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QUEST MEANS BUSINESS
Police: Bomb Explodes On Jerusalem Bus; Ecuador: Earthquake Death Toll Approaches 350; Death Toll Rises to 43 After Japan Quakes; Syrian Opposition Suspends Participation in Peace Talks; Japanese Companies Suspend Production; Brazil`s President Gives Speech on Impeachment; Rousseff: Impeachment Has No Legal Basis; Rousseff: I Committed No Impeachable Crime; Rousseff: "Today, Above All, I Feel Injustice"; Rousseff "Outraged" by Impeachment Vote; Rousseff: I Was Treated Like No One Else Was Treated; Rousseff: Impeachment Has No Legal Basis
Aired April 18, 2016 - 16:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA NEWTON, CNN GUEST HOST: The time is tickling for them to do the five-second countdown you an hear in the studio. The DOW goes above 18,000
for the first time since July. It`s Monday, April 18th.
[16:00:13] Tonight, a political crisis that threatens the Brazilian economy and the Olympics. Brazil`s battled president is due (ph) address the
nation with hour. We`ll have that for you live. This time the world`s major oil producers threaten to make the supply -- even worse have their
deal to freeze oil output falls apart. And Saudi Arabia says it will pull billions of dollars from the U.S. if Congress passes a law that would open
the door to claim from terrorism. I`m Paula Newton and this is Quest Means Business.
(Inaudible) the business news tonight and we begin in Brazil where President Dilma Rousseff is due to speak this hour. Brazil`s lower house
overwhelmingly voted to impeach President Rousseff. The motion now heads to Brazil Senate and if approved by a majority of lawmakers there, Ms.
Rousseff will be suspended for six months in order to prepare for her trial.
Now the country is truly in the throws of a political and economic crisis which is 108 days left until the Olympic opening ceremony`s kick off in
Senior Latin American Affairs Editor Rafael Romo is at CNN Center. Rafael, thank you. Fast (inaudible) continue in Brazil. She`s making this
addressed to the nation. There have been lots of rumors about how she would react being cornered in this position. What is she expected to say?
RAFAEL ROMO, CNN SENIOR LATIN AMERICAN AFFAIRS EDITOR: Well, this, anybody`s guest really at this hour, but you can expect that she is
probably going to defend herself because as you know over the last three days, it`s been really a political roller coaster in Brazil with the debate
in Congress over whether she`s impeached or not. And started Friday with protest in support of Dilma Rousseff and also, I guess, or and devote
itself didn`t come until last night when all 500 deputies in the lower house of the Brazilian Congress had to vote.
The Congress had to vote by a two-thirds majority and the crucial vote, the 342 vote didn`t come until 10:10 last night Eastern time. In the end, it
was 367 legislators in favor of impeachments, 137 against it and seven abstaining.
Now, as you mention, it goes to the Senate and 81 members have to vote on whether there`s a trial to impeach her. In the meantime, if they give the
green life for the trial to go on, she`s going to have to step down for six months while the trial takes place.
Now, the thing about this, Paula, is that Brazil as you know is getting ready to host the Olympic Games this summer. As a matter of fact, this
coming Thursday, the Olympic torch makes its arrival to Brazil. So, look, probably, the worst possible time for this to happen in Brazil, Paula.
NEWTON: Yeah, worse possible time and yet the markets are cheering the move. We will have more on what`s transpiring in Brazil at this hour as we
await the president speech.
Rafael, in the meantime, thanks so much.
Tonight, another big story we`re following. Oil prices hanging the balance after talks to freeze production fail. Now, crude prices still sharply
this morning, a dramatic 7 percent tumble. Yet prices rally after the news of production in Kuwait has more than half due to a worker strike.
Now, Nigeria`s oil minister says the world`s top producers need to continue negotiating despite the fail talks this weekend. He spoke earlier to
CNNMoney`s John Defterios.
(BEGIN VIDEO CLIP)
EMMANUEL KACHIKWU, NIGERIAN OIL MINISTER: Won`t be surprise if the couple of drops and it last couple of days. Even since we going to depend on how
serious the team continues to work on the issue. And so I think if what (inaudible) must be on how to get a team out to Iran, get a team out to
Saudi Arabia, get a team out to Russia, be sure that Russia is still there available. And I think (inaudible) Russia says they`re going to be there,
they`re going to be available, they`ll continue to walk the issue, but like (inaudible) find some glance of sunny within themselves.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: That could be candid. This seems to be disunity within Saudi Arabia. The Minister Ali Naimi agreed to
something for freeze back at home. The Deputy Crown Prince kind of see differently. It makes it very difficult for the other members of OPEC.
KACHIKWU: I think that either way they still works Saudi Arabia feels stronger about it`s own position (inaudible) so much of internal politics.
But we need to (inaudible) in our internal politics is understandable. Well, it`s just let them walk through these issues. We need somebody to
work which everybody to try and find some solutions.
[16:05:05] DEFTERIOS: With Iran coming back into the market, can OPEC really have to big players that are geopolitical players at the same time?
(Inaudible) OPEC apart?
KACHIKWU: No, not at all. They`ve had that before. It`s been historical. That is how I decide no matter position. And that`s what the position is
citing. And in some ways one is the balance of your order (ph) so that`s fine.
So, nothing. I`m sure we`ll walk positions (ph). I`m sure we`ll find some -- as Iran stabilizes, this production gets more comfortable. I`m sure you
do not see a lot more momentum to be inclusive.
(END VIDEO CLIP)
NEWTON: Perhaps more optimistic that we would have hope. Earlier, I spoke to our John Defterios from Doha and asked how he would explain what
happened this weekend.
(BEGIN VIDEO CLIP)
DEFTERIOS: Well, in fact, Paula, there`s a lot of bad blood on the floor. As my understanding from those who are in the meeting that they would had
with 12 drafts try to get the language right for Saudi Arabia, so everyone could be at least on the same page.
As you suggest, we thought we had a deal after a conversation between the Ministers of Saudi Arabia and Russia last week, but clearly the Deputy
Crown Price of Saudi Arabia had different intentions and he said that he Iran had design on the dotted line as well.
As you know the Iranians weren`t here. They said they would not participate because it cannot be part (inaudible) after the sanctions. So,
where do we go from here is the big question. Is their willing to us proceed. Russia still seems to be on board but again, Paula, if you look at
the faces of the ministers of Azerbaijan, Oman, Kazakhstan and Mexico, they were shell chocked.
A marathon talk of 12 hours in length. It was supposed to be three hours plus a meeting with Emir of Qatar and didn`t play out that way. They have
less than two months now to kind of patch together a deal around the OPEC meeting which is the first week of June in Vienna.
NEWTON: And what`s going to be savior here, John? I mean in terms of this oil market just moving forward, it needs to rebound. There`s only two ways
to do that either supplies goes down or demand goes up.
If we look to the last two quarters of 2016, how is that going to happen?
DEFTERIOS: Well, let`s cover the role of the freeze here or the big freezes we`re recalling it in Doha that do not take place. One called that
the anti-freeze because it fell apart. It`s all about the optics when it comes to the freeze. The 18 producers at least singing (ph) from the same
When it comes to supply and demand it`s very clear where we are today. Over production of about 1.5 million barrels a day. The International
Energy Agency is suggesting that should drop by the fourth quarter to about 200,000 barrels, so not imbalance but close. This depends on demand rising
more than a million barrels a day. Big question mark with China`s slow down. India may feel the gap of course.
But also what we have any surprises. Now Saudi Arabia deputy crown prince was suggesting we could add a million barrels a day immediately, two
million within six months, trying to goat the Iranian back to the bargaining table here. The Iranian said to me they have their sites set on
four million barrels a day below the pre-sanctions level.
Perhaps that`s the wiggle room of negotiation. If they get to four million barrels a day perhaps they sit down eye to eye with the Saudis and say, now
we can talk about our freeze going forward, but we`re not there yet, Paula, and the market is imbalance. Don`t forget we have an overhanging of three
billion barrels that will have to be workout after that market starts to come into balance in the 4th quarter of 2016.
(END VIDEO CLIP)
NEWTON: In the meantime, Qatar`s energy minister says more time what was needed to reach an agreement. Now the breakdown of the deal is providing
fears that the market share battle compounding the already epic supply (inaudible) is talking about.
Now some 18 oil nations gather for the Doha talks and expectations were really ramped up. Yet, Iran made it clear it will not participate
(inaudible) until it`s able to pump four million barrels a day and hopes to regain much of the market share loss under western sanctions.
Now, OPEC`s biggest member Saudi Arabia have of course long standing tensions with Iran, Riyadh said it will only hold back production if Iran
does the same.
Now, Russia has defended Iran and it says it won`t freeze output if nobody else does either. It sounds like a classic game there that we`re use to
being played and Saudi Arabia continues to really formulate those oil markets and direct them into the direction they want them to go.
Now Saudi Arabia though is also keeping the close eye on U.S. Congress and says it may have to sell off billions in American assets if the bill is
passed which would have allow victims of 9/11 and other terror attacks to sue foreign government.
As President Obama prepares to travel to Riyadh on Tuesday. David Gergen served as adviser to President Ford, Nixon, Reagan, and Clinton and he`s
now CNN senior political analyst and joins us now.
You know, this is been such an issue in terms of granting the victims, those 9/11 victims to make sure the Saudi Arabia is no longer has that
immunity, that sovereign immunity from being sued and that`s what that issue here.
[16:10:10] David, there are a lot of implications politically both domestically and internationally, let`s turn to the Saudis first, though.
Why are they getting out here in terms of posing this threat?
DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Well, Saudis see a very strongly that the Obama Administration has not treated them what the kind
of respect that ally or friend of many, many years would. Let`s say (inaudible) increasingly that the Obama administration has invited Iran by
major and large role in the Middle East and that`s how rival, of course, with Saudi Arabia and Saudi Arabians believe that the Iran (inaudible)
terrorism all across Middle East, so you got that issue.
You go the president calling the -- complaining of our free riders and Saudis very single out by that in this famous Atlantic peace by Jeffrey
Goldberg. And also the president is being complaining about his frustrations with the Saudis and about women. Our women are treated in
Saudi Arabia all of which ends up to a growing tension and one of the most important bilateral relationships in the world that is between Saudi Arabia
and the United States. These two countries have long been working together in the gulf and that is accounted for some of the stability in the gulf.
But now things are (inaudible). With the president going over there this could be pretty tense meeting this coming week in Saudi Arabia. There are
number of other gulf countries as you know who are also very upset the Obama administration.
What surprised me of the most, I must tell you, was Hillary Clinton has come out on the side of the Saudis in this. That was real surprised. I
thought given her time as secretary of state, given the long relationships. There`s -- she would have some concerns. The freeze (ph) that you hear in
the Middle East, the United States staring snarling on its friends and smiling at its enemies.
NEWTON: You thought the perspective appears on Ryadh right now. This certainly has ...
NEWTON: ... domestic implications especially when to consider in the election campaign. You just mentioned Hillary Clinton along with Bernie
NEWTON: And this bill apparently has strong bipartisan support. I mean what is that work there and let`s make it clear, the Obama administration
doesn`t saying they veto the bill. They don`t want it to pass at the end of the day?
GERGEN: The Obama administration may take a very hard line on this (inaudible) does not want the bill to pass. There is a law in the United
States passed back in 1976 which grants most foreign nations immunity for old practical purposes from lawsuits against a country.
(Inaudible) the United States government claims immunity from lawsuits against it. One time (inaudible) say is wait a minute, if you open this
door against the Saudis, you`re going to have all sorts of other countries opening door against United States and that would be (inaudible) want to do
And besides, P.S., hey, the Saudis are supposed to be our friends.
NEWTON: At least that`s what most people have thought in the past. The relationships are changing and everyone is trying to adjust. Our David
Gergen there, thanks so much. We`ll continue to follow the story closely ...
GERGEN: Thank you.
NEWTON: ... as it develops, appreciate it. Now, as of the (inaudible) the top of the show, the DOW shot (ph) more than 100 points higher on Monday
and yes it is back over a milestone. Is the milestone psychological? Who knows. It is now close above 18,000 points for the first time since July.
The DOW was low as -- this is going to hurt if you can`t get back to the market -- 15, 450 in January. CNNMoney`s Paul La Monica is here.
Paul just to get to that headliner first, I mean, really, did anyone expect any of these?
PAUL LA MONICA, CNNMONEY CORRESPONDENT: This is pretty stunning when you consider just how (inaudible) people have gotten at the beginning of the
year (inaudible) worried about China, worried about earnings growth pretty much slowing to a very slow trickle. It is stunning that we have come this
far from our lows.
NEWTON: Especially at the back of that concern about oil. OK. Now moving to the star of the afternoon, Netflix. So, everyone was waiting for those
results, what happen?
LA MONICA: So far, it looks like Netflix put up a disappointing numbers. The earnings did top forecast, sales were little light, second quarter
guidance appears to be a little bit weak. The subscribing numbers look good though and it`s interesting. It`s usually the stock (ph) that people
don`t focus as much on the earnings and sales because they`re getting a mature company looking more to subscribers. But I think people are worried
about maybe subscriber we`re going to slow internationally because that`s really the big growth story for what Netflix going forward.
NEWTON: So they`re surprising subscribers, though, or is it more than they thought?
LA MONICA: The U.S. subscribers -- at first, look, and these numbers are just came out in the past few minutes. It does look like they were little
bit better than expected. So maybe all the hype about the new shows that are coming back. We had "House of Cards" and "Dare Devil". Those are very
two popular shows that had their return in March. Maybe that brought some people to subscribe to the service in the past couple of months, but it`s
be very interesting to see going forward whether of not Netflix can justify the high cost for all of these shows. I mean Kevin Spacey came from
[16:15:07] NEWTON: Yeah, I can imagine. Quickly, though, big competitors, I mean Netlfix is used to being the disruptor. Amazon now close on its
LA MONICA: Yeah, Amazon now with a monthly subscription service of its own and I think, Paula, that maybe scooping (ph) some people as well. Because
Amazon (inaudible) done a very good job of amassing some of its own original shows the people want to watch. Things like transparent Amazon in
the jungle -- excuse me, Mozart in the Jungle.
So that is something that people are now I think a little bit more worried about that Amazon is a legitimate threat to Netflix in streaming these
original content not just the live warrior films and T.V. shows that they have as well.
NEWTON: It`s an exciting sector to watch in every sense of the world literary. And otherwise, Paul La Monica thanks so much.
LA MONICA: Thank you.
NEWTON: I appreciate it.
Now big businesses Britain is doomed if it leaves the E.U. We`ll be speaking to a U.K. law maker who is also a multimillionaire businessman and
NEWTON: Now get used to hearing this. The British government is warning of economic damage if the U.K. leaves the European Union.
Now officials estimate trade barriers could substantially shrink the U.K. economy 15 years after of BREXIT. The finance minister says vote to exit
the world`s largest single market could have serious consequences for British workers.
(BEGIN VIDEO CLIP)
GEORGE OSBORNE, BRITISH PRIME MINISTER: Britain would be permanently poor if we left the European Union. Under any alternative, we trade less, we do
less business. There would be less investment. And the price would be paid by British families.
(END VIDEO CLIP)
NEWTON: Now poll show a close E.U. referendum vote already. And we`ve got quite a few weeks of campaigning to go.
Businessman and British law maker Adam Afriyie is a pro-BREXIT and he joins me now live from London. Thank you so much for joining us. You really
have to do the heavy lifting here. As a business person many people wouldn`t expect you to be pre-BREXIT. Why?
ADAM AFRIYIE, CONSERVATIVE BRITISH MP: Yeah. Well I think that`s a -- it`s imagined to being members of the European Union is good for business.
But actually all of the opposing Britain (inaudible) poll points out that small to medium size businesses don`t want to be members of the European
Union because it places burdens on all British businesses and not particularly helpful.
NEWTON: But what kind of proof do you have that actually leaving the E.U. would be better for your business and other businesses in the U.K?
AFRIYIE: Well, it`s absolutely clear that the regulations that the E.U. imposed caused British businesses often a lot. And if those regulations
weren`t there, then businesses would be employ more staff, would be more of interest in the way that they operated.
But I think the key thing here is actually about Britain controlling its own economy, its immigration, its trading relationships. I mean God
forbid, in America if Obama is being suggested that the Americans should be bound by some external body in the way that they trade in the amount of
taxes that they raise.
So I think it would be very good for British business if we were to leave the E.U. because we could set up by electoral deals with other countries.
Probably trade a lot more with the U.S. as well. And we could -- but bear in mind also that the European Union in the last 30 years has lost half its
share of well trade.
And so being shackled to body like that when there`s the rest of the world to consideration as far as Africa and Asia, well, it doesn`t seem to be a
good idea to me particularly for businesses.
[16:20:01] NEWTON: And yet I want to hear completely from you in terms of the favorable trade positions that the U.K. finds itself and now being part
of the E.U. I mean look Europe authority saying we`re going to play hard ball with the U.K. if we have to go and re-negotiate those trade bills.
Won`t that hurt businesses?
AFRIYIE: Yes. Yes, well, no, exactly the opposite because of the moment, the European Union buys billions of pounds more goods from us. Then we set
- I`m sorry, so it was billions of pounds more goods to us then we buy from it. So, actually the pressure if the British people vote to leave which I
hope they will, is on the European Union to beg us to trade with them. so, I think does any settlement, any continuing trading relationship which we
will have with the European Union as well as the rest of the world will be beneficial to Britain.
NEWTON: Now, the trading isn`t going to be the easy as you say, I mean there will be a lot of hiccups there if the U.K. and the (inaudible)
trading position. But I also want to bring up the tech sector. You know, that`s supposed to be the darling to look into and bring in terms of the
new job creators. They are saying definitively the majority of (inaudible) of saying, this is not a good idea, tech sector will do better within the
AFRIYIE: Well, I think what they perhaps doing is not looking at the facts on the ground because one can still be trade with European Union if one is
not a member of the European Union. And in fact I think there will be more opportunities in Britain if we were also member with the opinion union but
we were trading with the European Union.
NEWTON: I think they know, they say you`re wrong. But the tech sectors says you`re wrong about that, absolutely 100 percent wrong and also because
of that whole - freedom of movement of the labor market which is you know was very important to the tech factor.
AFRIYIE: Yes, absolutely but if Britain is outside the E.U., we would have control of our borders, control of our immigration system and they moved
out to choose the type of person that works in Britain where at the moment we all -- we have to sit here kind of passively and accept 300, 000, 400,
000 even 500, 000 people a year from the European Union because of free movement, where it`s actually -- if we`re outside the E.U. we could choose
which type of persons came here. And believe me, on the (inaudible) of the old parliamentary group on financial technology, I want us to be on the
right at the forefront in this area and I believe that we`re in better positions to be at the forefront if we were outside of the constructs of
the European Union.
NEWTON: You know, let me ask you this moving away from the economic arguments for a minute. We`ve got this poll numbers and its incredible
close and yet there`s a significant portion of undecided. What do you think it`s going to come down too, I mean you look at the doom and bloom
scenarios from the ...
NEWTON: ... conserve -- from parts of the conservative government and you`re saying it`s going to be all (inaudible). When it gets down to the
British voter and it`s going to be tough decision no matter which side of the fence you`re on. What do you think it`s going to come down too?
Passion, are they going to be with their hearts or they`re going to be with their heads?
AFRIYIE: Well, I think it`s going to be a combination of both as a politician would say, but in essence I you can`t tell - in essence I think
it`s genuinely comes down to - a genuinely comes down to two major points, and that is, who controls the British economy? Who controls our
immigration system? Who controls but not the fundamental question? And I think the people will conclude like they did with joining the Euro where we
decided we would not join the Euro but actually its better if British politicians, if the British government controls Britain.
I think the second thing that comes down, there`s older generation in Britain that thought they joined the European Union, it was a good idea
because it would help to the future walls in Europe. But I think that they realize now that wasn`t necessarily walls that it wound have been helpful
(inaudible) that is a membership of NATO, United Nation Security Council and other institutions which secure -- we secure out which -- which secure
our nation security.
NEWTON: Well, we`ll continue watching the sidelines with interest. This is going to be a fascinating few weeks here as this campaign. (Inaudible)
appreciate it. I hoping (ph) from you again.
Now, as impeachment for Dilma Rousseff had becoming increasing likely Brazilian stocks ave its counterintuitive, I know, but they traded higher
since the beginning of the year. (Inaudible) index is up, wait for it, more than 22 percent in 2016 and look prime to rally after Sunday`s vote.
Now, investors feel a new administration could do better to dig Brazil out of its recession being more business friendly. But actually it fell
slightly on Monday down a half of that percent.
Joao Augusto De Castro Neves is the Director of Latin America on Eurasia Group and he joins me now live from Washington. You know, we continue to
watch what goes on in Brazil with other fascination. I think a lot of Brazilians are watching now with the lot of concern.
You know, when we look at even the impeachment`s of Dilma Rousseff, they likely prospect to take over are themselves implicated in the corruption
scandal/ Do you think Brazil its economy, its people, its institutions, who stand the shocks of that sure to come in the next few weeks?
JOAO AUGUSTO DE CASTRO NEVES, DIRECTOR OF LATIN AMERICA ON EURASIA GROUP: I think the short answer is yes. I think the institutions are actually
strong and the -- it is a political crisis, a very deep one in the economic crisis for sure. But at least the institutions are working and we`re still
in the middle of the process, you know, the - yesterday`s vote was important one but there`s still two votes in the senate. So it`s going to
be a bumpy road.
[16:25:04] But, you know, if you compare Brazil with other emerging markets I mean it`s not that there`s a corruption in a lot of it`s emerging market
is Brazil this institutions I think on that -- extent with compare to some countries in a region are stronger and the, you know, if there`s cost to
that as well in terms of more accountability and kind of this unearthing of the current scandal but overall, you know, it`s not an institutional
NEWTON: Is that about institutional crisis and yet those institutions will be leaned on quite significantly in the coming months because of two
things, one is we`re very close to the opening of the Olympics and the whole situation with the Zika virus. Do you have concerns? I mean there
seem to be some wobbles on the Olympics already, we`ll turn to that first, how do you think it will -- the politics will impact that?
NEVES: I think that it won`t have a major impact. I think most of the works have already closed to be finished. I think we had a little bit of
that brinkmanship that doing the World Cup in 2014 and it went really well except for the team actually playing the field but, but the Olympic ...
NEWTON: We won`t mention that to anybody who`s Brazilian (inaudible).
NEVES: Well, yes. But the Olympics I thinks there`s going to be -- it`s quite, you know, " simpler" because it`s one city, Rio de Janeiro which
used to host international events. I mean, there will be some problems there but I don`t that the politics will impact us much. I mean the main
thing will be, who`s going to be the president in the opening ceremony.
NEWTON: I know what you`re saying but even connected to the Olympics, you have this issue of the Zika virus and that rally can unsettle people in
terms of trying to settle there. I mean just last week, we have the CDC here in the United States saying that look the link -- link is there to
the, you know, the kind of problems they`ve seen in newborns and the Zika virus.
In terms of these institutions actually having to perform, I dare say it, after peak during this kind of political crisis, I mean you and I both know
nothing is getting down in Brazilia right now. What gives you so much confidence is this is all going to go, you know, OK for them throughout the
rest of 2016?
NEVES: No, I think with the Olympics, you know, I think that most of the job has already been done. But now you`re completely right. I mean
there`s a state of paralysis that kind of ineffectiveness that explains why as a markets are reacting so -- so palliative who lasts several months
because essentially they`re saying, you know, anything -- anything different in President Rousseff is better than her. So I think that that`s
-- but of course, I mean there`s a sense of paralysis and many, many new problems like the Zika that, you know, you`re not going to go away anytime
So even if we have an impeachment whoever is sitting in the Presidential Palace in the next coming in the coming months will not solve the crisis
and I think that`s quite clear that`s one of the few certainties we have of late when it comes to Brazil. But with the Olympics, I don`t that that`s a
NEWTON: Interesting. I don`t want to put you on the spot here but of course I will, anyway. You know, social media showdown in Brazil. You
have people saying and agreeing with Dima Rousseff that this is been a coup. Others are saying that this proves the strength of the institutions
Now this is really democracy at work that she is incredibly unpopular and that is time for her to go and yet others are saying look this isn`t a
democracy, she was voted in, she has the right to continue her term. Where do you stand on that?
NEVES: I think this is the growing pains of as a stronger democracy. I think that I don`t it`s a coup, I think institutions are working, I think
were will be ample chances for her defense still. But you know, when we look in the bigger picture, I think this is a process of a country that has
come back to democratic state 30 years ago and its showing some signs of a vitality although ver -- more dysfunctional that it should be.
NEWTON: OK, with that, we will leave it there al though we promise not to bring up the Brazilian laws once again in soccer because the country is
already suffering enough and I think we better not go there again, but thank you we will have you back to discuss the local crisis appreciated.
NEVES: My pleasure.
NEWTON: Now, rescuers are rising to try and find anyone trapped in the rebel from Japan`s two earthquakes. Now, the countries major businesses
are also of course suffering. We have a live report from Tokyo and that`s up right after the break.
NEWTON: Hello, I`m Paula Newton, and there`s more Quest Means Business in just a moment. When Britain should get ready for a long period of
certainty with the vote to leave the E.U. That`s the warning from a head of the IMF.
Could a drone have hit a commercial airplane at one of the world`s busiest airports? The pilot certainly think so, we`ll have the latest on the
investigation. Before that though, this is CNN, and hear the news always comes first.
Israeli police are investigating an explosion aboard a bus in Jerusalem calling it a deliberate attack. They are saying an explosive device went
off at the back of the bus causing a huge fire that engulfed another bus as well. At least 21 people were wounded.
The death toll from Ecuador`s earthquake is approaching 350. Thousands have been injured and there is widespread damage across the country after
the 7.8 magnitude quake hit Saturday. The U.N. is preparing an airlift of supplies and a massive search and rescue operation is now underway.
The death toll in Japan from last week`s two earthquakes now stands at 43. Search and rescue crews continue to look for survivors and crumbled
buildings in an area that`s hit by landslides. Japan`s meteorological agency says there still a risk that more buildings will collapse.
An U.N. envoy says Syria`s main opposition group has suspended its participation in peace talks but he says opposition negotiators will remain
in Geneva for informal discussions. They`re protesting escalating violence in Syria. Accusing the government of violating a cease-fire deal.
In Japan, there is a knock on effect for the economy from those deadly quakes we were telling you about. CNN`s Andrew Stevens is for us now, very
early there in Tokyo and yet the day begins, Andrew, and again a lot of adversity for this economy, arguably an economy that can`t really -- comes
at a bad time. I suppose it`s no surprise that it would be affecting industrial production?
ANDREW STEVENS, CNN MONEY, ASIA PACIFIC EDITOR: Well, absolutely, Paula. But perhaps a little more so than in many other economies, because Japan
really invented the model of how to supply parts to their factories all over the country. Just in time, as it`s known to actually go to the finish
product. When you get a disruption somewhere along the line, it`s going to have quite a big ripple effect across the country. And this is
particularly true of the car industry. Take a look.
STEVENS (voice-over): As the search for survivors of the two Kyushu earthquakes continues, corporate Japan is now counting the cost of the
disaster. Quake damage, aftershocks, and smashed roads, bridges and rail lines on the island have either stopped or severely cut industrial
production. Kyushu is known as car island. Toyota, Nissan, Mitsubishi and Daihatsu, between them produce about 1.5 million of the 9 million cars made
in Japan each year. And Honda`s only motorcycle plant has stopped production.
STEVENS (on camera): The impact just isn`t being felt in Kyushu either. So many car part suppliers are based on the island which means production
is going to be hit right across Japan. Toyota is going to be forced to cut production across the country dramatically over the next week.
STEVENS (voice-over): Toyota says that a majority of its car assembly plants in Japan will be shut down in stages over the next few days. The
car companies, CNN spoke to, say it`s too early to know how long these disruptions will last. And it`s not just the automakers. Sony makes
iPhone parts at a plant in Kyushu.
[16:35:00] And tourism is also booming in Kyushu. As visitors flock to its natural and manmade wonders. But attractions like the 400-year-old
Kumamoto Castle have been badly damaged.
Kyushu makes up almost 9% of Japan`s economy. Experts say the quake comes at a bad time for Japan by the quake.
UNIDENTIFIED MALE: Japan`s economy is weak. The long term growth potential of Japan is 0.4%, so any knock to the economy is going to be felt
STEVENS (voice-over): Shinzo Abe`s government says it has an initial $3 billion set aside to help economic recovery efforts. And that includes the
government says, providing all necessary support to companies affected by the quakes.
STEVENS: So Paula, we`ve been talking to Toyota just trying to get a handle on just how much production could be cut. They`re not saying, but I
can tell you for April last year, for example, for the month of April they produced like 250,000 cars and nearly all their production lines, they
won`t say how many, but virtually all their production lines across the country are going to be closed at some stage during the next week. It
depends on just how bad the damage is as to how long they`ll get going again. But this stage, economists are saying they expect things to pick up
fairly quickly and you`re not going to see a dramatic short-term impact and even if there is an impact there will be more spending on rebuilding Kyushu
so that could offset the downside somewhat.
NEWTON: And in terms of there being risks to the economy in a larger way as we know, Japan really seeing a lot of adversity before this, of course,
the Japanese government and the central bank trying to do whatever they could to stimulate growth there, is there a sense, and I know you just
said, production won`t be perhaps impacted for that long, is there a sense it will have any effect on the macro economy in the next quarter?
STEVENS: It`s interesting, Paula. The Japanese economy has a long-term growth potential of less than half of 1%. Gives you an idea of just how
slowly the world`s third biggest economy is growing. It`s an aging population. People are worried about jobs in Japan, even though money is
cheap, no one is borrowing, and certainly no one is spending it. There could be more of a psychological impact. You got earthquakes, people tend
to sort of don`t go out and spend, they sort of tend to keep their money at home. That is a bigger problem.
As far as the actual number of the economic sort of slowdown if you like, caused by the Kyushu quakes, no one is really saying. But the research
notes you read say it should be a short-term impact, don`t expect it to have a big effect on the overall state of the economy. Like I said, Kyushu
contributes about 10%, a little bit less than 10% of the total Japanese economy. If this quake had happened closer to the industrial heartland it
would have been much, much more severe on the economic performance of the entire country.
NEWTON: Still an incredibly interesting look on the interconnectedness of all of the production facilities. Andrew Stevens, therefore us bright and
early in Tokyo, he continues to stay on top of that.
As we were saying, we are following developments in Brazil. We now hear that President Rousseff is speaking, she`s addressing the nation. Let`s
DILMA ROUSSEFF, PRESIDENT OF BRAZIL (via translator): Good afternoon to all of you. Good afternoon to all the journalists, to the photographers.
I would like to say to you, that today, above all, I feel I injustice. Injustice because I consider that this process is a process. There is no
base for systemization, and that`s why I feel injustice. Injustice always occurs when somebody is squashed, when the process of defense is squashed.
But also when in an absurd way, there is an accusation, when someone is accused for something first, that is not a crime, and secondly, they accuse
and nobody refers to what is the problem.
[16:40:00] I watched throughout yesterday all of the interventions and I did not see a discussion about the crime of responsibility that is the only
way to judge a president of the Republic in Brazil. This is what the constitution defiance. The constitution predicts that the impeachment is
possible, yes, and we have to recognize that it`s over there written, but at the same time the constitution determines that it`s necessary the
existence of the crime of responsibility. So that someone can be considered and taken away from the position of president after receiving
the majority of votes from the population.
I received 54 million votes and I feel this decision is absurd. That`s a consideration of admissibility of my impeachment. And I`m going to insist
it may seem that I am insisting in one key only. It`s an important key, but it`s the key of democracy. I am going to insist that there is no crime
of responsibility. The acts that they accuse me of, they were practiced by other presidents in the Republic before me and it wasn`t characterized as
being illegal acts or criminal acts. They were considered legal. Therefore, when I feel injustice, it`s because with me, I was treated like
no one else was treated.
The acts of which they accuse me, they were practiced based in technical precedence and none of them are benefits to me. They are not acts so that
I may get rich individually. I leave this question of the acts, with a peaceful conscience, because I practice these acts, they are acts that are
practiced by all presidents in the Republic who will exercise their position. And when one president practices, administrative acts, he does
based in a chain of decisions. This chain of decisions there is technical analysis, legal analysis, and from there on the president signs. So this
was the opinion before I signed these acts and after,
That was the position of all of the jurists that were involved in this decision. It`s important that I leave with a clean conscience of the acts.
I leave with a clean conscience because I did not do these illegally. I didn`t do them, based in any illegality. And worse than this, I am certain
that they know this. That everybody knows that it`s this. Everyone knows. Even more, it is very interesting because there is nothing against me in
the accusation of misappropriation of public money. There is no -- nothing against me about the enrichment. I wasn`t accused of having accounts
overseas, therefore I feel injustice. I feel like this, because those who did illegal acts and have accounts overseas, they presided the session that
takes care of such a grave serious issue that is the impeachment of a president.
[16:45:00] And I want to say to you, that I also feel without justice for another reason. For not allowing me that I could not have in the last 15
months governed the last 15 months in the environment of stability, see that against me, practice me, practice against me, a systemic tactic,
strategy, of the worst the better. It`s the worst for the government, it`s better to the opposition and this is expressed in several agendas that are
like bombshells where some of these agendas involve over 100 billion.
It did not allow for any government action from the government. Agendas like this one that has taken place right now that is a project, of a
decree, it`s a legislative decree project that in transforming the correction of the states that in a correction of -- it will create a hole
in our budget in the country of over 30 billion PIs. It`s a bombshell agenda that insists systemically never announce that what the government
does good, but underscore every time that we have not done or we forget to do.
It`s a bombshell agenda with us now also. In every circumstances, projects, important projects that were necessary to be voted, so that
Brazil in a quick way could retake its growth or there were delayed or they were not voted because of this. I want to say to you that this is a
situation that can only provoke. This is what I told you, what it provokes first, it`s an immense feeling of injustice, and secondly, it`s a feeling
that there is violence in Brazil against truth, against democracy, and against our Democratic state.
I believe that it is very bad for Brazil and may the world see that our young democracy enters a process with this, with a low quality, with low
quality mainly when we deal with the formation of blaming the president of the Republic. Because if it is possible to condemn the president of the
Republic without him or her having any culpability, what is possible of doing against the citizen, any of the citizen. That is what each one of
us, when we`re not president or what is possible to do with the Brazilian citizen that are in truth the great protagonists of the history of
I would like to remind you how this process happened, how it took place, and to explain the feeling of injustice. First in the beginning and this
each one of you of all the news in the beginning, went the opening of process is accepted. The reasons that take the acceptance of this, this
process open, they are not reasons founded at the lead of exception but in a way a vengeance. The fact that we did not accept to negotiate votes in
the ethics committee, let`s remember this, you news makers. In our defense, we have not presented nothing other than what the news have
[16:50:00] I want to say, that now, in the second moment, the second phase of this process, I leave with a feeling of indignity for the fact that of
the face that is the image that was shown to the world, is the abuse of power, the no commitment to the institutions and the practices and
unethical and immoral practices. I would also like to say, that I have always fought for democracy. I believe in democracy. And I always fought
for it. I will always continue to fight for it. In the past, in my youth, I faced the dictatorship by my conviction and now I face with conviction, a
coup. A coup that is not only a traditional coup when I was young, but unfortunately a coup that is traditional of my maturity. It is a coup. In
which there is an appearance used of a legal and democratic process to perpetrate the most abominable crime against a person that is injustice.
To condemn someone who is innocent.
No government, I am sure of this, will be legitimate, will be a government, in which the people can be recognized in it, on it. It is a product of its
democracy without being through the secret vote direct in a general election previously called for in which all of the citizens participate.
It cannot call an impeachment as a tentative of an indirect election. This tentative of indirect election it happens because those who want to get the
power, they don`t have the votes for such. Beyond this I believe, that it`s important to recognize that it`s extremely strange, but above all that
a vice president in the exercise of his position, conspires against the president openly.
In no democracy in the world a person who had done this would be respected, because society, human society, they don`t like traitors. Why do they not
like traitors because each one of us knows also the injustice and the pain that one feels when betrayal is seen in the act? This I want to say to
you. I would like to answer some questions.
The world and history observe each act that is practiced in this moment, we know, all of us, who have, who live in difficult times, but times that are
NEWTON: And we were listening to Dilma Rousseff, President of Brazil, saying, of course, that she believes what is happening to her, this whole
impeachment process is what she calls, a coup, she calls it in injustice, and says that it is a betrayal, a betrayal not just of herself but also of
democracy. We now bring in our Shasta Darlington, who is live in Brasilia. I means, Shasta, what do you make of this? A lot of what she said is not
new, you heard it several times before. She continues to put up the same defense and yet do you think it will matter now?
SHASTA DARLINGTON, CNN CORRESPONDENT: Paula, that`s a great question. I think it may be too little too late. She does repeat some of the same
arguments and said over and over again how can I be accused of a crime, which is basically hiding this budget deficit, borrowing money from state
banks that pay for her social programs.
[16:55:00] When according to her, other presidents did it before her and it wasn`t criminal behavior. Why is it suddenly behavior when I do it? So
that`s how she defends herself and says, you know, when you take a look at my past, you`re not going to see any personal or enrichment, not going to
see any Swiss bank accounts.
Clearly that`s a dig at many, unfortunately, many legislatures in the congress who have been accused of just that, especially the leader in the
lower House of Congress, Eduardo Cunha, who is the most adamant person leading this impeachment effort. She talked about this as being vengeance,
the leader of the House is in the same party as the Vice President Michel Temer, who would step in for her if she were to face an impeachment trial.
And she`s referred to him as a traitor saying that this wouldn`t be accepted in any other democracy in the world. And you heard her saying how
can this happen and in a democracy we should be worried about our Democratic institutions. As you said, Paula, she said this before. What
impact could it have now, she`s definitely not going to take this laying down, she going to go down with a fight. But it`s hard to believe it will
have much of an impact going forward, Paula.
NEWTON: Shasta, one thing that you have underscored for us time and again in the fact that while so many Brazilian politicians have been accused of
corruption, Dilma Rousseff has not. What she`s being accused of is basically fudging the budget books and she says something other leaders of
Brazil has done. Why is that make nothing difference in Brazil whatsoever? As she said they`ve investigated me and I`m clean. I`ve not taken any
DARLINGTON: Paula, it`s the context, you know, as you know, Brazil is suffering its worst recession in decades. Unemployment is high. Inflation
is high. So even many of those people who backed the Workers Party over the last 13 years, who voted for Dilma Rousseff and her predecessor Luiz
Incio Lula da Silva, they feel betrayed.
Shasta, we apologize but we have to leave it there, Shasta, thanks so much. Thanks, Shasta. Shasta from Brasilia will stay on the story for us. And
that`s QUEST MEANS BUSINESS. I`m Paula Newton. Stay with CNN for more news after the break.