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Quest Means Business
US and Cuba to Normalize Relations; US Policy Changes to Help Cuban Economy; Ruble Rallies on New Measures; Russia to Sell Currency Reserves; Russia Risks Recession in 2015; Fighting Ebola; Fed to "Be Patient" in Raising Rates
Aired December 17, 2014 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(NEW YORK STOCK EXCHANGE CLOSING BELL)
RICHARD QUEST, HOST: You're looking at the power of patience. The best trading day of the year for the Dow Jones. It's up 1.5 percent, 283
points. The gavel has been hit, it is a fact. Now, of course, the Fed is telling the markets take a chill pill, and it's given them the best results
of the day on Wednesday, December the 17th.
Also, it's a day for new beginnings. The US and Cuba ending half a century of diplomatic and economic hostility.
Also, Russia's economic emergency. The central bank steps in to prevent a complete currency collapse.
And if all that wasn't enough, tonight, on this program, the World Bank president will tell me where he sees economic threat. You'd be mad to
go anywhere in the next hour.
I'm Richard Quest. I mean business.
Good evening. We have an extraordinary hour ahead for you. US stocks have surge. We're going to lead and just show you that number --
(RINGS BELL)
QUEST: -- after the Fed suggested it is not raising interest rates anytime soon. We'll give you the exact wording of what the Fed said, but a
gain of 287 points means this is the best day's trading for the Dow Jones of the year so far to date. We'll explain how and why as we continue our
nightly conversation.
But we must begin with the chapter of economic isolation that's come to an end between the United States and Cuba. This period is over. And it
was all made possible by the release of this man, Alan Gross. He's an American who's been held by the Cuban government since 2009 and exchanged
for three Cubans convicted of espionage in the US.
Mr. Gross was arrested for illegally distributing communications equipment. He was sentenced to 15 years in prison for crimes against the
Cuban state. A short time ago, after arriving back in the US, he spoke.
(BEGIN VIDEO CLIP)
ALAN GROSS, AMERICAN PRISONER RELEASED FROM CUBA: I also feel compelled to share with you my utmost respect for and fondness of the
people of Cuba. In no way are they responsible for the ordeal to which my family and I have been subjected.
To me, Cubanos, or at least most of them, are incredibly kind, generous, and talented. It pains me to see them treated so unjustly as a
consequence of two governments' mutually belligerent policies.
(END VIDEO CLIP)
QUEST: That's Alan Gross speaking a short while ago. Mr. Gross's release was, of course, only part of the story. It might have been the
catalyst. The main story, of course, is after 55 years, an historic thawing of policy from the United States now promises to transform the
Cuban economy.
Diplomatic relations are to begin to be reestablished. These are the measures that will be taken. Embassies are to be opened in Havana and in
Washington. A ban on trade and travel from the United States to Cuba, restrictions that had been in place since the administration of John F.
Kennedy, those restrictions will be relaxed.
And there's more. Telecommunications providers will be permitted to invest in Cuba. With an ailing infrastructure and with access and
expanding access to the internet. Not surprisingly, with all those measures on the table, the leaders of both nations, Barack Obama and Raul
Castro, delivered separate addresses, both optimistic and both praising the measures they were taking.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I believe that we can do more to support the Cuban people and promote our values through in
engagement. After all, these 50 years have shown that isolation has not worked. It's time for a new approach.
RAUL CASTRO, PRESIDENT OF CUBA (through translator): We must learn about the art of living together in a civilized manner along with our own
differences.
(END VIDEO CLIP)
QUEST: Perhaps today it's difficult to overstate the significance of what's taken place. After all, these measures have been in place for the
best part of five decades and beyond. The easing of economic and travel restrictions by the US will allow for an overhaul of the Cuban economy,
which of course, as you'll know, is no stranger to struggle.
Over at the super screens and you'll see what I mean. Here we have, obviously -- this really does show graphically. Actually, Cuba, of course,
is closer to Key West, the southern tip of Florida, actually, than Miami is to Key West. Just a gap of 90-odd miles between the two countries.
Wait. Look at the growth concerns. Cuban growth is slow going. They've not been allowed to set up their own companies. The Cubans are
looking for more international investment, which is crucial. A law passed earlier this year has lowered taxes on international investors, which eases
red tape. And that investment will come not only from central and Latin America, of course. It has bee coming from Europe. Nothing from the
United States.
Cuba's relying on ties to Venezuela, 20 percent of its GDP comes on those bilateral ties. Now, the Venezuelan economy, you'll be well
familiar, we've talked about it on this program, is one of those OPEC members which is now seriously being hit by the low price of oil.
Patrick Oppmann is the only US television journalist reporting from Cuba. Good to have Patrick with us tonight. He's with us live from
Havana. Is there much -- Patrick, look. I'll leave it to my other colleagues to do the politics and the geo strategy here. Let's you and I
talk business. Is there a feeling that a modern-day gold rush is about to begin?
PATRICK OPPMANN, CNN INTERNATIONAL CORRESPONDENT: Oh, absolutely, and people have thought that in Cuba for years. People have always said if,
when. Behind me, you can't see it, Richard, is the area where cruise ships would dock. There's not a single cruise ship here right now. They come in
about maybe once or twice a week.
Of course, pre-Castro, pre-revolution, this area of Havana where I'm standing, Old Havana, was crawling with American tourists. So, everyone
here as always thought there's a fortune to be made in Cuba if I only knew when.
Today, it seems "when" is a lot closer. But of course, when you arrive here with your sacks of money, it's not like you can just invest
immediately. You still need the Cuban government's permission to do so.
They haven't been very good in terms of giving permissions in a fast manner. They haven't been the best business partner to deal with. They're
trying to change that. They admit they've made many mistakes as they lurch toward at least an accommodation with capitalism.
Certainly for Cuban -- the Cuban people, who have started small businesses, there's a lot of excitement. They feel that if American
tourists come in, they're more likely to go to Cuban-owned restaurants than a state-owned restaurant, which are badly managed. Cuban services tend to
be better than the state ones.
But there's still a lot to be worked out here. It's not just the US that needs to change. It's also the Cuban government that needs to change,
and they haven't quite figured out how to deal with people who want to come here and go into business. Richard?
QUEST: Patrick, thank you. You and I will talk many more times on this one in the days, weeks, and months ahead. Patrick Oppmann joining me
from Havana. Barney Harford is the chief exec of the online travel firm Orbitz worldwide. Barney joins me on the line now from Chicago.
A very simple question to you tonight, sir. Thank you for joining us. Are you already putting plans in place, or dusting off the shelf of those
plans to get into Cuba?
BARNEY HARFORD, CEO, ORBITZ (via telephone): At Orbitz, we believe passionately in the power of travel to bring people of different countries
together. And since 2009, we've been very focused on how to give Americans the freedom and right to travel to Cuba.
We launched a petition, Open Cuba, in 2009 and delivered 100,000 signatures to the president asking that that right be opened up, and we're
delighted to see this move today and see it as a very positive trend towards that goal of opening up travel.
QUEST: All right. But how does this opening up of travel, how can it be done in a managed capacity? The last thing Cuba needs -- obviously, it
needs the revenue, but it certainly doesn't need every US travel company, hotel group, airline and anybody turning it into what has happened in many
other parts of the Caribbean.
HARFORD: Cuba already has a well-developed tourism industry and receives tourists from many countries around the world. In particular,
Europe, Canada, for example. And so, America certainly won't be the first nation to visit Cuba.
But you're right, there is a unique cultural heritage in Cuba. I think it's something that will be very attractive to American tourists.
But it's obviously one that the Cuban authorities, working with their partners, will need to be thoughtful about how they develop for sure.
QUEST: When do you expect to be able to offer to your US customers a Cuba vacation in the form that we're talking about?
HARFORD: That's very hard to determine, but if we look at the remaining years of the administration, it is my very clear hope that we
will be able to be selling travel to Cuba within that timeframe.
QUEST: If I'm not mistaken, in 2009 with your petition, you promised everybody who signed the petition a $100 voucher against a holiday in Cuba
when you were able to offer them. Are you now getting ready to redeem those vouchers?
HARFORD: We would be delighted to offer such a voucher to those who signed the petition, and we really appreciate the efforts from all of our
customers who did sign that petition and made a very important first step back in 2009 to make things happen.
QUEST: Barney, I'm going online to sign your petition. I want my $100 voucher.
HARFORD: Thank you.
QUEST: Thank you very much, indeed. Barney joining me from Orbits to put this into perspective. That's obviously the big, long-term business
news that happened in the world today, Cuba and the US, the rapprochement that's taken place long term.
Short term, the Russian government is turning to increasingly desperate measures to stop the ruble's free fall. We'll be talking to the
World Bank president, Jim Yong Kim, about the risk of contagion beyond Russia in a moment. This is QUEST MEANS BUSINESS. Good evening.
(RINGS BELL)
(COMMERCIAL BREAK)
QUEST: The ruble has rallied in quite a bit way, up 11 percent against the dollar. That's after the Russian central bank announced even
more members, supposedly, to shore up the country's banks. This is how the trading went. This is the ruble verses the US dollar, so it's a reverse
number, of course, from 14 to 17.
The rally follows to days of -- that's what one buys against the other. It's increasingly desperate measures, of course, to stop the
various bleeding. The drop in the ruble came to a head as Russians lined up to exchange the currency.
Others headed to the shops. They're anticipating the imported inflation that will come from a lower ruble, and so they want to get their
goods first. Some companies, like Apple, have halted sales altogether. Join me at this part of the super screen.
As customers struggled to get ahead of the decline, the government's tried to slow it down. Let's start with the Finance Ministry and what they
have been doing. Now, the Finance Ministry has been describing the ruble as "extremely undervalued." It plans to sell $7 billion in foreign
currency reserves. It's selling its reserves to buy rubles.
The Russian prime minister, Dmitry Medvedev, insists Russia has the resources for this undervalued currency to overcome the crisis.
(BEGIN VIDEO CLIP)
DMITRY MEDVEDEV, PRIME MINISTER OF RUSSIA (through translator): The figures we have seen during the last few days do not reflect the real
picture and have unreasonably left a zone comfortable for the people and for the economy. And emotions have also played their role here.
(END VIDEO CLIP)
QUEST: So, that's what the central bank -- that's what the Finance Ministry as done. As for the central bank, well, they, of course, having
jacked up interest rates, the central bank has taken a very different view.
It's been taking on increasingly desperate measures to shore it up. It's tripled interest rates, 17.5 percent. It's moved to a free-floating
of the currency. And it's spent roughly a fifth of its currency reserves.
The issue, of course, is whether all these measures by both Finance Ministry and central bank have merely arrested the decline, or have they
turned the corner? Sergei Guriev is the economics professor at Sciences Po. He joins me now from Paris. What's your opinion, sir? Have they
merely temporarily arrested the decline, or have they turned the corner?
SERGEI GURIEV, PROFESSOR OF ECONOMICS, SCIENCES PO: I think we have not turned the corner, but I think we did arrest the decline and these
measures did provide some message to the markets that the central bank is ready to step in and to refinance banks' external debt and also
recapitalize banks if needed. Because before that, we were actually falling off the cliff.
And you mentioned what has happened this week. If you just look at the trends from Monday morning to Tuesday afternoon, the ruble lost 30
percent of its value just in this one and a half days. Now, it came back a little bit. Yes.
QUEST: We're having a few sound problems, but we will battle on. Sir, the issue here, though, of course, is the fundamentals haven't
changed. The low oil price will still leave a huge hole in the Russian accounts. The ruble is still down. So, for the -- for a longer-term
growth, something more has to happen.
GURIEV: Yes, Richard. The fundamentals have different natures. So, if you just look at the oil, the ruble is indeed undervalued. But in
addition to oil, we have very bad investment climate, and therefore capital outflow.
And then, on top of that, we have foreign policy which is not necessarily rational, which resulted in sanctions, which adds to a weaker
ruble. And in that sense, we don't know what the fundamentals are.
If, for example, tomorrow Russian government says we don't want sanctions to be imposed, we want more reasonable foreign policy, and we
want rapprochement with the West, the term you used to describe the US- Cuban relationship, ruble would definitely appreciate.
But for the moment, the ruble is what it is, and the markets are a bit happier today than they used to be two days ago, because the central bank
and the government did produce at least some idea how Russian government will support banks and corporates which have a very large external debt to
refinance in the next couple of years. And with the sanctions, they really need all the support they can gather.
QUEST: Sir, thank you for joining us. Apologies, we'll cut it short. We are having some problems with your sound in Paris, now, but we thank you
for that.
Now, a collapse in oil prices and economic sanctions over the Ukraine crisis have hit the economy hard. Russia estimates $40 billion. The
economy is almost certainly to enter recession next year. That's likely to get deeper, and will have consequences for the rest of the world.
The World Bank president, Jim Yong Kim, joins me now from Washington. Mr. President, always delighted and honored to have you on our program, and
thank you for taking the time. We'll come to your visit to Africa in a moment. I need to just start with Russia. How concerned are you, sir, at
the deteriorating economic situation in the country?
JIM YONG KIM, PRESIDENT, WORLD BANK: Well, Richard, we're very concerned. What we've seen in oil prices is a precipitous drop. It's gone
down 40 percent in terms of the per-barrel price since the summer. And that's unusual.
We're not surprised that the price dropped, because now it's about on par with other commodities since 2011 in terms of the overall drop. But
the speed of it has really had an impact. Now, in Russia, the estimation from the central bank governor was that if the average price per barrel is
$60 that the economy will shrink 4.5 percent. Now, it's not just Russia that we're concerned with --
QUEST: Right.
KIM: -- because in some of the surrounding countries, remittances from Russia played a very large role. So, even though those countries are
importers of oil, the remittances from Russia will have an impact.
Now, we take a global view, as you know, and so this is very good for China. And we see other opportunities in the sense that, for example,
Indonesia, which has announced a cut in their fuel subsidies, this might be the time to do it.
But Russia is a very important economy in the entire region, in the world. And so we're very concerned about the fluctuations. The measures
taken today --
QUEST: Right.
KIM: -- seem to have stabilized the ruble.
QUEST: Right, but what --
KIM: For now.
QUEST: Right. But as I look, let's just take away from Russia and look at some of your other client countries. Emerging markets are finding
their currencies being very -- you mentioned Indonesia, which saw it with the rupiah.
Thailand's had some problems, Brazil's had some problems in the market and the currency largely on the back of this falling price in oil, which is
a true -- a true half-full, half-empty.
KIM: Yes. We're especially concerned. Certain countries -- Nigeria, Venezuela. In Venezuela, PetroCaribe has an impact on many countries in
the region. The reduced oil prices they've been offering to some neighboring countries, like Haiti, for example, could have a huge impact in
the region.
And so, we have to follow this very closely. It is good for the oil - - for many of the oil important countries. But for those countries that it's really going to hit hard, it's not just those countries. Nigeria, for
example, is so important to the West Africa region that we are very carefully watching and preparing to step in with help as needed.
QUEST: So, you are preparing if currency crisis becomes something larger in your member countries to step in?
KIM: Absolutely. We have to be prepared. We were prepared in 2008, we're prepared again. And again, we're in very close touch. I had a video
conference this morning with all my country directors to really try to understand the impact of these declining oil prices all over the world.
And again, it's a mixed picture. But some areas are of great concern.
QUEST: I need to talk about your trip to Africa on the Ebola issue, sir. I believe you're recently -- you've been there. What did you find?
How bad is it, and are thing getting -- I mean, do you -- can you come to me tonight with any note of optimism?
KIM: Well, Richard, I am -- I was extremely impressed and inspired by the effort from the presidents of those three countries all the way down.
There is a tremendous effort to tackle the epidemic.
The US, the UK, some of the other countries, France has announced that it's going to step up its support of Guinea. The intensity of activity is
very impressive. And it seems to have had an impact, at least in Liberia. Liberia, the cases now are only 15 new ones a week.
But let me tell you, Richard. We have to have a plan to get to zero. There's no approximate victory in Ebola. It's either you win by getting it
to zero or you continue to lose.
And so, we visited Senegal, and I've spoken directly with President Goodluck Jonathan in Nigeria. What it took those two countries to get to
zero was an immense effort. In Senegal, it cost $1.3 million for a single case. For 19 cases in Nigeria, it took $13 million, and they did 19,000
home visits --
QUEST: Right.
KIM: -- just for those cases. We have to do that now in each of these three countries, and we're not yet there.
QUEST: All right, let me --
KIM: But the commitment is encouraging.
QUEST: Well, you've mentioned money, sir, so are you going to have to put your hand in your pocket or you'll get the World Bank checkbook out and
help those three countries to pay that sort of extremely high cost per case?
KIM: We have no choice, Richard. So, we've already pledged in both the public and private sector $1 billion. The United States as well, north
of $1 billion. It pledged $2 billion more. The UK is well on the way to spending many hundreds of millions of dollars. But the thing is, Richard,
we have no choice. There is literally no price that's too high to pay.
QUEST: Right.
KIM: We've got to get it to zero. Some people talk about Ebola becoming endemic. Endemic means that it's an infection that's just sort of
always around. We cannot have that, Richard. That's why Ebola is so much more difficult and so much more important than any of the other epidemics
I've dealt with in terms of our approach to it.
I've battled HIV, I've battled tuberculosis, drug-resistant tuberculosis. But in those cases, you do not absolutely have to get to
zero.
QUEST: Right.
KIM: Here we do. And that concerns me.
QUEST: And I want to just finish, if I may, sir, back to the oil price, if I may, just to end on this one because this promises to be a
great benefit -- economic benefit for those countries highly consumers. But as you say, sir, it's a double-edged sword. So, what's your principal
concern tonight?
KIM: Well, Richard, what we're trying to do in the face of the plunging oil prices, what we need to do is support the producers and then
encourage the importers to make reforms that they can do right now.
In Ebola, my biggest concern is we've got to be sure that this doesn't happen again. What we're looking at are phenomena that are potential huge
downside risks to the global economy but are not yet understood as such, and the global economy is not yet buffered.
So, one of the things we're doing in the Ebola crisis is looking forward and saying what we need is some kind of pandemic funding facility.
A kind of insurance policy that we would put together that when there is a trigger, when there's an epidemic, rather than passing the hat and waiting
--
QUEST: Right.
KIM: -- for people to respond, we'll be able to respond immediately. That's our job, Richard. Our job is to be here as protectors of both
national economies and the global economy. We're doing it with Ebola, and we'll continue to do it also with the falling oil prices.
QUEST: Sir, thank you for joining us tonight. Always appreciate it, having you on our program. Thank you very much, Mr. President.
KIM: Thanks so much, Richard.
QUEST: Thank you. President of the World Bank talking to us.
Now, plenty more. We've got -- we had a president. We've still got a few chief execs. There's an enormous amount, but there's no change in
policy, just a new buzz word. The Federal Reserve chief Janet Yellen has introduced new language to soothe the financial markets. And really, the
message is very simple: be patient.
(RINGS BELL)
(COMMERCIAL BREAK)
QUEST: The Federal Reserve's message to investors: be patient. The Fed will be patient in normalizing monetary policy. That's a posh way of
saying get rising interest rates. This idea of "be patient," it's the new buzzword.
Now, the Fed until now has used the phrase "considerable time" as part of its guidance. What the Fed says is, "be patient" is the same as
"considerable time." It's a highly sophisticated argument that fundamentally I'm not really sure I understand. But I have one man who
does know, is CNN Money's Paul La Monica.
And before we talk to Paul, this is what we really need to just focus on, Paul. Whatever you and I may think it meant, the market absolutely
loved it. Tell me why.
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: We needed this after what's been a very rough December. No Santa Claus rally. I think what we
have here is that investors are hopeful that the Fed is not going to rush with rate hikes, they're not going to be overly aggressive. And that's
what is driving, I think, the action today.
QUEST: Why did they change the phrase from "considerable time"? It's a time-honored phrase we've known and loved for months. Why change to
"we're going to be patient"?
LA MONICA: I think with "considerable time," the signal and the code was that meant probably late spring, summer of 2015, because we now know
that QE is over, and that's what considerable time was a reference to. It would be a considerable time after QE ended before they'd raise rates. So
now we're about to enter 2015. You can't keep saying "considerable time."
QUEST: Because the event upon which "considerable time" was predicated has been and gone.
LA MONICA: Exactly. So, I think right now, the Fed is saying "be patient" because they're not 100 percent sure the rate hike is going to be
later spring or early summer. They're going to watch the data. That's what they have to do.
And obviously, when you look at what's happened with energy prices, inflation's no longer a concern, and that's still one of their mandates.
It's not just the job market.
QUEST: But the statement was slightly more hawkish on inflation. It did say they now expect inflation to hit 2 percent within the timeframe.
So, I ask you, is -- was today's statement hawkish or dovish by adding the phrase "be patient" or "patience"?
LA MONICA: I think they're now kind of trying to play it both ways --
QUEST: Ah!
LA MONICA: -- a bird of many feathers, if you will. When you look at the data, not just the statement, we had consumer prices come out
earlier this morning for November, and the rise is the slowest since December 2008 when you include the huge drop in oil prices.
Janet Yellen did say that she thinks that inflation will creep back up towards 2 percent. But she also conceded that you're probably going to
have rates low -- inflation rate low for a little while. So, it's not going to get there very quickly.
QUEST: Can you be patient?
LA MONICA: I can be patient, and the market wants me patient. They're addicted to low interest rates. They don't want this anytime soon.
QUEST: Good to see you, sir. Thank you for joining us.
LA MONICA: thank you.
QUEST: When we return, we go back to Cuba. The country is opening up, the United States says relations will be normalized, and the question,
of course, is what does it all mean for the business community?
(RINGS BELL)
(LATIN MUSIC)
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more "Quest Means Business" on a busy day in a moment. This is CNN and on this network the news always
comes first. The United States and Cuba are dramatically shifting their relationship after decades of hostility. President Barack Obama says the
two countries will normalize relations and the U.S. will ease trade restrictions. It comes as both sides released prisoner who were being held
in the respective countries for years.
Pakistan's lifted its moratorium on the death penalty a day after the Taliban attack on a school which killed 145 people. One hundred thirty-two
of the dead were children. Prime Minister Nawaz Sharif says he's lifting the ban in terrorism cases.
Most of the largest cinema chains in the United States say they will not show the upcoming movie "The Interview" after hackers threatened a
terrorist attack on theaters. Hackers have targeted Sony Pictures over the film which is a comedy about an attempted assassination of the North
Korea's Kim Jung-un.
The man charged with investigating possible corruption in the bidding process for the World Cup has resigned from the FIFA Ethics Committee.
Michael Garcia had appealed against FIFA's summary of his investigation, an appeal which was turned down. Garcia says he lost confidence in FIFA and
had no choice but to resign.
We turn to our top story tonight. It's an historic move. The U.S. and Cuba have agreed to normalize diplomatic relations and Cuba's economic
reliance on Venezuela of course which is crucial. Venezuela welcomed the move, saying today that President Obama had made a brave decision. Well,
joining me now from the CNN Center is Charles Shapiro, the former U.S. ambassador to Venezuela. Ambassador, very good of you. Thank you, sir.
CHARLES SHAPIRO, FORMER U.S. AMBASSADOR TO VENEZUELA: Thanks.
QUEST: For coming in though. We'll get to the relationship with Venezuela in just one second, but if we just simply look at this momentous
decision today, what do you think predicated it?
SHAPIRO: Oh, first of all, it's a huge story. It's great with Canada, the Pope, Venezuela, spies, the Castros - it's fabulous. I think a
couple of things predicated it. Number one is I think the Cubans are concerned that the oil from Venezuela's going to be cut off and that they
need diversify who they're doing business with. And of course the United States wanted to get Alan Gross out of prison where he was unjustly in
prison for five years. So, they got him home.
QUEST: Right. But if - it's not going to be as straightforward as maybe reasonable men and women sitting afar from Cuba and Miami in Florida
think, is it? There will be a section of society that says `No, not now.'
SHAPIRO: Oh, of course and I'm sure you're interviewing them. You're hearing senators and congressmen who are opposed to this as well as those
who think it's a great idea. So you've got both Republicans and Democrats who approve of these moves and you've got Republicans and Democrats who
oppose it.
QUEST: Right.
SHAPIRO: So it's going to be very, very complicated.
QUEST: As they unwind - as Havana and Washington unwind five decades of effective no contact and cold war. Five decades, Ambassador. It has to
be managed carefully. You can't just open it up like the slews gate (ph) can you? What has to - what do they have to be careful about?
SHAPIRO: Well first of all, I think bureaucrats in Havana and Washington have been working very carefully for the past maybe a year,
trying to clear out the underbrush so that once this political decision was made, they could move ahead. And you're seeing some of that cooperation
with - against Ebola in Africa for example or in Haiti - medical teams working together in Haiti.
QUEST: Right.
SHAPIRO: Working on oil spills and various technical stuff. So getting all that cleared out of the way so that when the political level
decided they wanted to make these moves, --
QUEST: Right. Now --
SHAPIRO: They could do that. The key is going to be Roberta Jacobson, the Assistant Secretary for Western Hemisphere is going to go to
Havana in January for the migration talks. And that's going to set this on the case. She is a great diplomat - very cautious and then we're going to
hopefully soon get ambassadors both the Cuban ambassador in Washington and our U.S. ambassador in Havana.
QUEST: Would you like the job? I mean, I'm not saying it's yours to have, but would you like the job?
SHAPIRO: It would be a huge challenge.
QUEST: (LAUGHTER).
SHAPIRO: That's for sure.
QUEST: A diplomat to the end, sir. Thank you very much indeed. The former ambassador of Venezuela joining me from the CNN Center. I'll put in
a good word for you, sir. Thank you. Now, the Greek Parliament has failed - failed - to pick a new president, putting the country one step closer to
elections that could really rock the Eurozone. It's a key test for the Greek Prime Minister Antonis Samaras. The next two rounds of voting failed
to produce the required majority, then there will be snap elections.
Speaking to me a short while ago, the former ECB president Jean-Claude Trichet, says that the way this is going, we may see more political
upheaval.
(BEGIN VIDEOCLIP)
JEAN-CLAUDE TRICHET, FORMER ECB PRESIDENT: I would say it is certainly something which is very, very important, and depending on these
elections of course we could have an acceleration of political coberences (ph). That's absolutely clear. We will see. We cannot say yet because
there is still a possibility that the presidential elections is finally done before the end of the year. That what will be needed in the 29th of
December would be 180 votes which is not totally excluded. We will see.
QUEST: Do you think other European countries - and I'm thinking now about how the Euro group has dealt with Greeks' exit from the bailout
procedures. Do you think they're losing patience with Greece? Greece wants to get out quickly, they say not just yet, there's still more money,
still more reforms. The others seem to be saying `enough.'
TRICHET: No, I - first of all - I think that the idea that Greek should get out of the appropriate conditionality is not feasible because
the creditworthiness has not been regained yet. A lot of progress have been made, a lot of progress which are underlined by the fact that the
great economy is going now - is in black figures and that there is also job creation now in that term (ph). So they are very good news on Greece. But
the idea that the creditworthiness of the signature is there so that you do not need an international stamp to confirm that you are going in the right
direction is not feasible in my opinion.
QUEST: With all the money, all the liquidity, all the low interest rates, the OMT, the TLRTO - everything that's been thrown at this. Still
inflation is low and worryingly low - inflation expectations. Growth is low, unemployment is high. So I ask you, sir, finally, what will it take
do you believe to get Europe or the Eurozone back to something acceptable when it comes to growth and inflation?
TRICHET: One of the difficulty we have today is that the country that we're under stress have done quite a good job and are now more or less in
black figures. But the countries that have very good positions that are competitive, that have got account surpluses and a very good financial and
monetary envelopment (ph) should go much faster only by virtue of market economics, by -
QUEST: Right.
TRICHET: -- you know - the virtue of spontaneous (ph) - decision of economic agents. And we do not observe that Germany, the Netherlands,
Austria are not going as they should taking into account their fundamentals.
(END VIDEOCLIP)
QUEST: Strong words there from Jean-Claude Trichet, making it clear that some countries could do more. Now, when you enter your hotel room,
the first thing you may like doing is slumping on the bed. Well, this hotel will give you a bed, but it'll also want to keep you moving. Yes,
that's cork floor. I'll explain in a moment.
(COMMERCIAL BREAK)
QUEST: Now, a bed, a nightstand and a desk. They are the very basics - little bit of hot water out of the bathroom - that you should expect to
find in a hotel room (RINGS BELL). At EVEN Hotels, you'll find all that and you'll find a yoga mat and a balance ball as well. It's all part of
EVEN's focus on fitness. It's a new chain from IHG, and it's extending from check-in to the bedroom and the dining room. It's the latest edition
of "Business Traveller," and when you look at keeping fit, EVEN believes it's come up with something new.
(BEGIN VIDEOCLIP)
QUEST: Pool (ph), happy, well - the mantra of EVEN, the health- inspired hotel that's opened in Connecticut. In this brand, the word wellness is everywhere because for this chain, fitness is the fabric of its
DNA.
OLIVER BONKE, CCO, INTERCONTINENTAL HOTELS GROUP: This is really here to set the tone is our garden wall. And a deep breath for some oxygen has
got to improve you r happiness.
QUEST: The Chief Commercial Officer Oliver Bonke believes his new brand will keep our travel tensions in check. It all starts with checking
in. Where else? At the Well-come Island.
BONKE: EVEN Hotels was conceived really from the ground up as a wellness brand and as a wellness experience and that's a very important
distinction to a hotel that may have what I would call a slap on feature around wellness - a spa or a healthy restaurant.
QUEST: It may sound obvious, but here the gym is the heart of the hotel.
BONKE: Travelers are frustrated because gyms are perhaps converted guest rooms or they're in parts of the building that really do not feel
particularly accessible. You do not have to give up any of your fitness or workout routines that you may have at home.
QUEST: Now to the room - to wash up or work on getting washboard abs.
BONKE: First thing you'll notice in the EVEN Hotel room - space is big. Cork on the floor for your EVEN Hotels trainer. This is in every one
of our rooms. It's got TRX that is linked to the channel on the TV with 19 different channels giving you literally hundreds of exercises you can do in
the privacy of your room. Yoga mat, yoga block and of course an exercise ball.
QUEST: So much for satisfying physical needs. EVEN believes it has to go further, so it's experimenting with emotional health as well.
BONKE: Rest easy is one of the key pillars that we have in the EVEN Hotel brand. Next to the bed you have the mood lighting. Dial blue for
happiness.
QUEST: For those looking to socialize, Dieter Schmitz, the general manager, has more than a cocktail to offer in the early evening. He
doubles as a group run leader.
DIETER SCHMITZ, GENERAL MANAGER, EVEN HOTEL NETWORK: Where the traditional GM's just in his office, you never interact. With us, we'll
work out with you. We keep you motivated, encourage you.
QUEST: This is the place where most healthy concepts fall apart -- the kitchen. For the busy business traveler, all too often grabbing a
croissant (ph) is a lot easier than an egg white omelet.
SCHMITZ: The idea here is there's a very transparent space you feel like you want to walk into, and you know whatever it is that you grab is
actually good for you. Balancing, you know, sort of what's good for you with a little indulgence.
QUEST: The true test for EVEN will be as IHG rolls out the brand. Will it remain true to the concept? After all, if you're going to make a
promise of a healthy place to stay, better deliver.
(END VIDEOCLIP)
QUEST: EVEN Hotels. And one interesting fact about this of course - travelers always say in every survey that they want more gyms and they want
to have more fitness and they want to go and keep fitter in the hotels when we all travel as business travelers. The reality is they never use them.
Go into a gym most times, and it's a few miserable machines and a few people doing it. To say one thing, want something else. They're too busy
out having a big breakfast.
A major new step up for Sony for the firm and the film "The Interview" in a moment.
(COMMERCIAL BREAK)
QUEST: Sony has learned that many of the largest U.S. theater - movie theaters - will not show the movie "The Interview" which of course is from
Sony Pictures. They're dropping the movie after hackers threatened a 9-11- style attack on the theaters. Thursday night's premier in New York has already been canceled. The film's a comedy about the assassination of the
North Korean leader. Joining me now, CNN's senior media correspondent Brian QUEST: We can, I mean, the mere fact of a film about - a comedy -
about assassination is a pretty unpleasant film to start with -
BRIAN STELTER, SENIOR MEDIA CORRESPONDENT: Yes.
QUEST: -- but let's put that to one side for the moment. What do you make of it? Why are these theaters cancelling? Are they just being
pusillanimous?
STELTER: I think they are afraid that Americans will be afraid to go to the theaters on Christmas Day. You know, some of the biggest movies of
the year are supposed to come out next week. Not just Sony's but also Disney's and Universal's and Warner Brothers'. Everybody's big movies are
coming out and I think there were concerns that moviegoers would be discouraged from going out at all because of this, frankly, preposterous
threat.
QUEST: Right. But if they don't have a premier, then when they do open, it'll just be another premier on another day. Are they planning to
not open this movie at all?
STELTER: You know, a couple of the movie chains, the only ones that have commented have said `We're not cancelling, we're postponing, we're
delaying.' That's what we've heard so far -
QUEST: So no guts (ph).
STELTER: A Cineplex in Canada said , `We're postponing until we can show this film.' But I would be surprised if it really reaches a mass
audience in theaters. The question now is whether they're going to put it online. Can they distribute it digitally? Can they have you pay 10 bucks
to watch it on the internet somewhere somehow? Or will the company that would do that also then fear the hacking. The same hackers that went after
Sony, will they also go after companies that might try to stream the movie online?
QUEST: We'll talk more about that. Thank you, sir.
STELTER: Thanks.
QUEST: Good to talk to you. When we come back, -- where's my machine? BlackBerry is going back to its roots. I may be the only person
still using it, but I was pleased to see there's a new BlackBerry coming - the BlackBerry Classic. You'll hear from the chief exec in a moment.
(RINGS BELL). Ah, I do beg your --
(COMMERCIAL BREAK)
QUEST: If you want to know which travel trends are on the horizon for 2015, help is at hand. I've been peering into the future as my passport to
2015. And when we look at next year, the shared economy is set to soar.
(BEGIN VIDEOCLIP)
QUEST: As the mists clear from my crystal ball, I can see 2015 will be the year of the shared economy, a trend that's been growing increasingly
popular as travelers seek ways of pruning the budgets without cutting their comforts now sharing seems set to soar. It all started with sharing
accommodation. From crashing on a stranger's couch, to sleeping in a luxury penthouse. The chance to lodge with a local catered for a range of
budgets, a range of locations, --
Female: Hello.
QUEST: -- and the opportunity to get insider knowledge from your hosts. The pioneers such as Airbnb are now joined by an increasing range
of similar websites. One fine stay focuses on upscale properties while couch-surfing at campinmygarden.com - they speak for themselves. From room
and board and now food. The prospect of sharing a meal provides us travelers with the opportunity to taste authentic home-cooked cuisine
rather than that familiar fare served by chain. A simple mac and cheese or a sumptuous multi-course banquet. And all with the company of a local
host. Feastly, Cookening and Eatwithalocal are among those offering similar services in multiple cities.
Finally, sharing an experience is appealing to more adventurous travelers. It might be that walking tour of street art in San Francisco, a
night photography tour of Paris, or an architectural adventure in Buenas Aires. They are among the offers for websites such as Vayable. All in
all, in your passport to 2015, the sharing traveler will be the way to go.
(END VIDEOCLIP)
QUEST: We'll have more passports as the week goes on. A quick update to you. And then, while we've been on air, Sony has announced it's
canceled the release of "The Interview" - the movie of course about the attempted assassination of the North Korean leader. It says, "In light" -
according to Reuters - "because of the decision by the majority of theaters not to show the film." Apparently when we told you a moment when we talked
to Brian Stelter that many movie theaters were not going to show it, and now they've canceled the release. So "The Interview" is no - is not -
going to be released in theaters. Which raises the question that Brian Stelter was saying - what is going to happen to it in terms of whether
it'll just go straight online and straight to digital.
Well, anybody familiar with this program knows that I'm a great fan of me BlackBerry - I wouldn't be without it. Well now BlackBerry - all right,
I may be the only one left! But now BlackBerry's going back to its roots, trying to keep people like me onboard. The smartphone maker's unveiled its
all-new classic. It's calling it a no nonsense device built with its most loyal customers in mind. So I sat down with John Chen, the BlackBerry
chief exec and asked him what the - what the Classic actually does.
(BEGIN VIDEOCLIP)
JOHN CHEN, CEO, BLACKBERRY: It's our testimonial to our customer that we'll listen to them. I came from about 13 months ago. I ran around and
saw all our customers, and I basically asked them, you know, why do you still have it and what will make you change an order? And then this - you
know - they gave me a whole long list of things. So I - this device that we released today covers most of everybody's concern or likes.
QUEST: But is it a standstill device designed to stop the rot? Or is it a device that moves you forward?
CHEN: When I first come up with this idea on the deswide (ph) device, it was meant to be a standstill device because we have about 40 million
very loyal customers around the world and said that we really need this and wanted this. Don't want to get off, but it's falling apart - the old
devices. And so I said what is good for it? The keyboard, navigation belt and your cut and paste and the whole long list of things. I said, `OK, I'm
going to go address that.' Then of course while you addressed it - it's a big task by the way. Most people don't think so. But while we addressed
that, we also upgraded everything - the power supply we upgraded, security we upgraded, you know, a long list of things - the browsers and so forth.
So then it became like, wow, it's not just a standstill device. We may be able to gain new customers or at least gain back a lot of the customers.
QUEST: I'll admit it. This is where one's journalistic neutrality goes out the window, and I freely admit it. I am a loyal BlackBerry user.
CHEN: Thank you.
QUEST: Have been for years. I love you and I hate you. But am I the sort of person you want? Because I also have an iPhone. Am I the target
person you want --
CHEN: Absolutely.
QUEST: -- middle-aged, on his way out executive?
CHEN: Not on his way out part. We're looking for professional people. I don't know about age having anything to do with it. You could
be a 28-year-old that you say, `Hey, I just need this to - for my work. I need to type, I need to cut and paste. There are a lot of TV host people -
anchors, writers -
QUEST: Is it sexy?
CHEN: In what way?
QUEST: Well, all these devices now for a younger millennial generation, it's got to be sexy. You're - but you're appealing to you
know, the bottom line - productivity, --
CHEN: Security.
QUEST: -- security.
CHEN: Right.
QUEST: Not exactly sexy.
CHEN: No, I don't know how to be sexy, certainly not at my age. I guess - I guess -- we could change the color of the - we could change the
color of the back and make it a little sexier, I suppose. So, no, this is about productivity. This is about, like you said, secure, private and
productive.
(END VIDEOCLIP)
QUEST: I'm keeping mine. And that's "Quest Means Business" for tonight. I'm Richard Quest. Whatever you're up to in the hours ahead,
(RINGS BELL) I hope it's profitable. Let's get together tomorrow.
END
