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British Authorities Attempting To Identify Man On Jim Foley Execution Tape; Massive Aid Effort Ramping Up To Help Iraqi Yazidis; Fight Against ISIS; Middle Eastern Wines, Lebanese Lager; Capitalizing Middle East Start-Ups

Aired August 21, 2014 - 11:00   ET

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

BECKY ANDERSON, HOST: Weighing up the next move.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: No just god would stand for what they did yesterday and what they do every single day.

(END VIDEO CLIP)

ANDERSON: Western leaders avow not to bend to ISIS demands in the wake of James Foley's execution, but the militant campaign continues with a

vengeance.

We'll tell you how oil is helping ISIS maintain momentum to the tune of $3 million a day.

And we'll speak to the humanitarian chief tasked with reaching countless refugees displaced by the terror threat.

ANNOUNCER: Live from CNN Abu Dhabi, this is Connect the World with Becky Anderson.

ANDERSON: A very good evening. It's just after 7:00 in the UAE. One day after U.S. President Barack Obama vowed to confront what he called

hateful terrorism, ISIS is continuing its ground campaign in Iraq and its propaganda war.

Today, the militant group posted video on YouTube said to show dozens of people from the Yazidi religious minority converting to Islam in

northern Iraq.

Now meanwhile, we are learning that U.S. military commandos attempted to rescue American journalist Jim Foley and other captives from ISIS

earlier this summer, but the mission failed when the team could not locate the hostages.

Foley was executed by ISIS and the video posted online on Tuesday.

Well, Anna Coren joins me live now from Irbil in northern Iraq. An a propaganda war then being waged by ISIS alongside its military one, of

course. What's the situation on the ground?

ANNA COREN, CNN INTERNATIONAL CORRESPONDENT: Well, Becky, certainly that fight with ISIS is raging. We spent time down at Mosul dam in the

past couple of days where those U.S. airstrikes really changed the situation on the ground allowing the Peshmerga as well as the Iraqi

commandos to come in and push ISIS to the periphery.

From what we understand, fighting is still continuing in those surrounding areas. But there is no doubt about it, those U.S. airstrikes

really changing the situation on the ground.

Now we know there were 14 air strikes yesterday, that was an extremely intensive campaign following the weekend over the space of some 72 hours in

which there were 35 strikes. They would follow up with 14 yesterday. It really shows that they are trying to target those ISIS positions.

But I think, Becky, the question is if this is going to be the way forward, if this is going to be template moving forward, considering the

success at Mosul dam, the U.S. has to get more involved.

We've heard from President Obama following the death of James Foley that, you know, the U.S. is not going to shy away from its fight against

ISIS. But they can't do that just form the air. It's going to take a much more involved strategy, Becky.

ANDERSON: Meantime, Anna, we see pictures of ISIS purportedly converting Yazidis to Islam. You've been among the refugees. What sense

did you get of their attitude towards the group?

COREN: Well, they're absolutely terrified of ISIS. They fled their homes having witnessed horrors, having heard about horrors -- the massacres

that took place. We've all seen the pictures.

As far as the Yazidis are concerned, they believe that they were facing genocide, so many of them fled to the mountain.

But, we have seen video surface today from ISIS showing those who stayed and decided to convert.

Now we can't verify this video, but certainly from what we see, busloads of Yazidis getting off, being embraced by the ISIS commanders,

whether, you know, welcoming them into the brotherhood, almost, and then there's another shot of them in a courtyard listening to a sermon and you

can see the look on their faces, Becky. Obviously, they've very subservient, being obedient, but there is also that sense of terror in

their faces.

So those who decided to stay obviously had to convert or they would be massacred. That is the option that ISIS gave them. But certainly for the

thousands, the tens of thousands who weren't prepared to take that chance, they have fled.

They're now living on streets and schools, in abandoned buildings. This is the situation, the plight of the refugees, many of them also in

UNHCR camps. We know the aid is finally getting here to Irbil. It will then be distributed to the outlying provinces in the coming days. This is

the biggest operation that UNHCR has conducted in more than a decade.

So that aid finally getting to these people, but the question, Becky, is what happens to them after this? These people need livelihoods, they

need homes and living in a refugee camp is just definitely not the answer.

ANDERSON: Anna Coren on the ground for you with in depth analysis of what is going on. We're going to have a lot more on Iraq later on Connect

the World.

I'll take you to a warehouse in Dubai here where a massive aid operation is underway to help those refuges. It's all part of what Anna

was explaining there.

We'll also talk to a regional director of the United Nations about the roadblocks to getting that aid into Iraq and to the people who need it

most.

And John Defterios will be here with me to talk about ISIS oil assets and its black market distribution network. This is a fascinating part of

the story. That is later on Connect the World with me, Becky Anderson.

Well, an international manhunt is underway for the ISIS militant who is shown beheading James Foley in a video. The killer speaks with what

sounds like a British accent. Have a listen to this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Any attempt by you, Obama, to deny the Muslims their rights of living in safety under the Islamic caliphate in the result

in the bloodshed of your people."

(END VIDEO CLIP)

ANDERSON: Well, linguistics experts say the man could come from an area in London known as the East End.

Well, the British Prime Minister David Cameron came back briefly from holiday to head a meeting of the government's emergency committee known as

COBRA. He says that it looks increasingly likely that the killer is a British citizen.

Well, Atika Shubert is in London on the story for you. British security agencies, Atika, working to identify this man. What sort of

intelligence do they have on those Brits who have left the country to join the fight, as they've said? And how long do they think it will take them

to identify this man?

ATIKA SHUBERT, CNN INTERNATIONAL CORRESPONDENT: Well, I think there's a very good chance that they've already identified this man. I mean, they

have been tracking hundreds of young men, and a few women, that have gone to Syria and now of course Iraq to fight. So, what they're really trying

to do at this point is match the voice and whatever clues they can pick up from that video to whatever they have in their databank -- images, audio

recordings -- and there is a lot of material out there.

And then of course they will be trying to track all the people they do have and see whether or not there are any connections.

I think there's a good chance he's already been identified, but they may not want to say that, exactly. But what seems clear from talking to

linguistic experts is that this is somebody who grew up here in Britain, probably from a very young age, probably from a fairly well off family

because he's very quite articulate, well educated, and possibly somebody from the south England, London area, could be the East End, could be south

London, but somebody who is very familiar and most likely probably British.

ANDERSON: You've been covering this story, I know, for some time. You've done an awful lot of digging on jihadists who may have been

radicalized in the UK and then gone out to fight. Give me a sense of the scope of the sort of group that we are talking about here?

SHUBERT: Well, we are talking about quite a problem, particularly for the UK. An estimated 400 to 500 young men and a few women have gone there

to fight. Now there have been thousands more across Europe, but the UK has a particular problem with it. And it's not with the recent conflict,

of course, Afghanistan we also saw a number of youths going over there to fight.

But in this particular case, what's happened is a lot of these sort of -- a lot of them Muslim youth have gone to fight for very idealistic

reasons. They were fighting against the regime of Bashar al-Assad.

And I've talked to a lot of family members who say that their sons and daughters might have gone in there with the best of intentions, but when

they get there they get sucked into this world of ISIS, of Jubhat al Nusra, of much more militant, hardcore groups that are very bloody and brutal and

they can't find a way out.

ANDERSON: Atika Shubert on the story for you in London.

I want to just break away from what we have been doing for a moment to take you live to an event in Atlanta, Georgia. Dr. Kent Brantly contracted

the Ebola virus in West Africa while helping fight its largest outbreak in recorded history. He's just been released from Emory University hospital

there. And he's talking certainly -- or will be talking -- on what happened. That's after his blood tests have come back negative for the

virus.

Now CNN has learned that fellow missionary Nancy Writebol has also been released. The hospital is holding a news conference now. Let's just

listen in.

(SIMULCAST WITH CNN USA)

BECKY ANDERSON, HOST: Well, you're watching CONNECT THE WORLD with me, Becky Anderson, taking over from our colleagues in the States. These

are the headlines this hour.

The Pentagon says US elite commandos staged an operation earlier this summer to rescue American hostages, including journalist Jim Foley, but the

mission to Syria failed when the commandos were unable to find the hostages. Video of Foley's execution by ISIS was posted online on Tuesday.

Hamas is vowing revenge for an Israeli airstrike that killed three senior military commanders in Gaza. Several other Palestinians were also

killed in that attack. Now, Hamas's military chief was targeted in a strike on Tuesday, but the group says Mohammed Deif survived that attack.

The mood in Ferguson, Missouri in the States appears calmer after nearly two weeks of tensions over the death of Michael Brown. The unarmed

African-American teenager was fatally shot by a white police officer on August the 9th. A grand jury has begun hearing evidence on that case.

We have witnessed ISIS's bloody and ruthless takeover of northern Iraq. We've witnessed it now over the past months, killing anyone or

anything that gets in its way. But the execution of American journalist James Foley appears to be the first time that ISIS has killed an American

citizen. Could his death, then, be a turning point in the fight against ISIS or, indeed, in their messaging?

Afzal Ashraf is in London. He served several tours of duty with the RAF in Iraq and Afghanistan and currently works as a consultant with the

think tank the Royal United Services Institute. Sir, thank you for joining us.

I know that you believe that this execution, this cold-blooded execution of an American journalist was a sign of weakness by ISIS. Can

you explain what you mean by that?

AFZAL ASHRAF, CONSULTANT FELLOW, ROYAL UNITED SERVICES INSTITUTE: Yes. The timing of the execution is very interesting. They've had poor

James Foley for 22 months, and they chose to execute him just two days after the Peshmerga took over the Mosul Dam.

Now, by doing that, what has happened is that the Peshmerga are within striking distance of Mosul City, and Mosul City is where they've set up

their headquarters. At the same time, the Iraqi army is attacking Tikrit, another center of this organization.

So, they really are in a very desperate situation, and this is the only thing they could do to send a signal out to the US, because they know

that without the US's help, the Peshmerga would not have been successful, and the Iraqi army would not have been able to start to try and retake

Tikrit. So, they really are on their back foot, as it were.

ANDERSON: OK. I understand your analysis. Some would say that they have retreated to reorganize, but I get your point. Let me just get you

and our viewers what was written by one AP journalist on the death of James Foley. Of course, his death has made plenty of headlines. I want to show

you one particular one from the AP.

"Foley's death," and I quote, "isn't changing views in Congress." The writer Bradley Klapper starts his article as follows. "For all its horror,

the beheading of an American in journalist in Syria appears unlikely to change lawmakers' minds about military intervention against Islamic State

extremists. It's equally unclear whether the Obama administration will be asking them to back a new US approach."

Also, before we discuss where you think the US goes next in its actions in Iraq, just want you to get a sense of reaction from this part of

the world, and we are coming -- broadcasting tonight from Abu Dhabi in the UAE.

Let's start with Syrian state media. And Syria has repeatedly warned, they say, that since the outbreak of the internationally-devised terrorist

war against it in 2011 that terrorism will backfire on the countries which have exported, funded, and supported it, on top of those being the US.

Egypt emphasized the need for, and I quote, "concerted and combined efforts of the international community in the fight against terrorism as a

global phenomenon that does not target a specific country or region, or linked to a specific religion, but rather aimed at stability, security, and

development throughout the world.

And on our air this time yesterday, sir, we also heard from the acting Iraqi foreign minister, Mr. Zebari, and he told me that "we are forming a

new government in Baghdad to stand up collectively against ISIS and against this crime. This barbarity," he told me, "we have seen at the beheading of

James Foley is an evil act done by evil men with an evil ideology. So everybody should know what we are facing."

So, reaction there from the Middle East and North African region and, indeed, from one US journalist. How do you expect the US to change policy,

if at all, in Iraq. And also outside of that, perhaps in the UK as well, where we believe this jihadist who beheaded James Foley was from?

ASHRAF: Well, the statement by President Obama and the statement that -- the suggestion that Congress is unlikely to change policy is, I think,

what we will expect, that the policy towards Iraq will not change.

But that doesn't mean that they US's commitment to its citizens' safety, and its commitment to its allies in the region and its desire to

deal with this extremist, violent threat is unchanged, because those commitments were already there.

And this beheading, all it's done is, perhaps, to focus people's minds. But actually in terms of policy, nothing major is likely to change.

Now, one of the things that I think the US has done very well in the last few weeks and months is the diplomacy that's been going on behind the

scenes, which has resulted in Prime Minister Maliki eventually resigning, even though just a week or so ago, he was refusing to do so. He had put

his army and his guards on alert in Baghdad and gave every indication of fighting just to remain in power.

So, something has happened, and I think the US has had a part to play in this behind the scenes So trying to get a government in Baghdad that is

truly representative is a large part of the solution, the political solution here.

Military and security measures only buy you time and space. They don't provide a solution. And I think that is what the policy is in in

Washington right now, that the military actions will be precise, they will be targeted, and they will help enable the political solution rather than

lead the political solution.

ANDERSON: Sure, OK. Now, that I understand. But surely the problem is this, that this group can't be allowed to continue to expend its arc of

influence. And quite frankly, to many a young jihadi, it seems, around the world, particularly from Western countries, they are a success.

ASHRAF: Indeed. And that is an area that I think if there is anything that we, the international community, including the Middle East,

should be doing is highlighting the fact that their success was temporary.

I think a lot of people have given ISIS a lot of credit that it doesn't deserve. Yes, there was a dramatic rise in June. They took over

lots of towns and cities. Almost every day, cities and towns were falling, and people attributed that to the capability of ISIS.

In reality, it was in large part because of the failures of the Iraqi army and the Iraqi police and the Iraqi government to provide security.

So, I think we have been somewhat guilty of giving these terrorists, this group, a lot more credit than it deserves.

And this is one of the reasons why I think it's important to understand what it is that led to poor James Foley's execution. And it was

because these people have realized that their boast of two and a half months ago, that they would be in Baghdad within days, wasn't delivered.

They have not been able to make any further gains of any significance, and they have lost ground.

And they are now in a situation where they believe with Western help, the US's help, and other regional countries' help, including Iran, that

they now are likely to reverse those gains. And I think it's important to highlight publicly to potential recruits that this is not a winning side --

ANDERSON: We'll take a very short break.

ASHRAF: -- it is a losing side.

ANDERSON: I'm not sure that our guest can still hear us. I think we're having some technical difficulties. I'm going to have to take a very

short break. That was fascinating stuff, sir, thank you. I'm Becky Anderson, that was CONNECT THE WORLD, thank you for watching.

(COMMERCIAL BREAK)

LEONE LAKHANI, HOST: This week on MARKETPLACE MIDDLE EAST, a special edition from the vineyards of Lebanon, how winemakers here are rallying to

get their bottles on international shelves.

Plus, in a region with a high jobless rate and low opportunities, the challenges entrepreneurs face to bridge the gap.

Welcome to the show. Winemaking in this region dates backs thousands of years, but modern-day production really didn't start until the 20th

century. But as the wines from here have gained international recognition, local producers are making a concerted effort to get their bottles on

shelves abroad.

(BEGIN VIDEOTAPE)

LAKHANI (voice-over): The fruits of modern winemaking in Lebanon are rooted here. This is the Ksara vineyard in the Bekaa Valley, founded by

Jesuit priests in 1857.

MICHAEL KARAM, WINE WRITER: The Jesuits went over to Algeria. They wanted some vines that they were used to working in with in France brought

over here and planted it.

LAKHANI: It's now grown into one of the country's top wineries. Of the 8 million bottles of wine Lebanon produces each year, 3 million are

from Ksara.

CHARLES GHOSTINE, MANAGING DIRECTOR, CHATEAU KSARA: In those barrels, you have the red wines. The Chateaux wines are matured for 12 months in

the barrels.

LAKHANI (on camera): So, each of these are in for 12 months at least.

GHOSTINE: Twelve months, exactly. We export between 40 and 45 percent of the whole production, and we have 65 percent of our export to

Europe, and we have to some Arab worlds. We are exporting goods to China. But now, we are trying to go to Brazil, as well, where there is a huge

Lebanese community there.

LAKHANI (voice-over): It hasn't been easy. Tourists from Syria were among its best customers. That's changed since the war began.

GHOSTINE: We used to have 70,000 visitors per year. Unfortunately, now the tourism in Syria is not anymore active, and it affected us because

we used to export 300,000 bottles to Syria per year. Now we're exporting around 50,000 only.

LAKHANI: So, Ksara is looking into new markets, along with Lebanon's other winemakers rallying to promote Lebanese wines collectively.

GHOSTINE: When we go to international fairs, we go as a Lebanese pavilion. Before, every participant used to go and to have his own booth.

So, it's very easy for the visitors to come and to visit all the wineries gathered in the same place.

LAKHANI: Ghostine says the idea is to sell the story of Lebanon, not just its wines. Its history, its distinct location. Like these ancient

cellars discovered below Ksara's land in 1898.

LAKHANI (on camera): There are a million bottles of wine stored in these cellars that date back to the Roman era. Walls of wine stepped in

history. Ksara sees this heritage as a key selling point for its wines abroad.

LAKHANI (voice-over): That's essential in an incredibly competitive market.

KARAM: We produce a very microscopic amount. If I tell you we produce 8 million bottles of wine a year, which may sound a lot, but if we

compare that to Turkey, which produces 70 million, the Cypriots around 35 to 40 million, Israelis produce about 50 million. So even on a regional

scale, we're tiny.

Global scale, we're a dot. Italy, the biggest producer in the world, probably produces on average around 4 billion bottles a year.

LAKHANI: To overcome it, Karam says Lebanon needs to capitalize on its exclusivity.

KARAM: They should play on the scarcity. The message they should be sending consumers is we only make 8 million bottles a year, these bottles

are by and large of a very high quality, and come and get them while you can. And I think if they can do that, there's no reason why Lebanese wine

cannot be the sexiest wine on the planet.

LAKHANI: To that end, it's not just the large-scale wineries, but also the smaller family businesses, capping every bottle with a personal

touch.

FAOUZI ISSA, WINEMAKER AND CO-OWNER, DOMAINE DES TOURELLES: The message behind this winery is to produce qualitative wines, products from

this land, made by people working in this land.

LAKHANI: Faouzi says family, along with the el-Khourys, bought the winery in 2007. Before then, it had been run by three generations of the

Brun family, who came from France. Today, it produces 250,000 bottles of wine each year.

ISSA: This is how we age the arak.

LAKHANI: But the specialty here is arak, a Lebanese spirit made from aniseed.

ISSA: We're a leader, now, in the local market for arak. And 20 percent is in around 15 to 17 countries. We ship everywhere. Where the

Lebanese people are, we follow that market.

LAKHANI: With the arak market well-tapped, Issa says he wants to expand the company's wine business to achieve his ultimate dream.

ISSA: The target is as more of a global target to show Lebanon everywhere, to have the Lebanese wine in the list of every and each

restaurant in the whole world.

LAKHANI: But Issa says Lebanon still has to overcome negative images abroad. Ghostine couldn't agree more.

GHOSTINE: The message that we want to forward to the world is as well that Lebanon is not an exporter of terrorism, Lebanon is an exporter of

culture and of good wines.

(END VIDEOTAPE)

LAKHANI: From crushing grapes to brewing beer. There aren't many local Lebanese lagers, but one man has turned his home brew hobby into the

latest craft beer brand.

(BEGIN VIDEOTAPE)

JAMIL EL HADDAD, FOUNDER, COLONEL BEER: Hi, I'm Jamil el Haddad. We're going to walk inside to show you our micro brewery.

I'm fans of drinking beer, so I drink beer every day. I came with a home brew at my place to drink my beer with friends, and everybody was

like, why not to have something more than drinking beer at home? We want something else.

I sold everything I had, even my car, my sailing boat, my everything, so to have this project. We used in our stock two basic materials other

than the beams. This is the eco board. It's like a plastic bag. We're going to put plants in each one of these so you can see green walls from

outside and inside.

The whole wood here are wood pallets. This whole year, we're going to paint it to create this awareness around the beer culture in Lebanon.

This is our micro brewery. It's 1,000 liter capacity. Everything starts here. This is our -- here we start with the mashing process. Each

batch goes through one of these tanks for fermenting. You can see here, this is our small artesianal filtering machine, this is a storage tank, and

here we have the final product. You can see here the Colonel.

We made here four types of beer, but what we bottle is one type of beer, because what we want is to go to the market with one strategy, one

type of beer, to let people taste our beer. And already we started to sell it outside Batroun, in Beirut at some unique places. This is the target,

because we don't have mass production and we don't want to sell it everywhere.

When someone has a dream and wants to do something, nothing is impossible. Cheers!

(END VIDEOTAPE)

LAKHANI: Projects like this require a lot of capital, which isn't always easy for small businesses to come by, but there's one company that's

making it its business to help young entrepreneurs realize their dream.

(COMMERCIAL BREAK)

LAKHANI: Welcome back. The Middle East is a region plagued by high unemployment among the youth and low job opportunities. The good news is,

there's a burgeoning start-up scene that could help change that.

(BEGIN VIDEOTAPE)

LAKHANI (voice-over): Entrepreneur Habib Haddad is part of that. Recognized by the World Economic Forum as a young global leader in 2009,

he's founded two start-ups himself. He's also the founding CEO of Wamda, a platform that supports entrepreneurs in the Middle East. Haddad says

funding is one of the main challenges for young businesses.

HABIB HADDAD, FOUNDING CEO, WAMDA: The three main obstacles are access to funding, access to talent, and access to markets. There has been

plenty of activity in early stage funding. In fact, about three times more activity today than there was in 2008. But the follow-on funding hasn't

happened.

From a start-up to a scale-up, they get stuck at an early stage. And it's important for a start-up to become a scale-up for it to create jobs

and to actually have a big impact.

LAKHANI (on camera): So, what kind of criteria do businesses need to meet if they want to get that funding from early stage to second stage

funding?

HADDAD: So, early stage is a lot about the team. Very little about the business. In fact, the business changes are very fast, as long as they

understand their market in general. Now, later stages become more on the business. And in the region, what we're focusing on is the ability of this

business to scale beyond its borders.

LAKHANI: But many start-ups fail, don't they? So, is that a deterrent for investors?

HADDAD: Well, failure is part of the DNA of entrepreneurs and of start-ups. In fact, about 90 percent of start-ups fail. Now, when they're

venture funded, when they're backed by investors, that level of failure becomes lower.

LAKHANI: So, how do you convince investors, then, if 90 percent of start-ups are going to fail, what kind of returns can they expect? How are

they going to make their money back?

HADDAD: You look at it at a portfolio level, you don't look at it as numbers level. Although you have a large percentage of your companies to

fail, the rest of the companies that haven't failed will produce a much higher return. And that's the higher return that will produce the returns

for investors.

LAKHANI: We're in a region where there's a lot of volatility, a lot of political instability, and we know investors don't like uncertainty.

So, how do you convince investors in this kind of an atmosphere and environment to put their money into businesses here?

HADDAD: Well, I think uncertainty is great for entrepreneurs. It's great for businesses. Actually, if you look at the US, the major big

businesses, Google and others, have been built in recession time.

When entrepreneurs build great companies, either they spot them early on and they make a lot of money, or they don't spot them early on and they

bite their fingers for not spotting them early on and they come in later on.

Some investors will understand that, especially the ones who were entrepreneurs. The others who didn't will eventually follow.

(END VIDEOTAPE)

LAKHANI: That's it for this edition of CNN MARKETPLACE MIDDLE EAST from Lebanon. I'm Leone Lakhani, thanks for watching.

(COMMERCIAL BREAK)

END