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Quest Means Business
Head Of IMF Says Coronavirus Could Slash Global Growth Prospects; Coronavirus Impact Grows; E.U. Rejects Facebook's Proposals For Regulations; More Than 1,000 Former DOJ Officials Call For U.S. Attorney General William Barr To Resign; One Woman Presumed Dead In U.K. Flooding From Storm Dennis; Police Investigate Racist Abuse Against FC Porto Striker. Aired 3-4p ET
Aired February 17, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:20]
ZAIN ASHER, CNN INTERNATIONAL HOST: From the FTSE 100 to the CAC 40, European stocks ending the day with green across the board. U.S. markets
are closed. There is no trading on Wall Street because of Presidents Day. But here is what is moving the markets today.
China prepares to pump more money into its economy as nearly half of its citizens are told to avoid traveling and Japan becomes latest world economy
to tilt towards recession as the
And rejected. E.U. leaders rebuff Mark Zuckerberg's last ditch attempt to shape new European new rules on social media.
Coming to you live from the world's financial capital here in New York City. It is February 17th. I'm Zain Asher, in for my colleague, Richard
Quest, and this is QUEST MEANS BUSINESS.
All right, good evening, everyone. I'm Zain Asher. Tonight, the International Monetary Fund tells CNN that the coronavirus could drag down
the global economy.
Managing Director Kristalina Georgieva says uncertainty remains high and the fund might have to cut its global growth outlook. She wants Central
Banks at the ready for more monetary stimulus.
CNN's Emerging Markets Editor, John Defterios spoke to the MD at the Global Women's Forum in Dubai. I want you to listen to what she had to say.
JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Zain, let's call it a dual message from the IMF Managing Director, be poised to take action on
monetary policy if needed and tread very carefully when it comes to unilateral trade action, which seemed like a strong hit to the White House.
I asked her if the IMF estimate of 3.3 percent for the global economy can hold up, and whether China will lose a full percentage point and growth as
a result of the virus.
(BEGIN VIDEOTAPE)
KRISTALINA GEORGIEVA, MANAGING DIRECTOR, IMF: It is too early to say because we don't yet quite know what is the nature of this virus. We don't
know how quickly China would be able to contain it. We don't know whether it would spread to the rest of the world.
What we do know however, is that yes, indeed it is going to affect global value chains, already affecting some. It is affecting tourism. It is
affecting travel.
What we also know that if it is contained rapidly, there can be a sharp drop and then a very rapid rebound, what is known as the V-curve and we are
very much hoping this is going to be the case.
But let me say about China, it has been slowing down naturally transiting from what we can call high speed to high quality growth. Understandably, as
many other economists have had done it.
And as a result of the reduction of trade tensions, with the Phase 1 agreement signed between U.S. and China, we actually have been predicting
some improvement for 2020 in the projections for China.
Bottom line is, we are in a world with more uncertainty.
DEFTERIOS: Would you suggest here that global growth, which is fairly sluggish at 3.3 percent on the projections could come below three percent
because of what we see in China? And the fact that the economic cycle is 10 years old?
GEORGIEVA: Well, we have to be concerned about sluggish growth and it has been -- last year, it has been the lowest growth in a decade, 2.9 percent.
And what is more important to recognize is that Central Banks in a synchronized manner, cutting interest rates have given half a percentage
boost to growth last year.
Forty nine banks cut interest rates 71 times. If we didn't have that, we would have been practically in recession.
And just to answer your question on whether China would drag growth further down, it is true China today is a much bigger share of the world economy
then during SARS.
During SARS, eight percent. Today 19 percent. So if things go bad for China, this is not good news for the rest of the world.
But they're working very hard to contain the epidemic. They have poured $115 billion equivalent liquidity so they can perk up the economy and they
have fiscal space to do stimulus for the regions that are most impacted, so not to be --
DEFTERIOS: Can we hold on to the three percent growth this year, do you think?
GEORGIEVA: For now, for now we are saying that 3.3 is our forecast. There may be a cut. We're still hoping it would be in the 0.1 to 0.2 percentage
space.
But again, I wish I had the ability to tell you to look in the crystal ball. This is a particular case when I advise everybody not to jump
prematurely to conclusions. There is still a great deal of uncertainty. We operate with scenarios not yet with projections. Ask me in 10 days.
[09:05:53]
(END VIDEOTAPE)
DEFTERIOS: Zain, it's much more difficult to manage now because China makes up about a fifth of global GDP, vis-a-vis during the SARS crisis back in
2003 when it was about eight percent. Back to you.
ASHER: John Defterios. Thank you so much.
Now each of the world's largest economies now appear to be facing unknowns. Fed Chair Jay Powell said it was very likely the economic effects of
coronavirus will spill over to the U.S. Uncertainty abounds on Wall Street over Donald Trump's trade policy as well and the 2020 U.S. election and
China is dealing with the brunt of the outbreak.
Growth was already slowing and debt is alarmingly high. Japan appears ready to slip into a recession. New figures out Monday show its economy shrank at
an annualized rate of 6.3 percent last quarter.
Coronavirus could push it over the edge that is the fear that Germany is heavily reliant on exports to China. Even before the outbreak, the country
posted zero growth at the end of 2019.
And finally, India's recovery is also looking at less than certain. Moody's cut its 2020 growth forecasts by more than one percent anticipating fallout
from the virus.
To make things worse, major Central Banks have used up much of the ammunition they would typically deploy to fight economic downturns.
Mohamed El-Erian is Chief Economic Adviser at Allianz. So, Mohamed, we were just talking about this a second ago. When you are in a low rate
environment, what tools do Central Banks have at their disposal to fight fears about the global economic outlook caused by coronavirus?
MOHAMED EL-ERIAN, CHIEF ECONOMIC ADVISOR, ALLIANZ: So they basically have two tools, the result of which is to make it easier to borrow and to inject
more liquidity.
Their problem is this is like pushing on a string when it comes to the coronavirus. These measures will be ineffective in terms of offsetting the
economic impact. They will please markets and in fact markets responded today to China introducing more monetary stimulus. So markets will be
happy.
But the real economy will not feel much. It is going to be ineffective and it may even be counterproductive.
ASHER: Maybe they've used much of their ammunition already, so when you think about China's recovery from the coronavirus, a lot of people have
talked about it. In fact, you wrote about it that people are anticipating it's going to be a V-shaped situation whereby it gets a lot worse, and it
dives before it eventually it gets better. That's what we saw 20 years ago during SARS.
This time around things are likely to be different. The negative impacts on the economy is likely to last a lot longer than it did during SARS. Explain
why.
EL-ERIAN: So first of all, it shocks me the speed with which the economists on Wall Street have gone about a V and like you say, it's a very sharp V.
It comes on in the first quarter, it comes and closes back up. Why? Because we've been conditioned to think like that.
When the Saudi oil attack happened, it came back very quickly. When there was an attack on an Iranian general by the U.S., again it came back. So we
have been conditioned to think that.
This is completely different. Think of this as being a cascading economic stop when it comes to the economic effect. So it starts in the province,
everything comes to a standstill. No one goes out, no one buys. No one gathers.
They just saw spreading and it's the rest of China that feels it initially and then suddenly Japan finds out fewer Chinese tourists. Burberry finds
out sales going down by 75 percent.
ASHER: The world is so much more dependent on China these days.
EL-ERIAN: Apple shuts down its factories, and next thing you know, there's questions about supplying factories in New York. Fayette says in three
weeks' time, they may have to shut down factories in Europe.
So this is a very different dynamic. I hope it's a V, but I sincerely doubt it.
ASHER: What do you think the second quarter is going to look like for China?
EL-ERIAN: I think it's going to be a U. So we're going to come down shop in the first quarter. We're going to stabilize in the second quarter. And
hopefully we'll go back up. The risk is that we'll have a W. We go back up and then something else happens and then comes down.
But I think we've got to be ready that this is going to push several countries into recession.
ASHER: When you think about what Japan is going through. They're already sort of dealing with issues surrounding the consumption tax hike, their
economy as we just saw today, the economy is on the brink of a technical recession and now they're dealing with this.
[15:10:09]
ASHER: What's the impact going to be when their economy is already in the thick of it?
EL-ERIAN: So it's interesting because people who factored in the tax increase on the consumption tax said, okay, the economy will contract and
annualize at the rate of 3.7 percent. It contracted at an annualized rate of 6.3. And what that tells you is that the consumer is very risk averse.
So the minute they get hit by any shock, they end up saving a lot more. That's going to make things worse.
ASHER: Right.
EL-ERIAN: I'm told that activity in Tokyo has gone down. You go to the subway, you'll find that very few people are there. Gatherings are being
canceled, including royals --
ASHER: Shanghai is a ghost town right now.
EL-ERIAN: Right. We canceled the Barcelona conference. So I think that you will find that fragile economies are going to pushed, unfortunately into
recession.
ASHER: And then when you think about just the fact that we're dealing with trade issues between the U.S. and China, does the coronavirus and the
economic fallout of the coronavirus make it much harder for Xi Jinping to negotiate with President Trump going forward? Are they in a weaker
position?
EL-ERIAN: They are and it is clear that they're not going to be able to meet the commitment on how much we import from the U.S., and because of
that, a couple of weeks ago, they preemptively reduced tariffs on U.S. goods.
So you see them saying we may not be able to do this, but we're doing this, but on the U.S. side, the pressure continues.
I was at a Munich Security Conference, and the message was very clear. This is not just about economics. This is about national security. So be careful
they say to their allies. Be careful if you sign up with certain companies, Chinese companies that will risk your national security because we will not
cooperate.
ASHER: All right, Mohamed El-Erian. Thank you so much. Appreciate you joining us.
As the coronavirus continues to spread, so does its impact. Banks in China are now either literally burning money or sterilizing it before issuing it
to the public as panic buying sets in in Hong Kong, more than $100 in toilet rolls were seized in an armed robbery.
The government assures however, the supplies remain unaffected. Meantime, Flightradar24 says that flights across China's busiest airports have
dropped up to 80 percent. I spoke with the site's media director about the decline in travel. Take a listen.
(BEGIN VIDEO CLIP)
IAN PETCHENIK, MEDIA DIRECTOR, FLIGHTRADAR24: So we're talking about is using a metric of daily departures. And so on the beginning of the year,
through the third week of January, we saw about 10,000 daily departures from China's 25 biggest airports. And as of last Tuesday, we were down to
about 2,000.
So an 80 percent cut across those busiest airports and those 25 airports account for a very large share of China's air traffic both international
and domestic traffic.
(END VIDEO CLIP)
ASHER: All right. Time now for a quick break. Facebook CEO Mark Zuckerberg is meeting with the European authorities this week. He's been asking them
to regulate his company.
And cameras are rolling in the city that never sleeps. Small studios are making the move to the Big Apple. That's next.
(COMMERCIAL BREAK)
[15:16:00]
ASHER: E.U. authorities are rejecting Facebook's latest proposals for online regulations. That's according to "The Financial Times."
The company's CEO, Mark Zuckerberg is in Europe this week meeting with authorities. On Wednesday, the E.U. is expected to propose new rules around
artificial intelligence, facial recognition and data use. Nina dos Santos is joining us live now from Brussels. So Nina, just walk us through this
sort of fine line that both E.U. and Facebook have to walk in terms of on the one hand protecting freedom of speech, but on the other hand, making
sure that Facebook reins in false information and hate speech.
NINA DOS SANTOS, CNN EUROPE EDITOR: Yes, that was in the forefront of lawmakers minds. Three of these E.U. commissioners as they sat down with
Mark Zuckerberg to hear what he had to say, but also to press home the message that new laws will be coming into place in this key market of
Facebook's later on and they are expecting Facebook to stick to them.
I spoke earlier today to Vera Jourova, who is essentially the E.U.'s privacy czar. She is in charge extensively of transparency and also values
across the bloc, and she said, look, we've done a huge effort here to try and make sure that we've ring-fenced our citizens privacy.
That was the big exercise in 2018, where new GDPR regulations were implemented. They're going to continue to be tough and things like that.
But her main worry was things like disinformation, and how the public could be manipulated, and messages amplified by algorithms.
She spoke to me just before walking in to speak to Zuckerberg himself.
(BEGIN VIDEO CLIP)
VERA JOUROVA, EUROPEAN COMMISSION VICE President: I would like to have a strategic debate about how internet should work for the people, not against
the people.
I want to discuss the position of the Europeans who wants to have their privacy protected. I want to discuss the issues related to the spread of
hate speech and misinformation and other kinds of illegal content.
DOS SANTOS: So you're going to be unveiling new regulation for this environment that will have an impact on people like Facebook. What will be
the ultimate punitive measures that the E.U. will have over these companies?
JOUROVA: The illegal content, we definitely will come with the rules which will impose more responsibility on the platforms.
Because up to now, we have a kind of gentleman agreement, but this time is over.
DOS SANTOS: Do you believe Facebook respects those laws? Or that the issue of the algorithms amplifying certain types of content and so on and so
forth, just makes it a very difficult environment to police?
JOUROVA: I am sure that the business model Facebook uses for selling those cannot be used for selling the political ideas or political actors. That's
why I also want to speak about the protection of elections.
I want to protect European voters against the mechanisms of algorithms which is just chase them into the bubble and do not give them the free
possibility to make a free choice.
(END VIDEO CLIP)
DOS SANTOS: So that was one of the E.U. commissioners who met with Mark Zuckerberg. We also had the commissioner who is in charge of the whole of
the single market, this massive market in the world that's one of the biggest -- meet with him, Thierry Breton, he did not issue a statement and
the all-powerful Margrethe Vestager, the antitrust commissioner, who really has the power here to impose sanctions potentially fines on Facebook. She
issued a rather terse statement after her meeting with Mark Zuckerberg saying that they had had an informative and useful meeting -- Zain.
ASHER: So informative and useful, but overall, do you think that Mark Zuckerberg was somewhat successful in how he got his message across?
DOS SANTOS: Well, Mark Zuckerberg went into these meetings Zain already at the Munich Security Conference over the last few days, taking to the stage
saying I recognize that this is a sector and my company with two billion users probably need some regulation. But we need to hear from the
authorities.
[15:20:09]
DOS SANTOS: We also need to hear from some of our customers and we need the authorities to recognize that the openness of Facebook is also a good thing
as well, because it can help say, for instance, in relief efforts when there's been a natural disaster.
In fact, he wrote those very words, in an opinion piece in "The Financial Times" ahead of this very crucial meeting earlier today.
But the reality is, is that both sides need to get this right, Zain, because of the economics. Facebook has 307 million users here, daily active
users, people who go back to Facebook every single day for communication or for information inside this bloc of 455 million people.
So the E.U. knows that around about three quarters of its citizens use this as a vital platform. They can't just cut that off, but they can fine
Facebook large amounts of money if it doesn't comply to new regulation.
Facebook, on the other hand knows that it needs this region as a vital part of the world for its balance sheet, but also for its overall business
model.
And I should point out, Zain, this isn't just Facebook that has been arriving here and paying pilgrimage if you like to the bigwigs here in
Brussels. We saw the head of the parent company of Google just in the last few weeks also have high profile meetings with the E.U. as well -- Zain.
ASHER: Nina dos Santos live for us there. Thank you so much.
Amazon CEO Jeff Bezos says he's giving $10 billion to fight climate change. That's about 7.7 percent of his net worth. Bezos is the latest business
leader to draw attention to the climate crisis. Martin Sorrell told Richard Quest the situation is only getting worse.
(BEGIN VIDEOTAPE)
MARTIN SORRELL, EXECUTIVE CHAIRMAN, S4 CAPITAL: I think we get quite ugly. I mean, it has already gotten fairly ugly. I think when you see the Amazon
on fire, when you see Australia on fire, whether it's because of bad land management and the Aborigines would have done it better, whatever it is --
and the greens prevent proper land management.
When you see volcanoes popping off. When you see Larry Fink do what he's doing, what Satya Nadella has done, I think quite brilliantly with
Microsoft is sort of setting the targets, to recoup what has happened historically, let alone what's going to happen in 20, 30, or 40, or 50, in
our case -- I suppose it will be 2026 of neutrality.
When you see what Joe Keyser said about the supply in signaling equipment to a railway that is going to cut to a coal mine, when you see Roger
Federer and Credit Suisse being criticized for endorsing or entering in the program with Credit Suisse because of the investment in fossil fuels.
What that means, Richard is that the activist base is going to be, I think, very strong, and that will put enormous pressure.
You know, today, "The Guardian" newspaper announced they weren't going to take advertising revenues from fossil fuel companies. So the pressures from
consumers, the pressures from employees, from people inside the firms in which we operate, all of these pressures, I think can be quite intense and
rationality, sort of goes out the window.
RICHARD QUEST, CNN BUSINESS ANCHOR: Okay, where do you stand on this? Because it's fine to say divest from fossil fuels. But where will fossil
fuel companies like your companies in the majors, and the gas, where will they get their investment capital?
SORRELL: It's not a question of where you stand on it. The practicalities of it. They have not become irrelevant, but there's a lot of emotion now,
whether it be through aggressive speech or President Trump's speech and in response, and it's all very well sort of intellectually analyzing the
arguments, but it is become so emotional.
And there are other examples going on in the world at the moment where activists are very strong and very prevalent, and are disrupting the
situation.
So I think there will be significant amounts of disruption around climate change, and what is the view being that companies are not willing to move
fast enough.
QUEST: And what's your advice to companies?
SORRELL: Move as quickly as you possibly can, and I think that -- you know, the toothpaste is out of the tube on this one. The train has left the
station. It's such a big issue and of such great concern. I think it will gather momentum. And I think -- the interesting thing about Davos, although
I think the issue between China and America is the big issue.
The interesting thing about Davos is it has accelerated the focus on it, you know, everybody going there got a letter from Klaus and Brian Moynihan
and others about what are you going to do as a firm? And in our case, as I said, you know, by 2026 we will be carbon neutral, and we decided to -- we
are a small one 2,350 people in 30 countries with broad geographic spread, but we're taking it very seriously. Why? Because we take it seriously and
now people take it seriously.
(END VIDEOTAPE)
ASHER: Still to come, Richard Quest is going to be joining me live from Lagos as African economies borrow record amounts of cash. The heads of the
World Bank and the IMF say they are concerned -- Richard.
QUEST: Good evening, Zain from Lagos. Very hot. Very humid. We'll be talking economies after the break. And the question that we would like you
to answer is this. Go get your phones, digital devices, cnn.com/join. Entirely subjective. Which country has the healthiest economy? The
healthiest? Is it Nigeria? South Africa? Kenya? Or Ethiopia? cnn.com/join. We will have the chairman of a bank after the break. This is QUEST MEANS
BUSINESS.
(COMMERCIAL BREAK)
[15:28:53]
ASHER: Hello, everyone. I'm Zain Asher. There is more QUEST MEANS BUSINESS in just a moment when will be live for you in Nigeria where an economic
recovery is now facing a new threat, mounting debt.
And move over Hollywood. New tax rules have sparked a movie production boom here in New York City.
Before that, though, these are the headlines we are following this hour.
Fourteen Americans evacuated from a cruise ship in Japan have tested positive for coronavirus and are now back in the United States. They were
among a group of more than 300 Americans who left the Diamond Princess Ship and were flown back to the United States.
Those who tested positive for the virus will be kept in isolation. The rest will remain under quarantine for 14 days.
The road in Northwestern Syria off clogged with tens of thousands of people fleeing the advancing Syrian military. The U.N. says that more than 800,000
people have been uprooted from their homes in northern Syria since December.
Two hospitals in the region are out of service after airstrikes on Monday.
And more than 1,100 former U.S. Justice Department officials are calling on Attorney General William Barr to resign. They posted a statement after Barr
overruled a sentencing recommendation for Roger Stone, a longtime ally of President Trump.
[15:30:10]
They say his intervention in the case damaged the Department of Justice's reputation. One woman is presumed dead after being swept away by flood
waters in the U.K. Authorities say their search and rescue efforts had to be called off on Sunday because of the extreme conditions.
Hundreds on red alert flood warnings are in effect through Monday after a storm Dennis pounded the area. Portuguese police say they're investigating
racist abuse directed at Porto forward Moussa Marega. Marega walked off the pitch during a match on Sunday after people in the stands directed monkey
noises at him. Marega later criticized referees for not defending him, and on top of that, giving him a yellow card.
CNN's Patrick Snell is following all the developments. Patrick, I feel as though we hear about racism in football constantly in Europe. What is being
done to combat this issue?
PATRICK SNELL, CNN SPORTS REPORTER: You're absolutely right, Zain, short answer is clearly not enough. Because once again, this is yet another stain
on what should be the beautiful sport of football. Look, already this past season, we've been seeing incidents in Ukraine, in England's Premier
League, in Italy, in Holland as well. And this latest incident really does leave very unsavory taste in the mouth.
As you mentioned, the player Moussa Marega -- the video here is really emotional because he actually scored the winning goal in that game. And
then he pointed to the color of his skin as he wheeled away and part of a celebrations. And you can just see there, his teammates trying to restrain
him, trying to restrain him from leaving the field of play. Why?
Because they want him to stay on. They don't want this to become a victory for the racists. They want him to stay on the pitch and seal out the game,
but he wanted to go off. What happened, he actually ended up being substituted. Really emotional stuff. And I do want to get to reaction from
the player himself. Because on his Instagram, which he took to afterwards, these are very powerful words indeed.
Marega saying, "I would just like to say to these idiots who come to the stadium to make racist chants to go blank themselves. And I would also like
to thank the referees for not defending me and for giving me a yellow card for defending the color of my skin." Very powerful words indeed from the
player himself. The Portuguese Football League, Zain as well, want to get to their reaction.
"Liga Portugal does not agree, nor will it ever, with acts of racism, xenophobia, intolerance and any other that jeopardize the dignity of
footballers, agents or just any human being. Liga Portugal will do everything to ensure that this and all episodes of racism do not go
unpunished." Another incident that we just don't want to see, Zain, and yet, as you say, you know, people talk about education and the need for
education.
That couldn't be more front and center right now. It's hard to report on as well at times. There's no question about that. It really is.
ASHER: And no doubt if European clubs don't get a handle on this, it will certainly impact their ability to attract top quality talent. Patrick Snell
live for us there, thank you so much. The African Development Bank says accusations that it's worsening Africa's debt problems are inaccurate and
not fact based. That's a response to the head of the World Bank who accused the African Development Bank of a tendency to lend too quickly and in
unsustainable ways.
But debts on the continent are rising fast, and the World Bank is not alone in expressing their concern. The IMF has too. Nigeria's total external debt
has doubled in the past two years as the country climbed out of recession. We are asking you, who has the healthiest economy in Africa? Who has the
healthiest economy in Africa? As Richard mentioned, it is a subjective question, so, only your opinion counts.
Is it Nigeria? Is it South Africa? Is it Kenya? Or is it Ethiopia? Who has the healthiest economy in Africa? There's still time to cast your vote, to
go to cnn.com-slash-join on your phone or on your computer. Let's go now to Richard Quest who is joining us live now from Lagos.
So, Richard, I understand you've been speaking to the CEO of Zenith Bank, Jim Ovia. What did he have to say about the health of the Nigeria economy,
and also how new innovative sub-sectors like Fintech are disrupting the banking sector?
QUEST: Good evening, Zain, from Lagos. Taking the opportunity of being here and catching the temperatures on an economy of course that was in recession
just three years ago on the back of low oil prices that has since made quite considerable improvements in recovering.
[15:35:00]
But as always with the Nigerian economy, what you see is not always the whole story. And that's why I was grateful to sit down with Jim Ovia, the
Chairman of Zenith Bank to get a deep underlying view of what's actually happening in Nigeria today.
(BEGIN VIDEO CLIP)
JIM OVIA, CHIEF EXECUTIVE OFFICER, ZENITH BANK: In a big economic situation, you can't diversify too fast. It has to -- you know, elephant
doesn't really move too fast. Nigeria is like a big elephant in the context of the African economy. It's the largest economy in Africa, there's no
doubt about that. If you fall, trying to get up, in some cases it's difficult. But we did get up. We got up and we're moving steadily up, and
we're heading up.
So, that diversification in the area of agriculture, in the area of manufacturing, in the area of tourism, it has to be a gradual process, but
it's been done.
QUEST: What worries you most about the Nigerian economy at the moment?
OVIA: Well, the worry will come in the area of infrastructure. Can we really do enough? And as you right say, how fast can we do it at? We can't
be too fast, but at the same time, we shouldn't be too slow.
QUEST: But I look at this economy, and you have a very traditional emerging markets economy that's oil based. But you, on top of that, you do have the
digitization. You do have enormous amounts of work being done in this country. Do you think -- whether it's Fintech, digitization. Do you think
enough resources are being put into these new economies? Is the government recognizing these new economies?
OVIA: Oh, definitely. We have so many brilliant people in the government. The president had appointed very renowned Nigerian individuals that are
brilliant. Take for example, the Central Bank Governor, is one of the most brilliant individuals that we could have given that job. He is arguably
doing a fantastic job with the economy. In the area of supporting, and giving some intervention in the area of agriculture, there are many people
who never wanted to do farming or support agriculture.
But he has encouraged them by disbursing the required resources, required in the area of agriculture, in manufacturing, there's a lot of incentive if
you are doing manufacturing. And a lot of central bank support in that regard, and so on and so forth. And of course Fintech. The Fintech
companies are eating the lunch of the banks.
In fact, that wasn't me saying that. It was Jamie Dimon. And he is right. But won't let them eat our breakfast, but they can eat the lunch. They can
skip breakfast, eat the lunch. That is why we have to partner with Fintech company because the various products, various apps they're developing is
ensuring financial inclusion because it allows us to be able to embrace unbanked.
(END VIDEO CLIP)
QUEST: Joining me now here is Stephanie Busari.
Good to see you, our correspondent here in Lagos. Thank you for staying up late and for allowing us in and to join you. The nuanced change in Nigeria
since I was last here --
STEPHANIE BUSARI, CNN REPORTER: Yes --
QUEST: In what, 2017, what is that?
BUSARI: OK, first of all, welcome back to Lagos --
QUEST: Thank you.
BUSARI: Richard, it's great to have you here. Of course, there's been a few interesting developments. We've had election, President Buhari was re-
elected. But he said earlier this month that he is not standing for re- election. So, there's already jockeying for who will replace him in 2023. And it raises the question, will he be a lame-duck president or will the
key things that need to be done get done?
QUEST: But surely, immediately, he says that, he's got two or three years left. He's out. He's gone. What can he get done? He's got no political
power.
BUSARI: Well, I think he's still got considerable power, he's still the president, he's still the sitting president, and he is still, you know,
doing the things that he's promised Nigerians that he will do. Key amongst those things is infrastructure. There have been some investments, but for
some people, it's just not going fast enough.
QUEST: And what about the security question here, because no matter how good the economic benefits, the security issue in the north of the country
is always a problem. Is it getting better?
BUSARI: Sadly, it is not, Richard. No matter how many times the government has said, Boko Haram has been technically defeated, they stage audacious
attacks. Just recently, 30 people were killed --
QUEST: Right --
BUSARI: Sleeping in their cars. So, Boko Haram issue is still very much there. And parts of the country also are suffering from violent outbreaks.
[15:40:00]
QUEST: I want to read you the results of our totally unscientific question. Nigeria, 50 percent of our viewers -- good evening to you, say 50 percent
say, Lagos or Nigeria is the healthiest economy. You cover the region, South Africa, 16 percent, Kenya, 13 percent, Ethiopia, 20 percent.
BUSARI: Yes --
QUEST: Is that your understanding?
BUSARI: Well, this is Africa's largest economy, so that's not surprising results. But everyone refers to Nigeria as the sleeping giant, and they
really hope that Nigeria will wake up and fulfill the potential that it really has. But at the same time, it's never been cooler to be Nigerian.
Everywhere you go, as a Nigerian, very proud to go to clubs around the world and hear our music being played in clubs, plus the restaurants.
And one of Nigeria's artist was recently nominated for a Grammy award. So, it's very cool to be Nigerian right now, but we just hope -- people here
hope that their potential --
QUEST: Oh --
BUSARI: Will be realized.
QUEST: Good to see you. Thank you for letting me come, arrive and take over --
BUSARI: Always a pleasure to have you --
QUEST: And leave. All right, Zain, I will have a profitable moment from Lagos after the break -- well, at the end of the program, I should say.
ASHER: Stephanie Busari, Stephanie Busari put it perfectly, it has absolutely never been cooler to be a Nigerian. Let's just hope that our
country reaches its full economic potential. Richard Quest live for us there, thank you so much. GM announcing the end of the road for its
historic brand Holden. The American car maker says it is leaving Australia for a drive into the future. We'll explain why, next.
(COMMERCIAL BREAK)
ASHER: Welcome back. General Motors is retiring the roaring lion. The company announced its sales, the design and in short, nearing operations of
the iconic Australian brand, Holden will end by 2021. The decision comes as GM ramps up spending on electric and autonomous vehicles. Simon Cullen has
more.
(BEGIN VIDEOTAPE)
SIMON CULLEN, CNN CORRESPONDENT (voice-over): In Australia, the Holden car is as iconic as, well, football, meat pies and kangaroos. It's a brand
that's existed for more than 160 years, at one point exporting to dozens of countries.
UNIDENTIFIED MALE: And as most often referred to as the car from Australia.
CULLEN: But it's now the end of the road. Its U.S. based owner General Motors, has already closed its Australian manufacturing plants. Now it's
going a step further, shutting down most of its remaining operations in Australia and New Zealand by the end of the year, and killing off the
Holden brand entirely.
[15:45:00]
JULIAN BLISSETT, GENERAL MOTORS: This was an agonizing decision for us, and one that we didn't make lightly or easily.
CULLEN: And it's one that has angered the Australian government, which has poured billions of dollars into the company's operations over many years.
KAREN ANDREWS, INDUSTRY MINISTER, AUSTRALIA: A lot of money has been given to these car manufacturers to try and support them here, that makes it
particularly disappointing.
CULLEN: The decision to pull out of Australia is the latest move by General Motors to shrink its global presence, one it says that reflects the
changing economics of car manufacturing.
BLISSETT: It's an issue of scale. With the global consolidation of the automotive industry, it is becoming increasingly challenging for us to
support a brand and a business that operates in just two markets.
CULLEN: It's a decision, too, that reflects changing consumer demand at a time when more drivers want small cars or SUVs, Holden's flagship sedan was
left behind. The company's dwindling sales a sad end to its long and proud Australian history. Simon Cullen, CNN.
(END VIDEOTAPE)
ASHER: French train maker Alstom has signed a deal to buy Bombardier's rail business. Alstom's shares jumped 3.5 percent in Paris, and in anticipation
of the deal, the company is attempting to compete against larger Chinese rival CRRC. Paula Newton is joining us live now from Ottawa. So, Paula,
just walk us through what we know about the details of this deal.
PAULA NEWTON, CNN CORRESPONDENT: Yes, Zain, you and I were speaking a few hours ago, and apparently, their ears were ringing because no sooner did we
get off the air than they announced this deal, and it was probably one of the worst kept secrets really on Wall Street and elsewhere. Depending on
how you slice it up, it's worth about $8 billion.
Most of it in cash, and some in shares. And this will do two things. The first thing as you were mentioning in terms of the competition, look,
Alstom has been trying to convince EU regulators that they need scale, not so that they can monopolize the European market, but so that they can
actually compete in the world market where those Chinese fast trains have really been doing some damage to market share.
You have huge infrastructure projects coming up perhaps in places like the U.K., and they want to be able to compete. This will knock out a competitor
in the market, but also give them more scale to perhaps venture into the business further into North America and South America. What does Bombardier
get in return? Cash, Zain, they desperately need it. They were laden with debt, they need to get rid of some of that debt to do what they say will
now be the focus of their business going forward.
Only the private jet industry. You remember that they unloaded their -- they merged kind of with Airbus, but that didn't last long. They basically
let go of their commercial aircraft division a little while ago. Which means that they will now only be in this private jet market. Here in
Canada, look, this is an 80-year-old company, we were just hearing about that Australian company, this is an iconic Canadian company.
It will continue to exist, and some of those employees that Bombardier employees now working in the train division will now work for Alstom, but
no doubt there will be a lot of people here in Canada who are a little bit reticent about accepting this kind of deal and wondering what it means in
terms of research and engineering, and especially in a carbon-free type of rail network and where those jobs for that research will go to.
Zain, Alstom says they will continue to have an R&D center and somewhat of an American headquarters here in Canada.
ASHER: All right, Paula Newton live for us there, thank you so much. When we come back, "Sesame Street" gets some new neighbors as more shows make
the move to New York City. That's next.
(COMMERCIAL BREAK)
[15:50:00]
ASHER: Long before Google Maps, we had that song I'm sure a lot of you remember it. It brings back so many memories from a lot of our childhoods.
That song guided us to a classic New York institution, of course, I'm talking about "Sesame Street". Big Bird and Cookie Monster have made their
home in the Big Apple for more than 50 years. They've been around for five decades. Yet many other productions set in the city aren't actually filmed
there at all.
For example, a 2005 film "Hong Kong" was set in New York, but it was actually shot in New Zealand. The 2008 film, "The Incredible Hulk", again,
shot in New York but actually filmed -- or set in New York, rather, but actually filmed in Canada. And the 1999 film, "Eyes Wide", shot, again, set
in New York but shot in the United Kingdom.
That may be changing, thanks to the growth of streaming and a substantial tax credit from New York State. CNN's Clare Sebastian has more.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: This building was used for "The Greatest Showman" --
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT (on camera): Wow --
UNIDENTIFIED MALE: And for something I can't tell you.
UNIDENTIFIED MALE: Ready? Showtime!
SEBASTIAN (voice-over): From "The Greatest Showman" to "The Marvelous Mrs. Maisel" --
UNIDENTIFIED FEMALE: It is the best place to have your first nervous breakdown.
(LAUGHTER)
SEBASTIAN: Starred in the studios on the grounds of a 19th century U.S. Navy yard has seen a lot of hits, something that less than two decades ago
seemed impossible.
DOUG STEINER, CHAIRMAN, STEINER STUDIOS: It almost broke me and almost was a colossal failure.
SEBASTIAN: Despite New York's crew and talent base, the city was just too expensive.
STEINER: About six months before we opened, I realized if we didn't have a tax credit, there wasn't going to be more business in New York in and after
to support us.
SEBASTIAN: The tax credit now covers 30 percent of qualified production costs, putting it in tough competition with other states battling for
production dollars like Georgia and Illinois.
STEINER: Rolling.
SEBASTIAN: In 2010, 14 TV productions applied for the credit in New York. Last year, it was more than five times that.
STEINER: And action.
UNIDENTIFIED FEMALE: Look, hey, I appreciate all this. I do.
SEBASTIAN: This "CBS" show, "God Friended Me", one of the recipients. The show also has on "CBS'" all access streaming platform. Outside this old
Naval hospital featured in the series "Gotham".
(on camera): If you're a fan of "HBO's" "Boardwalk Empire", you might even recognize this Chicago street scene.
UNIDENTIFIED MALE: See you in a few hours.
STEINER: The explosion in content creation is great for us. Everybody wants to be a subscription service and the next "HBO".
SEBASTIAN (voice-over): In the next 10 years, Steiner plans to almost double its square footage, adding 15 more sound stages.
STEINER: Let's try a rehearsal, shall we? All right, everybody in, everybody up. Here we go. Three, two, rehearsal.
UNIDENTIFIED MALE: There he is.
UNIDENTIFIED MALE: Where?
SEBASTIAN (on camera): Counting all the expansion there is one constant in New York's production scene, and that is "Sesame Street", now filming its
51st season in New York City.
(voice-over): Across down at the centennial Kaufman Astoria studios, the old guard is also getting a new lease of life. "Sesame Street" is moving to
CNN parent company Warner Media's "HBO Max" streaming service this year and is growing.
BEN LEHMANN, EXECUTIVE PRODUCER, SESAME STREET: We recently completed production on a "Sesame Street" spin-off called the "Not Too Late Show with
Elmo".
HAL ROSENBLUTH, CHIEF EXECUTIVE OFFICER, KAUFMAN ASTORIA STUDIOS: And you can't compare shooting in New York to Hollywood. We've got better bagels.
SEBASTIAN: Kaufman's President Hal Rosenbluth no longer has to run campaigns like this one, selling New York to Hollywood producers.
(on camera): Oh, here we go.
ROSENBLUTH: Here we go. Right, and one of the first shows of Netflix.
SEBASTIAN: Kaufman is now expanding, adding 150,000 square feet. Netflix is also building its own production hub in New York.
[15:55:00]
ROSENBLUTH: New York is facing questions of capacity, which is a high quality problem.
SEBASTIAN: A problem he says with huge economic benefits.
ROSENBLUTH: State-of-the-art stages have been built and created. We've seen equipment companies grow. And the main thing is jobs. You know, it's the
old story, jobs.
STEINER: Action.
SEBASTIAN: An old story with what New York believes is a Hollywood ending. Clare Sebastian, CNN, New York.
(END VIDEOTAPE)
ASHER: Many thanks to our Clare Sebastian for that story. And that is it from me here in New York, I'm Zain Asher. My colleague, Richard Quest is
going to be back with a special profitable moment from Lagos, Nigeria. He'll be with you after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's profitable moment from Lagos in Nigeria. It's lovely to be back in Nigeria, feeling the warmth, the heat, the humidity and the
extraordinary welcome that you get. Also of course, some things don't change. There's the chaos at the airport. There is the power cuts that are
endemic. We've had one while we've been on air, and I had one in the gym this morning, one in the afternoon and one in the evening.
And there's the ever present questions of transparency and the like, with government and big business. But this all ignores the real progress that is
being made. There is an energy here in Nigeria, once again that you can plug into and feel from the people who are here. A natural optimism that
things will get better.
I think what's worrying of course, is that now the president is not standing for re-election, there will be a couple of years of literally
jockeying for position. Who will have the best policies that take Nigeria forward into the future? The real problem with Nigeria is the same as
always. And people will tell you, this to your face when you speak to them in a moment of honesty.
There have been so many promises of Nigeria coming to fruition, of the benefits coming to the people, and so often, it has not come to fruition.
The people are cynical. They are worried it will never happen. But then somehow, there is this moment of hope, and yes, everybody is back at it
once again. And that is QUEST MEANS BUSINESS for tonight. I am Richard Quest in Lagos, Nigeria.
As always, whatever you're up to in the hours ahead, I hope it's profitable. We'll be back tomorrow.
END
