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QUEST MEANS BUSINESS
Greek Fears Rattle Global Markets; No Plan B for Greece; Little Progress in Greek Reform Negotiations; Global Markets Fall; Anti-Immigrant Attacks in South Africa; South African Unemployment; Egypt's Growth Outlook
Aired April 17, 2015 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:59:55] (NEW YORK STOCK EXCHANGE CLOSING BELL)
RICHARD QUEST, HOST: Pretty dreadful day in the market. The Dow is off 1.5 percent, a very sharp fall as trading comes to a close in New York.
Hit the gavel -- a harsh hit for the gavel, but thank goodness it's over, because tonight, red stands for losses, red tape in China, and red faces of
frustration. It's a sea of red on Friday, the 17th of April.
The EU's top economics official tells me time is running out for Greece. You'll hear him on this program.
South Africa's finance minister joins me to talk about the rise in violence against foreign workers. You'll hear him on this program.
And Italy's finance minister tells us Europe needs a strategy to deal with the migrant tragedy. Of course you'll hear him on this program.
I'm Richard Quest. It may be Friday, but I still mean business.
Good evening. Tonight, Europe's top economic official says there's no plan B for Greece. Pierre Moscovici told me there's little time, and the
situation is getting rapidly worse. Now, the Greek debt talks are combining with fears over China in the global markets.
I'll show you just how bad it is if you join me at the super screens. Just seconds ago, you saw the Dow Jones Industrials close. Now, they weren't at
the lowest of the day. That was just after 2:00. But it was still pretty grim, with a loss of 1.5 percent. The Dow was off 279 points. I think we
can call this a sharp fall. It was off more than 300 before a little rebound.
As to Europe, and it was a similar tale of misery. The FTSE was down 1 percent. In many ways, that was the best of the major markets, because
look at Paris, off 1.5. The Xetra DAX in Frankfurt down 25, and Athens down 3 percent.
And the Athens market was by far the worst clobbered overall. And the reason, of course, is escalating worries over the inability of Greece and
the eurogroup to come to a deal.
Pierre Moscovici is the European Commissioner for Economic and Financial Affairs. He's in Washington for the spring meetings of the IMF. Just
before we came on air, the commissioner joined me, and I asked him if he's preparing for a Greek exit from the eurozone, Plan B.
PIERRE MOSCOVICI, EUROPEAN COMMISSIONER FOR ECONOMIC AND FINANCIAL AFFAIRS: It's true that my job is not to prepare a Grexit. My job is not to
consider a Grexit. My job is to avoid it, because I'm deeply convinced that the place of Greece is in the eurozone. That's the interest of the
Greek people, the interest of the Greek state, and we need to maintain the integrity of the eurozone. So, we'll fight for it.
But at the same time, we need for that to happen to have a now detailed and precise and concrete reforms proposed by the Greek authorities. And we ask
for them. That's why here, all of us, we are preoccupied because there is work in progress, yes, but the progress is too slow, too low.
QUEST: The problem is, after the election, when there was the first round of talks with that very late-night agreement, proposals were brought
forward, they weren't good enough. We've had another round of proposals from the Greek government, which don't seem to be good enough. So I ask
you, sir, are you not frustrated at the inability of the Athens government to provide the information the eurogroup want?
MOSCOVICI: Certainly, this government is in place for, now, three months, and time is running short. This is why my message, and I think also the
message of the other institutions and of most of the governments I meet here is it is time. It is time to speed up. It is time to deliver.
QUEST: But --
MOSCOVICI: It is time to show the capacity and the will to reform. And we've got little time. Next week there will be a eurogroup meeting of the
ministers of finance of the eurozone, plus the IMF. And it must be a useful meeting. We must see there that there are true moves.
And on the 11th of May, there is another eurogroup. It must be decided. So, speed up. Yes, let's all speed up.
MOSCOVICI: And let's now work in a cooperative and concrete way.
QUEST: The problem is, if you listen to what's coming from the Greek side, yes, they make the noises that there needs to be reform, but there are
actions being taken by Greece which go contra to what you're seeking. So, the gap is getting wider, not narrower, in some view.
[16:05:10] MOSCOVICI: I wouldn't say that, because we are discussing, we get to know each other better, and we want the same thing, which is Greece
in the eurozone. So, no, the gap is not widening. But it's not narrowing enough.
And this is why now we've got to put into effect what you said, the agreement which was signed on the 20th of February here in the eurogroup,
which is our common road map, and which has a name. First reforms, because it's necessary for the Greek economy to get more competitive, to attract
investors, to create growth and jobs, and also we need to have some flexibility.
Of course, the Greek voters voted for a change. They need -- they want that change. But there is also the need for respecting the commitments of
Greece towards its partners.
QUEST: Watching from outside, as people like myself do, it seems as if you're going -- or the situation is going in circles. You're saying
reforms followed by flexibility, they're saying flexibility followed by reforms. Unless one of you moves to the other side, this is going to end
MOSCOVICI: No, we don't want that to end badly. It must not end badly, it cannot end badly. Why? Because the problem is the sake of Greek people.
Because there is an urgent need of action in this country. Because there is an urgent need of competitiveness, of jobs and growth.
Think about it: 50 percent of the young people who are unemployed, I think about them, and everybody should think about them. This is why, as you
said, if there are circles which don't meet, it must be the end of it. Now, we must work together.
And again, there is little time, because the Greek government and also the Greek banks need to have money. Money. And money can only be obtained if
there is credibility.
QUEST: That's Pierre Moscovici, the European economics commissioner. It's a case of no postponement, no delays. Greece creditors want concrete
reforms now, and without them, Greece won't be able to unlock the $7.8 billion in bailout funds that it desperately needs.
The Greek prime minister Tsipras is confident a deal will be struck. But you need to understand just how far apart the two parties are, and there's
only one way to bridge that gap, and that is with reforms that the Greeks are seemingly drawing -- being stuck on.
Now, so far, this is what they've agreed on. Greece will increase tax collection substantially. It will combat corruption and it will
redistribute the tax burden to those who can afford to pay. In other words, stop tax avoidance. So, those are the parts of the bridge that the
EU and the Troika and Greece have agreed on.
But these are the sticking points. First of all, labor market rules. Creditors want the power of the unions to set wages to be reduced, but this
current government arguably has got union favor behind it and is unlikely to squander that.
Then there needs to be dramatic pension reform. Creditors want pension cuts. But again, the government of Alexis Tsipras was voted in on refusing
to make many of these reforms.
And finally, sales tax. Creditors want sales taxes increased. That's what you need so far, but if you really want to bridge that gap to the other
side, privatization. The creditors want more state assets sold off, and they want them sold off now.
All of these have been known for some time. For example, privatization, they've been at it for several years. But apparently, very little has
actually been sold off. At the IMF meetings, finance ministers from France and Italy told CNN a Grexit is not a viable option.
(BEGIN VIDEO CLIP)
MICHEL SAPIN, FRENCH FINANCE MINISTER (through translator): There is no Plan B. There is no other option. Greece cannot go out of the eurozone,
first and foremost for Greece and for its people. If it did, it would be a very painful situation for the Greek people that have already endured a lot
of pain over the years with lower wages, for example.
For Greece to go out, it would be a hit over the head. People would lose their purchasing power. So, there is no other option.
PIER CARLO PADOAN, ITALIAN FINANCE MINISTER: A Greek exit, or an exit from monetary union is uncharted territory, and it would transform monetary
union into something different. It will not happen.
(END VIDEO CLIP)
QUEST: Maggie, who's at the IMF in Washington, Maggie, you've just had the Italian minister, the French minister. You've just heard Pierre Moscovici
all say a Grexit is not going to happen. It's not possible, it's not likely, it's not relevant. If that's the case, then frankly, Alexis
Tsipras and Varoufakis have won the argument, because they're going to get what they want.
[16:10:05] MAGGIE LAKE, CNN BUSINESS CORRESPONDENT: That's not clear, Richard. But I think it's very important that this is the message coming
out. Because remember, heading into these meetings, the rhetoric was dominated largely by the Germans suggesting that an exit was manageable and
that the terms were on the table and that was it. And the markets were really grabbing on that. So, you are hearing that that is not an option.
However, we -- those details remain, and they are big, and time is running out. I got a chance to have a few quick words with the Greek finance
minister, the man of the meeting, as he was heading inside yet another G20 group meeting, and asked him whether he thinks things are more
constructive. Have a listen.
(BEGIN VIDEO CLIP)
LAKE: The French and Italians said to us this morning that a deal must be reached with Greece. Are you feeling more confident? Are talks more
YANIS VAROUFAKIS, GREEK FINANCE MINISTER: I would be surprised if it was anyone amongst them who would say something different.
LAKE: There's some talk of the need for IOUs. Can you tell us whether that will be necessary?
VAROUFAKIS: No, no comment, thank you.
(END VIDEO CLIP)
LAKE: Richard, he has largely been avoiding the press, you can understand why. There's a lot of ground to cover to get to those details. I'm going
to tell you, he is meeting with the US Treasury secretary in just a little while, so they've got to feel a little bit more positive, but I don't think
they thought they've won this yet.
QUEST: But Maggie, there is an inherent contradiction if everybody says Grexit's not going to happen and that they're going to keep Greece in if
Greece doesn't make the reforms. Ergo, if one follows one follows one, if they don't make the reforms, the only, if you like, sanction or downside is
that they leave.
LAKE: That's right. Richard, I think you and I have talked about this, you asked Moscovici about this. It is can they both get something? Can
the Greeks give them privatization? Clearly, they haven't done that. Or some of the reforms to rebuild that confidence.
Clearly, they haven't done that, because they don't feel like they're going to get the money from the European Union. This has to happen at the same
time, it appears. They've got to find an issue they can all agree on and move forward. There's got to be a difference.
One thing I'm going to tell you that came up with all of the interviews that I did, all of them made great pains to talk about the suffering of the
Greek people, they understand the Greek people are under duress. That was largely absent. This is a conversation that's been very technical, about
technical measures --
LAKE: -- about reforms, not really talking about the pain on the ground. All of them really made an attempt to do that, so there does seem like
they're trying to move forward, but the big problem, Richard, is this should have been happening months and months and months ago. They're
jamming up against --
QUEST: All right.
LAKE: -- the fact that Greece is running out of money quickly. That's really important.
QUEST: Maggie's at the IMF in Washington at the spring meetings, where the spring has sprung. Maggie, thank you very much, indeed.
Now, the markets as it has settled finally. Down 1.5 percent, a loss of 279 points. I think this is a very sharp loss, whichever way we look at
it. It's not a plunge, it's not a dramatic fall, it's a sharp fall.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Seems like it is.
QUEST: And Alison Kosik is here to tell us why. Good to see you.
KOSIK: Hi, Richard. It's been so long. You know, I talked with one trader today --
KOSIK: -- who told -- who said it this way: the issues that plague the market today, they're nothing new. They've been hanging around --
KOSIK: -- for a while. And for some reason, these investors woke up today and thought, you know what? We're going to sell today. And apparently,
finally, Greece was on their radar. And that was really the prime reason you saw markets drop so sharply today.
QUEST: Right, but if you're -- well, I think you are right, because there's obviously no reason other than Greece and a bit of China.
KOSIK: Well, there's more. And another issue that's been on investors' radar as well for a while is US earnings. Earnings season is underway. So
far, not getting off to a stellar start. The strong dollar really going to be wearing --
QUEST: That strong dollar, how about it? Are we seeing more and more companies phrasing it in? Because they don't like to talk about the
currency as a reason, generally, for poor results.
KOSIK: But they are talking about it. We've really only heard from financials. Today, we did hear from AmEx and GE and Honeywell. But even
there, we're hearing about the strong dollar weighing on their profits.
We're going to hear more, I think. Multinational companies start reporting next week. So, you're kind of seeing a preemptive strike going on as far
as investors go with this sell-off, expecting earnings season to be what they expected, and that's one of the worst they've seen in many years.
QUEST: Have a good weekend.
KOSIK: You've got it, you too.
QUEST: Good to see you.
QUEST: When we come back, attacks on immigrants spread to South Africa's largest city. I'll be speaking to the nation's finance minister about the
violence after the break.
[16:14:43] (COMMERCIAL BREAK)
QUEST: The pictures tell an awful tale. A wave of anti-immigrant attacks in South Africa has now spread to the country's largest city, Johannesburg.
Six people have been killed in the xenophobic violence that began in the city of Durban.
Now, some are accusing the government of not doing enough to protect immigrants and their property. In just a moment, we're going to be talking
to the South African finance minister, who joins us from Washington and the IMF.
First, our correspondent Diana Magnay is in Johannesburg for us this evening. And Diana, the situation, describe what is happening, and whether
it's getting better or worse.
DIANA MAGNAY, CNN INTERNATIONAL CORRESPONDENT: In Johannesburg at the moment, it is isolated in a couple of parts of the town. But the situation
there is bad. I spent the whole day down in Jeppestown, which is eastern Johannesburg. You had the police separating a crowd of foreigners, mostly
West Africans, Nigerians, whose shops had been looted and burned.
And on the other side of the road at the end of the street in front of a hostel which is home to a lot of migrant workers coming into Johannesburg
from KwaZulu-Natal, so a lot of Zulu men, gathered there, armed with spears, machetes, anything, really, that they could get their hands on, and
the police firing rubber bullets to try and make sure that those two sides didn't meet.
So, it was very, very ugly scenes. The hostel -- the men from the hostel say that they're having their jobs stolen from them by these foreign
nationals who set up businesses in their vicinity. The facto of the matter is that many of these businesses are fairly successful. They have -- they
contain valuable objects, and they've become the very easy --
MAGNAY: -- targets and economic scapegoat, really, for broader problems that these very poor communities have. Richard?
QUEST: Diana Magnay in Johannesburg, setting us up into the situation. Now, South Africa's finance minister, Nhlanhla Nene, joins me now from
Washington. Minister, good to see you, sir. Thank you for taking time in the very busy meetings that you'll be having to talk to us.
Minister, everybody in official South Africa from the president down is making the right noises and saying the right things, but the violence
continues. So what now needs to be done?
NHLANHLA NENE, SOUTH AFRICAN FINANCE MINISTER: Thank you, Richard. Firstly, let me say that indeed, as you have correctly pointed out, we all
are condemning this series of events with the contempt that it deserves.
And as we are saying that, we have mobilized our security forces on the ground to deal with the situation. But we're also trying to get to the
bottom of this to understand exactly what could have actually ignited this --
NENE: -- unpalatable situation. But all the security forces are on the ground, and we just need to deal with it in that manner.
QUEST: Well --
NENE: And as your reporter also observed, it is in isolated areas, and what needs to be done is to arrest it such that it also doesn't spread into
the rest of the country.
QUEST: Now, on the underlying issue -- because I appreciate, obviously, the police, the forces will do whatever they can, but the underlying issue
of resentment against the migrant workers or immigrants, if you like. This, as the president says, goes counter to everything that South Africa,
the Rainbow Coalition, was set up about.
[16:20:04] NENE: Indeed it does. And you will realize, Richard, that as I've said, it is isolated instances, and unfortunately, it has erupted, and
some people and some criminal elements have actually taken advantage of this situation, as you have seen that in some.
In most cases, when these things happen, you will see people looting, and it's actually just the criminal element that we actually need to nip in the
bud. And you will also appreciate that most of the foreign nationals in South Africa are fully integrated into our societies.
QUEST: All right.
NENE: And it is a sad and unfortunate development indeed. And it is for that reason that we are doing everything in our power to stamp it out.
QUEST: OK, now, Minister, on the underlying question of growth -- now, if we look at the level of unemployment, and we look at the strikes that have
taken place in the public sector or in the mines, Minister, what do you need to do to get economic growth moving further and faster so that more
people are lifted out of poverty?
NENE: A number of initiatives are already underway in order to deal with the unemployment situation in South Africa.
You realize that we are actually confronted with a situation that not only in South Africa, but most economies, as well here in Washington, that's one
of the things that we are discussing with our peers, where it is clear that for a considerable period of time, we're going to be experiencing slow
But we do need, as you have correctly pointed out, to focus on the sectors, like in South Africa, as we have done. If you look at our growth drivers
that we have identified in sectors like agriculture, in the energy sector where, indeed, we have these challenges.
NENE: But they present us with an opportunity of focusing more seriously in those areas that would create more jobs in the shortest possible time.
QUEST: And how concerned are you as the Fed starts to tighten later this year, how concerned are you that again emerging economies may be -- like
South Africa, to some extent, you're going to be hit by a withdrawal of investment that will be moving to more secure our higher yield, such as the
NENE: We indeed are concerned, but as you have seen that those spillover effects did affect us in the past. But as we -- at least now we have much
more improved communication, and that's one of the discussions that we are having here.
Much more -- better communication, better coordination of macro-economic policies. And as a result, we are able to mitigate the impact -- or the
negative impact of the withdrawal of quantitative easing. And as a country and our peers also, we are beginning to look at the ways and means of
mitigating such impact.
QUEST: Minister, good to see you, sir. Thank you for taking time out of the meetings to talk to us. South African finance minister joining me
from the IMF. Obviously, if they're worth hearing from, you're hearing from them on QUEST MEANS BUSINESS.
In Washington, the Egyptian investment minister will be joining us after the break. Now, there's an economy that seeks investment, has huge
potential, and many challenges to go with it. We'll find out what the minister says after the break. QUEST MEANS BUSINESS.
[16:25:20] QUEST: The IMF is predicting Egypt's economy will improve by 4 percent this year even as other parts of the Middle East struggle with
lower oil prices. Egypt's minister of investment, Ashraf Salman, joins me from CNN in Washington. Minister, good to see you, sir. Thank you for
talking to us this evening.
ASHRAF SALMAN, EGYPTIAN INVESTMENT MINISTER: Nice to see you, Richard, as usual.
QUEST: Good. Now, you have a great task at hand: how to convince people that Egypt, a country that everyone knows well and has great promise, but
obviously manages to go off the rails with investment opportunities. What are people worried about now?
SALMAN: I think we are just sad that it is -- we have a rough ride to convince people how to join our economy. And I think the kick-off was in
Sharm El Sheikh in the mid of March, last two weeks, when we had great attendance from everywhere in the world. And they have seen themselves the
story of the Egyptian reforms.
SALMAN: And that was a great kick-off for us.
QUEST: Now, Sharm El Sheikh and the whole southern part of the country, we pretty much now, anybody who's studied this, has been untouched by much of
what's been going on. However, you have to convince that the capital and other industrial and agricultural areas are safe and secure for investment.
How can you do that, Minister?
SALMAN: Let me tell you, there are some figures that show how we started to convince people to come to the country. The first half of the fiscal
year 14-15 of the Egyptian budget shows that FDI in Egypt increased to reach $3 billion.
Yes, we do understand it is a very low figure so far. However, when we compare it to the last year, you have a full year of $4 billion in FDI. We
have seen also that this figure, the $3 billion, achieved in the first half of the fiscal year 14-15.
SALMAN: Will increase to reach anywhere between $6 billion to $8 billion in this year. And also growth. While every other part in the world is
slowing in growth, Egypt is actually anywhere between 4 to 4.5 percent coming up from 2 percent during the past three years.
QUEST: Right. So, what is it that you need now? What will, if you like, create that virtuous cycle of growth leading to more FDI leading to more
growth? What is it you want and need?
SALMAN: We need to continue reform. And this is number one challenge. We need to continue removal of subsidy. We need to continue our structural
adjustments. We need to continue our legislation reform. And we need also to continue our plan to get rid of bureaucracy as much as we can.
QUEST: Minister, thank you very much for joining us. Appreciate it.
SALMAN: You're welcome, Richard.
QUEST: Good to talk to you, sir. Now, as we continue our review of what's been happening, danger and despair in the Mediterranean. Desperate
migrants risk everything to get to the gateway of Europe and a better life. Italy's top leaders ask the world to wake up to the unfolding tragedy.
[16:28:42] (COMMERCIAL BREAK)
[16:31:00] RICHARD QUEST, ANCHOR AND HOST OF "QUEST MEANS BUSINESS" SHOW: Hello, I'm Richard Quest. There is of course more "Quest Means Business"
in just a moment when the Italian finance minister tells us about the migrant tragedy. The chief exec of Rolls Royce and Emirate Airlines tells
about their new deal.
Before all of that, this is CNN and on this network the news always comes first.
Attacks against immigrants in South Africa have spread to Johannesburg. Police fired rubber bullets at crowds attacking immigrant-operated
businesses in Johannesburg. The violence has left six people dead. It flared in the city of Durban.
Stocks fell around the world on Friday. In the U.S. the Dow was down more than 300 points at one stage. It then was rebounded towards the end of the
day a little tad. In Europe, all the major indices ended lower. The cause was a cocktail of Greek debt dorps (ph) and fears over China.
The Greek negotiations are at the top of the agenda at the IMF's Spring Meetings in Washington. Speaking to me a short while ago, the E.U.'s
economics commissioner says the negotiations aren't narrowing quickly enough. Pierre Moscovici warned time's running out.
PIERRE MOSCOVICI, E.U. ECONOMIC AND FINANCIAL AFFAIRS COMMISSIONER: There is little time because the Greek government and also the Greek banks need
to have money, money. And money can only be obtained if there is credibility.
QUEST: At the White House, President Barack Obama echoed calls for reforms in Greece. Speaking alongside the Italian Prime Minister Matteo Renzi, Mr.
Obama called on European governments to boost consumer demand. And he warned that with growth in China slowing down, Europe couldn't count on the
U.S. to support everyone else.
BARACK OBAMA, U.S. PRESIDENT: What I've said to the Europeans is don't expect that the United States is simply going to be the engine for
everybody. Don't want - don't expect that you can just keep on selling to the United States but we can't sell anything to you because your economy is
so weak. That won't benefit anybody. And those are concerns that I've expressed across the board.
QUEST: Iraq says Saddam Hussein's closest deputy was reportedly killed today in a special operation. Iraqi TV says General Izzat Ibrahim al-Douri
played a leadership role in a number of terror group that emerged after the fall of Saddam Hussein, including ISIS.
So this is a map that's showing the situation and demonstrating how desperate it's become for Italy and for migrants seeking a better life as
they try and escape whether it be from Eritrea, Somalia and parts of Sudan from Libya and up across the Mediterranean Sea.
The Italian Coast Guard say more than 10,000 people fleeing war and poverty have arrived on the Italian shores since last weekend alone and they're
arriving in Palermo, Lampedusa, and all around the coastline.
Today more chaos on the open water as the Italian Navy managed to retake control of a fishing boat. It had been seized by gunmen off the coast of
Sicily and steered towards Libya.
Italian authorities say the gunmen are suspected of human trafficking. Italian officials have arrested 15 Muslim migrants suspected of killing 12
of their fellow boat passengers because they were Christian. They say the men threw the victims overboard during their voyage from Libya to Italy.
In Washington Italy's prime minister was at the White House. Matteo Renzi told Barack Obama this is not just Italy's challenge, it's a human tragedy
of global proportions.
MATTEO RENZI, ITALIAN PRIME MINISTER, VIA INTERPRETER: I am convinced that the United States and I - the President and I - are fully on the same page.
In the next few weeks, we will see that we will reach the fruit of all this commitment. Everything that happens in the Mediterranean Sea is not merely
something that has to do with security. And of course it is, but at the same time, it has to do with justice and the dignity of mankind. This is
why the very authoritative cooperation that the United States can offer is for Italy an extremely important fact.
[16:35:29] QUEST: Now the dangerous journey to Africa up to Europe turned especially tragic even before it started for dozens of migrants. Some
suffered severe burns before they ever got into a boat. John Ray from ITV News reports from Sicily. And I must warn you - some of the video in his
story is disturbing.
JOHN RAY, REPORTER, ITV NEWS: From the Mediterranean, this ocean of man- made misfortune, a ship of horrors. Rescue teams who have saved so many poor souls this week, they have seen nothing yet to match this suffering.
Migrants - mostly women - disfigured by burns from an accident on shore, then cast out as sea in a sinking dinghy. The smugglers they'd paid
handsomely for the journey abandon the injured and the dying to their fate.
BARBARA MOLINARIO, UNHCR SPOKESWOMAN: The traffickers would not allow them to leave and reach the hospital So they did not get treatment for a few
days and then were put on a boat - in fact on a rubber dinghy, and when rescuer arrived, they had spent two day at sea but they were drifting away
because the rubber dinghy was half deflated already.
RAY: -- big gas cylinder (ph) as the women gathered `round a cooking stove. This afternoon we watched as the injured were brought to hospital
in Sicily. Wounds so long untended leave lives in the balance.
Here the survivors will belatedly get the specialist medical help they need. But despite the best efforts of surgeons, doctors here say that
though they may live, many will bear the scars of their journey forever.
The smugglers responsible have not been caught. No doubt they're busy with their next boatload of human misery. John Ray, ITV News Sicily.
QUEST: It is difficult to know what to say. Maggie Lake spoke to Italy's finance minister about the human tragedy. He told her it's time for Europe
to come up with a common immigration policy.
PIERRE CARLO PADOAN, ITALIAN FINANCE MINISTER: It is a human tragedy, it is a political tragedy of course. It's also an organizational tragedy.
Italy is guarding the southern borders of the European Union and we need a European policy.
In the short term, we need collaboration among European countries in terms of resources. This is a very expensive endeavor. But also we need a
common - true common - immigration policy in Europe. This is essential.
MAGGIE LAKE, BUSINESS ANCHOR AND CORRESPONDENT FOR CNN INTERNATIONAL: Stopping the search and rescue some had hoped would slow it. It has not.
Should the policy change? What's the longer-term solution?
PADOAN: The longer-term solution is the coordinated response with truly European resources. But also the long-term solution implies that the
reasons why these people face sometimes that journey are eradicated. So we need to stabilize the country from which these people are coming from,
starting from Libya.
QUEST: That's the Italian finance minister. Ukraine is seeking out creditors to restructure $40 billion in debt before a May deadline. The
finance minister warns that Ukraine could be forced to skip payments if the war-torn nation situation gets even worse.
Maggie Lake sat down with the minister to ask how Ukraine can avoid defaulting.
NATALIE JARESKO, UKRAINIAN FINANCE MINISTER: I think it's very important that we work together with the creditors to achieve a collaborative
solution. So I think that's in and of itself is the goal - not a default. I wouldn't want to be pushed to that, but I would like instead to find a
solution that enables us to meet the three targets that we have that are debt sustainability, balance of payments and payment ability.
I think it's possible. I think we still have some time and I'm confident.
LAKE: Your ability to reach agreement, a lot of the IMF money that's been promised is tied to that. Are you confident that will come through and
will it come through in time?
JARESKO: Well the timing is important as the first tranche we received of $5 billion doubled our international reserves. That enabled us to also
unlock monies from the United States from the E.U., some of which I believe we'll be able to access in the next month or so.
But the next review of the IMF is at the end of May for the second tranche in June. And, yes, the debt restructuring is one of the structural
benchmarks. And that's why it's so critical that the creditors understand that a collaborative approach is the best approach for us all and in all of
[16:40:06] LAKE: And where does the sticky point remain? Is it with the Russians?
JARESKO: No, I think with the creditors in general, the sticking point is that there seems to be perhaps a lack of understanding that we are facing
not only a liquidity problem which could be a maturity extension but also solvency problem which is going to require a coupon and a nominal reduction
of some sort.
I don't have a particular setoff targets in mind, but some combination of those three elements are going to be required to solve the very serious
problems that Ukraine faces today.
LAKE: And they are serious. And part of getting that from creditors is some sort of faith that the future is going to be better. Let's start with
the immediate - there are concerns that the ceasefire is falling apart.
JARESKO: Now there's no question the ceasefire is fragile. I think, you know, we watch day to day and we get horrendous, you know, terribly painful
reports of continuous death, continuous aggression.
But we are hopeful. Our president keeps underlining we are very hopeful that the Minsk Agreements can be indeed implemented.
In the interim, I think it is important for creditors to understand that these are the kinds of shocks that might throw us off, and one of the
reasons why we want right now to come to an agreement - a collaborative agreement, one that's transparent, one that meets the targets so that we
have the ability to withstand any potential shocks like that.
LAKE: We're here at the IMF where so many finance ministers from around the world are, and the conversation seem to be dominated by Greece. Do you
feel that you are getting - Ukraine is getting - the attention and the support that your country needs right now?
JARESKO: Well, we're very grateful for the support, in particular of the G7 of the United States and the European Union and the IMF, the World Bank.
But, no, I would love to see more support.
I think it's very important that we look at the situation of Ukraine as very unique. The challenges faced by the country are enormous. They're
above and beyond economic.
We have this war - this aggression against our county and I think unique from Greece or other countries that are being discussed here, Ukraine has
embraced the reforms, Ukraine has embraced democracy, Ukraine has embraced those principles for which today people are sacrificing their lives and
therefore I think it deserves a little bit more attention. I think it deserves a little bit more support certainly.
QUEST: That's Ukraine's finance minister talking to Maggie. It's Rolls Royce's biggest job ever.
QUEST: This is what makes the whole thing work.
QUEST: Now the CEOs of Rolls Royce and Emirates tell us about their historic deal next.
QUEST: After a grim year of profit warnings, Rolls Royce has landed an enormous deal. The company has made a $9.2 billion deal at list prices to
supply engines for Emirates Airlines' fleet of A380 super jumbos.
[16:45:03] Rolls says it's the company's biggest deal ever and the biggest non-defense order ever for a British company. CNN's Claire Sebastian was
there as the deal was signed.
CLAIRE SEBASTIAN, CNN PRODUCER: Signed, sealed and ready for liftoff.
JOHN RISHTON, CEO, ROLLS ROYCE: : These contracts to supply more than 200 engines for a fleet of 50 Airbus A380 aircraft is the largest order in the
history of Rolls Royce.
TIM CLARK, PRESIDENT AND CEO, EMIRATES: It marks an important milestone in a long and proud history between Emirates and Rolls Royce.
SEBASTIAN: A shift in engine supplier is a rare move for an airline. Until now, Emirates has powered its A380s using engines made by Engine
Alliance, a joint venture between U.S. companies Pratt & Whitney and General Electric.
The decision to change was not taken lightly.
CLARK: It's a combination of the commercial proposal, the engineering proposal, the fuel efficiency of the aircraft. We didn't believe (AUDIO
GAP) Rolls Royce.
SEBASTIAN: Sir Tim Clark will be glad of the opportunity to celebrate. The airline is locked in a contentious dispute with major U.S. airlines
which accuse it of unfairly benefiting from government subsidies.
I asked him about reports (AUDIO GAP - 06:15.0 - 06:27:1).
The deal will help fuel continued expansion for Emirates. And for Rolls Royce, the timing couldn't be better. Revenue fell from the first time in
a decade last year and the company's forecast profits could drop up to 13 percent in 2015.
RISHTON: This is a very, very important deal. It increases our auto books significantly and it secures many jobs in the U.K. and around our business.
SEBASTIAN: You've been in the job since 2011. Could you foresee a deal of this size in the pipeline when you first joined?
RISHTON: Only when I was dreaming, but it's great to make it a reality.
SEBASTIAN: Claire Sebastian, CNN London.
QUEST: "Something was destroyed that can never be healed again in this world." Those are the emotional words of the German President Joachim
Gauck who was speaking at the memorial service for those who died in the Germanwings crash in the French Alps.
The German Chancellor Angela Merkel joined relatives of those who were killed along with ministers from France and Spain. Andrew Carey reports.
ANDREW CAREY, CNN INTERNATIONAL SECURITY PRODUCER: Bound together by grief, the shock and pain still fresh. Germany is in mourning.
Relatives of the victims of Germanwings flight 9525 gathered to pay tribute to their lost loved ones.
Male, VIA INTERPRETER: Each death will leave deep marks.
CAREY: One hundred and fifty candles lit, one for each of the dead including co-pilot Andreas Lubitz who is believed to have deliberately
flown so many people to their deaths.
The president of Germany urged compassion for the co-pilot's family.
JOACHIM GAUCK, GERMAN PRESIDENT, VIA INTERPRETER: We do not truly know what was on his mind in the decisive seconds or in these minutes. But what
we know is that also his relatives lost a loved one on 24th of March.
CAREY: German Chancellor Angela Merkel, dignitaries from France and Spain and executives from the airline filled the pews. All were presented with
hand-crafted wooden crosses, each one a small reminder. Sarah who lost her sister spoke on behalf of all relatives.
SARAH, SISTER OF CRASH VICTIM, VIA INTERPRETER: Let the love in the middle of the mourning be stronger than desperation. God, please help us and
protect us always. (CRYING).
CAREY: No individual funerals yet. Investigators at the crash site are still trying to identify human remains found on the mountainside.
CAREY: The Haltern School which lost 16 students and two teachers have formed a haunting tribute. A song from Schindler's List.
Outside the city of Cologne came to a stop to let people trying to come to grips with what happened also pay their respects.
There's been little ease to the suffering, but this service at least something for families and friends to hold onto. Andrew Carey, CNN
[16:50:12] QUEST: Around the world, around the clock, this is CNN.
QUEST: Bayer's chief executive Marijn Dekkers has almost tripled the company's earnings in the last five years. He says the key's been to
shifting focus to life science and making that work in the high-tech era. CNN's Rosie Tomkins went to meet him.
ROSIE TOMKINS, CORRESPONDENT AND SENIOR PRODUCER FOR CNN INTERNATIONAL: Three hundred and eighty-four tiny little tubes, each one containing just
one cubic milliliter of liquid ready for testing.
MARIJN DEKKERS, CEO, BAYER AG: This is not work that can be done by humans quite honestly.
TOMKINS: This is state-of-the art biotechnology in action. Ultra-high precision, fully automated medical research and development, also known as
DEKKERS: So these are all hamster cells that are later in production going to produce a protein that is used as a biotech drug. And the question now
is which of these cells is actually very good at that and which is more or less lazy? And then we pick the best ones and use those in production.
And that is what is happening here in a completely automated way.
TOMKINS: Now screening on that volume in the past with that technology like this could have taken -
DEKKERS: Oh! 30 years by 40 people everyday 24 hours. It was basically not doable. Without this type of technology, these biotech production
capabilities wouldn't be there.
TOMKINS: That increased automation is key to future manufacturing across the board. Humans making way for robots, however tiny, not only making
things more efficient, but in cases like this, making the previously impossible possible.
DEKKERS: Oh, this is millimeter or less type of work. The whole micronization of robotics is here at work. And also we're not doing this,
you know, save labor. It's not about a cost factor which often happens in robotics where people say if I let a robotic do it, it costs less, so
you're not motive manufacturing. This has nothing to do with costs. People just couldn't do this job at all.
TOMKINS: Taking people out of the picture is just as crucial in the manufacturing process. In this fermentation plant, cells are being
multiplied by the billions without any human involvement. Here automation is not about cost saving or efficiency. It's about removing human error.
DEKKERS: Every time a human touches something in a process, there is the risk of variability. Even worse, when person A does it today and person B
does it tomorrow. But a robot's variability can be much more narrowly defined.
So that is precision, lack of variability is a big advantage in manufacturing.
TOMKINS: People are talking about, you know, a fourth industrial revolution - Industry 4.0. In research and development at pharmaceuticals,
where is the link? Where are things headed toward that future?
[16:55:04] DEKKERS: It's an easy thing to say but it's really everywhere in everything we do and the hard part sometimes is to say now I can measure
all of this stuff but how do I use the data intelligently to make the next step forward. The smarter insight that helps you use the same data more
intelligently can become a competitive advantage.
TOMKINS: Well that's all for this special week looking at how in the future we'll be "Producing the Goods." For now, I'm Rosie Tomkins for CNN
in Hanover, Germany.
QUEST: We will have a "Profitable Moment" after the break.
QUEST: Tonight's "Profitable Moment." The Greek saga rumbles on as you can see from the IMF and World Bank. The Eurogroup and others say Greek
needs to do more reforms and meanwhile the Greeks say there has to be flexibility before they can do the reforms.
It's classic - which comes first, the chicken or the egg? In this case it really doesn't matter because unless they start sorting it out soon,
there'll be yolk everywhere to be cleaned up. The truth is this has gone on way too long and what's happening of course is that the Eurogroup and
the Eurozone just continue to say they don't want Greece to leave, that they want to ensure that a fair deal is done, but nothing ever moves. The
markets were down very sharply today. There is instability and fragility and volatility in the markets. The last thing we need at this point is
more uncertainty from Greece.
Now that's "Quest Means Business" for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, (RINGS BELL) I hope it's
[17:00:00] I'm away next week. I'll see you when I get back.