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Urkraine Returns 10 Russian Soldiers; American Pro Wrestlers Perform In Front Of North Korean Crowd; Iraqi Forces Break ISIS Siege of Amerli; ISIS Recruiting Women; Anti-Government Protests Turn Violence In Pakistan; Tackling ISIS; UK Terror Threat; Showy on the Road; Turkey's Presidential Future; Turkey's Businessmen; ISIS's Black Gold

Aired August 31, 2014 - 11:00   ET


BECKY ANDERSON, HOST: Breakthrough in Iraq -- thousands living in fear win a reprieve as Iraqi security forces end a siege by ISIS militants.

Also ahead, a power struggle in Pakistan leads to death on the streets. Pressure mounts on the country's leader to quit as protests continue.

And easing tensions between North Korea and the west one body slam at a time. Take a ringside seat for some bizarre diplomacy.

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

ANDERSON: A very good evening from the UAE. It is 7:00 p.m. here. It is a new day for Northern Iraqi town, for a northern Iraqi town freed from the

grip of ISIS militants.

With the help of U.S. airstrikes, Iraqi and Kurdish forces have broken what has been the siege of Amerli about 160 kilometers north of Baghdad.

Now tens of thousands of residents there have been living under the harshest of conditions with little food and water for more than two months.

Now the Iraqi air force evacuated dozens of women and children from the town.

We are covering this from all angle. Jomana Karadsheh is in Baghdad. And Anna Coren joins us form the northern Irbil town of -- northern Iraqi town

of Irbil, sorry.

Anna, let's begin with you.

What do we know about this fight between the Peshmerga, as it were, and ISIS fighters in this ongoing push for this town of Amerli.

COREN: Well, this was taking place, as you say, north of Baghdad. So it was actually an Iraqi military operation that has freed the township of

Amerli. For weeks now, they've been doing these aid drops, if you like, aid, weapons, but it's been very haphazard, quite piecemeal and the

residents have been saying it's not enough.

Obvoiusly, we heard from the United Nations special representative of Iraq a week ago when he raised the alarm telling the world that a potential

massacre was going to unfold. And really, Becky, it was because of that, because he raised the red flag, because he really highlighted this issue to

the world that things finally got rolling. It then took another week, mind you, before the United States and the international community finally came

to the aid of Amerli, but it has happened. And it would appear, I should say, that the crisis has been averted.

But certainly from speaking to organizations closely aligned to family, friends in Amerlie say the Turkman foundation, they believe, Becky, that

dozens of children have died over the past few weeks because of the dire conditions.

Obviously those ISIS militants cutting off power, cutting off water, there is no hospital in the township of Amerli, so there's only a medical center.

Lots of medical issues.

Obviously, great relief now that the Iraqi forces are in there.

ANDERSON: Yeah, and it does beg the question why this has taken so long given the sort of extreme conditions the residents have been under. And as

you say, the possible loss of life of so many kids.

Just how significant is the breaking of this siege within the wider Iraqi- ISIS conflict at present?

COREN: Look, you speak to officials, Becky, and they will say it was never going to be a difficult fight. The reason being is that it's a small

township, the Iraqis are there. Yes, there were ISIS militants, but we're talking about them aligning with the Sunni Arab villagers and townships

around them. They'd obviously been fighting them for several months themselves, the local militia, Shia militia as well as the local police


But I think it goes to show what can happen when the Iraqis, certainly when the Kurdish forces, put their mind to it. I mean, here in northern Iraq

where we have seen the Kurds take the fight to ISIS militants it is working, thanks, of course, to those U.S. airstrikes, 115 to date according

to U.S. Central Command.

But, Becky, yesterday we are out at Mosul dam. And this is a place where there is fierce fighting going on. Obviously the Peshmerga claimed it back

a week ago. We assumed that that meant the surrounding areas, that is not the case. The Peshmerga still in heavy battles with ISIS militants who are

dug in in these villages, in these townships around Mosul dam. Once again Sunni Arab populations who have come to the cause of ISIS.

But certainly there is much more resistance up there than we are led to believe, Becky.

ANDERSON: Anna Coren is in Irbil for you this evening. Thank you, Anna. We'll have more on the crisis in Iraq later on Connect the World with me

Becky Anderson.

A live report from Baghdad.

And we'll be in Washington for more on the increasing pressure on U.S. President Obama to take military action against ISIS militants in Syria.

Anna, an inside look at ISIS as an equal opportunity employer. More women joining the ranks, but are they really treated equally? All that and more

on Connect the World. Stay with us for that.

Now, demonstrations against Pakistan's prime minister have turned deadly. A hospital spokesman in Islamabad says that two people were killed in

clashes between protesters and police on Saturday, hundreds, hundreds of demonstrators were injured.

Well, the protesters returned to the streets on Sunday. CNN producer Sophia Safi is on the line now from Islamabad with the latest on the tense


And these protests have ebbed and flowed now for weeks, mostly peaceful until now. What sparked these deadly troubles?

SOPHIA SAFI, CNN PRODUCER: Becky, what really happened is, as you just said, that they've been peacefully sitting in front of parliament not

moving, just far from the red zone, off the capital of Pakistan not really doing much, but there was a sense of festivity.

And what happened was that last night Dr. Tahir ul Qadri and Imran Khan ordered the supporters to march onto the prime minister's house. And what

police are saying is, is that the protesters actually attempted to enter parliament, which was not what they had initially set out to do. And to

prevent that state institution, the police then had to use force -- Becky.

ANDERSON: OK. Let -- have a listen to this, I want to keep you with me, these leading opposition leaders that you have eluded to there heading up

these protests are appealing for calm. Let's have a listen.


TAHIR UL QADRI, PATKISTANI PROTEST LEADER (through translator): With Allah's help, move towards your final destination, remain peaceful, remain

peaceful, remain peaceful. Please maintain my credibility. There should be no violence. There should be no destruction, no violence. God willing,

you will win this war with peaceful means.

IMRAN KHAN, PAKISTANI OPPOSITION LEADER (through translator): I will lead the way. I will march ahead of everyone else. I will stop my people from

becoming unruly. I also ask my Pakistani police and army to also remain peaceful.


ANDERSON: All right. Well, it hasn't, of course, things getting ugly. Do you think this is a sign that pressure is building on the prime minister?

And if so, what do you think happens next?

SAFI: I mean, there's always been pressure building up as protesters marched on the capital. There has been a lot of pressure. You've got the

army stepping in to work as a sort of negotiator. You've got analysts calling this a soft coup, that (inaudible) that the army itself has had to

work as a negotiator between political parties is something that's actually weakened democracy.

We've got just a statement in from the prime ministers' office where he met with his main cabinet members. And they've said that they condemn this

act, but they've actually appreciated the efforts of the police and security forces.

I'm right now right in front of where the protests actually took place last night where rubber bullets were being fired as well as tear gas shells.

So, by the looks of the amount of security forces that have just driven in right now while I was talking to you, it looks this night might just be

another repetition of what happened last night. It doesn't seem like the prime minister is willing to let go of his post any time soon.

ANDERSON: And, Sophia, as you talk we're looking at pictures from Saturday, this when the violence really broke out, but as you have

suggested, fears that we may be facing similar images tonight as well. We're going to stay on this story for you at CNN. More as we get it, of

course. Sophia, thank you.

Well, 10 Russian paratroopers who were captured in the Ukraine have been returned to Russia.

Ten soldiers were detained last week in eastern Ukraine.

Now authorities there said it was proof that Russia is supporting the insurgency, though Russia said they had crossed the border by accident and

now in an apparent swap they are home. And Russia has returned 63 Ukrainian soldiers who had crossed the border to escape separatist


But as pro-Russia fighters take over more towns in Ukraine's southeast, the Ukrainian president warns his country is creeping closer to, and I quote, a

full-scale war with Russia.

Let's not underestimate what is going on there. Vladimir Putin is calling for a political solution and immediate talks on the future of the east of

Ukraine. But as our Phil Black reports the Russian president's suggestions are not exactly being seen as an olive branch.


PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Vladimir Putin says it is time to start threshing out the specifics on how the east of Ukraine should

be governed. He's calling for immediate substantive negotiations on setting up a new system of government in the region that reflects the

concerns of the people there.

What he's talking about is greater autonomy.

It is not a new idea. The central government in Kiev has said it is prepared to negotiate a more federalized system, but not with those

currently leading the armed rebellion in the east. That is where that issue remains deadlocked. It is unlikely to be resolved quickly.

The Russian government says it is the Ukrainian government using military force against protesters, civilians who are just defending, legitimately,

their concerns, their lives, their desire to self-determination.

Kiev is also unlikely to be in the mood for accepting advice from Moscow on how to make peace after this week accusing Russia of invading its territory

with regular soldiers.

Russia denies that and continues to insist it is not sending fighters and weapons across the border. And it also says it can have no real part in

any peace negotiations that do take place, because it says its influence is limited. And it is not directly involved in the conflict.

Phil Black, CNN, Moscow.


ANDERSON: Still to come tonight on Connect the World with me Becky Anderson, are they supporting militants or their own families? Women

taking up arms to work for ISIS. That up next.


ANDERSON: This is CNN and Connect the World with me Becky Anderson. Welcome back.

Now let's take another look at one of our top stories tonight. A two-month siege of a northern Iraqi town by ISIS militant forces, we are told, has

ended. Iraqi and volunteer forces have pushed out ISIS around the town of Amerli.

Now the Iraqi air force evacuated dozens of women and children from the town. As you can see here, residents have been living under the harshest

of conditions with little to no water, food and medical supplies for nigh on 70 or 80 days.

Well, Jomana Karadsheh is now with us live out of Baghdad. And whilst that is a story on the ground, we are told again and again and again that it's

politics, the political situation that needs to be sorted out in Iraq in order that we can go get anywhere for the future and indeed do anything

about these ISIS militants.

Now negotiations are afoot among the myriad of factions of the Iraqi parliament as the new PM actively tries to form a new government. Jomana,

any sense at this stage of how close they are to forming what would be a real unity government. And do remind us why it's this functioning unity

government that is so important to the wider picture here.

JOMANA KARADSHEH, CNN INTERNATIONAL CORRESPONDENT: Well, Becky, that constitutional deadline, 30 days for the prime minister designate Haider

al-Abadi to put together that cabinet is really taking right now -- and the caucus taking on that. He's got until September 10 to present that cabinet

for a vote in parliament.

Politicians that we've been speaking to from the Sunni, Shia political parties are saying they're sounding a bit positive optimistic that he will

meet that deadline.

Basically what is going on right now, Becky, is that they haven't even gotten down to the part where each bloc will nominate its candidates. What

they're working on is what they're calling the program, basically here these political blocs basically, looking at the Shias and the Sunnis and

the Kurds here, everyone will be presenting what they want. They have lists of demands that they need these concessions met. They want these

demands met. And each one has a long list.

These are things that have been carried on for years that we have seen back in 2006 and 2010 and here we are again some of these demands also carried

to these negotiations.

What they want to see most importantly we are hearing from those involved in these talks is guarantees. They want to see that the repeat of the last

four years will not happen. They accuse Prime Minister Nuri al-Maliki of abusing power, of basically centralizing power and not sharing it with the

rest of the political parties.

So what they want to see, they want to see guarantees that this does happen and that there is no one person that consolidates the power here.

And it is very important, Becky, as you mentioned here Sunni inclusion is key as we have seen in the past. The Sunni community played a big part in

2006 and 2007 in turning on al Qaeda. In that battle, the U.S. military recruiting Sunni tribes. And that was really major turning point here in

the violence and in ISIS's predecessors gains on the ground.

Al Qaeda in Iraq was holding large parts of territory here too. And it only changed when the Sunnis were brought on board and Sunni tribes were

fighting them.

So it is very key that they feel included, because of the past few years Sunnis have felt marginalized by the government in government decision

making also with their ministers in government and also Sunni communities say that they have been persecuted by the Shia dominated security forces.

So it's a very, very fragile time here. These negotiations are really tough, because it is all about trust here and all about trying to regain

the trust of the Sunnis here and the Kurds, too, to make sure that everyone feels that they are a part of this government and part of this country and

have a stake in it, Becky.

ANDERSON: Yeah. Jomana, thank you for that. Well put.

And lest we forget, none of these stories are roiling in in isolation, of course. Jomana and I have been speaking over the past couple of weeks

about what is going on with political Islamist militia there and we also know the story, of course, is roiling over the border from Iraq in Syria.

And the Syrian Observatory for Human Rights says that in the past few weeks ISIS sold some 300 Yazidi women and girls for about $1,000 each.

The abducted Iraqi women were supposedly regarded as spoils of war for the infidels, but women also play an active role in maintaining the ISIS reign

of terror. They're being used at checkpoints, in raids, and to intimidate other women. As Brian Todd reports, some of them have no choice.


BRIAN TODD, CNN CORRESPONDENT (voice-over): The terrorists of ISIS, dressed in black, armed with Kalashnikovs and now some have observed them wearing

hijabs and burqas. Human rights observers and analysts say women have joined the ranks of ISIS. We're told there's at least one group of women

called the al-Khansaa' Brigade which operates in the ISIS stronghold of Raqqa in Syria. ??

LOUAY AL-MOKDAD, FORMER SPOKESMAN, FREE SYRIAN ARMY: If your daughter will serve in al-Khansaa' Brigade, that's something will protect you, will

protect your family. ??

TODD: Louay Al-Mokdad is a former spokesman for the Free Syrian Army, a rebel group, which is a rival to ISIS. He says friends of his have had

female relatives pushed into ISIS. CNN could not independently verify his accounts. Observers from the U.N. and Amnesty International tells CNN ISIS

uses women primarily in a policing role, patrolling the streets, cracking down on other women who aren't wearing conservative enough clothing.

??According to reports female ISIS militants also help at checkpoints where their male comrades are not allowed to touch women coming through. ??

NIMMI GOWRINATHAN, U.N. GENDER EXPERT: They're very useful because they will be able to check any woman coming through and be able to detect any

sort of enemy combatant coming through the checkpoint. ??

TODD: Including men trying to sneak through checkpoints dressed as women. Al-Mokdad says ISIS women also go on house raids. ??

AL-MOKDAD: They need to women to search inside the woman's clothes, inside the woman -- inside the bedrooms and they -- even they do a body check for

the women. ??

TODD: A U.S. intelligence official tells CNN ISIS has demonstrated a, quote, "diabolical flexibility in pursuing its goals and is open to using

women tactically to advance them." ??Does that include fighting on the front lines? ??

CHARLIE COOPER, QUILLIAM FOUNDATION: Females do not fight for ISIS. There is no theological legitimation for a lady to be allowed to take up arms

against men on a battlefield within ISIS's very, very austere extremist interpretation of Islam. ??

TODD: Why would a woman join this brutal group? Experts who follow the region say personal security and small salaries are factors. ??

GOWRINATHAN: Particularly when the alternative is to be displaced to Turkey or elsewhere and have to work as a prostitute to get money for your family,

women join because they have relatives in the movement, they have networks within their communities who are a part of that movement. Women join

because they've been raped.

TODD: There seems to be little, if any, empowerment of women in all of this. Despite the lure of security, money and responsibility, one activist

says ISIS created these female brigades to terrorize women.

Brian Todd, CNN, Washington.


ANDERSON: Well, it's 7:22 p.m. Live from Abu Dhabi, this is Connect the World with me Becky Anderson. Coming up, wrestling to get the message

across in North Korea. We get a report from a correspondent inside what is this secret state.


ANDERSON: We're doing what it says on the box, we are connecting the world for you live from Abu Dhabi. I'm Becky Anderson.

Well, for more than 60 years, diplomats have tried to ease tensions between the west and North Korea, haven't they? And they haven't had much success.

Well now, American professional wrestlers, it seems, are in Pyongyang with a view to shaking things up a bit.

Will Ripley got a chance to go along.


WILL RIPLEY, CNN CORRESPONDENT: Pro wrestlers wrangling in the ring would almost never be international news. But this is North Korea, and these are

American fighters, saying thanks to a Pyongyang crowd of 13,000.

JON ANDERSON, WRESTLER: We're here to do something bigger and better.

RIPLEY: Jon OStrongmanO Anderson and mixed martial artist and former NFL player Bob Sapp may not be household names to most. In North Korea, theyOre

getting star treatment like they havenOt had in years, pulling crowds all over the capital, public stunts with smiling kids, and a host country keen

on any positive international press.

We, like the wrestlers, have been invited here and are being shown a very limited view of the country.

BOB SAPP, WRESTLER: Well, we expected a lot of gloom and doom.

RIPLEY: The North Korea theyOre seeing is very different from the country described by a United Nations panel as a Obrutal state,O accused of

torture, slavery, and mass starvation.

ANDERSON: You could find some crappy political view on everything.

RIPLEY: Foreign tourists are getting a carefully controlled capital city tour. Chinese, Japanese, even this American hip-hop artist, co-founder of

the group The Fugees.

PRAS MICHAEL, COFOUNDER, THE FUGEES: The infrastructure seems really good for a third world country.

RIPLEY: At least what weOre allowed to see.

MICHAEL: Well yeah. Well, yeah, exactly.

RIPLEY: Japanese retired pro wrestler-turned-politician Antonio Inoki organized this event. He says Osports diplomacyO can bring North Korea

closer to the outside world.

You know, this isn't the first time PyongyangOs has had wrestling festival like this. They had another one almost 20 years ago, and weOre told back

then, most of the audience members thought the fighting was real. This time, theyOre enjoying the performance, but they see right through the


"It looks more realistic in person than it does on television," this woman says diplomatically.

The biggest applause of the night was for something far more familiar to this audience -- a perfectly choreographed tae kwon do display.

TheyOre here to see what the outside world has to offer, but this is their world. This is North Korea.

Will Ripley, CNN, Pyongyang.


ANDERSON: Fascinating stuff.

Because of the difficulty reporting on and from North Korea, every time that we do do a story from the country I've got to say it gets an awful lot

of interesting from you, the viewers. And over at you can check out this picture gallery from Will and the team in Pyongyang. Find out

which images the government there does want you to see. is where you can find that.

The latest world news headlines are just ahead, plus just how real is the danger? What the people of London think of the UK's severe terror warning.

That is after the break. Stay with us.


BECKY ANDERSON, HOST: You're watching CONNECT THE WORLD with me, Becky Anderson. The top stories for you this hour.

Ukraine has sent 10 Russian paratroopers home after negotiations for a swap. The Russian soldiers were captured on Ukrainian soil, but Russia

denying that they were sent there to fight with pro-Russian separatists. Moscow says it returned more than 60 captured Ukrainian soldiers.

Al-Shabaab has claimed responsibility for an attack (inaudible) the capital of Somalia. A car bomb and gunmen targeted a prison. One civilian and two

soldiers were killed, along with eight al-Shabaab members.

Violent protests continue in Pakistan. Two people killed overnight when demonstrators threatened to march on Prime Minister Nawaz Sharif's house,

demanding his resignation. Mr. Sharif refuses to step down in the light of allegations of corruption.

A huge victory for a northern Iraqi town surrounded, until now, at least, by ISIS militants. Iraqi security forces have broken what is an ISIS siege

around the town of Amerli. This comes after US-led airstrikes on militant positions surrounding the town. An international humanitarian airlift now

underway, and the Iraqi air force has been evacuating women and children, as you can see here in these images.

US president Barack Obama preparing to head to the UK for next week's NATO summit. ISIS likely to feature high on the agenda, of course, especially

after Mr. Obama's comments about not having a strategy yet for airstrikes against ISIS targets in Syria.

Let's get you to Washington. Erin McPike is standing by at the White House with more on Obama's options. And it's options we have to discuss, here,

Erin, because the president has been more than willing to announce to the world, and I guess to the ISIS militants, that he doesn't have any answers

as of yet. Slightly odd strategy, some might say.

ERIN MCPIKE, CNN CORRESPONDENT: Well, Becky, that's right. And what you'll hear from the White House and from the Obama administration broadly

speaking is that they are finding some success with what they have done in Iraq with regards to ISIS.

But they don't yet know how to handle ISIS on the whole, and especially as ISIS relates to Syria. And I want to play for you the exact comment that

President Obama made on Thursday that's getting so much attention in Washington and around the world right now. Take a listen.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I don't want to put the cart before the horse. We don't have a strategy yet.


MCPIKE: Now, what's happened since then is that Secretary of State John Kerry wrote a lengthy op-ed in "The New York Times" that was published on

Saturday, and it essentially lays out that the United States wants to get international partners onboard, allies to the United States, in the fight

to stop ISIS.

And to that end, so far, Australia has committed some help to the United States, they will be transporting equipment, arms, munitions at the request

of the US government, but Australia has not yet said that it will take on a larger military role. But if the United States does ask for that, the prime

minister of Australia said that they will consider that, and it has to meet certain criteria.

But just yesterday, that comment from Australian prime minister Tony Abbott is certainly some momentum for the Obama administration as it tries to lay

out a strategy. And of course, the president is weighing options from the Pentagon right now, but they haven't had anything specific, and they're

going to try to get a number of other countries onboard before then coming back to Congress.


MCPIKE: Congress returns September 8th. But this may take a few weeks before we see what's really going to happen, Becky.

ANDERSON: So, we got the president over in Eastern Europe and then at NATO, which is Cardiff, Whales, towards the end of the week, I believe, that

Secretary of State John Kerry also traveling out of the US in order to sort of corral this coalition of the willing.

But listen, Erin, I can't remember the last time a leadership told the enemy that they will be discussing their options through the month -- and

we are talking through the end of the UN General Assembly, here, which is towards the end of September. Doesn't this give ISIS a whole load of time

to effectively create havoc in this region before the US and its allies come up with something concrete?

MCPIKE: Well, Becky, absolutely, and that's been a lot of the commentary that we've heard, especially from Republicans this morning on a number of

public affairs program that we've been seeing in the United States today.

Specifically, Republican congressman Adam Kinzinger was on "State of the Union" this morning with Candy Crowley, and he made that very point that by

saying that we do not have a strategy, what the president said about the United States, that they are telegraphing to ISIS, to the enemy, that they

have plenty of time to develop their next strategy as well.

ANDERSON: Yes, fascinating stuff. All right, we're going to leave it there for the time being. This story will gain momentum as we move through the

week. As Erin rightly pointed out, the NATO meeting towards the end of the week in Cardiff. Before that, the US president and his secretary of state

traveling pretty extensively to try and get this coalition of the willing together.

Well, in the UK, the government has reacted to the growing threat of ISIS by raising the threat level to what's known as "severe." CNN's Karl Penhaul

took to the streets of the British capital to find out how that is being received. Have a look at this.


KARL PENHAUL, CNN INTERNATIONAL CORRESPONDENT: Britain is on high alert. The government is telling us that a jihadi attack is highly likely, so

we've come down to the streets of central London to see if there are signs of panic. This is Kings Cross train station, one of the busiest in the


JODI O'ROURKE, EVENTS MANAGER: Everyone just gets on with their everyday life, don't they?

UNIDENTIFIED FEMALE: If it's going to happen, it will happen

O'ROURKE: Yes, what happens, what happens. You don't think every time you get on the train if there's anything going to happen.

DILL SHAWKI, PHD STUDENT: Yes, I think it's just trying to make people scared, really. That's all it is. Make people scared, and then they'll --

they're more likely to support something if the government then eventually did try to go into Iraq.

PENHAUL (voice-over): Britain's no stranger to home-grown terror plots. In 2005, in the so-called 7/7 Attacks, four suicide bombers killed 52 people

in London.

CARL TOON, TOURIST: If you'd let things like that rule your life, you'd never do anything. So although you're aware of it and you hope that the

government's on top of the situation, you're just going to take it on trust that they are.

PENHAUL (on camera): Police chiefs are saying they'll step up patrols in public places, like train stations, airports, and tourist hot spots like

here, in Trafalgar Square. But Saturday afternoon, there was no sign of that except --

You're the one that's getting married.


PENHAUL (voice-over): This group of young women, out on a pre-wedding hen party dressed as British bobbies.

PENHAUL (on camera): But Cameron's pledge o crack down on radical Islam is leaving some feeling uneasy, fearing that it could turn into a witch hunt

against all Muslims.

ANTARA MUHAJIMI, STUDENT: It's like in movies when alien invasion, the first thing people think about is attacking them. That's exactly the same

with us. They don't know why they do it or what it is that we want from them, so they go and attack it because they don't know it.

JAHID AHMED, CIVIL SERVANT: Yes, there is radicalism, but that exists in every community, and not just Islam. But Islam has been focused and used as

a scapegoat.

DAVID CAMERON, PRIME MINISTER OF BRITAIN: We are in the middle of a generational struggle.

PENHAUL (voice-over): Mr. Cameron said he could announce new measures to parliament this week. No word on how long the heightened terror alert could


Karl Penhaul, CNN, London.


ANDERSON: What do you think about the rise of ISIS, or as the call themselves, the Islamic States in Syria and in Iraq? Do you think the

international community needs to do more to defeat them? Well, we want to hear from you, it's your show. Get in touch with me or you can tweet me

@BeckyCNN. Use Facebook or tweet me @BeckyCNN.

Finally, here in the Emirates, fast cars and big money come as standard. Those of you who've traveled to the Gulf will know that. Below where I am

standing now, there is little surprise in seeing a Ferrari or a Porsche or two parked up. And Dubai police have famously added a Lamborghini and a

Bugatti to their showy fleet.

Well, the latter valued at about $1.6 million and can travel up to 250 kilometers per hour. And while it might not turn too many heads around here

in the UAE, a Bugatti can make quite a splash in the United States. Jeanne Moos explains.


JEANNE MOOS, CNN CORRESPONDENT (voice-over): Hey! Did you see that? That is a Bugatti. And since this ultra-expensive super car is rarely seen, no

wonder a guy riding near Galveston, Texas, five years ago whipped out his camera when he saw one.

UNIDENTIFIED MALE: That will be mine one day.

MOOS: I don't think you want this one, not after what happens next.

UNIDENTIFIED MALE: Oh. Oh! He's going to be wet. Oh (expletive deleted)! Oh (expletive deleted)!

MOOS: The Bugatti slammed into a salt water marsh, driven by a dealer of high-end cars named Andy House.

MOOS (on camera): House first told police he dropped his cell phone, reached down to get it, and when he sat back up, he was distracted by a

low-flying pelican, which he tried to avoid by jerking the wheel.

MOOS (voice-over): But that excuse was for the birds, because this week --

CHRIS TORTORICE, ASSISTANT US ATTORNEY: Andy House plead guilty to one count of wire fraud.

MOOS: The assistant US attorney says House bought the Bugatti for $1 million, took out a car collector's insurance policy worth $2.2 million,

and intentionally totaled the car. House didn't turn off the engine so salt water would ruin it. House's excuse for not turning it off?

TORTORICE: Well, he said the mosquitoes were really bad, but they're not so bad that you need to bail out of a car like it's on fire.

MOOS: But Bugatti is the type of car rappers rap about.

ACE HOOD (rapping): I woke up in a new Bugatti.

MOOS: Though it's so unusual, it's hard to identify.


UNIDENTIFIED MALE: I'm pretty sure it's a Lambo, dude.

MOOS: Uh, no, not a Lamborghini. That "Lambo" line became a catch phrase.

TORTORICE: "I think it's a Lambo, dude."

MOOS: The assistant US attorney called the 24-second videotape of the crash the cornerstone of his case. It shows there was no pelican to avoid and no

brake lights.

MOOS (on camera): What are the chances of having a video of this happening?

TORTORICE: If there were a Mount Rushmore of bad luck, I think Andy House's face would be on it.

MOOS (voice-over): Though there's a 20-year maximum for wire fraud, a more likely sentence is a year or two. There was vindication for one much-

maligned character. One poster noted, "Finally, after all these years, that poor, innocent pelican is off the hook."

Even the tow truck guy bows to the Bugatti, washing his hands in the marsh before daring to touch the wheel. Bugatti? Bu-gotcha.

Jeanne Moos, CNN --

UNIDENTIFIED MALE: Oh (expletive deleted)! Oh (expletive deleted)!

MOOS: -- New York.


ANDERSON: Oh. That's just so wrong, isn't it? I'm Becky Anderson, that was CONNECT THE WORLD. Thank you for watching. We'll be back in about a quarter

of an hour with your headlines.


JOHN DEFTERIOS, HOST: This week on MARKETPLACE MIDDLE EAST, Turkey's new president is sworn in. How will President Erdogan's continued political

presence shape the country?

And the market for black gold. How ISIS is becoming richer by the day through illegal oil trades.

Welcome to MARKETPLACE MIDDLE EAST. Turkey's first directly-elected president has been sworn in this week. Recep Tayyip Erdogan, the country's

former prime minister, has switched roles to president, a move that could keep him in power for another decade.

While the presidential role is supposed to be mainly a ceremonial one, Erdogan has already indicated the desire to change the constitution and see

his powers extended beyond that. But will this help or hinder the development of this large emerging market of nearly 80 million consumers?

And will it attract or repel investment into this economy of better than $800 billion. Let's take a closer look.


DEFTERIOS (voice-over): During the first decade as prime minister, Recep Tayyip Erdogan delivered economically. His government's policies are

credited with creating wealth by tripling incomes in a decade.

Tire maker Pirelli is one of a long list of foreign companies having set up shop in Turkey. Selcuk Yorgancioglu oversees the country for private equity

group Abraaj. They put up nearly a billion dollars, having invested in eight Turkish companies.

SELCUK YORGANCIOGLU, PARTNER, THE ABRAAJ GROUP: Business has done very well in the last ten years. And they are happy, they continue to prosper.

They can see ahead of them very clearly.

DEFTERIOS: Growth averaged 5 percent for ten years. But the last two years have tested the scrappy former footballer. With months of protest over Gezi

Park development and ongoing investigations into allegations of corruption at the top of the ruling party, charges the government has denied.


DEFTERIOS: After Erdogan's latest election victory, ratings agency Fitch said political continuity does not eliminate political unrest and social

unrest, adding, this could lead to credit weakness.

The new president has lashed back at the ratings agencies and appears more emboldened than ever.

DEFTERIOS (on camera): Erdogan has designed a massive infrastructure build- out for Istanbul. This includes a new airport to compete with Dubai as a transit hub, a better than 40-kilometer canal to run parallel with the

Bosphorus, and last year, he opened up a new underground train network to connect Europe and Asia. Some suggest he has his sights on his legacy and

not near-term growth.

DEFTERIOS (voice-over): By 2023, the 100th anniversary of modern Turkey, Erdogan wants to see a $2 trillion economy and a more than doubling of per

capita incomes to $25,000. To hit those targets, Turkey would need to grow 7 percent a year. Some analysts say Erdogan could jeopardize economic

stability again.

MARIOS MARATHEFTIS, STANDARD CHARTERED BANK: The higher the growth, the more the economy was overheating and the wider the current account deficit

of Turkey was becoming.


DEFTERIOS: But with fighting at the country's doorstep in Iraq and Syria, business still prefers continuity.

YORGANCIOGLU: Can you show me a good revolution in the last few years? I think we're happy where things are going. There's confidence in the system,

and the markets and the people are supporting it.

DEFTERIOS: That's if Erdogan's economic policy as prime minister is sustained as president.


DEFTERIOS: So, an overall look, there, at how the Turkish economy could take shape under President Erdogan, but how do businesses on the ground

feel about Turkey's future?

I spoke with the chief executive officer of Ustaoglu Mining and Construction, who's also the president of the American-Turkish Chamber of

Commerce, and I asked him if he was concerned about the slower growth we've been seeing in the country.


BESIR KEMAL USTAOGLU, CEO, USTAOGLU MINING AND CONSTRUCTION: We have been growing quite rapidly in the last ten years, and especially for the last

three years of the Erdogan government. And nowadays, the economy is a little slowing down, you are right. And we should be expecting to see

growth rate of 3 percent, 3.5 percent in the next few years.

DEFTERIOS: This is a difficult time because of the unrest in Iraq, which could last a few years. You have the challenges to the south in Syria. And

Europe is slowing down again. Where do you get your export growth?

USTAOGLU: Well, the neighboring countries in the southern part of Turkey, Iraq and Syria, was our main partners for exports in the old days. And

actually, being the gateway to the Middle East markets, going through Syria, Turkey was exporting to almost a dozen countries.

You're right, it stopped. And now, European Union is going through some recession. And hopefully, the United States and the European Union are

working on TTIP, Transatlantic Trade Investment, and Partnership Project. Turkey is partner and exporting to both the European Union and the United


DEFTERIOS: Years ago, though, Mr. Erdogan was promising this great growth to the Middle East and tilting south to Africa. Africa's still in play, but

the Middle East looks very chaotic. This is really going to undermine the prospects for the next few years, though.

USTAOGLU: Of course, after this Arab Spring, Northern Africa -- Turkey had so many contractors in Libya, in Egypt, and Algeria. This also didn't help

the Turkish economy, you are right. And I hope in the near future this -- all this conflict is resolved, and again, Turkish contractors will take

their place in those countries in Northern Africa, especially.

DEFTERIOS: You've had Prime Minister Erdogan in office for nearly a dozen years. He could be in power for another ten years.


DEFTERIOS: Does this not concern you, that there's a centralization of power under one personality and one individual?

USTAOGLU: Well, not really, because if you look at it, Turkey had its best time in terms of economics and social welfare, the last 12 years, since

November the 3rd, 2002, things are really growing.

Good track record of a dozen years, as you say, 12 years of managing the country in terms of social welfare, economics, and the relations with

Europe and the United States. I think Mr. Erdogan was given a chance to see what happens in his presidency.

DEFTERIOS: It's interesting to note that the ratings agency, particularly Fitch and Moody's, are putting a question mark over domestic political

challenges. Do you think that's fair, by the ratings agencies?

USTAOGLU: I don't think so. I don't agree with those. If you look at the Turkish economy, we have our own dynamics, and if you look at production,

it's increasing. And the unemployment rate is not so bad . And we have a 29-year-old average -- of an average age. It's a big consumer market.

And so rating institutions, I don't understand why they are trying to reduce the ratings of Turkey. I don't know.


DEFTERIOS: CEO of Ustaoglu Mining and Construction, Besir Ustaoglu, on the more challenging times in Turkey in terms of economic growth.

Up next, an in-depth look at Turkey's neighbor, Iraq, and how ISIS has quickly established a black market network for oil.


DEFTERIOS: Welcome back to MARKETPLACE MIDDLE EAST. As ISIS continues to ramp up its attacks in Iraq in a bid to create an Islamic state in Iraq and

Syria, fears are growing that their capture of oil-rich territories is making the extremist group an increasingly wealthier force to be reckoned



DEFTERIOS (voice-over): ISIS popped up on the global radar in June with its attack on Mosul. And in a span of just two months has created its own black

market for Iraqi crude.

THEODORE KARASIK, DIRECTOR OF RESEARCH AND CONSULTANCY, INEGMA: The scale is actually sizable in the sense that they are able to export up to $3

million a day of oil. Now, this is probably going to rise in the coming months, because winter's coming.

DEFTERIOS: Kurdish regional government president Massoud Barzani confirmed that figure, which he said is generated through a combination of oil sales

and extortion.

DEFTERIOS (on camera): Now, this may be a small sum by global oil standards, but if left unchecked, ISIS could earn more than $1 billion a

year from its oil operations in Iraq. It made that charge June 10th into Mosul. It now has four oil facilities in Mosul.

And if you go down to Kirkuk, which has big deposits, but they have three smaller operations, it has a total of 80,000 barrels of capacity per day.

DEFTERIOS (voice-over): What ISIS lacks is refining capacity, unable to wrestle control of the strategic Baiji refinery south of Mosul. Energy

strategists say ISIS is selling Iraqi crude at $25 to $60 a barrel, a deep discount on the global benchmark of $100 a barrel. But black market

distribution, even for basic crude, in this part of the world is well- established.

ROBIN MILLS, MIDDLE EAST ENERGY ANALYST: Northern Iraq, of course, people have been stealing and smuggling oil and tapping oil from pipelines for

years in small volumes. So, there's already that kind of infrastructure and those middlemen who know how to trade this stuff.


DEFTERIOS: Islamic militants plied their energy trade in eastern Syria, seizing oil and gas assets for the past few years. In early June, under the

banner of ISIS, they took control of Syria's biggest field in the Deir ez- Zor province.

LUAY AL-KHATTEEB, FOUNDER AND EXECUTIVE, IRAQ ENERGY INSTITUTE: This is not a nascent experience. It is something I would call at least three years of

experience, and they've been supported by various cartels that they have interest in in this black market economy.

DEFTERIOS: Opposition Turkish parliamentarian Mehmet Ali Aediboglu, based in the country's south, bordering Syria, claims $800 million worth of oil

that ISIS obtained is being sold in Turkey.

AL-KHATTEEB: We're talking about a sophisticated network that stretches between -- predominantly between three countries. That's Iraq, Turkey, and


DEFTERIOS: With US military intervention, strategists say the Kurds have kept ISIS out of Kirkuk's super oil field, capping for now the group's

newfound wealth.


DEFTERIOS: And it's worth noting, despite ISIS's control over some oil fields and all the continued chaos in the region, the prices of crude

continue to weaken. And that's all for this edition of CNN MARKETPLACE MIDDLE EAST. I'm John Defterios, thanks for watching. We'll see you next