Return to Transcripts main page

CNN Newsroom

Democratic Debate Reviewed; Latest on Iran Prisoner Swap; Iowa Poll Numbers Examined; Match Fixing Alleged in Professional Tennis. Aired 3-4a ET

Aired January 18, 2016 - 03:00   ET

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

[03:00:01]

ERROL BARNETT, CNN INTERNATIONAL NEWSROOM HOST: Tense times, Democrats clash over healthcare, Wall Street, and guns in the last Presidential debate before the Iowa caucuses.

BERNIE SANDERS, PRESIDENTIAL CANDIDATE: I think Secretary Clinton knows that what she says is very disingenuous.

HILLARY CLINTON, PRESIDENTIAL CANDIDATE: He has voted with the NRA, with the gun lobby numerous times.

ROSEMARY CHURCH, CNN INTERNATIONAL NEWSROOM HOST: Also ahead, sticks and carrots, the U.S. slaps new sanctions on Tehran even as Barack Obama praises the results of the Iran nuclear deal.

BARNETT: And double fault, tennis executives reject reports they ignored match fixing by some of the games' top players.

A warm welcome to our viewers here in the U.S. and those of you tuned in all around the world. I am glad you could join us. I am Errol Barnett.

CHURCH: I am Rosemary Church. Thanks for being with us. This is CNN Newsroom.

BARNETT: So I think you could say that the gloves came off at the Democratic Presidential debate on Sunday night, with Bernie Sanders surging in the polls and voting just two weeks away in Iowa, frontrunner Hillary Clinton repeatedly tied her positions to the Obama administration while targeting Sanders on his policy shifts.

CHURCH: The debate was held a block away from the scene of a racially-motivated shooting at a South Carolina church last year, and a clash over gun control came up very quickly.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Senator Sanders, last week Secretary Clinton called you "A pretty reliable vote for the gun lobby." Right before the debate, you changed your position on immunity for lawsuits for gun manufacturers. Can you tell us why?

SANDERS: Well, I think Secretary Clinton knows that what she says is very disingenuous. I have a D minus voting record from the NRA.

CLINTON: I have made it clear based on Senator Sanders own record that he has voted with the NRA, with the gun lobby numerous times. He voted against the Brady Bill five times. He voted for what we call the Charleston Loophole. He voted for immunity from gun makers and sellers, which the NRA said was the most important piece of gun legislation in 20 years.

(END VIDEO CLIP)

BARNETT: And the two frontrunners also disagreed on financial reform. Sanders questioned Clinton's ability to regulate banks while taking donations from Wall Street. Watch.

(BEGIN VIDEO CLIP)

SANDERS: Can really reform Wall Street when they are spending millions and millions of dollars on campaign contributions and when they are providing speaker fees to individuals. So it is easy to say, I am going to do this and do that. But I have doubts when people receive huge amounts of money from Wall Street.

CLINTON: I go after them and I can tell you that the hedge fund billionaires who are running ads against me right now and Karl Rove who started running an ad against me right now funded by plan from the financial services sector, sure thing, I am the one they don't want.

(END VIDEO CLIP)

CHURCH: Another hot button issue with the debate, Iran. Both Bernie Sanders and Hillary Clinton had positive reactions to the nuclear deal with Tehran but opposing views on normalizing relations. Take a listen.

(BEGIN VIDEO CLIP)

SANDERS: I think what we have got to do is move as aggressively as we can to normalize relations with Iran. Understanding that Iran's behavior in so many ways is something that we disagree.

CLINTON: I was responsible for getting those sanctions imposed, which put the pressure on Iran that brought them to the negotiating table which resulted in this agreement. And so they have been so far following their requirements under the agreement. But I think we still have to carefully watch them. We've had one good day over 36 years, and I think we need more good days before we move more rapidly toward any kind of normalization.

(END VIDEO CLIP)

BARNETT: Our Political Director David Chalian was inside the debate hall, he says the race is in a new phase.

[03:05:01]

DAVID CHALIAN, CNN POLITICAL DIRECTOR: This debate happened in a new context, new point in the race. And clearly, Hillary Clinton came in to really try to draw contrast with Bernie Sanders on guns, on healthcare, and he came in to do it on Wall Street and her connection to wealthy contributors. Here is what you have going on. For the first time in this race, I really think that Bernie Sanders was a little bit more on defense in a way he hadn't been. Scrutiny because of how well he is doing in the race. And Hillary Clinton's mission was to make sure that the Bernie Sanders

momentum, if there is some for him right now, and he is doing well in the two early states, didn't grow. That she still made him the candidate of the far left.

CHURCH: CNN Political Reporter Maeve Reston joins me now to talk more about the last Democratic debate before the Iowa caucuses. Thanks so much for talking with us. So the Democratic candidates clashed over a number of issues including healthcare, guns, foreign policy, and Wall Street reform. What is your initial reading of how it all went? Who do you think came out on top?

MAEVE RESTON, CNN POLITICAL REPORTER: This was a really interesting debate because it was really Bernie Sanders who was the target here, which was a little bit unusual given that Clinton has been the candidate on top for so much of this race. But obviously, Clinton is releasing her lead shrink in some early policy primary states. And so tonight, she went after him really hard on guns. Also questioning whether his numbers went up, introducing Medicare for all, and I think Hillary Clinton did win this debate tonight, just by going after him again and again and coming after him on foreign policy as well.

Showing her credentials as Secretary of State, heading into Iowa as people are getting ready to vote in the next couple weeks.

CHURCH: Interesting. So what do you think of the stand out moments in the debate? The ones everyone will talk about in the hours ahead?

RESTON: Well, I really do think that Clinton's attacks on Sanders on guns were the fire -- most fiery moments of the debate. He came back very strongly, saying that her attacks were disingenuous, saying he had a D minus rating from the National Rifle Association. But I do think that that will continue to be an issue on the campaign trail that the two of them will engage over. There was also another interesting moment where Bernie Sanders was asked about his critique on Bill Clinton's past indiscretions.

He said wait a minute here, this is not the kind of issue I want to be talking about on the campaign trail. I want to have an issues debate. There was an interesting exchange there between the two of them.

CHURCH: As Bernie Sanders pointed out as well, the race between him and Hillary Clinton is very close in Iowa and New Hampshire. Clinton claims she is not concerned, but as the presumptive nominee she must be a little worried. What are your sources telling you?

RESTON: They definitely are worried. I don't think they expected the race to get this close, and the question is whether Bernie Sanders' lead in some of the states is actually real or not. But he's really getting organized in these states and what everyone is so afraid of is once again she may have underestimated her challenger here. And they looked at Bill Clinton and see if they underestimated Bernie Sanders.

It is interesting to see how much firepower she trains on him the next couple weeks, and if tonight is any indication it is a very feisty battle right down to the end.

CHURCH: I think you're right. Maeve Reston, thank you so much for joining us. Appreciate it.

RESTON: May pleasure, thank you.

CHURCH: And you can find complete coverage of the Democratic debate on our website at CNN.com.

Now we turn to Germany where three Americans are enjoying freedom after spending months, even years, in prison in Iran.

BARNETT: U.S. Secretary of State John Kerry says Washington Post reporter Jason Rezaian, Marine Veteran Amir Hekmati, and Pastor Saeed Abedini will reunite with their families and undergo medical check- ups.

CHURCH: CNN Senior International Correspondent Frederick Pleitgen is outside the hospital in Landstuhl, Germany where the three men are being evaluated right now. So Fred, it is the first night outside of Iran for the three released American prisoners. Talk to us about what happens next and these evaluations that we mentioned, and what has been the reaction from some of them so far?

FREDERICK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: So far they are saying they are thrilled. They have made it here to the medical center, of course, one of America's biggest and best trauma centers outside of the United States. It is a military hospital. There was a short phone conversation apparently between Jason Rezaian, Washington Post reporters, and his editors, where he said he was doing very well and in good spirits.

[03:10:01]

He said that the toughest thing for him, he was of course, in Iranian detention for about 1 1/2 years, was in solitary confinement. There is great concern over his medical condition. Certainly, the physical health of these three men -- one of them in detention in Iran for about four years, he is something that is grave concern to their loved ones at home, to the U.S. public of course, and to the U.S. politicians as well. So that's one of the things that they will be looking at.

But of course, all of this also takes a psychological toll as well. As we have mentioned, Jason Rezaian there in solitary confinement for a very long time. That's something the Washington Post kept saying again and again. All of these things will be looked at by the physicians here at the regional medical center and then of course, probably just as important is the fact that they are going to be able to see their loved ones once again.

Some are coming today apparently some have already arrived here in Germany and already inside the hospital complex, Rosemary.

CHURCH: Extraordinary day for those three men. What do we know about the fourth American who was freed and then surprisingly elected to stay in Iran? What do we know about him and his case?

PLEITGEN: Yeah. You know it was surprising to see his name on the -- on those who were released for many people in the first place. (Inaudible) His case was not very well known. There was virtually nothing known about his case. It was interesting because Barack Obama -- when he came out yesterday and gave a short speech about the fact the prisoners' exchange had taken place, he said, listen, there's not very much known about this case. However, it was important for the U.S. to try and get as many Americans out of Iranian custody as possible.

He was the one who then apparently elected not to go on this Swiss government flight that took the three other men out of Iran. It is unclear why he elected to do so. Unclear whether or not he is still in Iran or whether or not he might take a commercial flight out. That is something that perhaps we will find more about in coming days. American politicians said, there is not very much known about this man.

CHURCH: All right, our Frederick Pleitgen bringing us up-to-date on the situation there from Landstuhl in Germany. Many thanks.

BARNETT: U.S. officials are working with Iraqi authorities to find three American contractors missing in Iraq. An Iraqi security official says a group of gunmen grabbed the men from an apartment in Baghdad on Friday.

CHURCH: A company filed a report Sunday, saying three of its staffers went missing and we are told two of the contractors are dual Iraqi- American citizens.

Iran is getting back in the oil market after sanctions are lifted. But recent missile tests spark a new round of sanctions by the U.S., Tehran's response, that's next.

BARNETT: Plus, reports of a major scandal threaten to cast a shadow over the start of the pro tennis season, details on that after this.

(COMMERCIAL BREAK)

[03:19:01]

CHURCH: Welcome back, everyone. The pro tennis season is beginning under the shadow of possible scandal, the sports' four governing bodies strongly rejecting explosive new reports of widespread match fixing. They are responding to the BBC and Buzz Feed news which both say they've acquired secret internal files implicating 16 players ranked in the world top 50 over the last decade, including grand slam winners.

BARNETT: Now no individual players were named in all of this. But the ATP, WTA Grand Slam Board and ITF, they all deny allegations they suppressed evidence. Listen.

(BEGIN VIDEO CLIP)

CHRIS KERMODE, ATP EXECUTIVE DIRECTOR: The tennis authorities absolutely reject any suggestion that evidence of match fixing has been suppressed for any reason or isn't being thoroughly investigated. While the BBC and Buzz Feed may lead to event from about ten years ago, we will investigate any new information and we always do.

(END VIDEO CLIP)

BARNETT: Now even matches of hallowed grounds of Wimbledon may have been involved. CNN Digital Producer Ravi Uppal joins us live if Melbourne where the Australian Open just got under way today. And Ravi, what a bombshell this is for the tennis world, the reports suggests a real network of gamblers linked to top ranked players. What evidence is at the center of all of this?

RAVI UPPAL, CNN DIGITAL PRODUCER: Hi Errol, the evidence really coming from several sources. An analysis of 26,000 matches with betting patterns in the matches, leaked documents, and also people were spoken to, people involved in the game, former players, past players, and the like, so very, very thorough investigation. It was a bombshell because here we are first day of the grand slam calendar in Australia. Serena Williams is playing her match and what a season she had last year, and we are talking about this match fixing scandal.

BARNETT: I am wondering what the word is on the street. As you mentioned, first day of Australian Open, you wonder if that timing was linked, timing of this report. But no one will be talking about Serena Williams or any other star and even if they will be, this controversy will be hanging over them and really the entire sport for some time. Do fans feel that way? How were they reacting?

UPPAL: I think that it is interesting to see what the fans do think about it in this situation. We have to make the distinction, too, Errol, between the top, top players and second and third tier. They don't make a lot of money. They have to play for their flights and hotels. They have to do everything themselves. They may be more susceptible. We just heard from Novak Djokovic, and he said couple things. Maybe what he read was speculation. But he also said there is zero tolerance for this in the sport.

And he felt in the last few years' tennis has done a better job to tackle this. The Tennis Integrity Unit was made. So Serena Williams, and Novak

Djokovic, we heard from both of those best players, and they felt confident in going forward.

BARNETT: They are pushing back a bit, but as you mentioned the top ranked players don't necessarily need to make the kind of -- I guess, allegations, bad behavior and match fixing that lowers players would need. Andy Murray, I thought this was interesting. He sent out a tweet, and in fact the last tweet on his time line to this Buzz Feed, BBC investigation. He re-tweets it essentially without comment. What kind of signal is that from a top tennis player, do you think? UPPAL: Errol, I think we will find out more because he plays his

first round match tomorrow. There is a mandatory press conference. But Andy in the past has been outspoken. Not shy to let people what he thinks. He spoke about Scottish independence. The one thing about Murray, he wants a clean sport that pertains to doping. I don't think he will hold back tomorrow, Errol.

BARNETT: Yeah. That's what makes this so damaging for the players who are following the rules, those who are not. It really taints it for everybody. I appreciate you joining us, Ravi Uppal, with CNN Digital joining us from Melbourne. Thanks very much.

CHURCH: Now to another story we are following, Iran is denouncing new sanctions imposed by the U.S. on 11 Iranian companies and individuals.

BARNETT: These sanctions come after Iran carried out two missile tests last year that violated U.N. resolutions. An Iranian ministry spokesman says the sanctions lack legal or moral legitimacy.

[03:24:01]

CHURCH: Earlier, U.S. President Barack Obama hailed the nuclear deal with Iran that saw long-standing international sanctions eased. He said the agreement makes the world safer.

(BEGIN VIDEO CLIP)

BARACK OBAMA, U.S. PRESIDENT: Under the nuclear deal that we and our allies reached with Iran last year, Iran will not get its hands on a nuclear bomb. The region, the United States, and the world will be more secure.

(END VIDEO CLIP)

CHURCH: Now these later sanctions were imposed by the U.S. after the prisoner swap had been worked out, and three of the Americans who had been imprisoned in Iran left the country. CNN International Diplomatic Editor Nic Robertson joins us now on the line from Vienna, Austria. So Nic, the prisoner swap went off smoothly but no sooner had sanctions against Iran been lifted, then more sanctions were slapped on their country. What will likely impact of that be? And why lift some sanctions and then add more?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: The reason to lift some is that Iran met some of their agreements of last July. And the IAEA verified that Iran is compliant. And thus, beginning a new phase of inspection in Iran and they had the IAEA, Dr. Imano, he went there and arrived yesterday. He is meeting today their President, head of the Atomic Energy Agency there. And he will outline what is expected in terms of inspections coming up to continue to monitor and verify what Iran has agreed to.

So in terms of the sanctions that are being lifted, that is Iran's actions access up until now, and also ballistic missile issues. As you said, testing ballistic missile a few months ago was in contravention of the actions of the nuclear deal and the new sanctions have been applied because of that. And allegedly involve in procurement of parts for those missile systems. And some of those have been in the Middle East. Some of those have reached into China.

They are a means of procurement for parts to make a ballistic missile that go beyond the limits stated in the agreement last July. That is why the new sanctions have been imposed. But we heard from all sides, from President Obama, to President Rouhani in Iran, from Secretary of State John Kerry, and this diplomacy is the way forward. And the pressure and sanctions don't work, according to the Iranian foreign minister.

In the light of where things have stood over the past few days, and the talk and success of the diplomacy that happened, it seems that that's an avenue that both sides are likely to continue to try, obviously new sanctions are not what Iran wants but what they've signed up and agreed to, Rosemary.

CHURCH: All right, many thanks to our Nic Robertson joining us on the line there from Vienna in Austria.

BARNETT: Now the lifting of sanctions may be an economic boom for Tehran, but they are already saturated in the oil market. Crude was selling below $28 a barrel.

CHURCH: That is a 12-year low, pushing the major stock indices mostly low. You can see there, Hong Kong's Hang Seng down 1.5 percent, Japan's Nikkei lost 1.12 percent and Australia down .7 percent there.

BARNETT: Now for more on Iran, the foreign oil prices and effects on the market, let's turn to Richard Quest. He is standing by in a very picturesque Switzerland to talk about all this. Richard, I wonder what the attendees there this week will make of oils deep dive and Iran receiving $100 billion in unfrozen funds, thanks to the prisoner swap. Those points prove that world economy is changing.

RICHARD QUEST, CNN CORRESPONDENT: The world economy is most definitely changing, and what they will talk about here is factoring in them. As you know, there is always this straight dichotomy between dealing with the crisis de jour and keeping your eye on big global issues. Pardon the pun, the blue sky thinking. And that's what they're going to do. The blue sky thinking we can put to one side for the moment.

[03:29:01]

On oil prices, it really does come down to who wins and who loses. And you have the losers who are the oil exporting nations. And particularly the gulf, Russia, you've got Brazil and load of oil export -- Nigeria. They are on the losing side of the equation, and the gaining side of the oil importing countries. Particularly like Japan, vast importers. Then you've got the United States. And at 27, $28 a barrel, just about every oil exporter is in deep trouble for one reason or another.

And so that's one of the issues they will be talking about as they come to deal with this issue, and also, how you factor in Iran increasing its oil production, whether it's half a million barrels a day, a million up to five million in the future. What effect does that have?

BARNETT: So Richard, that's kind of the geopolitical angle of all of this. But I am wondering what lifting of U.S. sanctions on Iran will do to smaller business exchanges. Meaning what types of businesses will benefit and look to make new deals? Who might suffer with what Iran can undo?

QUEST: Right. Now it's important to understand here that when you say lifting U.S. sanctions, you're talking about lifting U.S. sanctions as they relate to non-U.S. persons. And that's a crucial distinction, for the simple reason that U.S. people, U.S. citizens, U.S. companies, banking system in many cases is still shut off to Iran and the oil money coming from Iran. So it is important that we keep in mind, the sanctions that were lifted were those that relate to the United Nations, if you like, the 2003 to 2006 sanctions.

Now that is huge, absolutely vast. And I am going to show you two distinct examples from the little to the large. On the little side, you have the Caspian caviar industry from Iran. The Iranian caviar, because of its blackish water, is extremely popular and extremely much sought after. That will now be able to be insured and exported. And on the other side, you have airbus. The big European plane maker, they just sold more than 100 planes to Iran which needs to modify and regenerate the domestic aviation fleet, so all aspects of the Iranian economy, little and large, big and small, are going to benefit in some measure.

BARNETT: There you have it, Richard Quest. Breaking it down to what you eat, what you fly and how it relates to this story. Just past 9:29 there, Richard, thanks a lot.

CHURCH: Democratic Presidential candidates clash in their final debate before voting starts in Iowa, as polls show a tightening race. We will have a recap after the short break.

BARNETT: Plus, another U.S. Presidential hopeful will be the focus of a British Parliament debate later today. Why some people want Donald Trump banned from the U.K.

(COMMERCIAL BREAK)

[03:35:30]

BARNETT: A big welcome back to viewers in the states and those of you watching around the world. This is CNN Newsroom. I am Errol Barnett.

CHURCH: And I am Rosemary Church. We do want to check the headlines for you this hour.

Democrats hold a spirited debate Sunday ahead of the Iowa caucuses, with Bernie Sanders surging in the polls, Hillary Clinton took sharp aim on a number of issues. They clashed on gun control, healthcare, and Wall Street reform. BARNETT: Three Americans who just been freed from prison in Iran and

now in Germany and also reunite with their families. Washington Post reporter Jason Rezaian, Marine Veteran Amir Hekmati, and Pastor Saeed Abedini are being evaluated in a military hospital before continuing on to the states.

CHURCH: The U.S. held off on imposing new sanctions on Iran so as not to endanger the release of the prisoners, the Treasury Department has now blacklisted 11 companies and individuals it says helped supply Iran's ballistic program. Senior White House officials say Iran knew about the sanctions but there was no deal in place.

BARNETT: Turning back now to the Democratic Presidential debate. Recent polls in Iowa and New Hampshire show Bernie Sanders closing in on frontrunner Hillary Clinton's lead. A short time ago, I spoke with Larry Sabato, Director of the Center for Politics at University of Virginia. I asked him if he thought Clinton had done enough to stop Sanders' momentum.

LARRY SABATO, DIRECTOR OF THE CENTER FOR POLITICS AT UNIVERSITY OF VIRGINIA: I doubt it. I think she did a good job stressing her issues and putting Sanders on the defensive again about guns. She is where party is on guns. But he has the more emotional issue of Wall Street. Democratic activists feel very strongly about income inequality and what happened with the great recession. So I would say that she solidified her support.

He probably solidified his. And I think it is still a very close race in both Iowa and New Hampshire.

BARNETT: There is something beyond that after they get the party's nomination. Some said that Bernie Sanders with his Democratic socialist push, things like a $15 minimum wage, fighting climate change, talking about the prison system, that pushed essentially little Hillary to the left as she tries to outdo Sanders. Might that hurt Hillary Clinton in a general election when you need centrist voters, not the far left?

SABATO: Good point. The truth is Clinton would much prefer to not be pulled left. Not having Sanders as strong an opponent as he turned out to be. But you know the Clintons are very good to moving and drifting ideal logically as needed. I think she will scramble back to the middle for the general election. Given her long record, she can always site something to support that move.

BARNETT: There you have it. Bit of insight from Larry Sabato, Director of Center of Politics at the University of Virginia.

CHURCH: The death toll from last week's terror attacks in Jakarta, Indonesia has risen to four. At least 25 more people were wounded when suicide bombers and gunmen targeted a busy intersection near a Starbucks coffee shop.

BARNETT: Now 4 of the attackers were killed and 12 other suspects have since been arrested. Authorities say a Southeast Asian faction of ISIS was behind the assault. CHURCH: Burkina Faso is observing three days of mourning in the

aftermath of Friday's deadly attack in the capital.

BARNETT: The siege appeared well-planned with some attackers going to the hotel during the day and mingling with guests.

CHURCH: Our David McKenzie has details.

(BEGIN VIDEO CLIP)

DAVID MCKENZIE, CNN CORRESPONDENT: Fiery scenes both shocking and horribly familiar. Authorities say at least four heavily armed attackers, two of them women storming a cafe popular with westerners in Burkina Faso's capital late Friday.

UNIDENTIFIED MALE: It's horrible because everyone was panicked and was lying down on the floor. There was blood everywhere. They were shooting at people point blank. The sound of the detonation was so loud. We could hear them talking and they were walking around and kept shooting at people that seemed alive.

MCKENZIE: Officials in Burkina Faso was a complex attack, some terrorists posing as tourists during the day before striking at night, moving from the cafe to a popular hotel across the street. Burkina bay forces joined by forces flown in from military support. Hours into the bloody siege, the security operation moved in and shooting soon stopped. But the attack left dozens dead from at least 18 countries.

More than 120 hostages were freed. And many still injured.

[03:40:30]

UNIDENTIFIED MALE: They came in. We were all lying on the ground and they shot at everybody. Maybe I was lucky it was just my arm.

MCKENZIE: The attacks allegedly claimed by Al Qaeda and executed by this man the notorious one-eyed Shaikh. The same groups behind the deadly Radisson Hotel attack in Mali made last year.

(END VIDEO CLIP)

BARNETT: Our David McKenzie reporting there.

Heavy lifting expansions are expected to have a major effect on Iran's economy. Coming up next, we will see how much might change for the average Iranian and the gulf region.

CHURCH: Plus, Taiwan's newly elected President is expected to lead more independence to China and that is not sitting well with Beijing. We will take a look when we come back.

(COMMERCIAL BREAK)

OBAMA: Following the nuclear deal. You, especially, have the opportunity to begin building new ties with the world. We have a rare chance to pursue a new path, a different, better future that delivers progress for both our peoples and the wider world. That's the opportunity before the Iranian people. We need to take advantage of that.

CHURCH: U.S. President Barack Obama presenting the lifting of Iranian sanctions as an opportunity, but with that opportunity of course comes some uncertainty. And for perspective on that, I am joined from London by Fawaz Gerges, Chair of Contemporary Middle East Studies at the London School of Economics and author of the new Middle East Protest and Revolution in the Arab World. Fawaz Gerges, thank you so much for talking with us.

FAWAZ GERGES, CHAIR OF CONTEMPORARY MIDDLE EAST STUDIES AT THE LONDON SCHOOL OF ECONOMICS: Good morning.

CHURCH: So President Obama offers a very positive spin on where this prisoner swap and lifting of sanctions might take the world. How big an opportunity is this? And what are the likely ramifications of Iran being opened up to the world like this?

[03:45:30]

GERGES: Well you know, Rosemary, let's take stock of where we are. I think what has happened in the last few months is that the cycle of hostility, more than three decades of hostility has been broken between the United States and the west on the one hand and Iran. And a new page, new chapter has opened in relations between Iran and the world. In fact, if you go back and listen what President Rouhani told the Iranian people during his Presidential campaign, he promised the Iranian people to improve the quality of life of average Iranians and also improve relations with the world.

And he basically reiterated these two goals in the last few days. But a great deal remains to be done. Let's keep in mind that the Iranian economy has been decimated, Rosemary, by almost -- since 1980. It has been under tremendous -- very painful punishment sanctions. Unemployment among the youth is between 20 and 25 percent. The Iranian currency has lost a great deal of its value over the last few years.

And for Iran, to really improve its economy structurally, not just about the infusion, 50 or $100 billion that will go into the Iranian economy in the next few weeks and next few months, Iran has to restructure its economy and this is a very painful process, and the new leadership of Rouhani will most likely face a great deal of resistance from the conservatives, from the revolutionary guards. What deeply suspicious about opening up Iran in particular because they fear that the cultural influence of the United States and the west could easily -- I mean have terrible impact on state and society and the Iranian republic.

CHURCH: Wanted to ask you this. Recent missile tests in Iran have resulted in a new round of sanctions coming from the U.S. What will the likely impact be of that because Iran is not happy of course, this was done right after the four Americans were released and flown out of the country. GERGES: Another point, Rosemary, another critical point. What we

need to understand, even though there is a new dynamic, a new momentum of relations between the Iran and the United States, this is not a transformative moment. There are no diplomatic relations between the United States and Iran. And the new opening of relations is really very -- not on institutions but on a trusted relationship between John Kerry and the two foreign ministers. The two countries have interest if the Middle East. Vehemently oppose each other in Syria, to a lesser extent in Iraq and Lebanon and Israel and Yemen.

Basically have interest and the United States for your own audience, the United States has major sanctions still against Iran in terms of Iran's support for resistance by Hezbollah. Support for terrorism and the current sanctions tells you a great deal that even though we are really witnessing a seat change in relation between Iran and the world, United States and Iran are not on the same page.

And Iran believes that it is a pivotal power, unrivalled power in the gulf. It is trying to build both its military capacity and describe its influence in the region, and the United States believes that Iranian interests basically -- I mean clash with American security interests and its allies, and in particular Saudi Arabia and other Arab states in the gulf.

CHURCH: Fawaz Gerges thanks for joining us. We appreciate it.

GERGES: Thank you.

[03:50:01]

BARNETT: Chinese state media say Taiwan's landmark election will pose great challenges to relations between Taipei and Beijing. Elected Taiwan's first female President over the weekend, she leads the Opposition Democratic Progressive Party.

CHURCH: In another first, ruling pro China KMT Party lost control of the legislature.

BARNETT: For more on China's reaction to the election, we're joined now by CNN's Kristie Lu Stout who joins us from Hong Kong. You are there in Taiwan when this was happening. China has warned of challenges now that Taiwan has elected a new leader. You just returned. Why did she win? What do people there want exactly?

KRISTIE LU STOUT, CNN CORRESPONDENT: They wanted change. Taiwan is facing a number of challenges including a stagnant economy, then the tricky relationship with China. So the people of Taiwan not satisfied with the ruling party. That's why they voted for the DPP. We have been monitoring and looking at Chinese reaction from mainland China very, very closely. No official reaction from the minister of foreign affairs, but interesting response the Global Times newspaper.

This is a pro-China newspaper saying this, "The results of the elections do not necessarily mean triumph of Taiwan independence." It says it wasn't independent views that won her and her party the favor of the Taiwan residence. Dissatisfactory performance of the -- and his ruling KMT is the root cause for the result. KMT lost the presidency and majority in parliament for the first time in Taiwan history. We are seeing Chinese state media blaming fall of KMT for the ride of DPP. The additional saying today this the victory of the Democratic progressive party leader in today's Presidential election, quotation marks duly noted, there, now Errol relations have indeed improved over the last two sides over the last eight years.

You remember historic handshake with Jinping in November. Analysts are saying this and also China watches inside China that those closer ties not let them be described any time soon under the new President, back to you.

BARNETT: All right. Kristie Lu Stout, live in Hong Kong for us. You also wrote about this story, you can find out on CNN.com on the Taiwan elects first female leader and see what a pop star's apology has to do with all of this as well, Kristie, great to see you -- joining us from Hong Kong.

CHURCH: We will take a quick break. But still to come, should Donald Trump be banned from the U.K? We will tell you how the U.S. Presidential candidate has become the subject of upcoming British Parliamentary debate, back in a moment.

(COMMERCIAL BREAK)

[03:52:01]

BARNETT: This is hours, interesting. In the coming the British Parliament will discuss whether Donald Trump should be banned from the U.K.

CHURCH: It comes after more than half a million people signed a petition calling for the ban. The government responded to the petition, saying exclusion powers are very serious and not used lightly.

BARNETT: CNN's Max Foster joins us from London with details on this. It is very strange, Max, but is this really expected to go anywhere?

MAX FOSTER, CNN CORRESPONDENT: It depends on how you look at it. The idea of a ban -- this one debate and there won't be a ban as a result of this debate. But there's a huge sense feeling about Donald Trump. Particularly, the comment about Muslims in the U.K Parliament right now, and as they debate, they are protected against parliamentary privilege so they can't be taken to court for slander or defamation.

There are certainly people in the Labor Party who will use it as an opportunity to really lay into Donald Trump and what he stands for. Obviously, U.K. is a key ally of the U.S. so it is an interesting test of how politicians in an ally country view the prospect of President Donald Trump, I think.

CHURCH: And with this, Max, they probably already made their point, haven't they?

FOSTER: Yes. I think the public certainly made their point because this was -- this petition started by someone in Scotland, in Aberdeen, where Donald Trump has a controversial golf course, it did snowball it get half million signatures. The parliament didn't have much choice but to make this part of a debate. But all the political leaders are united and say they don't think Donald Trump should be banned. Actually, there are those that think it may work in his favor. Make him look like a victim which may help him in the U.S. election. So they would rather he did come over, actually many of the political leaders, to counter argue any points is making about Muslims, particularly in the U.K.

BARNETT: I heard the person behind that petition was overwhelmed by that response. We'll see where it goes but interesting nonetheless. Max Foster, live for us in London. Viewers will see him shortly.

CHURCH: Thank you for watching CNN. I am Rosemary Church.

BARNETT: And I am Errol Barnett. Connect with us any time on Twitter. It is great hearing from you. Early Start is next for those of you in the states.

CHURCH: And for viewers elsewhere, stay tuned next for Max Foster and CNN Newsroom.

[04:00:00]