes was that she should have laid the groundwork better before announcing these tax cuts
and also increasing spending as well. What should she have done prior to announcing these measures? Do you think?
PICKERING: At the very least what she should have done is asked the independent office for Budget responsibility, which is the U.K.'s fiscal
watchdog to publish a set of forecasts, borrowing figures and inflation numbers based on her tax proposals. That would at least give a markets a
benchmark from which they could have been adjusted their borrowing costs for the U.K., their inflation outlook, that would be a minimum.
And optimum outcome would have been to actually stagger these tax cuts and then announce some spending adjustments so that actually they would not
risk any additional inflation or affect the U.K.'s financial stability.
ASHER: How likely is it that Kwasi Kwarteng is going to stick to some of his other policies he intimated just a few weeks ago that there would be
further tax cuts down the line.
[09:25:00]
ASHER: How likely is it that he's going to stick to some of the other policies given the fallout that we've seen this time around?
PICKERING: I think appetite for the tax cuts both within the Conservative Party of the wider U.K. and even in markets at this stage is probably low.
The two other elements would be supply side reform, which is essentially adjusting regulations in markets and for businesses to try and make the
economy more dynamic, more competitive.
Let's see what the detail involves. Often, these policies go one of two ways. They're either very good, and they help economies improve their trend
growth, that would be the case of U.K. and the fascia, often, well, occasionally, they go the wrong way. And they introduce the market failures
which worsen underlying performance.
So let's be neutral on that for now where there'll be some uncertainty is really around spending. In order to offset the borrowing that will be
needed for these tax cuts, it's probably likely that some departments will see their spending freezes for at least a year or two that will be
politically unpopular.
ASHER: Right and that has been the fear despite the fact that they are eliminating these particular tax cuts for the wealthy. The U.K. economy is
still in dire straits. Liz Truss inherited an economy with a significant cost of living crisis. Obviously, inflation is hovering at around 10
percent, the highest of any G7 nation. Where does the U.K. economy head from here, even with this reversal by Kwasi Kwarteng just announce today?
PICKERING: This will probably doesn't change the dynamic for the economy, or at least in the near term. Inflation in the G7 is similar rates. Most
advanced economies are between 9 and 10 percent, which is where the U.K. is really facing the European style inflation linked to these high energy
costs is likely to persist through winter. Whereas in the U.S., perhaps there's some evidence that things are rolling over the U.K. is heading for
recession, it's been my clear view that we're heading for recession now for a few months.
In fact, actually, these policy announcements, at least in the short run, because they've tightened financial conditions so much will actually deepen
the recession. So probably, we're heading for a fall in GDP of around 2.5 percent.
Now, historically, that would not be a huge recession. But it will be very painful, because it will entail a lot of inflation, and it will force the
Bank of England to react with high interest rates. That's not what you would like to do during a recession.
My best bet would be by this time next year, the economy will be recovering and inflation will have rolled over. But the risks across the advanced
world at this stage are to the downside.
ASHER: And how much is what's happening in the U.K. in terms of the U.K. economy, a bad omen or a negative signal in terms of what you expect to
happen with the global economy overall?
PICKERING: Well, I think what governments need to be careful of is not making the mistake that the U.K. Government has made. Actually, some of the
details of the policies, some of the tax adjustments, the plans for supply side reform, our policies, which point in the right direction, this
standard formula for improving economies with weak trend growth. It's what Mr. Macron in France has been pursuing.
And it seems to be working in Germany, the same thing with 2000s Britain in the 1980s. But what the U.K. has suffered from unfortunately, is because of
Brexit, because of the noise around the negotiations on the Irish border, is a lack of credibility in markets.
And so when the U.K. tries to take this gamble, it's failed. Markets don't believe that this government is credible. And so before other governments
try to borrow money, even just to subsidize energy policies, they should just check with markets, are we actually credible? If you're credible, then
go ahead and borrow markets will probably reward you if you like credibility, you'll be penalized.
And the U.K. has found out the hard way actually, but when it needed to use its credibility, it really didn't have much to begin with.
ASHER: Right, Kallum Pickering live for us there. Thank you so much we appreciate it. Alright, Brazil's Presidential race heads to a second round
runoff after neither Lula da Silva nor Jair Bolsonaro scores an outright win that story next.
(COMMERCIAL BREAK)
[09:30:00]
ASHER: Hello, everyone, welcome back to "First Move". U.S. stocks opening let's take a look here. Higher on the first trading day of the quarter Wall
Street has posted three consecutive quarters of losses so far this year.
Let's talk about Credit Suisse because shares at the bank are falling. As concerns rise over its financial health, Tesla is also sliding after
announcing lower than expected deliveries for the third quarter.
We'll turn to Iran now. Police clashed with students at a university in Toronto on Sunday as a crackdown on anti-government demonstrations
continued across the country.
The university's newspaper says the security forces fired pellets at a large group of students protests erupted across Iran last month after 22
year old Mahsa Amini died in police custody.
She was detained by the morality police for allegedly not complying with rules on women's dress. CNN's Jomana Karadsheh has been following the story
very closely from Istanbul.
So Jomana, this happened at the University of Sharif, which would be the equivalent the Iranian equivalent of let's say, MIT or Harvard, it's one of
the sort of more prominent universities in the country.
And even though it is a site of a lot of student protests, the fact that you have students clashing with security forces, potentially gunshots being
fired, also tear gas being dispersed. I mean, this is significant, Jomana.
JOMANA KARADSHEH, CNN CORRESPONDENT: It is very significant, as you mentioned one of the most prestigious universities in the country, some of
Iran's best and brightest go to this university. And Zain just to explain to you what was going on over the weekend.
You know, there were questions last week towards the end of the week. Are we seeing these protests coming to an end? Are we seeing less people taking
to the streets as the crackdown really intensified?
But what happened over the weekend is you saw thousands of students taking to the streets protesting on university campuses across the country. And
you know what started with these calls for Justice and Accountability for the death of Mahsa Amini has really now morphed into these louder, bolder
calls for regime change for the downfall of the Islamic Republic.
And so yesterday evening, Sunday evening, Tehran time, we started getting reports of some sort of an incident unfolding at Sharif University. And you
and I have spoken about this a lot over the past couple of weeks.
It's very difficult for us to call people to find out what's going on because of the communication restrictions that are in place that the
government has put in there the internet blackout.
But over the past few hours, we have gotten statements from the university itself from its newspaper. We have all also spoken to an eyewitness who was
there. And we've also gotten some video that has emerged.
[09:35:00]
KARADSHEH: And if you piece it all together, it really paints a picture of a night of horror that unfolded. As you mentioned, security forces appear
to have used metal pellets Birdshot fired at these young students and professors of the university.
They were using paint ball, they use batons to beat up the students. And this young man that we spoke to earlier, he said he got a phone call from a
friend of his saying, please come and save us.
So he rushed over and he says it was a war zone, in his words, he said there was blood everywhere. Now, we don't have casualty figures. We don't
know how many people were hurt. We don't know how many people were detained a lot of concern for the safety of those students who were detained.
What is clear right now Zain is this government is clearly determined to crush these protests. We haven't yet seen them unleash their full brutal
force that they've not hesitated to use in the past to crush protests.
So speaking to that young man who has also taken parts in protests, we asked him if you know what they saw happen yesterday is going to stop them.
And he said absolutely not. It has made them more determined to continue and he's describing this as the point of no return.
ASHER: Yes, it's interesting. I mean, these protests showing no signs of abating despite the crackdown by security forces despite into that
blackouts, as well. Jomana Karadsheh live for us there. Thank you so much.
Alright, Brazil's presidential race is heading for a second round runoff after neither candidate one in an absolute majority in Sunday's first
ballot, former President Lula da Silva finished ahead of the incumbent Jair Bolsonaro.
But support for Mr. Bolsonaro actually turned out to be stronger than opinion polls predicted. CNN's Shasta Darlington is live for us in Sao
Paulo. So Bolsonaro did much better than expected, Lula also coming out and saying, look, I typically win elections in the runoff stage in the second
round. Shasta what happens next?
SHASTA DARLINGTON, CNN CORRESPONDENT: Oh, that's right, Zain. There were two main headlines coming out of Sunday's elections. As you mentioned, the
Left Wing former President Lula did get the most votes, but he didn't get over that 50 percent threshold.
So we're going to have this run off against the incumbent Right wing President Jair Bolsonaro. We're also going to, unfortunately for Brazilians
face another month of the most polarizing electoral race in recent history, it's been marred by political violence by Bolsonaro's attacks on democratic
institutions.
And the other takeaways you mentioned is that the race was a lot tighter than anticipated, polls had predicted that Lula would be ahead by a wide
margin, even double digits.
In the end, we saw that he did get the 48.4 percent of the vote, which was roughly predicted, but he was only five percentage points ahead of
Bolsonaro. Take a listen to what the candidates had to say.
(BEGIN VIDEO CLIP)
JAIR BOLSONARO, BRAZILIAN PRESIDENT: We overcame today's lie statistics saying it would be 50-30 result. We overcame that lie, we are moving
forward, we're all is now equal, and we will better demonstrate for the Brazilian people.
LUIZ INACIO DA SILVA, FORMER BRAZILIAN PRESIDENT: Now there will be a face to face debate with the President of the Republic to see if he keeps
telling lies or if he will tell the truth to the Brazilian people.
(END VIDEO CLIP)
DARLINGTON: So what we saw is Bolsonaro coming out stronger than anticipated. And in fact, his Right Wing party did extremely well in
legislative elections. They're now the biggest block in the Senate.
Both candidates, however, have a tough four weeks ahead. They both have extremely high rejection rates. We're going to see Lula trying to convince
voters that he can bring back the boom times. They're really benefited the poorest in Brazil during his - two terms in office, and we'll hear
Bolsonaro trying to remind voters that Lula was subsequently put in jail as part of a massive corruption scandal.
Although those convictions were unknown by a Supreme Court expect a lot of polarization and a lot of tensions going ahead, Zain.
ASHER: Right because Lula couldn't run in 2018 couldn't even vote because of those charges, right. Shasta Darlington live for us there. Thank you so
much. In South Africa, plans are underway to construct the world's largest green ammonia plant; ammonia is currently used in the fertilizer and mining
industries. The $4.6 billion project could soon be helping the decarbonization of the global shipping industry.
(BEGIN VIDEOTAPE)
ELENI GIOKOS, CNN CORRESPONDENT (voice over): It's a massive Greenfield site, thousands of hectares of land in Nelson Mandela Bay in the Eastern
Cape. Its backers hive energy, say that the $4.6 billion green ammonia project will be sustainable and create thousands of green energy jobs.
COLIN LOUBSER, MANAGING DIRECTOR, HIVE ENERGY, AFRICA: We looked at sites all over Africa all over the world and we came to the inevitable conclusion
that this would be the best site to set up a green ammonia plant.
[09:40:00]
LOUBSER: And there are many reasons for that, they have infrastructure in place road infrastructure, is the water desalination plant. So we've got
fresh water available to us, these plenty of land is over 9000 hectares of available land.
GIOKOS (voice over): Demand for ammonia is growing internationally. Its main use is to make fertilizers and explosives in mining. But it's a
cleaner green version that is being touted as having a bright future.
LOUBSER: Green ammonia is normally ammonia that's made using renewable energy. So it's completely clean. It's not made using fossil fuels. This
means this is a completely clean process.
GIOKOS (voice over): Its potential as an alternative fuel for the shipping sector that's exciting the industry most.
LOUBSER: We will start replacing heavy fuel oil sort of ships and it will replace diesel. So that become the fuel of the future, particularly in the
maritime industry.
GIOKOS (voice over): Preparations for the construction of the plants already underway. It's set to create thousands of jobs in a region where
they are badly needed.
ASANDA XAWUKA, EXECUTIVE MANAGER, COEGA DEVELOPMENT CORPORATION: But as in the Eastern Cape, the unemployment rate is sitting at over 50 percent. So
which means an investment of this nature with the number of jobs that are going to be created, it's going to be very big.
GIOKOS (voice over): Hive Energy says it plans to create 20,000 construction and permanent jobs, and that more will be created when they
begin exporting to the continents.
LOUBSER: Both Mozambique and Zambia import ammonia, they imported they have huge commercial farms. And ammonia is an import for them. We see huge
opportunities in Africa for inter trade cross border cooperation.
GIOKOS (voice over): Hive Energy says that it aims to begin production of green ammonia at the plant in 2026 and that through its greener energy
alternative; it should help in climate change mitigation. Eleni Giokos CNN.
(END VIDEOTAPE)
ASHER: We'll have much more news after this quick break.
(COMMERCIAL BREAK)
[09:45:00]
ASHER: After more than two and a half years Hong Kong is lifting many of its COVID restrictions. The city had some of the strictest quarantine rules
in the world. Now its struggling tourism industry is showing signs of life. But whether Hong Kong can completely revitalize itself and bounce back from
the pandemic, is still in question. CNN's Kristie Lu Stout has more.
(BEGIN VIDEOTAPE)
KRISTIE LU STOUT, CNN CORRESPONDENT (voice over): Rain or shine, the players train for the international Rugby Sevens tournament in Hong Kong
for more than 40 years, its fans from around the world would come every year for the sport and the spectacle until the pandemic. Now after a long
hiatus, they are thrilled to play again.
RUSSELL WEBB, RUGBY PLAYER: It's been three years, three years yes, three years or so since the last Hong Kong Sevens and you know, we're really
excited and you can just tell the rugby community in general really excited is so good for Hong Kong.
STOUT (voice over): Also coming to Hong Kong is the International pop sensation Black Pink in January. And in November a global banking summit,
the travel industry is buzzing. Expedia.com says searches for hotels in the city jumped 50 percent.
LAVINIA RAJARAM, TRAVEL EXPERT, EXPEDIA GROUP: So we can anticipate the business audience coming back to Hong Kong, as well as travelers that as
always favored Hong Kong as a culinary destination, so we can see a little bit of that trend coming back in the coming months.
STOUT (voice over): With the easing of border rules, the city hopes to reclaim its spot as an international business hub and reboot its economy.
But for many like this market vendor, they don't have months to wait.
UNIDENTIFIED MALE: My most frequent customers used to be tourists. Locals rarely shop here. It's been terrible, very terrible. There was no business
at all. It's been a fruitless labor. Business has been static.
STOUT (voice over): Tough COVID-19 measures have devastated businesses, including the iconic Jumbo Kingdom floating restaurant now no more. Max
shut his restaurant last year after nine years in operation.
MAXENCE TRAVERSE, RESTAURANT OWNER: Rather restaurants right now about closing down filling in a filing bankruptcy or try to sell try to sell
because the seminar was really, really hard.
STOUT (voice over): He says it will take more than simply ending the COVID rules to revive the city.
TRAVERSE: We need to be providing you know, excitement for Hong Kong because right now we will have so many things nothing's happening in the
convention center is the concert is often result in a big scene anymore.
TRAVERSE: Before the pandemic it was with big scenes like these in the stands of the Rugby Sevens famous for its legendary party energy. Today
Rugby players practice in the rain ahead of the return of the big tournament and big hopes for the revival of a city. Kristie Lu Stout CNN,
Hong Kong.
(END VIDEOTAPE)
ASHER: Right, stay with "First Move"; we'll have more news after the short break.
(COMMERCIAL BREAK)
[09:50:00]
ASHER: In the UK, there are about 27 billion coins in circulation featuring the late Queen Elizabeth. Eventually they'll be joined by notes and coins
with the face of King Charles. And these are the first.
Today the Royal Mint has begun selling commemorative coins, in line with tradition that king's portrait faces to the left, the opposite direction to
his mother's. The Royal Mint is the world's largest producer of coins; it makes billions of coins and blanks for about 60 countries.
Anne Jessopp is a CEO of the Royal Mint. She joins us live now. So and there has been intense demand here intense demand to snap up some of these
commemorative coins, so much so that your website even crashed. I understand that it's back online now. But how are you keeping up with
demand?
ANNE JESSOPP, CEO, THE ROYAL MINT: Yes, so we're delighted today to be launching the coin, the very first coin that has the effigy that's the
portrait of, of King Charles on. And the website has been so busy, we had over 120,000 people register interest over the weekend.
And so we've been really working really hard to keep up with it. But we've got a real range of coins. So for people who want a really expensive one
that may be in gold, but also those people who may want one to a less expensive one as well?
You get lots of people coming to the site. And we have 20,000 people register their interest from America; we were delighted to see over the
weekend.
ASHER: And just in terms of we're seeing it right now on our screen, this commemorative coin with King Charles's image on it. He had some input into
this; I understand and just walk us through what his reaction to it has been.
JESSOPP: Yes, so we understand he's very satisfied from his staff, he did have some input. The Royal Mints, we quite often make royal coins, and
therefore we have photographs, from which the artists worked, Martin Jennings who is a really accomplished artist, sculptor. And then over the
last two or three weeks for the final detail, then we've been liaising with the palace.
ASHER: And from January 1 next year 2023 from what I understand you only the Royal Mint will only be making coins that feature King Charles's image.
But both coins and both images will be in co-circulation for some time. How long does that period of transition take?
Because you're not going to sort of we're not going to be able to sort of only have King Charles's face on a coin for some time. It takes about 20
years from what I understand.
JESSOPP: Yes, that's right. So most people in the UK really can't remember as having a new mother Monique, because obviously she was on - the late
queen was on the throne for 70 years. But yes, it's absolutely normal for the coins to co circulate. So they last for about 20 years.
So we will be seeing coins with the late Queen and the new King Charles and co circulating for about 20 years. And really interestingly, the Royal Mint
has been in existence for 1100 years.
And we've always marked as the Monarch changed that obviously the new Monarch goes on to the new coin. And often, you know, hundreds of years ago
that was the only way that people got to see what their Monarch look like, no social media, no calibrator. So we think there's a history in the past,
yes.
ASHER: That's fascinating. And how much of a privilege is it for you just for you yourself to be part of history in this way?
JESSOPP: I can't, I can't explain. It is just so fantastic. It's a real privilege. I'm called the - I'm the Chief Exec of the Royal Mint, but I'm
also the Deputy Master of the Mint, the first female in over 1100 year history.
ASHER: Incredible.
JESSOPP: I know, I know - seriously in terms of the official role that we have in the UK you know obviously we sell coins as well. But my official
role is really to make sure that the UK coins we have the right portraits with the right effigies.
And they are absolutely effigies to be proud of. And I really love this new portrait. I think the new king looks really, really shows this whelms in
the portrait, I think it's really, really accomplished.
[09:55:00]
ASHER: And there are some key differences between the - the coin featuring King Charles's images and his late mother because the faces are basically
pointing in different directions. And Queen Elizabeth is wearing a crown and Charles is not, explain why?
JESSOPP: That's right. Yes. So in history and nobody quite knows the reason why these traditions happen. But in history each preceding each Monarch
faces the opposite way than the preceding monarch. So, King Charles is facing to the left and his mother face the opposite way.
And also in history and female Monarch tend to have a crown or I think Queen Victoria had some headband on and one of her has, actually, the male
Monarch tend not to.
ASHER: And we actually have to leave it there because we are out of time. I could talk about this with you all day, fascinating stuff. Anne Jessopp
live for us there.
JESSOPP: Yes, lovely to talk to you.
ASHER: Lovely to talk to you too. And that is it for the show. I'll be with you in a couple of hours for "One World". "Connect the World" with Becky
Anderson is up next, you're watching CNN.
(COMMERCIAL BREAK)
[10:00:00]
END
