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QUEST MEANS BUSINESS
India Unexpectedly Cuts Interest Rates; Central Banks Cut Rates to Fight Deflation; US Markets Slide on Mixed Economy Data; European Stocks Rally; Departing Standard Chartered CEO Waives Bonus; Ukraine Mine Explosion Kills 33; Backlash After Ads Precede ISIS Videos Online; Former Baseball Star Takes on Twitter Trolls
Aired March 4, 2015 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(NEW YORK STOCK EXCHANGE CLOSING BELL)
ISA SOARES, HOST: That is the chief executive of the Indian company Wipro ringing the closing bell. You'll hear from him tonight on the day
India shocked the markets. It is Wednesday the 4th of March.
Tonight, a dramatic day in New Delhi. India cuts interest rates to try and boost its economy.
Chaos at a coal mine in eastern Ukraine. Dozens are killed in an explosion.
And a scam in Britain funding terror in Syria. British police arrest two in London.
I'm Isa Soares in for Richard Quest, and this is QUEST MEANS BUSINESS.
Good evening. Tonight, fears of deflation the world over pushing central bankers to take dramatic action. In a surprise move, Indian
Central Bank has cut interest rates for the second time in as many months, and we are only in March.
It caught markets completely off guard, as you can imagine, and briefly sent the Sensex to a new all-time high, you're seeing it there.
Sensex tipped 30,000 before retreating to actually close down three quarters of a percent.
Now, when the Bank of India cut interest rates in January, it was the first in nearly two years. Now the bank has made another unscheduled rate
cut just days after the Indian prime minister unveiled his ambitious budget plan. That was on Saturday. India's Finance Ministry is predicting big
growth this year, as much as 8.5 percent.
Now, Wipro, one of India's leading tech companies, celebrated their 15th anniversary being listed on the New York Stock Exchange by ringing the
closing bell just a few minutes ago, as you saw there. Well, I spoke to T K Kurien, the CEO of Wipro, and asked him for his reaction to this surprise
rate cut. Take a listen.
T K KURIEN, CEO, WIPRO: I think the government is far more comfortable and the Reserve Bank itself is far more comfortable with
inflation. And second is right now, India needs a big boost as far as infrastructure is concerned. So, overall, I would say a positive move and
something that we all expected at some point in time. We didn't expect it so early. But inflation at 5 percent, it makes sense.
SOARES: Yes, India -- the Indian Central Bank clearly being very proactive. Do you think that this will bolster their credibility, or do
you think that this -- there's a fear that this may backfire?
KURIEN: I think generally today if oil prices remain at this level, we think it's a positive move, and the chances of it backfiring, in my
view, are fairly minimal. If the oil price does go up, then I guess that's got its impact as far as deficits are concerned, and that would be the
SOARES: Let me ask you this. You said recently -- I'm going to quote you here -- "The biggest thing about India is that in the last couple of
years, we had lost hope." What did you mean by that?
KURIEN: So, it's pretty simple. If you look back for the past couple of years, India was a country where every couple of years you had this huge
hope coming up, and then after that, nothing happened.
I think the government for the first time has taken a fairly long-term view of fixing the basic finances of the government. If you look at bank
recapitalization and all those things that have been pending for many, many years, the government has finally started doing something about it.
And I think with that comes hope. And as you know, with hope comes consumer spending. So, we're hoping consumer spending will come back, and
the Indian economy will again start kind of going up. Right now, everybody's pretty positive, because if you look at the budget this year,
people expect to see 8.5 percent growth in the current year, which is pretty decent.
SOARES: Let's focus on that budget, if you don't mind, because this interest rate cut comes just days after the budget announcement, and there
were high expectations. And I saw that the finance minister, his closing line, this is what he said, he said, "The budget lacked big bang reforms."
What was your take on the budget? Did it meet those expectations?
KURIEN: I think as far as the budget is concerned, for the first time, we saw a budget that was devoid of special effects. It was very
grounded. It was grounded on basically fixing the financial state of the government.
Which I think is a huge step forward, because without fixing fiscal deficit, fundamentally what happens is, whatever you do, it really will not
lead to long-term growth. And I think the government has taken a good first step in figuring out the first baby step towards long-term growth. I
think that's a very positive thing.
Now, I'm sure a lot of investors were a little disappointed by it because it's the big news that makes headlines that sends stocks up. That
did not happen. But the impact of this budget, you're not going to see this year, you're going to probably see it over the next two to three
And there are some very basic reforms that have happened there which is going to make the economy more competitive. And India for the first
time has realized that competition is not other Indians, but it's the world. And I think really what the government has done is preparing India
to face up to the world.
SOARES: And many investors would have said on that, the many who didn't -- weren't so pleased with the budget, said that really what it's
missing was the idea of job creation reforms, to really lead with job creation. What do you make of that?
KURIEN: I don't think job creation by itself can be something that the government can do. The government can fundamentally put in fiscal
policies to help that. And I think this is what they've fundamentally done this time.
The fiscal measures that they've taken long term will lead to more employment. But in the short term, again, don't expect that blip to
happen. And we don't want it to be just a blip.
SOARES: Let me ask you, finally, about your numbers for the third quarter. They're better than expected, business being driven by the US in
Europe. How is the outlook for the rest of the year? Any concerns?
KURIEN: Well, put it this way: Europe is still a little bit of a concern because we don't know how that will finally end up and where Europe
will finally land. China's a little bit of a concern because it's slowing down, but the rest of the world seems pretty bullish.
If I look at the US, the US is very, very bullish. India is bullish for us. Middle East for us is a market, and I think overall is a market,
the way we see it is that with oil prices the way it is, it will probably you'll see a dip in investment expenditure for the next couple of months.
It's not happening right now, but towards the tail end of the year, we expect to see some dip in investment in the Middle East. But overall, I
would say positive.
SOARES: That is the CEO of Wipro, T K Kurien speaking to me earlier.
Well, India's second rate cut this year is reinforcing what's becoming a global trend. I think we can say that when we look at the numbers. More
than a dozen central banks have announced new stimulus so far in 2015. Let me talk you through some of them.
Poland cut rates today to a deeper-than-expected record low. The People's Bank of China cut rates over the weekend, that's the second time
for China in just four months. When we look at all the countries seeing rate cuts since the start of the year, it seems everyone is doing it.
And many have cut rates more than once. We're talking about Australia, Denmark, obviously ECB, as you can see from the map, as well as
Uzbekistan. Now, the big question mark on the board is the United States. The Federal Reserve may begin tightening its monetary policy soon, which
could expose some of the more fragile economies to greater risk.
Well, let's take a look at how US stocks fared today, and they slid for a second day in a row on Wednesday, thanks to mixed economic data. CNN
Money's Paul La Monica is in New York and joins us now. Paul, those stock markets low for a second day of declines. What's behind the drop, or is
this just a bit of profit-taking?
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: I think you do have some profit-taking, because Monday we hit the NASDAQ getting above 5,000
for the first time in 15 years. The Dow and S&P 500 also hit all-time highs again.
And February was an amazing month, so it's not that surprising that you're seeing some people take money off the table. But the ADP jobs
numbers this morning, they were good but not fantastic, could raise some concerns about the big jobs numbers that are going to be released on
And as you point out, there's this disconnect between what the Fed is likely to do later this year and what the rest of the world is doing with
easing. We're going to see that tomorrow when the ECB hopefully gives more details about its quantitative easing program.
SOARES: And Paul, on that private report on US jobs that was released today, is that giving us any indication, any insight into Friday's numbers?
LA MONICA: I think that there is going to raise some concerns that maybe payroll gains will slow a little bit in February, but I think it's
also very important to note that the ADP numbers do not always correspond at all with what the government reports. People have definitely gotten
burned by reading way too much in the ADP figures. So I don't think you're seeing that much concern about that just yet.
The hope, though, is not just jobs growth, but that we actually see some wage growth, too, and that's what the Fed is really waiting for. And
if we get that, then I think you're going to have more talk of a rate hike sooner rather than later.
SOARES: Yes, absolutely. And if we switch gears slightly and focus a bit on Alibaba, it's had a mixed couple of days, hasn't it?
LA MONICA: Yes, Alibaba did rebound sharply today, but it hit an all- time low yesterday, just above $80 a share. I think it still can't shake those concerns that people have raised about it being a haven for fake and
And let's be honest, when the company went public last year, the valuation on it was very, very high. Expectations got out of whack, I
think, as a result.
And a lot of people just assumed that the Chinese e-commerce market was Alibaba's for the taking, and no one else would do well. JD, which is
one of Alibaba's biggest rivals, reported strong results yesterday, and they're backed by Tencent, which is by no means any slouch in China.
That's another huge tech company there.
SOARES: Paul La Monica for us in New York, thanks very much, Paul.
LA MONICA: Thank you.
SOARES: Well, European stock markets closed higher on Wednesday. Stocks rallied towards the end of the trading day on the low oil prices and
strong service sector data in the US. There, look, the Xetra DAX and the CAC 40 in Paris, probably best -- doing the best today, overall about a
As Paul mentioned just then, investors looking ahead towards Thursday's ECB policy meeting, and that's the day they could announce the
date of the stimulus, the 1.1 trillion euro bond program -- buying program. We shall find out -- wait for that.
In the meantime, the CEO of Standard Chartered is already headed out the door. Now, Peter Sands says he won't take a bonus this year after the
company's dreadful performance in 2014. Jim Boulden is here with us to talk about this. So, why is he saying he's -- why is he foregoing his
bonuses? I'd read that he's foregoing it to, quote, "show leadership."
JIM BOULDEN, CNN INTERNATIONAL CORRESPONDENT: Along with other members of the board as well. They did have a dreadful year. Standard
Chartered, like many banks, have had a tough -- couple tough years. There's a lot of scandals going on.
And he's decided even though he's leaving not to take his bonus. The idea, of course, here in the UK and around Europe is should these people be
getting bonuses during the tough times? Well, there's been a lot of political pressure on them and shareholder pressure not to take their
He's not the only big CEO this year to say I'm not going to take my bonus. And it's interesting, because he's leaving, so he probably could
get away with it if he wanted to it.
SOARES: Yes, and the profits haven't been great for the company in the first place, so many people say we're probably doing the right thing.
SOARES: But this announcement comes on the same day that European banker authorities have slightly tweaked their remuneration guidelines.
SOARES: Talk us through those.
BOULDEN: Well, it's kind of complicated, but --
SOARES: Make it simple.
BOULDEN: In Europe, obviously since the economic crisis, bankers bonuses are limited, either 100 percent of your salary or 200 percent of
your salary. That's in place. But some of the banks have been doing -- especially in the UK -- have been giving people a little bit of extra money
and then saying, well, that isn't a bonus and that's not their salary, so it's actually topping up their salary.
So, the European Bank Authority wants new rules put into place by next year to stop especially the UK banks from cooking the books a little bit,
giving these men and women a little bit extra money and not having it count towards their bonus.
SOARES: And that's why they differentiate between a salary and the bonus.
SOARES: Does this mean, then, Jim, that we're going to start seeing a clash between -- a bit of a clash between the EU and the UK?
BOULDEN: Oh, absolutely. The UK sees itself as one of the world's top financial centers, certainly the financial center of Europe, and they
don't always like the rules. Now, the politicians here have said, of course we don't want bankers to get exorbitant bonuses.
But when the banks do well, they want to see these people remunerated, and they want the banks to stay here in London, which they don't want to
see those banks moving elsewhere.
And that's why just today and yesterday, UK did win in the European court the ability to say, look, you can't move clearinghouses, another part
of the banking sector, just to the eurozone. The European Central Bank said that stuff should not be in London. If you're trading euro-dominated,
it should go to a city inside the eurozone. The UK is like, wait a minute.
SOARES: That's a major thing.
BOULDEN: That's one of the things we do very well here. You can't force these banks to move it away. And the same thing about the European
Bank Authority. If you tell them that bankers' bonuses are limited, UK is saying well maybe these banks will move offshore completely and not be in
the eurozone or in Europe at all.
SOARES: OK, but what -- can the EBA actually take any legal action against UK there?
BOULDEN: Yes, absolutely.
SOARES: What would that look like?
BOULDEN: There are ways to do this. So, if they feel that next year that the regulatory authorities in the UK aren't doing their job -- not the
banks, but the regulatory authorities stopping the banks from doing it -- then they could take the regulatory authorities to European court.
So, there is repercussions if the banks here and the regulators allow the banks to do this idea of giving more money to the bankers and not have
it count towards to the bonus.
SOARES: Watch this space.
SOARES: We'll be talking about bankers' bonus for many years to come.
BOULDEN: We have been for many years in the past.
SOARES: Absolutely. Jim Boulden, thanks very much.
Well, you are watching QUEST MEANS BUSINESS. A deadly explosion in a mine in eastern Ukraine. We'll have the latest after the break, right here
on QUEST MEANS BUSINESS.
SOARES: Welcome back to QUEST MEANS BUSINESS. We'll bring you up to date with a story that we have been following all day here on CNN. At
least 33 people have been killed in an explosion at a mine in eastern Ukraine. The mine is in an area that's been gripped by intense fighting.
The local media suggest the blast came from a gas explosion rather than shelling. We must warn you, there are graphic images at the start of
Erin McLaughlin's report.
ERIN MCLAUGHLIN, CNN INTERNATIONAL CORRESPONDENT (voice-over): Miner Ivan Lazarenko says it took all of his faith to survive the deadly blast.
He's one of the miners injured Wednesday at the Zasyadko mine in separatist-controlled eastern Ukraine. "There was a bang, and then it
threw me so hard that I flew for three or four meters," he says.
"Immediately, the heat, the temperature, rose, and here are the consequences. And then the temperature became a little lower, and we
started slowly crawling out."
Victims of the suspected methane gas blast are being treated at a local hospital, suffering some 80 percent burns. Dozens more are feared
dead, trapped deep within the mine.
The cause of the blast is thought to be unrelated to the conflict that has gripped eastern Ukraine, but even with the shaky cease-fire seeming to
hold, the desperate mission to rescue the missing is quickly turning into a political controversy.
Ukrainian officials say they are outraged the separatists have denied the Ukrainian rescue workers and investigators access to the site. They're
calling on Russian president Vladimir Putin to intervene.
ARSENIY YATSENYUK, PRIME MINISTER OF UKRAINE (through translator): That is why I publicly address the Russian Federation to give instructions
to these bastards to allow our mine rescue brigades to save the lives of miners.
MCLAUGHLIN: Separatist leaders say they don't need the Ukrainian government's help, and even if they did, they'd look to Russia for
assistance first. For now, they say they have the people and resources they need to compete the rescue mission.
The Zasyadko mine is infamous for accidents. For example, a gas blast in 2007 killed more than 100 miners. The company's official website
carries a warning about the mine. It reads, "Dangerous due to random gas release."
Now, the families of the missing have gathered outside the mine. They're waiting for more information. They're hoping their loved ones had
escaped the latest in a string of tragedies to grip their homeland.
Erin McLaughlin, CNN.
SOARES: Well, the mining sector is one of Ukraine's oldest and most crucial industries. Let me show you. This is where the coal reserves are,
most of them in the east of the country, where there's been heavy fighting. You can see there the Donetsk region.
Ukraine has the seventh-largest coal reserves in the world, 66 mines are now out of action because of the fighting we've seen there.
Technically a cease-fire is in place in Eastern Ukraine. Today, the United States has warned there may be more sanctions if Russia does not abide by
(BEGIN VIDEO CLIP)
VICTORIA NULAND, US STATE DEPARTMENT: We will judge Russia by its actions, not its words. And we have already begun this week intensive
consultations with our European partners on further sanctions pressure should Russia continue fueling the fire in the east of Ukraine or in other
parts of the country, fail to implement Minsk, or grab more land, as we saw in Debaltseve.
(END VIDEO CLIP)
SOARES: You are watching QUEST MEANS BUSINESS. Still to come, YouTube faces a backlash after ads pop household brands played online
before ISIS videos. We'll explain after this short break. Don't go away.
SOARES: Now, several companies are speaking out over concerns that their advertisements ran before videos linked to ISIS and extremists on
YouTube. Laurie Segall has the story.
UNIDENTIFIED FEMALE: New Bounty with Dawn. Available in the paper towel aisle.
LAURIE SEGALL, CNN MONEY TECHNOLOGY CORRESPONDENT (voice-over): Bounty, Budweiser, and Secret deodorant ads appearing before jihadi and
ISIS videos online.
SEGALL: Beer and a concert? Cue an ISIS propaganda video. Jennifer Aniston for Aveno, by no fault of their own, appearing before this. It's
tough to tell how many different companies' ads have run before these videos, but at least one we saw, Bud Light, was pretty upset.
In a statement, Anheuser-Busch said, "We were unaware that one of our ads ran in conjunction with this video. We have strict guidelines with our
media partners that govern when and how our ads appear. We are working with YouTube and our media buying agency, Mediacom, to understand and
rectify the matter." Johnson & Johnson did not respond to CNN's request for comment.
Sites like YouTube sell ad time to companies, and the ads get automatically inserted before videos on the site. But advertisers don't
select the videos they appear in. A person familiar with YouTube's business model says YouTube did not profit on these particular ads, and if
they had, profits would have been sent back to the advertisers.
In a statement to CNN, a YouTube spokesperson says they remove content that incites violence. "We also have stringent advertising guidelines and
work to prevent any ads appearing against any video, channel, or page once we determine that the content is not appropriate for our advertising
partners," the spokesperson said.
UNIDENTIFIED MALE: What I think is interesting about this case is that YouTube, all they have to do is watch that video to know what it is.
SEGALL: But with 300 hours of content uploaded to YouTube every minute, the service relies heavily on its users to flag violations. And
while not all of these videos are defined as extremist, they're certainly not prime real estate for an advertiser.
UNIDENTIFIED MALE: From a contract perspective, these corporations that are paying lots of money to get YouTube clicks may not be that pleased
when they find out that their video is placed right before an ISIS recruitment video.
SEGALL: It's worth noting that ISIS video flagged to YouTube has been removed. The other video remains, but is no longer running ads.
Laurie Segall, CNN Money, New York.
SOARES: Well, let's stay with social media. The New York Yankees have fined one of their employees after abusive tweets were sent to the
daughter of a former major league baseball star.
Curt Schilling used to pitch for the Yankees' biggest rival, the Boston Red Sox. He sent a tweet last week congratulating his 17-year-old
daughter, Gabby, for being accepted to college. Before long, the two became the target of vulgar and sexually-explicit messages from cyber
Then, Schilling decided to play hardball. He went on to identify the trolls and posted their names in a blog for the world to see. Well, Curt
and Gabby Schilling spoke to our sister network, CNN USA and were asked what they've learned from taking on the Twitter trolls.
(BEGIN VIDEO CLIP)
CURT SCHILLING, FORMER MLB PITCHER: The only analogy that comes to mind that I can use is if you're a parent, imagine somebody coming into
your house and punching your child in the face right in front of you. Because when you think about that, those scars are going to heal. That
physical stuff will go away. She's going to carry this for the rest of her life.
So, the lesson is, accountability. The anonymity of the internet really doesn't exist. There are a few people in this world that can do it,
but not many. And listen, if you're a parent, Twitter is not some other world.
I saw people talking about, hey, they did it on Twitter and then they got it in the real world. Twitter is the real world. And if you're a
parent, you'd better be able to admit that and understand it.
MICHAELA PEREIRA, CNN ANCHOR: So, Gabby, the fact is, not every other kid is lucky enough to have a dad like yours who is not afraid of
taking on a fight, is not a former pitcher for the MLB. But I know there's a lot of kids out there that are dealing with bullying, whether it's cyber
bullying or in the school, physical bullying.
What do you think is the takeaway from this that you could share with those kids that are suffering and maybe don't have an advocate that can
stand up for them?
GABBY SCHILLING, DAUGHTER OF CURT SCHILLING: Cyber bullying is a huge issue right now, and I think that people really need to reach out to
somebody else and get that help. Because some people just stay quiet about it and they let it eat away at them inside. And that's never OK, because
cyber bullying, you're just -- they're just alone. They don't have anyone to talk to, because it's not face-to-face.
The other person doesn't realize how much harm they're doing to someone, but I'm lucky to have him to stick up for me.
(END VIDEO CLIP)
SOARES: Very good advice, there, from Gabby Schilling.
Now, you are watching QUEST MEANS BUSINESS. Still to come, police in London arrest two people as they investigate a large-scale fraud linked to
terror financing. We'll have more on that after this break.
SOARES: Hello, I'm Isa Soares, and coming up in the next half hour, QUEST MEANS BUSINESS: Nigeria's government tells us a threat from Boko
Haram is not putting off investors.
And the British government bids au revoir to its take in Eurostar. We'll speak to one of the CEOs who's buying it.
Before that, here are the top news headlines we're following for you this hour.
India's blocking the broadcast of a controversial film on the gang rape and murder of a woman on a New Delhi bus in 2012. The film includes
an interview with one of the men convicted, during which he makes a derogatory comment about women. India's government has banned the
documentary on the grounds it could cause public disorder.
The bodies of all 33 miners following -- missing following suspected methane gas explosion have been recovered. Relatives had been eagerly
awaiting news outside of the coal mine in an area controlled by pro-Russian separatists. The Ukrainian prime minister Arseniy Yatsenyuk has accused
the rebels of not letting rescuers in. A representative of the Donetsk People's Republic has not offered help.
Defense lawyers in the trial of Dzhokhar Tsarnaev said he did set off two bombs at the Boston Marathon in 2012 but argued he was coerced by his
older brother, who was killed in a shootout with police. Three people died and 260 others were injured in the bombing. Tsarnaev could face the death
penalty if convicted.
The US Justice Department says no criminal charges will be filed against the Missouri police officer who fatally shot an unarmed black
teenager in Ferguson. A report released by the Justice Department did, however, find racial bias does exist in the Ferguson Police Department.
Well here in London two men have been arrested on suspicion of money laundering. Police have been investigating a large-scale fraud linked to
U.K. extremists traveling to Syria. Counter terror officials say scammers stole hundreds of thousands of dollars from elderly victims by
impersonating police officers. Nic Robertson has been following the story and he joins us with more. Nick, explain this to us - so these are people,
these are young men specifically targeting elderly people but having links to Syria?
NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: This is what's really interesting about this case. This is a case of fraud targeting the
elderly, the vulnerable, but you have counter terrorism officers going in and doing the arrests. And that indicates that it's not just something
that's linked to counter terrorism but it's also something that they believe these men could potentially be armed and dangerous. One is 29, one
is 23, one arrested in West London, one arrested in East London.
Four other premises searched. One of the victims had a quarter of a million dollars taken from her essentially by these men -- cold-calling,
turning up, telling these vulnerable people you have something wrong with your bank account, let me help you fix it, and then taking control of that
account and transferring funds into their own accounts.
So, (AUDIO GAP) and the police saying the link (AUDIO GAP) that these men were involved in was taking to this money to use it to send to Syria.
SOARES: Nic, really searching (ph) is the fact they are searching more properties and searching for more people. So they're basically going
to these houses, knocking on people's doors saying there's a problem with your account, you need to set up a new system. This is the new number and
then the money will be wired to their bank accounts - bank accounts somewhere else in the U.K.
ROBERTSON: You know, the police are not being specific on that. What they're saying is the bank account is controlled by the person who's cold-
calling - knocking on the door. I mean I think you know perhaps the indications are that that this - these - were accounts in the U.K. The
money was then taken and by other means.
But it's by no means clear. The police are not laying out all the evidence they have. But what is quite stunning, I mean, this is criminal -
normally viewed as criminal activity. The police don't often draw attention to this. But this is normal, -- if you will - normal - criminal
activity, but with a terrorism intent behind it to help fund groups in Syria.
SOARES: I don't know how long this has been happening for - when these cases go back to, but are there any sort of links with Mohammed
Emwazi or - as we used to call him - Jihadi John? Because they're roughly the same age group from North London as well. Is this something they're
looking at? Are they connected?
ROBERTSON: Again, the police aren't making that connection, and it's easy for us to make that connection because these arrests come just six
days after the announcing of whom Mohammed Emwazi is - the name connected to Jihadi John.
And the police have never commented on that, but one of these men is from the same part of London that he lived in and we know from documents -
prosecution documents, police documents - that there is a connection between Emwazi and a group of people, again, operating with religious
motivations -- funding and sending money to Somalia - and with criminal motivations and intent - robbing people in that area of West London. So
that link is established and there are other links. If you look at Denmark though, the case there that perpetrated there, was linked to a gang there.
So the connection between gangs and people drawn into these types of Jihadi circles is becoming better known. We don't know what the links are
particularly for this particular case.
SOARES: Counter terrorism now focusing on gang-related crimes to see if there are any kind of terrorism links. Nic Robertson, thanks so much.
Nigeria's President Goodluck Jonathan has ordered the government to pay off its debts to petrol producers worth more than $900 million. The
country has been gripped by fuel shortages just weeks before the presidential elections. The government says disruption of the pipeline is
the cause while the oppositions claims the president's inefficiency.
Well Nigeria is one of the biggest producers in the world, so a lower price of Brent crude has hit it hard - take a look at the numbers. It also
faces another big challenge - the terror group Boko Haram. Our emerging markets editor John Defterios has more.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Nigeria has the biggest economy on the African continent, a large and youthful population is
resource rich. But the challenge of Boko Haram is denting the economy. The more than half trillion-dollar economy with nearly 170 million
consumers has attracted the highest level of foreign direct investment on the continent since 2008 - some 44 and a half billion dollars and is home
to the second highest level of proven oil reserves in Africa at 37 billion barrels.
But the insurgency has challenged President Goodluck Jonathan ahead of the March 28th elections. The head of Nigeria's Sovereign Wealth Fund was
here in Abu Dhabi to meet with investors. I asked him what impact Boko Haram is having on its international reputation.
UCHE ORJI, CEO, NIGERIA SOVEREIGN INVESTMENT AUTHORITY: When I'm meet investors, it's usually the first or second thing we talk about and but the
reality is that we also have a fairly large-size economy and a large-size area. And this has not, in my opinion, led to any drop off in the
interests for people to invest with us.
DEFTERIOS: Ernst & Young put out a very interesting report on Nigeria suggesting that it's exciting and a lot of potential within Nigeria
internally, but externally the view is it's unstable and uncertain going forward because of Boko Haram and lower oil prices.
ORJI: Well, I'm one who/I wonder (ph) who informs (ph) external view.
DEFTERIOS: How do you close the gap?
ORJI: (LAUGHTER) No, I think how you close the gap is to visit. You come and see the opportunities in the country, you might have the
impressions changed, and in my case and I think in the case of some investors who have come to see us who were taken around, their view changes
dramatically once you are in the country.
Obviously there's always a tendency if all you do is watch snapshots on a country and the emphasis is on the negatives, that forms your
DEFTERIOS: Orji told me major sovereign funds (ph) from China, South Korea and here in the UAE remain interested Nigeria, but in the last two
years alone we have seen a sharp drop in foreign direct investment - well off the peak in 2011. And falling oil prices have added pressure on the
Two years after the period of July 2014 through January of this year shows revenues down by nearly a third. And original hopes of growing 5 and
1/2 percent seem ambitious in today's climate. John Defterios, CNN Abu Dhabi.
SOARES: Well you are watching "Quest Means Business." The U.K. is getting off the Eurostar. We'll have the latest off the train transaction
after the break.
SOARES: Welcome back to "Quest Means Business." From app-enabled locks to light therapy glasses, there are gadgets on the market that claim
to improve all aspects of your travel. Richard Quest is not here - he's letting me do all the work while he headed to Seoul, South Korea to put the
latest of the tech in this week's "Business Traveller."
RICHARD QUEST, CNN ANCHOR AND CORRESPONDENT: There are gadgets galore here and we need to find out which ones are best for the traveler.
While some people find them life-changing, I beg to differ. We start with a modern twist on the oldest gadget - the lock on your bag. EG Touch
has gone digital - either with a smart tag or indeed an app on the phone. This is how it works. You push the button, you put the tag on and the lock
undoes. So when it comes to lock it, you just put the lock it in and push the button and it locks.
If you want to use the phone, well, let's say you don't want the tag, say my dear, push - when it comes to unlock using near-field communication,
you just. Oh! Password correct and - yes! It's fiddly, it's not totally reliable. All things considered, I wouldn't use the app. I'd probably use
the tag, but I'm not sure any of this is better than a key or a combination.
Onto to the ultimate traveler problem - jet lag. Desperate for a good night's sleep after a long-haul flight, most of us would try almost
anything to fight our body clock - almost. The retime claims to offer a solution. Using intervals of what they call light therapy using their
online jet lag calculator, I'll figure out when and how often I need to wear these for my trip back to New York.
According to the website, I should have begun wearing this on the 30th of January and I finish wearing it on the 5th of February. I have to wear
it from 6 to 6:50, then on the next day from 5 to 5:50, 30th, 31st and the 1st. Good grief! Who the heck's going to do that?
Now for a bit of fun on wheels, the most definitely not necessary. The battery-powered Hovertracks allows me to roam around - controlling
movements by shifting my weight.
The Hovertracks really is great fun. But the ground has to be absolutely smooth - even these paving stones are giving a nasty jolt, and
you always get the feeling disaster is just this far away.
SOARES: I did say I was doing all the work and while he's having all the fun, and that just proves it. Now, the U.K. government is selling its
state in Eurostar, the operating of high-speed trains between London and continental Europe.
The government is set to receive over $1 billion - that's more than it expected. The 40 percent stake will go to a Canadian and British
consortium. The majority of Eurostar will still belong to the French State Railway. I'm joined in the studio by the CEO of Hermes Investment
Management who are one of those buyers. Let me ask you this, why Eurostar - what was so appealing about Eurostar? Because the amount as we just said
was quite substantial -- more than the government expected.
SAKER NUSSEIBEH, CEO, HERMES INVESTMENT MANAGEMENT: Let's talk about price first. When you're buying something the buyer always thinks they've
got a good price, the seller always thinks they got a good price and the Chancellor is happy - that's great. We're happy, that's great, so the
truth must be somewhere in the middle.
Why Eurostar? We are an institutional investor and our clients are looking for a variety of investments. One of the things that they look for
are infrastructure investments. Why? They have cash flow characteristics, they give a yield. This is at a time when we have super-low interest rates
for a very long time. So these are attractive to long-term investors who want a yield return and a reasonably-secure stream of cash earnings.
Eurostar provides this - this is number one. Number two, if you think about where we are in the cycle - quantitative easing is about to start in
Europe and now we know from what happened in the U.K. and the U.S., that means that we're probably going to see an increase in economic activity in
Eurostar had 10.4 million passengers last year. It'll probably start getting more people. As Eurostar starts to pick up - that is good. And
number three, Eurostar is upgrading some of its stock and we think that's quite attractive. So we think it's a very attractive proposition.
SOARES: So it's much more of a cash flow (inaudible) -
NUSSEIBEH: It's a cash flow proposition. And our partner in this - Caisse du Quebec - is a very good investor. They're a pension scheme as
well, they're a very good investor. We of course invest on behalf of our clients, not on behalf of ourselves, but they have very strong experience
in both railways where they're in with the French Railway in France, another project, and in transport they own a big percentage of Heathrow
Airport. So we're in with good company.
SOARES: I want to focus on the infrastructure in just a minute and the fact that we've got low interest rates. Let me ask you this, you know,
-- many expected Eurostar to be a runaway success. The numbers - they expected 21.4 million passengers - and I'm looking back, this was predicted
by 2004. You know, but by 2004, they only had 7.3 million, now we've just gone over 7/10 million. Do you think this is a good business in the long
NUSSEIBEH: It's good business from here on, yes. That's -
SOARES: Why is that? What is it that's so attractive - forget the - but the cash flow size?
NUSSEIBEH: Because - the cash flow size because there is a very strong reason to link the U.K. which is a financial hub to the rest of
Europe. And it's easier to use Eurostar as you well know than it is to use the airlines and it's more convenient and we'll see an increase in the
Fondly enough, I was there at the beginning of Eurostar when I started my career at Mercury Asset Management. And the problem with Eurostar at
the beginning is it was very optimistic but how quickly the passenger flow will go. But in time, it's there. From here on we think it's very
SOARES: And do you think that this is another example of the increasing attractiveness of U.K. infrastructure - the fact that there's
investors thinking this is the place to grow business?
NUSSEIBEH: Absolutely. I mean, -- but again - we have to differentiate between two kinds of infrastructure investment. What is
clear that long-term investor pensions schemes are looking for an alternative to yielding assets. Infrastructure provides that. But this is
mature infrastructure. In this case, it's an infrastructure that will grow its earnings growth, but it's still mature.
The government sort of wants people to build new infrastructure. That's something else entirely - that's a higher risk profile than the one
that people want. And there isn't enough built infrastructure to satisfy all the demand. In this, if you're a smaller house like we are - we're
only 28 billion pounds - actually we have an advantage.
SOARES: Thank you very much. Saker Nusseibeh, the CEO of Hermes Investment Management. Thanks for coming again.
SOARES: Now one year ago this week, 239 people took off from Kuala Lumpur on a routine flight bound for Beijing. Today the relatives of their
MH 370 passengers and crew are still waiting for answers. When we return, we'll look at the final moments of the disappeared aircraft.
SOARES: "Goodnight Malaysian 370" - the final communication from an airline that vanished a year ago this week. Now despite an extraordinary
international effort, the search for MH 370's come up empty. Tom Foreman is in our virtual studio with a look back at the plane's final moments.
And, Tom, one year on, what are we learning?
TOM FOREMAN, CNN CORRESPONDENT: You know, Isa, what've learned one year on is that this is just unfolded in five completely mysterious acts.
The first one was unremarkable - the plane took off from Kuala Lumpur, a clear night flying up toward China. It should have been a routine flight
where it would land around dawn.
And the second act occurred about 45 minutes in when authorities said they lost contact with the plane. Now subsequent analysis would suggest
that the transponder was either turned off or stopped working at that point. But nonetheless, the plane went missing and the first search areas
were triggered there with a lot of high hopes that something would be found soon.
Then came the third act in all of this. Gradually authorities let on that at the moment that this plane disappeared, it made a dramatic turn
toward the West and was tracked for some time by military authorities. That spurred a whole push off toward the West, and new search areas out
And then came the third act in all this - mathematical analysis of communications - data communications - between this plane.
And a satellite suggested another whole new theory which is that somehow the plane had slipped down to the Indian Ocean off the coast of
Australia - this great arc as they describe it there, and that's where we are today - in the fifth act of this mystery.
The search has gone on down there and it's gone on underwater in very deep water. Of course they have found debris, of course they have had
pings from what they thought were flight data recorders and of course none of that has been definitively connected back to this plane. In fact, all
of it has been discounted.
So now a year in, we're still underwater - they're still looking for any kind of remnant that would tell them where this plane is and how it
came to be there. So, Isa, in short, what have we learned in a year? Almost nothing except that this mystery is getting deeper and deeper as the
months go by.
SOARES: Yes, and for the families, agony and anger no doubt and pain. Tom Foreman there for us. Thanks very much, Tom.
FOREMAN: You're welcome.
SOARES: Well Malaysia has formally declared the disappearance of MH 370 an accident, infuriating family members of those onboard. And almost
one year since the plane vanished - you heard that from Tom - they say they are being largely ignored by both the government Malaysia Airlines. CNN's
Andrew Stevens has the story.
Female: Everything they do, they seem too insensitive about it and you wonder like who - who are they really trying to help? Themselves or
Male, TRANSLATED BY ANDREW STEVENS: They are failing to tell us the truth.
Female 2: Not only do we not get information of any substance, we don't get any response to our queries.
ANDREW STEVENS, CNN ASIA PACIFIC EDITOR: At all?
Female 2: At all.
STEVENS: One year after flight MH 370 disappeared, the families of the missing say they're still being ignored by the Malaysian authorities.
Sounds like your mother would have been hugely proud of you to have this - all this (inaudible).
Grace Nathan's mother Anne Daisy was onboard. For almost a year, Grace has kept silent, but this announcement by Malaysia's Department of
Civil Aviation on January 29 was the final straw.
AZHARUDDIN ABDUL RAHMAN, DIRECTOR GENERAL, MALAYSIAN DEPARTMENT OF CIVIL AVIATION: -- with the heaviest heart and deepest sorrow that on
behalf of the government of Malaysia, we officially declare Malaysia Airlines flight MH 370 an accident.
STEVENS: Grace and other family members are furious over how they had to find out about this announcement.
GRACE NATHAN, DAUGHTER OF MISSING PASSENGER: They really don't care about how we feel or what we have to say. No one - I mean, if they did,
they would have spoken to us. They would have asked us how we felt about such an announcement being made. They would have talked to us first. But
none of that happened, none of it.
And for us to hear from the members of the media first - to receive a phone call saying, `Can we can and record you when this declaration is
made?' and our response being, `What declaration?' We didn't know anything about it.
STEVENS: The families also dispute the declaration itself. Wen Wang Cheng whose son Wen Yung Sheng was one of the 153 Chinese nationals onboard
rallied next of kin to fly to Kuala Lumpur to confront authorities after hearing the statement of an accident.
WEN WANG CHENG, FATHER OF MISSING PASSENGER, TRANSLATED BY STEVENS: "The announcement has no legal basis he says. It's not legally effective.
We want evidence.
STEVENS: But for Sarah Bajc whose partner Philip was on 370, the facts have so far been impossible to come by.
SARAH BAJC, PARTNER OF MISSING PASSENGER: They still haven't produced the cargo manifest, they still haven't produced air traffic control
records, they haven't given us any rationale as to why they've determined it to be an accident, yet they have.
STEVENS: Bajc says Malaysian authorities have not learned the lessons from a year ago when they were heavily criticized for the initial handling
of the disappearance.
BAJC: If you look at Malaysia's response to this international catastrophe, it's a shambles - absolute embarrassment to the country the
way the leadership and the military responded to this situation. And I don't understand why the world community has accepted it.
STEVENS: But what about now, one year on? Have they learned their lessons?
BAJC: Of course not. In fact, if anything, they've gotten worse.
STEVENS: But families say they will continue to fight for access to information. They stay in touch and plan their next moves of social media.
STEVENS: Do you feel that you are a lone voice in this or a minority voice amongst the passengers' family or is this a majority view?
NATHAN: I don't speak for every single person, but I know whatever I'm saying is definitely the consensus of a large majority of us.
STEVENS: They draw strength from each other, but their burden does not get any lighter.
NATHAN: We hope that, you know, whatever you are doing that you keep us informed at least. I think that's not a lot to ask for - to just ask
for transparency, to ask to be treated in a humane manner.
STEVENS: Andrew Stevens, CNN Kuala Lumpur, Malaysia.
SOARES: Well Malaysian officials and Malaysia Airlines did not answer CNN's request for a response to how families of passengers say they are
being treated. We'll be back with more "Quest Means Business" in a moment.
SOARES: Welcome back to "Quest Means Business." Now, as one of the founders of Microsoft, Paul Allen has already made his mark on history.
Now he's come across another rather large piece of history at the bottom of the sea off the Philippines. CNN's Jonathan Mann has more on this
JONATHAN MANN, CNN ANCHOR/CORRESPONDENT: The billionaire and the battleship. After years of searching, Microsoft co-founder Paul Allen says
he's found the wreck of a long-lost Japanese war ship sunk off the Philippine coast during World War II. The ship is the Musashi, once one of
the largest and most powerful battleships in the world.
Male Voiceover: A furious naval battle rages.
MANN: Torpedoed and bombed by U.S. forces during the Battle of Leyte Gulf in 1944. More than 1,000 crew members perished. Allen announced his
discovery via Twitter, posting, "WWII battleship Musashi sank 1944 is found." Aboard his super yacht, the Octopus, Allen and his team found the
ship in the Sibuyan Sea at more than 1,000 meters deep.
Video shot by an unmanned submarine shows the ship in pieces at the bottom of the sea. A member of Allen's team narrates.
Male Narrator: This is the bow of the Musashi which would have had a large Teak Chrysanthemum which was the imperial seal of Japan.
MANN: Allen says that distinctive carving along with images of the ship's anchor, a gun turret, a catapult used to launch fighter planes and a
valve prove the wreck really is the long-lost war ship. Japanese historians agree, saying this does appear to be the Musashi but further
pictures are needed to know for sure. Jonathan Mann, CNN.
SOARES: And that does it for "Quest Means Business." Thank you very much for watching. We'll be back tomorrow at the same time. I'm Isa
Soares. Stay right here with CNN, the world's news leader.