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Great Britain Decides To Leave European Union. Aired 3-4a ET
Aired June 25, 2016 - 03:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[03:00:35]
MAX FOSTER, HOST: Welcome to our viewers in the United States and around the world as we continue our special coverage of Britain's landmark decision to leave the E.U. I'm Max Foster.
BECKY ANDERSON, HOST: Yes you are and I'm Becky Anderson. The rest of the world is rushing with reaction to what's known as the Brexit.
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ANDERSON: Foreign ministers meet the six founding E.U. member states are set to meet in Berlin this hour. And half an hour from now Scottish officials expected to hold a cabinet meeting.
FOSTER: Crucial one that one. Political wheels are turning in the wake of the vote. But the world economy is suffering a bit. Markets down across the board. Some investors are in crisis mode. If you look at the different markets.
ANDERSON: All while Britain prepares for another a change. A new Prime Minister, David Cameron called it quits on Friday after losing the push to stay in the E.U.
Well our international diplomatic editor, Nic Robertson standing by outside 10 Downing Street.
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FOSTER: Also Atika Shubert live in Berlin. What have we got in terms of crisis meetings in Europe then Atika today?
ATIKA SHUBERT, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Germany is hosting the meeting of the foreign ministers here of the founding E.U. members. Germany and France, of course the big ones but also Belgium, Netherlands, Luxemburg and Italy all of them looking into what happens next.
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SHUBERT: Foreign Minister, Steinmeier here in Germany already said this is a bitter day but the priority is keeping the E.U. together. So what they will be looking at is what is the quickest, most painless way that the U.K. can leave the E.U., and how can they make it clear that this must not happen to any other E.U. members.
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SHUBERT: They want to give a clear message that there must be no benefits to leaving the E.U. How this happened, the legal framework is what they will be discussing but they will also be discussing how to reform the E.U. from within. Whether or not there needs to be more flexibility for members who just don't want to move in the same directions all at once. So these are things that they will be tackling today but it will be a long process to go, Max.
ANDERSON: Nic, Angela Merkel called this a watershed moment for Europe and for European integration. It is a watershed moment potentially here in the United Kingdom, as well. What happens next?
NIC ROBERTSON, CNN SENIOR DIPLOMATIC EDITOR: Well, the S&P First Minister, Nicola Sturgeon in the referendum campaign in the early phases of it indicated quite clearly that if there was a Brexit as we now have, a leave the European Union, then she would be minded if the Scottish people wanted it to call for another referendum on Scottish independence.
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ROBERTSON: She is meeting with her cabinet later today in the coming hour or so and one would expect that to be a topic of conversation.
Look, the ground has changed a little since Scotland had the referendum in 2014, late 2014. The price of oil across the world and of course the economic forecast for Scotland going it alone were based on a relatively high price of oil the north sea oil that current flows to the London Exchequer.
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ROBERTSON: The expectation now is with a lower price of oil it might be harder for the Scottish government to make that kind of argument, plausible argument to the Scottish people that they could afford financially to go at it alone.
But the point that she will be putting to the cabinet today, the point that she has made publicly is that Scotland itself voted to remain part of the European Union. And that - and that the majority of the rest of Britain didn't. And therefore, they would feel, under those circumstances, that they are right to break away from Britain and join the European Union as Scotland.
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ROBERTSON: Of course questions about how they would negotiate that, how long it would take to negotiate that, are huge but the implications for Britain are also huge. Britain's trident nuclear submarines are currently based in Scotland.
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ROBERTSON: The Scots have indicated that if they went it alone they would not want to have nuclear weapons on their soil. So the implications are huge. It's a long way to travel but that seems to be the direction they are heading at the moment. Becky?
FOSTER: No one's really got a clue what happens from here have they because it's completely unprecedented. Atika, over there in berlin, the reality is isn't it that they want Britain out as soon as possible because they want to get rid of this uncertainty and they want to start reforming the system, whether or not it is very different from what we see today or not. And what the European Union stands for. So how are they going to get Britain out when the British leave campaigners are suggesting they want to drag this one out?
[03:05:17]
SHUBERT: Well, this is the tricky part. You know the referendum has happened but really nothing legally starts moving until the U.K. submits that Article 50 which is the official notice that they want to leave the E.U., and that has not been submitted. It is not likely to be submitted until there is probably a new Prime Minister the U.K. after Cameron has resigned.
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SHUBERT: So that means we are looking at long, drawn out process, which is exactly what Germany and other members of the E.U. have said they do not want. They want this to be quick, they want the instability to stop, they want it to sort of smooth out and even out so they can get back to the business of keeping the E.U. together and running it, whether or not the U.K. is involved. That does not seem to be happening very quickly though. And so one of the things they will be discussing today is basically how to move forward without this article 50 in place.
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ANDERSON: Nic, the conservative leader and Prime Minister David Cameron looked shell shocked yesterday morning once this vote had been announced. He said with heart, head and soul, I did my best. I pushed for what I believed in. It didn't work. What happens next so far as the leadership of this country is concerned.
ROBERTSON: Well the conservative party will have to pick a new leader who will be the Prime Minister. At the moment, the two favorites would seem to be Boris Johnson, who was a leading figure of the leave campaign. The flamboyant former mayor of London.
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ROBERTSON: He went to school with Cameron, he went to university with Cameron. They were friends and have run sort of parallel political lives for a long time but it's always been understood that Boris Johnson harbored an interest in becoming Prime Minister. And when he - when he backed the leave campaign, he was sort of roundly chided as this being a political move on his part to try to secure the job at number 10.
(END VIDEO CLIP) ROBERTSON: It's not clear that he would. He does seem to be the leading contender. However Theresa May, the Home Secretary who stayed loyal if you will to Cameron, there were people that said she had sort of Euro skeptic tendencies but she stuck with the narrative that Britain was better off in the European Union, that it was more secure.
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ROBERTSON: Obviously her job as Home Secretary very much dealing with the security of the country. She is also seen as a figure, somebody who has also harbored an interest potentially it's been rumored in becoming Prime Minister.
So the expectation is that she will throw her hat in the ring. There may be others. Could Boris Johnson who is seen potentially as a divisive figure could he really rally the party or would Theresa May be perhaps a safer pair of hands and be a more centrist figure?
However, she was on the wrong side of history, if you will, in terms of this vote. So could she still - could she still carry favor across the conservative party? We've yet to see how this is going to even begin to play out at the moment, Becky.
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ANDERSON: Nic Robertson is outside Number 10 for you this morning. Nic, always a pleasure. Thank you.
FOSTER: Global investors looking towards Monday's trading now after Friday's vote plunged the markets in to chaos.
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ANDERSON: We saw U.S. stocks lose more than estimated $800 billion in value in Friday's session. The Dow Jones Industrials down more than 600 points.
FOSTER: U.K. stocks finished down more than 3 percent whilst other European indices interestingly saw very heavy losses, the worse ones in some cases.
ANDERSON: Yes, the DAX and the French market there you can see down 6 and 8 percent respectively. And the British pound fell to a 30-year low against the U.S. dollar. At one point it was worth $1.33.
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FOSTER: No one knows exactly how this Brexit will play out. There were no precedents for it. But here's what we do know right now. The outgoing Prime Minister, David Cameron said his successor will trigger what's known as Article 50 of the Lisbon Treaty.
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ANDERSON: Now that gives the other 27 E.U. countries two years to come up with an exit deal. The U.K. will not take part in those talks. FOSTER: If there's no agreement after two years E.U. countries can
vote to go overtime or not crucially. There is no unanimous decision. If there isn't one, the U.K. is out of the E.U. with no deal at all.
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ANDERSON: Well, let's take a closer look at the potential consequences then of the Brexit vote and shock waves it set off. Robin Niblett is the Director of Chatham House, an independent policy institute based here in London and a good and regular guest here at CNN. Thank you sir.
FOSTER: And we are also joined by Matthew Karnitschnig, he's the Chief Europe Correspondent for "Politico" he joins us from Berlin.
First of all the view from Berlin, I mean all eyes really on Berlin because they've got to somehow get Europe out of this mess. How do you think - how do you think they're going to handle it? What are your sources telling you?
[03:10:00]
MATTHEW KARNITSCHNIG, CHIEF EUROPE CORRESPONDENT, "POLITICO": Well I think that the Germans are torn on a lot of fronts on this point. On the one hand, there is this pressure to take this process forward, to do it quickly, to have a clean break and also to make an example of the U.K. so that other countries like the Netherlands, like Denmark don't get the same idea.
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KARNITSCHNIG: On the other hand there's a lot of pressure from business lobbies in Germany that are worried about losing the U.K. as a market. One if five German cars is sold in the U.K.. There are about 400,000 U.K. citizens working for German companies there. So it would be an enormous blow to German industry, to the German economy if the U.K. were to leave without including them in the common market as they are now.
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ANDERSON: Robin, political leaders suggesting and I heard a number of them yesterday being quite conciliatory. But behind the scenes suggesting that out is out. Britain, you know you voted out so you're out, no deal and let's do this swiftly.
As you hear from our guest in Berlin this morning, for example, German businessmen suggest this needs to be dealt with very, very carefully. How do you see it playing out?
ROBIN NIBLETT, DIRECTOR, CHATHAM HOUSE: I think it's going to be played out cautiously. Because although you've got a lot of pressure from the Jean-Claude Juncker the President of the European Commission to as we just heard not let Britain set its own example, it is after all one of the largest economies in the Europe, second or third, depending on how you look at it. It's the largest export market, single export market and to try and rush a deal at the moment may prevent a kind of flexible outcome that you're already hearing in the leave campaign in the U.K. which is split between those that want to stay in the single market and those who take a different view. They could influence the outcome to one that is actually beneficial for the rest of the E.U. by giving some time and not pressuring the Brits too fast.
FOSTER: OK, Matthew, there's some confusion here in London. Because European sources suggesting that the Lisbon Treaty has already been invoked. They're pushing that because they don't want this to be strung out too long. But certainly all of Westminster, certainly the leave campaign as well saying it's up to Britain to decide when it is invoked. What do you think, is there any clarity on that issue?
KARNITSCHNIG: I think there is a clarity. I think it hasn't been invoked because Brussels says that it hasn't been invoked. We heard the Martin Schulz, President of the European Parliament today urging London to submit it as soon as possible. We heard similar things from Jean-Claude Juncker.
So if Brussels is saying it hasn't been invoked, then it hasn't been invoked. And I think this is going to be sort of the cat and mouse game that we're going to see in the coming months. The question is does London really have much leverage by holding off? I think that you will have a lot of pressure there obviously from the UKIP camp from the whole Brexit crowd to push this through quickly and then there are others that will, as Robin said, want to take a more cautious approach. And I think you have that on both sides.
I think the likely thing is that there will be a more cautious approach. People will want to let the dust to settle. That's the way Merkel tends to handle these sorts of situations, these crises. I think you're going to see something come out of this meeting coming up this week in Berlin on Monday in Berlin where Merkel will be meeting with Francois Hollande, the French President, and Renzi the Italian Prime Minister. And I think they're going to first of all try to calm Europeans, try to calm the markets and say they're going to do this studiously they're not going to act in haste but they want to it - they want to get it done.
ANDERSON: Clarity is the word that we kept hearing yesterday. An urge, you know we need it. Christine Lagarde the head of the IMF speaking to that. This lack of clarity to a certain extent is what investors absolutely hate and is why we saw the markets so weakened yesterday.
The U.K. was the fifth largest economy until yesterday morning. It is now the world's sixth largest economy. How is it going to hold up?
NIBLETT: You know, the danger here is the British economy has been painted not just by size, the fifth largest, but one of the fastest growing in developed economies for sometime. Low unemployment, it's in that kind of goldilocks phase from the outside but it's also the country to have one of the largest deficits, budget deficits last year in the developed world 4.5 percent. Current account deficit of 5 percent. Debt growing to E.U. averages of around 90 percent. Beneath the surface, the U.K.'s fine so long as it was connected to
the rest of the E.U. Once it disconnects, people start to look at it in isolation, how strong is the pound? How big can the city be if it doesn't have the hinterland over in the E.U. market with it? And those doubts are going to start creeping in, which is why we saw Mark Carney step up early and say don't worry, we've got it covered, we've got a base here.
The U.K. has relied hugely as well on foreign investment. The largest destination for foreign investment in the E.U. for ten years including the Chinese who were hoping it would its gateway to Europe as Xi Jing Ping said last year. That foreign investment, at least future foreign investment is likely to be held back while people work out what the deal is.
[03:15:10]
FOSTER: And that's impossible to quantify.
NIBLETT: You know this is the problem is we will not be able to quantify the loss. Those who want to push for Brexit, we've got to get this outcome can point to all sorts of ideas of what might be there. But those who are leaving are pointing to lost gain can't be seen. And this is you know it will take probably two to three to four years to see the impacts on the British economy.
ANDERSON: As it will take two to three to four years to cut this deal.
NIBLETT: Same thing Becky.
ANDERSON: And therein lies the issue.
FOSTER: Robin, thank you so much. Matthew, as well in Berlin, really do appreciate your time. Thank you both.
ANDERSON: U.S. President Barack Obama opposed what's known as the Brexit.
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ANDERSON: How he says it affects the U.S. and Britain's special relationship is coming up.
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PATRICK SNELL, CNN WORLD SPORTS: I'm Patrick Snell with your "World Sport" headlines. The Rio lab that was supposed to conduct drug testing on Olympic athletes has been suspended.
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SNELL: The World Anti-Doping Agency removing the accreditation of the facility due to what it calls non-conformity with lab standards. Now according to WADA the problem involves one unspecified issue. And it's not known if the lab will be reinstated in time for the games which start on August 5th.
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SNELL: To the European football championships in France and the race for a place in the last eight is officially on. The tournament surprise package and smallest competing nation, Iceland. They don't play until Monday in Nice when they face England.
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SNELL: But three matches on the slate for Saturday, including Wales facing Northern Ireland. A team that they failed to win any of their last eight matches against the Welsh by the way. It's the first time either nation has made it to the knockout rounds of a major tournament since the 1958 World Cup.
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SNELL: In Saturday's other matches, the '04 finalist Portugal have won all three of their previous meetings with Croatia.
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SNELL: CR7, Cristiano himself has now become the first person ever to score in four Euros, and he's now just one shy of Michel Papini's record hall of nine for France at this tournament.
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SNELL: Also on Saturday, Switzerland/Poland both countries having reached the knockout stages at this event for the very first time. The Swiss have won just once in ten attempts against the Pols.
That's a look at your sports. I'm Patrick Snell
FOSTER: Britain's vote to leave the E.U. reverberating across the Atlantic as well. American politicians from both major parties express respect for the choice of British voters.
ANDERSON: Yes, they did. U.S. President Barak Obama had urged Britain to remain in the E.U. in the run up to this referendum as you may remember. But on Friday he gave assurances that the "special relationship" between the U.S. and the U.K. is still solid.
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[03:20:02]
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I do think that yesterday's vote speaks to the ongoing changes and challenges that are raised by globalization. But while the U.K.'s relationship with the E.U. will change, one thing that will not change is the special relationship that exists between our two nations. That will endure. The E.U. will remain one of our indispensable partners. Our NATO alliance will be a cornerstone of global security.
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ANDERSON: Former French President Nicolas Sarkozy is also reacting to the decision. He said British voters' rejection of the E.U. is a sign that reform is needed and called for another treaty.
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NICOLAS SARKOZY, FORMER FRENCH PRESIDENT: (As translated) Europe now at 27 can no longer function in this way. The question of its deep refoundation is therefore urgent. It has dragged on for too long. I ask that a reunion of European heads of state and governments take the decision to elaborate another treaty, which will show the people of our continent that Europe has decided to take hold of its destiny.
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FOSTER: The U.K.'s decision to leave the European Union has been compared to the rise of Donald Trump in the U.S.
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FOSTER: Since both highlight voters' dissatisfaction with a political establishment and Hillary Clinton's campaign is rejecting the comparison saying in part that Trump is more concerned with himself than his fellow Americans. But the presumptive Republican presidential nominee disagrees.
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DONALD TRUMP, PRESUMPTIVE REPUBLICAN PRESIDENTIAL NOMINEE: I really do see a parallel between what's happening in the United States and what's happening here. People want to take their country back. They want to have independence in a sense and you see it with Europe, all over Europe. You're going to have more than just, in my opinion, more than just what happened last night, you're going to have I think many other cases where they want to take their borders back. So I think you're going to have this happen more and more. I really believe that. And I think It's happening in the United States. It's happening by the fact that I've done so well in the polls.
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ANDERSON: The Donald in Turnberry in Scotland on Friday during his visit to Scotland he tweeted that the country was "going wild over the Brexit vote."
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FOSTER: In reality, the return showed Scotland had actually voted to remain in the E.U., overwhelmingly, in fact. Trump's view has put him in hot water with British politicians and celebrities and they are speaking about it on social media.
ANDERSON: Yes they are. A member of the Scottish parliament, Joan McAlpine quickly replied, "You are in Scotland. We voted remain."
FOSTER: Singer songwriter, Lilly Allen not holding back. She tweeted "Scotland voted in, you moron."
ANDERSON: Much like comedian Sue Perkins who wrote "Scotland voted remain, you weapons-grade plum."
FOSTER: She's so English. Meanwhile YouTubers Nicki and Sammy Albon resorted to oh so British humor by tweeting respectively, "I don't know what part of Scotland you're in, pretty sure they're not wild about this."
ANDERSON: "And Scotland was more yellow than your fake tan." They say.
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FOSTER: Ouch. He can handle it. Many of Britain's allies have voiced concern about the U.K.'s vote to leave the E.U. though.
ANDERSON: That's right. CNN Pentagon correspondent, Barbara Starr has more on the global security concerns surrounding the Brexit.
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BARBARA STARR, CNN PENTAGON CORRESPONDENT: Popular on-line Jihadi forums applauding the U.K. vote to leave the European Union hoping to see more chaos in Europe. But from the war on ISIS to European terror threats, and Russian aggression, the security implications are still uncertain. The Pentagon clearly had not wanted it to happen.
Days before the vote Defense Secretary Ash Carter stood at NATO headquarters and called for the U.K. to stay put.
ASH CARTER, U.S. DEFENSE SECRETARY: We know the strategic value, the unity and cohesion brings to our alliance.
STARR: But after the vote the Pentagon struck a conciliatory note.
UNIDENTIFIED MALE: We feel confident that this special relationship including the special defense relationship we have will certainly continue.
STARR: The optimism is not shared by all.
COL CEDRIC LEIGHTON, CNN MILITARY ANALYST: What we are seeing here is the potential for a major reorganization within NATO and a potential weakening of the security environment in Europe.
STARR: Despite exiting the European Union, the U.K. remains a member of NATO though its financial contribution to the military alliance could be at risk if its economy falters.
JENS STOLTENBERG, NATO SECRETARY GENERAL: Today, as we face more instability, and more uncertainty, NATO is more important than ever.
STARR: European Union and NATO members are already scheduled to meet to discuss closer cooperation and issues like cyber and terrorism. On ISIS and fighting terror threats, Britain and the U.S. still will share the most highly classified intelligence. MIKE ROGERS, HOUSE INTELLIGENCE COMMITTEE CHAIRMAN: That agreement is
not going to be impacted by this in any way, shape or form.
STARR: But the CIA Director points out with 28 countries now in the E.U. there are already significant problems.
[03:25:05]
JOHN BRENNAN, CIA DIRECTOR: Within each of those countries, they have sometimes several intelligence and security services. They do not have the interconnectivity, either from a mission and legal perspective or from an i.t. Perspective.
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ANDERSON: Our Pentagon correspondent, Barbara Starr was reporting there.
FOSTER: Brexit really being felt around the world isn't it. So far the markets have had the brunt of it though.
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FOSTER: We will break down the economic fallout for you next.
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FOSTER: Welcome back to our continuing special coverage of Britain's decision to leave the E.U. I'm Max Foster.
ANDERSON: And I'm Becky Anderson. Scottish First Minister, Nicola Sturgeon is set to lead a cabinet meeting momentarily.
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ANDERSON: She says a renewed vote on Scotland's independence would be highly likely now that Britain has voted to leave the E.U. Scotland and Northern Ireland overwhelmingly stood with the remain camp.
FOSTER: Some of the remaining E.U. nations, foreign ministers are meeting in Berlin amid concerns that others may attempt to follow Britain out of this bloc. The rapid economic fallout is at the forefront as well as investors look to shore up in the face of fundamental uncertainty.
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ANDERSON: We can't know how the Brexit is going to play out but the International Monetary Fund already has some dire predictions.
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ANDERSON: It says a Brexit would plunge the British economy into recession, causing GDP to plummet 5.6 percent by 2019 on the worse- case scenario.
[03:30:08]
FOSTER: Let's hope it is. Risk models also suggest leaving the E.U. could cause U.K. stocks to crash, falling by 24 percent.
ANDERSON: And the IMF earlier warned a Brexit would trigger inflation to rise and house prices to drop.
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FOSTER: Some of the damage appears to be happening already as well. We're joined by Simon French, he's Chief Economist at Panmure Gordon. Extraordinary day yesterday. The -- London markets actually came back by the end of the day and it was the European markets that seemed to suffer the most.
SIMON FRENCH, CHIEF ECONOMIST, PANMURE GORDEON: It was and it was - we were down 8 percent at the start, we closed 3 percent down but that can be a bit illusory because at the same time sterling was down 7.5, 8 percent.
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FRENCH: You bolt those two things together and in dollar terms, the U.K. market had its second highest reduction in value in dollar terms, in its history. The only other time was the 20th October 1987 and that famous post-storm crash that we had.
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FRENCH: That was the only other time. So people may have walked away going it could have been worse given where we opened but it was still a very, very dark day on London markets.
ANDERSON: The amount of money that was lost yesterday on the markets is more than Britain has ever paid into the E.U. in dues. However the Brexiteers will tell us well we knew this was going to happen and warned it would happen. As people try to work out what's going on, as we put in our contingency plans, if they've got any, there was always going to be a bit of a wobble on the market, short-term everything will be fine going forward, will it?
FRENCH: Well I don't think it will be. But the only thing I would agree with the Brexiteers on is that one day's print on the equity market is not a good way to assess the long term impact of the Brexit.
The more material developments in that regard came from European Union leaders yesterday. They were indicating they wanted the U.K. to trigger Article 50 very quickly, they have a quite aggressive timetable. And there's one reason for that, and you alluded to in your introduction - contagion avoidance.
They're really trying to avoid other separatist movements getting strength from this decision by the British people. And that really sets the U.K. up for a very difficult set of negotiations. And one of the things that we will be looking at is whether they -- the leadership of the conservative party and then of the U.K. goes for an entirely free trade model which some of their economists advocated beforehand. Or try and go for a Norwegian Swiss type associate relationship.
The problem with any relationship, is if it's deemed to be too good of course that strengthens the hands of separatist movements who go well we will have the same thing for our country. So a very very difficult - and let's remember, all of the bargaining chips sit with the remaining 27 E.U. countries. They are a much larger economic area. They have the ability to veto a lot of this stuff. It is set to be a rocky road ahead.
FOSTER: They've got to reach some sort of common message as well over the weekend haven't they ready for the markets on Monday morning. How do they reassure the markets so we don't get the same chaos on Monday morning.
FRENCH: Well I think they need to speak directly to investors both through their fiscal arm and their monetary arm through the politicians. Because there will be a lot -- we had the institutions reacting yesterday. But you will have the retail investors considering over the papers, these shows, over the weekend what the long-term prognosis is for European earnings, U.K. earnings, global earnings. And of course their decision on redemptions, investment decisions going forward will hit the desks on Monday morning. And I think it is very important that the narrative is led out of Britain, led out of Europe to provide some assurance of the long-term future.
ANDERSON: What is the future of the union here? Nicola Sturgeon, the First Minister in Scotland holding meetings today and it's highly likely she will want to table an independence referendum again.
As Britain goes into or gets ready for these negotiations with Europe, how much worse off would it be if it ended up being England and Wales negotiating their deal with the E.U going forward as opposed to England, Wales, Scotland and Northern Ireland?
FRENCH: And the strength of this gives the separatist movement in Scotland is quite significant. But I wouldn't overplay it. Because of course when we had the Scottish referendum back in 2014, oil was trading north of $100 a barrel. That was material in terms of making the economics stack up.
And of course, the sub text to any second referendum in Scotland about independence will mean remaining in the European Union as a effectively a new member and there is an obligation to join the Euro as a currency and that is quite a swing factor for a lot of Scottish voters.
So I don't think it's entirely plain sailing for Nicola Sturgeon but certainly if she gets her way and she has proved to be single most effective perhaps with Nigel Farage up there as well. Single most effective U.K. politician in recent times. She is definitely capturing the mood, capturing the momentum and that's a very dangerous thing for the remaining U.K. Because of course with Scotland outside of that group it would just further weaken their hand in any negotiations.
[03:35:02]
ANDERSON: Who would have through that we would be calling Nigel Farage one of the most effective U.K. politicians.
FOSTER: Unbelievable.
ANDERSON: I don't think he can believe it. In fact he told Nima Elbagir, our colleague that yesterday, he said who would have thought 35 years ago and they were calling me a lunatic that I would have been able to pull this off. Nigel Farage of course being the leader of the U.K. Independence Party. Sir, thank you.
FRENCH: Thank you.
FOSTER: Thank you very much for joining us. Lots to digest just over the weekend let alone the next year or so.
A key figure who has campaigned for those two decades of Britain to leave the E.U. is Nigel Farage, leader of the U.K. Independence Party.
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FOSTER: Becky has spelled it out already and she has even intimated to these pictures, I mean it really does tell the whole story. He's been criticized though for inciting fears over immigration.
ANDERSON: But the vote to leave is a political success and that is an under-statement for Farage. CNN's senior international correspondent, Nima Elbagir spoke with him and this is part of the discussion.
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NIGEL FARAGE, LEADER, U.K. INDEPENDENCE PARTY: I've been doing this for 25 years. I mean I was in danger I think in the 1990s of becoming a patron saint of lost causes. I mean I was written off as being a lunatic. And politically support for this was absolutely tiny. So when we got to 10:00 last night and the polls closing, I almost dared not to hope that what I dreamt of and worked for for 25 years could happen. But it did.
NIMA ELBAGIR, CNN SENIOR INTERNATIONAL CORRESPONDENT: Could you believe it when you heard it?
FARAGE: Not really, I'm not sure I can now to be honest with you. I mean it is, and I say that not just because of my journey, but it's such a big seismic political event. It hasn't just affected the United Kingdom, it's affected the rest of the European Union too.
ELBAGIR: For those out there who have been concerned that the anti- immigration rhetoric has at times been cover for less savory sentiments. There have been times when like phrases like indigenous workers.
FARAGE: Well I've never used that phrase at all in the past. ELBAGIR: You have not. But the leave campaign has become a very broad
tent.
FARAGE: Well, both sides are a very broad tent. Look, I would say this to you. We set UKIP up, my party is not racist, a nonsectarian party we've been very successful at doing that and being that, and all we've argued for is an Australian style point system. All we're arguing for is normality.
(END VIDEO CLIP)
FOSTER: Well Farage also said didn't he that the U.K. will be safer outside the E.U. and that intelligence sharing will not decrease. That actually conflicts with what all the heads of the intelligence agencies said. But his message got across and that's the point isn't it.
Foreign Secretary, Philip Hammond completely disagreeing with him on that argument as well.
ANDERSON: That's right. After the U.K. voted to leave the E.U. the British Prime Minister said a new leader for the country is needed.
(BEGIN VIDEO CLIP)
ANDERSON: After this very short break and do not go away, we will look at who could replace this man on your screens, David Cameron.
FOSTER: Vote Becky.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
FRANCOIS HOLLANDE, FRENCH PRESIDENT: (As translated) Following the ministerial meeting to be organized here about the peace process in the Middle East, I want to say we are alongside Ban Ki Moon for the end of his mandate and all the initiatives that he's been able to take -- undertake in the areas of the objectives of sustainable development which have been a great success and which were approved by the General Assembly last September.
There was the Paris agreement which would not have been possible without the support of Ban Ki Moon and the Secretary General. I also like to speak about the British votes, which the consequences of the United -- which does not affect the United Kingdom's position, and the United Nations being a member of the Security Council - permanent member of the Security Council.
[03:40:05]
(BEGIN VIDEO CLIP)
HOLLANDE: (As translated) And whilst it is always done for peace and settle the great questions of the world but it is true for the entire planet. There are questions about what is going to happen. I was very concerned about the British vote I deplored it. But it is
democracy but at the same time we need to draw all of the conclusions and consequences within the framework of the European Union and the participation of the United Kingdom.
We now have to organize this separation but we have to do this in the right order and following the rules, which must be implemented. But we also are going to maintain our relations with the United Kingdom, particularly concerning economics, France's relations concerning questions of migrants and refugees and also this will be the case as far as defense is concerned.
We also - we spoke about the great subject that is first of all to ensure the Paris agreement can be fully implemented and this opposes there can be the ratification by at least 55 percent of the countries and we hope at the end of the year in Marrakesh there will be this meeting making it possible to ratify and therefore implement the Paris agreement.
We also have the will to settle in a humane and dignified way the question of refugees. And I'd like to pay tribute to an initiative of President Obama and the Secretary General of the United Nations and at the General Assembly in September, in New York we will ensure that the refugees will have new prospects.
We have to think up policies, in particular, making it possible for them to have value to their knowledge, to their achievements to what they have to offer. This is part of current affairs the historic agreement in Colombia which following the conflict which lasted 50 years. President -- I'd like to express all my gratitude and recognition to --
(END VIDEO CLIP)
ANDERSON: Francois Hollande speaking there and due at that stand today as well the Secretary General of the U.N. Ban Ki Moon.
After the U.K. voting to leave the E.U., you had Francois Hollande there suggesting that this was democracy at work, but it is now a separation or a divorce that will be the next and very difficult stage as the E.U. effectively organizes how the U.K. will leave the project.
Well after the U.K. voted to leave the E.U. the U.S. President spoke with the British Prime Minister on the phone.
FOSTER: He did. Barack Obama told David Cameron, that the special relationship between the U.S. and the U.K. remains a key part of American foreign policy.
(BEGIN VIDEO CLIP)
ANDERSON: Mr. Cameron had campaigned heavily to remain in the Union and now he is stepping down and wants a new leader in place by October.
DAVID CAMERON, BRITISH PRIME MINISTER: I think the country requires fresh leadership to take it in this direction. I will do everything I can as Prime Minister to steady the ship over the coming weeks and months. But I do not think it would be right for me to try to be the captain that steers our country to its next destination.
(END VIDEO CLIP)
ANDERSON: Rob Niblett is Director of Chatham House, sorry Max, back with us for more analysis about who could be the U.K.'s next Prime Minister. Thoughts?
NIBLETT: Boy, thoughts. I think the big question is whose hand do the conservative party want to have on the tiller of what is going to be a really difficult negotiation.
FOSTER: And that's where Boris is divisive.
NIBLETT: Look, if you have called - compare the E.U. to Hitler you are wondering how that as your lead negotiator is going to down with countries that are going to have to think very carefully about their own survival and their own political position. And you know, when you look at the steady hand, somebody like Theresa May, the Home Secretary, who has always been seen as very much Euro skeptic. People might think back to this thing called the balance of competencies review.
(BEGIN VIDEO CLIP)
NIBLETT: It was done by all the government ministers.
[CROSS-TALK]
NIBLETT: Well unfortunately those of us who work on this, hers was the only paper that didn't come out because it was maybe being a bit too pro-E.U. So she has -- and she came out with a very strong thing against the European Convention on Human Rights. Another bug there for the conservatives during the campaign phase.
ANDERSON: And she voted remain.
[03:45:11]
NIBLETT: Voted remain. So she's sort of been loyal to the Prime Minister but maintained those skeptical credentials. So I think people think is the country who unites?
(END VIDEO CLIP)
NIBLETT: Because in the end the leave campaign are split. And they are split today. You've got those who always wanted to control immigration, like Nigel Farage but didn't really care that much about the money side. And you've got those who really want free trade and an open market and for whom a single market is critical. And the single market of course would mean immigration. So you know who's going to bridge that?
FOSTER: That's interesting. I was just thinking Francois Hollande though he was giving an olive branch wasn't he really. He was saying OK, we want to maintain good relations but we want to follow the right rules. So it's very important that for whoever steps into Downing Street to be able to build on a relationship with Paris, with Berlin and with Brussels. Because whether or not you agree with it, you cannot extricate the economies.
NIBLETT: Absolutely. And I think this is the irony for me of this whole Brexit debate. Is the U.K. is going to be spending more time focused on Europe for the two to five, probably ten years -
FOSTER: -- but not on domestic issues.
NIBLETT: Not on domestic or international issues. So the Great Britain setting off as the buccaneering ship to look at the rest of the world is going to be obsessed about Europe. And in the end I think - you know France and Germany have very different attitudes to the future of Europe, each in a way want Britain slightly in their corner and Germany wants Britain still to be part of that single market. That's the vision that's wanted.
ANDERSON: Robin, it is always a pleasure.
NIBLETT: Absolutely.
ANDERSON: Thank you.
FOSTER: Much more on the fallout from the referendum. First we are going to take you live to CNN Center in Atlanta to check some other stories we're following.
ANDERSON: That's right, and we will be back after that. Stay with us.
(COMMERCIAL BREAK)
JONATHAN MANN, HOST "POLITICAL MANN": Hello, I'm Jonathan Mann. This is your Road to Rio update.
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MANN: The lab handling all drug testing for the Rio Olympics has been suspended. The Brazilian doping control lab was slated to be open 24 hours a day during the games, but the World Anti-Doping Agency found the lab unfit citing what it called nonconformity with international standards.
U.S. basketball star, Lebron James will not be attending the 2016 games in Rio. The all-star forward played and medaled in the past three summer Olympics. But after his hometown team The Cleveland Cavaliers clinched the NBA championship this week, James said he could, "use the rest."
Transport authorities in Rio de Janeiro have started selling a special travel card to help visitors get to and from the venues for the Olympic and the Para-Olympic Games. The Rio Card provides visitors access to all of Rio's public transportation. And Brazilian basketball star Janeth Arcain, a two-time Olympic
medalist has been named the mayor of the Olympic Village in Rio. Arcain won a silver medal in Atlanta in 1996 and a bronze at the Sydney games in 2000. As mayor she'll welcome athletes and officials to the Olympic Village.
(END VIDEO CLIP)
MANN: That's your Road to Rio update. I'm Jonathan Mann.
(COMMERCIAL BREAK)
[03:50:47]
NATALIE ALLEN, CNN HOST: I'm Natalie Allen. We will get back to London live in just a moment for more on the European Union referendum but now we want to turn to other stories we're following. And this one comes from China.
Russian President Vladimir Putin is in Beijing for what has become an annual meeting with his counterpart, Chinese President Xi Jing Ping. CNN's Steven Jang is covering the meeting for us from Beijing. And Steven, I would imagine the U.K.'s decision to leave the E.U. is likely to be a talking point between these two leaders.
STEVEN JIANG, CNN CORRESPONDENT: Natalie, that's right. Brexit is likely to be a topic but not going to be a focus. Because these two leaders are going to focus on this increasingly close and important bilateral relationship. And also Brexit is probably one of the international issues the two do not see eye to eye.
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JIANG: For his part, Mr. Putin has come out to say the result of the Brexit vote is understandable. In his words nobody wants to subsidize weaker economies. He even blamed the arrogance of the British leadership for contributing to this outcome.
For Mr. Xi, his government officially says they respect the choice made by the U.K. people and are confident that the future development of China U.K. and China E.U. relations.
But remember Natalie, last October, Mr. Xi paid a very high profile visit to the U.K. and signed multi billion business deals there. So the Chinese really have been trying to use the U.K. as a gateway to the larger European market.
(END VIDEO CLIP)
JIANG: And the U.K. for its part has been a very pro-China voice within the E.U., for example voicing its support to grant China the status of a market economy.
So all of these arrangements are now probably going to crumble down probably due to this Brexit vote. So I suppose Mr. Xi is probably not going to be very happy about it. Natalie? ALLEN: Right, the complexities of the vote are mind boggling as far as globally aren't they not. Steven I want to ask you though about the meeting between these two. The second time within the week. What are they really trying to accomplish from the bilateral meeting?
JIANG: Yes, that's right. They actually just met earlier this week in Uzbekistan and now they are meeting here again. There you have a quite an ambitious agenda both politically and economically.
Politically, I think both countries feel increasing western pressures on different issues. For the Russians it is the Ukraine issue. It's been isolated by the E.U. and the U.S. since its (inaudible) of Crimea in 2014. For China it's the South China Sea. As you know it's increasingly locked in a heated dispute with its neighbors over competing territorial claim and it feels the West and the U.S. have been unfairly treating their position. So the two probably want each other's support to shore up their case internationally.
Economically, both economies are facing challenges. And so, Russian, of course, is facing continued European sanctions and the Chinese economy is slowing down in the past few years. So they really could tap in to each other's huge markets as well as investment potentials. So it's really about money bit it's also more about money, Natalie.
ANDERSON: It usually comes down to money. We understand. Steven Jang for us covering - is there from Beijing, thank you.
We want to take you now live to Armenia. Pope Francis is continuing his visit there and we have video of him attending an outdoor mass right now.
(BEGIN VIDEO CLIP)
ANDERSON: This is live video from Armenia. Earlier he attended a wreath laying at the Armenian Genocide Memorial. He has said the mass killing of Armenians under Ottoman rule back in World War I was a genocide and this trip, and those comments are likely to draw the ire of Turkey.
The government in Turkey rejects calling the killings genocide, it maintains there were losses on both sides. Some 20 countries do recognize the event as a genocide, including France, Canada, Russia and Italy. The U.S., U.K. and Israel do not.
Turkey and Armenia also differ on the number of people killed. Armenia says 1.5 million died. Turkey puts the number at 300,000. But again, this is the Pope in his visit to Armenia holding mass right now.
(END VIDEO CLIP)
[03:55:02]
ANDERSON: Brazil's only accredited lab to test for doping has lost its license.
(BEGIN VIDEO CLIP) ANDERSON: The Brazilian Doping Control Lab was suspended Friday because of what the World Anti-Doping Agency calls a nonconformity.
The lab hopes to get its license back in time for the summer Olympics that's in six weeks. A spokesman for the lab said he will not comment on the events that lead to the suspension that lab officials hope again to get the ban lifted.
(END VIDEO CLIP)
ANDERSON: That's the news from Atlanta. We're back in London next. I'm Natalie Allen and you're watching. CNN.
FOSTER: Welcoming our viewers in the United States and around the World. We continue our special coverage of the United Kingdom's decision to leave the E.U. I'm Max Foster.
ANDERSON: And I'm Becky Anderson. The dust is starting to settle in Britain after what was an historic day.
(BEGIN VIDEO CLIP)
ANDERSON: The world getting a clearer look at some of the consequences it can expect from this decision.
FOSTER: Foreign ministers from the E.U's six founding countries are meeting in Berlin and the wheels are turning within the U.K. as well.
