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U.S. Tax Overhaul Bull Clears House; Saudi Government Plows on with Corruption Crackdown; First Sight of Mugabe in Crisis-Torn Zimbabwe; Oil- Rich Saudi Arabia Plans for Future Beyond Oil;

Aired November 16, 2017 - 16:00   ET


[16:00:00] RICHARD QUEST, CNN HOST: Children and a moose on the balcony of the exchange. Dow Jones Industrial is having a very strong session at

nearly 1 percent. A record on the Nasdaq. And now the Hartford ringing the closing bell, and a strong -- oh, well, there not top those gavels.

Maybe not as strong as it might have been. Trading in New York is over. Today, it's Thursday, November the 16th.

Tonight, the controversial tax plan clears the U.S. House. The Republicans seem joyous. Controversial reform in Riyadh. Investors are split on the

Saudi corruption crackdown. And controversy and confusion, it rules in Harare as we start to get pictures of the embattled president. But what is

going on? I'm Richard Quest. Tonight, live from Riyadh, Saudi Arabia, where, of course, I mean business.

Good evening. Tonight, we are live in the Saudi capital, as economic giants of both East and West embark on historic reforms. For instance, in

the United States, the House of Representatives has just passed a bill for a sweeping overhaul of the U.S. tax system. And here in Saudi Arabia, the

central bank governor tonight tells me the country's unprecedented crackdown on corruption will pay dividends.


AHMED ABDULKARIM ALKHOLIFEY, GOVERNOR, SAUDI ARABIA AND MONETARY AUTHORITY: Well, it's hard for me to tell at this time. And it's really hard to

assist. But I can tell you for sure, over the long-term, this will pay off.


QUEST: We begin though in the United States with the events of the last couple of hours. Markets have rallied, as the Republican tax plan has

cleared its first hurdle in the U.S. Congress. The Dow climbed 200 points, as anticipation grew. It was helped along by strong earnings from Walmart

and Cisco. Walmart was up 8 percent in the market.

The stocks held steady as the bill passed. Remember, of course, the U.S. hasn't overhauled a tax code since President Reagan's day some three

decades ago. The White House is saying, tax reform must be done before the year is over. Let's not be silly about this. There's s till a long way to

go before President Trump signs a bill and claims his first major legislative victory.

After all, not a single Democrat voted for this House bill. And in the Senate, where the Republicans have just a two razor- thin majority, a

handful of Republicans are already raising objections with the bill. Senator Ron Johnson, for instance, one of the skeptics, who told us the

bill doesn't do enough to help small business.


SEN. RON JOHNSON (R), WISCONSIN: Those pass-through businesses really are the engine of economic growth, job creation, innovation in our economy.

And so, I'm just looking for a fair shake for all businesses to maintain the competitive balance and position of all businesses. Let's not upset

that apple cart and harm our economy.


Lauren Fox is on Capitol Hill. Passage of the bill, perhaps, Lauren, wasn't in any doubt. The issue, of course, is what happens in the Senate.

The two bills are far apart. So, what does happen next?

LAUREN FOX, CNN POLITICS REPORTER: Absolutely. And like you said, a very strong vote in the House of Representatives today with only 13 Republicans

voting against the tax legislation. But now all eyes are on the U.S. Senate. And as we said, Mitch McConnell has a narrow majority to pass this

bill. There are already folks like Senator Ron Johnson, who we heard from, and Senator Susan Collins who have expressed concerns. And adding even

more complication is the fact that Senate Republicans are including a repeal of the individual mandate, part of the health care law in their tax

bill. And that makes it very hard to get any Democratic votes, even though it was very unlikely they get those votes to begin with. Now it looks like

Democrats are going to keep sitting on the sidelines and aren't going to help Mitch McConnell with that narrow majority.

QUEST: OK. Now, what about the controversial aspects of this bill, particularly, for example, the removal of the deduction for state and city

income taxes? Now, the house has passed that. At what point will all these very controversial bits of the legislation really come up as part of

the negotiation?

FOX: Right. And as we heard from House Republicans over the last couple days, they were feeling very confident about their vote. But they were

concerned that once this goes to the Senate, which did away with those state and local property tax reductions, that once it went to the Senate

that it was going to be very hard once they came into conference, if the senate is able to pass their bill, it's going to be hard to combine them.

[16:05:06] Because there are some very key differences here. A lot of House Republicans tell you, you know, it might be easy in the house, maybe

even if it states by in the Senate, conference is going to be very difficult.

QUEST: On this point, then, the realistic possibility of a bill getting to the president's desk, probably Thanksgiving ain't going to happen. But by

the end of the year.

FOX: Well, that's what Republicans have been saying this entire time. And they have set out an aggressive time line. You have to remember, House

Republicans just unveiled their tax bill two weeks ago. And they were able to pass it today. So, they are moving on a very aggressive schedule.

Senate Republicans are still marking up their bill in the finance committee today. We're going to have to see if they're going to be able to pass it

after that Thanksgiving holiday. That gives them only a few weeks to conference the differences between their two bills, which as we said, are

massive, and then give it to the president to sign. Whether that can be done by the end of the year remains to be seen.

QUEST: Lauren, thank you for that. And thank you for beautifully setting up the aspect that we're going to talk about next. Which is analysts --

excuse me. Analysts at UBS say markets are not even close to pricing in tax cuts. The Dow closed Thursday's session up 187 points. The Nasdaq

closed at a record. Paul La Monica is following it all in New York. What do UBS mean when they say not even close to pricing in the cuts? Are you

suggesting, or are UBS suggesting as this becomes more likely, Paul, then we could see even greater gains in the market?

PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: I think it's possible, Richard. There is still skepticism about what is going to happen with this tax

reform bill. As we've already heard, the Republicans in the Senate have some reservations about it. There will be a different version that they

vote on. There will have to be some reconciliation before anything gets on to the desk of President Trump for him to sign.

And also, let's be honest here. I don't think today's rally had much, if anything, to do with the tax bill being passed in the House. Everyone knew

that was going to happen. It was more about corporate America remaining strong, despite the lack of any significant reform in Washington just yet.

Cisco and Walmart's earnings didn't have anything to do with the possibility of lower corporate taxes. It's because their sales are good.

QUEST: All right. So, if the gains didn't have anything to do with it, how much of the market is priced in for a tax cut of -- particularly on the

corporate side, never mind the individual personal taxation -- that a failure to pass between now and the end of the year could royal the market.

I guess what I'm saying here, Paul, is the opposite true?

LA MONICA: I think there is always the possibility that you could have events in Washington derailing what has been an amazing rally. But most

people that I talk to are still skeptical that it's going to be a smooth ride to get a tax bill passed as quickly as President Trump and Republican

leaders in Congress want. And absent that, we still have very solid earnings heading into 2018. And obviously, the fourth quarter, as well.

So, with would the market pull back a little bit? Yes, but it might be another one of these mini corrections we had, barely a correction. You

know, 1.5 percent drop from record highs that we saw in the past couple of days. That's a blip. That's nothing.

QUEST: Paul La Monica, thank you.

LA MONICA: Thank you.

QUEST: European markets bounce back after five days of losses. Most sectors recovered. The sentiment was certainly better. The energy stocks

fell away after Norway has revealed plans to sell its oil and gas holdings. Somewhat remarkable when you think of the Norwegian sovereign fund is made

up -- only exists because of Norway's oil and gas holdings. But I suppose they're the ones under the ground rather than the investments.

The German giant, Siemens, announces cutting nearly 7,000 jobs, most in Germany and the United States. States.

The corruption sweeps here in Riyadh led to a course of snickering from the skeptics who think the moves are a power grab by the Crown Prince. The

governor of the Saudi central bank, the monetary authority, says the action is creating more level playing field to do business. You'll hear him and

Johnny D after the break.


QUEST: Tonight, Saudi Arabia's Central Bank governor, the head of the monetary authority, tells me the country's crackdown on corruption was not

only overdue, it has the support of his international colleagues. Now, roughly 10 kilometers from where I'm standing somewhere over in that

direction, many of the country's top billionaires and a good dose of princes, they are still being held, imprisoned inside the Ritz-Carlton

hotel. Nice jail, perhaps, if you have to go there.

The "Financial Times" is reporting the authorities are negotiating settlements. Where those being held, the detainees, can pay for their

freedom. Possibly by disgorging up to 70 percent of their gains. Now, in an exclusive interview with me, I asked the governor of the central bank

how much this fight against corruption still has to go.


AHMED ABDULKARIM ALKHOLIFEY, GOVERNOR, SAUDI ARABIA AND MONETARY AUTHORITY: Well, it's hard for me to tell at this time. And it's really hard to

assess. But I can tell you for sure, over the long-term, this will pay off. Preserving a level playing field for all investors, whether local or

foreign, that's what they need. And this is the stability that the foreign visitors they want and the local visitors they want. If you don't have

equal opportunity and some people are getting their business because of corruption or bribery actions. Then there is no equal opportunities. And

you want really to stop that.

[16:15:00] Is the message from Saudi Arabia that it is no longer business in the bad old days? That there is change that's happened here? And --

and what would you say to the cynic or the skeptic who says I'll believe it when I see it?

ALKHOLIFEY: Well, the skeptics always have to convince them. But the actions will approve that. That move is against corruption and nothing

else. And nothing else. And I am sure that -- I'm talking about my counterparts in other central banks. I was in Basel four days ago, and all

of them were commending the move by Saudi Arabia. Of course, one would be concerned, is it within the rules of law. I can assure you it is within

the rules of law.

QUEST: To finish on the economy itself, having had a pretty difficult couple of years, can you say that good growth is back? What would you

expect new growth to look like in '18?

ALKHOLIFEY: See, in the first half of this year we have negative growth rate.

QUEST: Right.

ALKHOLIFEY: This is because of the oil. Oil production and the real oil sector has been impacted. But the non-oil was positive. And the oil

prices now are being higher. I think we see one a bit of sentiment, stronger confidence. And you'll see more oil revenue, as well. And this

will at least decrease the pace of the depletion of oil reserves or more borrowing from the government. And by the way, the reserves now, the

depletion of our reserves was only 9 percent -- I mean, in the first nine months of this year. Earlier to 14 percent last year.

QUEST: When do you think you might be in a position to add to reserves?

ALKHOLIFEY: Well, if we have more non-oil revenues coming.

QUEST: Or the price of oil goes up.

ALKHOLIFEY: Or the prices still, I mean increasing. But I can tell you, I'm more uncomfortable with the high oil prices above the 60s than I was in

the first quarter of '16.


QUEST: John Defterios, our emerging markets editor, is with me. The fascinating thing he says, he is sort of -- slightly off to the s ide, but

he says this was a crackdown against corruption, and nothing more. In other words, this was not a land grab, a power grab. Get rid of the


JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Well, it's very interesting, because the perception you have from afar is very different. Because it

included the Royals. Who had broken the tradition of not touching the top tier here. Particularly members of the Royal family. So that broke with

tradition. It took in sitting ministers, including the minister of state, which is extremely unusual. And, in fact, the public support on the

ground, Richard, is extraordinary. It's almost like a shock and awe campaign by the Crown Prince. And it's one entrepreneur told me today,

look, he's ahead of society right now. He's moving so fast that it's a good idea. Proceeding so fast that nobody can respond. And he hopes to

get the job done before everybody wakes up to see what happens. Consolidate the power at the same time.

QUEST: Just join me as we listen to this particular entrepreneur, business leader, runs a date company, I believe. Haller and Haller, no relation to

our own --

DEFTERIOS: I was going to say classic product here in Saudi Arabia. The best dates in the Middle East.

QUEST: All right, let's have a listen and then we can talk about this idea of people accepting the crackdown but questioning where the reforms go



SALEH AL-HARTHI, CEO, HALLA AND HALLA CO.: When you have this much wealth, the number one enemy of development, of achievement, of getting services to

the people is corruption. It is a hard thing to fight. It's a dangerous thing even, because of the resistance. But when we saw the actions, we

believe in it. And we saw real actions going from the top. Because when you go to the top, it will trickle down to the bottom.


QUEST: How much of this, though, has destabilized the country? The economy is not doing well. It's doing better with higher oil prices. This

corruption crackdown is sending the strongest message.

DEFTERIOS: Indeed. As one said to me today, no one will ever dream of trying to pull off corruption again. So, really shocked, because they went

to the top to the bottom. But I think you have to worry about the shock it has on the economy. The first half of 2017 was awful. Quarter on quarter,

we're looking at a recession of 6 percent. They are going to try to eke out basically slight growth in 2017. The revisions I've seen are lower

than that. 2018 perhaps we don't have any growth. Oil revenues are up 30 percent. You're absolutely correct. 60 to $65 a barrel, by the way, is

prime time for Saudi Aramco, an IPO for next year. But they're not growing right now.

[16:20:00] So the worry is, if you shock on corruption, Richard, people start to look over their shoulders and say perhaps I'm next. Doesn't help

consumer spending. And there's a half trillion, half trillion dollars of projects either on hold or cancelled because of the tight oil revenues

right now.

QUEST: What do you make of this story -- two stories to just brief on tonight. Firstly, the "Financial Times," on the front page, saying that

those who have been locked up, if they disgorge 70 percent of their so- called ill-gotten gains, they'll be let go.

DEFTERIOS: OK. First and foremost, it seems premature. And, in fact, that was the same sort of word I had when calling today and talking to

people at the MiSK Global Forum. Because the reason I say that, it is because the attorney general in his original statement, when they haven't

changed, says, we have to have due process. And it's a test for Mohammed bin Salman, the Crown Prince, 32 years old, to say, look, 201 are being

held right now, Richard, at the Ritz-Carlton and other places here. Are we going to see this through? Also, the second thing I would say, there's

been a wide range on the potential cease of assets. As little as a $100 billion to $800 billion. This is a lot of intrigue and I think it's just

coming early in the process.

QUEST: So, what about the "Daily Mail," which has the story tonight.

DEFTERIOS: You really are trying to put me on the spot.

QUEST: I am. And why not?


QUEST: No, I imagine. How many years have you been coming here?

DEFTERIOS: A quarter century.

QUEST: Right. So, you know your way around.

DEFTERIOS: This was a little bit more tricky. Actually, a little trickier.

QUEST: I've completely forgotten the question. No, I haven't.

DEFTERIOS: You solve the "Daily Mail" report.

QUEST: The "Daily Mail" report. Thank you, the "Daily Mail" report. The "Daily Mail" report, which says that the King is going to abdicate in the

next week. We've heard this before.

DEFTERIOS: I was going to say, we have heard it before. And, again, when we heard it before, it was like, oh, I thought what you did, it's like, oh,

my gosh, that's premature. The Crown Prince came into that position just six months ago. He's moved with lightning speed. But those again, you're

talking here in town, said look, -- all they told me when I talked to them on the phone tonight, John, we've seen it two or three times before and

then you saw a statement to the contrary. You never know. I'm going to say that. But, again, it seems like a premature call so far. And it was,

again, just referred to as sources so far.

QUEST: Thank you. Good to see you.

DEFTERIOS: Thanks, my pleasure.

QUEST: There are seismic shifts under way here in Saudi Arabia. The lifting of social restrictions, a crackdown on corruption and the

transformation of the economy. They all trace their roots to a power struggle at the heart of the highest levels of the Saudi Royal family.


QUEST (voice-over): It was a stunning transformation. From relative outsider to heir apparent.

UNIDENTIFIED FEMALE: King Salman has removed his nephew as Crown Prince in favor of his son.

QUEST: The man known as MBS has shaken Saudi politics, society and foreign relations. Prince Mohammed bin Salman has taken control of the levers of

power. The kingdom's defenses. Saudi Aramco, and the transformation of the economy.

UNIDENTIFIED MALE: I think the pain is OK. No pain, no gain.

QUEST: The Prince's sweeping crackdown on corruption, also neutralized threats from within his family. He is trading establishment support for

loyalty from the country's youth. Promising jobs, loosening restrictions on women, and taking on the arch foe, Iran.

ABEL AL-JUBEIR, SAUDI FOREIGN MINISTER: We reserve the right to respond in the appropriate. Manner at the appropriate time.

QUEST: The Prince's military campaigns have caused tensions to flair. In Lebanon, Syria and Yemen. His diplomatic freeze out of Qatar shows no sign

of thawing. The posturing abroad and the promises at home are raising the stakes. Higher they go, if they fail, the farther the Prince and Saudi

Arabia have to fall.


QUEST: Now, when we're talking about the economy, Lebanon has emerged as a flash point in Saudi Arabia's proxy war with Iran. The Lebanese Prime

Minister, you'll have her today, has agreed to leave Saudi Arabia and visit the French president, Emmanuelle Macron in Paris on Saturday. The Lebanese

President, Michel Aoun, says that could be the start of a solution to the country's political crisis. CNN's Ben Wedeman is following all the

developments in Beirut. Ben, I don't want to concentrate too much about what's going to happen Hariri and Paris. I would rather talk, since I'm in

Riyadh, if I may, about this idea that the Saudis are behind the scenes pulling the Hariri strings, and whether or not it's a full-scale detention

or he's being kept here at their pleasure, the Saudis are in it up to their armpits.

[16:25:00] BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, certainly we don't know for sure. We've -- I spoke to his senior Lebanese

official today who told me I will say in public that he is free, but I will tell you in private that he's not. That Saad Hariri, as we heard from the

president of Lebanon, Michel Aoun, say yesterday, most Lebanese seem to believe that he is detained. Is he a hostage, as the president says? We

don't know. But certainly, they do seem to be pulling a lot of the strings.

And it's important to keep in mind that Saad Hariri and his father before him, Rafic Hariri, who was assassinated in February of 2005, have a long

history of close relations business relations, business relations with Saudi Arabia. Saad Hariri has Saudi citizenship as well. So, the ties are

there. And, of course, many Lebanese, hundreds of thousands, work in the Gulf. So Saudi Arabia has a lot of influence on the situation. In

Lebanon, but may be playing hard ball in this case, Richard.

QUEST: Why would Saudi want to get into -- why would the Crown Prince, newly crowned as the -- as the heir, why would he want to get into this

proxy battle with Iran, at this time, when he's dealing with so much on the home agenda of a complete revolution of the domestic economy?

WEDEMAN: Well, Crown Prince Mohammed bin Salman is already up to his neck in Yemen, for instance. He engaged in this blockade of Qatar along with

several other Gulf states and Egypt. And Lebanon is another one of these situations he's got himself into where it's complicated. Now, the talk

here in Beirut is, essentially, what he's trying to do is put pressure via Saad Hariri on his Baal, to pull out or become less involved in Yemen. And

therefore, sort of to calm the situation in Yemen down so perhaps Saudi Arabia can pull out of Yemen which is really a quagmire. That war has been

going on since the spring of 2005. It shows no sign of abating.

And perhaps this is what they're saying in Lebanon, is that this is his way out. But in the bigger picture, Richard, obviously Saudi Arabia is at odds

with Iran. Iran has got huge influence, which I've seen firsthand in Iraq, in Syria, and, of course, via Hezbollah. They're very powerful here as

well. So Saudi Arabia wants to counter Iranian influence. This is one place they can try to do it. Although most Lebanese will tell you, Bill

also probably fail -- Richard.

QUEST: Ben Wedeman, thank you. And I thought economics and quantitative easing complicated. But thank you. Putting us beautifully into the

picture of why the Saudi Crown Prince is doing what he may or may not be doing in places which may or may not be happening.

As we continue tonight, new pictures of another complicated area of the world. This time, it's Zimbabwe. Robert Mugabe, the issue here is, is he

or isn't he in power? And if he's not, who is really in power in Zimbabwe? We'll talk about that. It's QUEST MEANS BUSINESS. We are alive tonight in



[16:31:13] QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a minute. When the chief executive of AeroFarms tells me

that Saudi women can be the one that will take the kingdom and his company to

the next level. And Norway doesn't have much in common with Saudi except one thing, they both trying to give up oil in their different ways. As we

continue tonight, this is CNN, and on this network, the facts always come first.

The former Lebanese Prime Minister, Saad Hariri is scheduled to meet on Saturday in France with Mr. Emmanuel Macron after Mr. Macron extended an

invitation. The Prime Minister threw Lebanon into crisis after resigning earlier this month, while in Saudi Arabia, where he still is, the Saudi

foreign minister is denying claims Hariri is being held against his will.

The U.S. House of Representatives has just passed a tax reform bill along party lines. No Democrats backed legislation. The fate of the bill in the

Senate is more unclear with Republicans holding a slim majority, several members have already raised their concerns.

Democratic U.S. Senator Al Franken has issued an apology after a woman accused him of groping and kissing her without her consent. She says it

happened in 2006 when he was a comedian not a lawmaker. He says he wants an ethics investigation and will gladly cooperate.

The United States is removing restrictions on importing African elephant trophies from Zimbabwe and Zambia. That means Americans will soon be able

to hunt endangered species. U.S. authorities say the move will allow those two African countries to put much-needed revenue back into their

conservations. The critics of course saying that restrictions were created because the elephant population had dropped.

The White House says Pres. Trump finds the allegations of sexual misconduct against Alabama Republican Senate candidate Roy Moore very

troubling, and if true he should step aside. The White House Press Secretary Sarah Sanders said Moore's fate should rest in the hand of

Alabama voters. Moore has remained defiant saying the allegations are not only untrue, the accusers have no evidence to support them.

Now, we've just received these -- some would say stunning new pictures from Zimbabwe. The first signs of president Robert Mugabe since the military

detained him two days ago. He is seen here posing against the army chief, who led this week's takeover. The handshake appears friendly, both men are

smiling. Now, behind the scenes, Mr. Mugabe's future is far from clear. Tanks roaming the streets of that Harare, the capital. The country's main

opposition leader says the president's 37-year reign has come to an end.

Morgan Tsvangirai, Zimbabwe opposition leader spoke to CNN a short time ago and claimed economic troubles may have triggered this week's unrest.


MORGAN TSVANGIRAI, ZIMBABWE OPPOSITION LEADER: I must say this, they are really in a desperate situation. And they have witnessed the biggest

deterioration of the living standards over the last five years. So, they are in a desperate situation. That is no doubt at all. It is something

that may have led to this uncalled for maybe celebration. But as far as the people our concerned, they didn't see the light at the end of the



[16:35:00] QUEST: CNN Farai Sevenzo is in Harare. Very simple question. What is going on?

FARAI SEVENZO, CNN CORRESPONDENT: What is going on is that for the last 48 hours, Richard, the Zimbabwean army has been in control of this country.

Now, Mr. Chiwenga there is talking about the economics of the country. Yes, it is in a dire situation. Many, many people unemployed. Economy

hasn't been able to grow. But the fact of the matter is that President Mugabe fired his long-trusted vice president, Emmerson Mnangagwa which

precipitated the Army's takeover.

They were adamant they would not see someone of Mr. Emmerson's pedigree with his whole history of liberation struggle, and his support for the

liberation efforts superseded by Grace Mugabe, which was what was going to play out. And that's why they took over.

QUEST: All right. So, we don't know whether it's a full-scale coup, or it's just an armed takeover and that will clear itself in the next few

days. Is it your feeling, as a seasoned observer of Zimbabwean affairs that Mugabe era is over?

SEVENZO: Richard, it certainly looks like it from my point of view. Indeed, from many Zimbabweans' point of view. What is going on at the

moment? Those pictures you just referred to, what is the army doing talking to Mugabe at the moment? Are they trying to ease him out? And is

he happy with their choice of leader, who is Emmerson Chiwenga the guy he fired? Does he feel safe enough to allow this man to take over when he has

done what he has done to him? Are his wife and children -- are they safety guaranteed? Are we talking about the ICC? All of these things Zimbabweans

are asking, and they don't yet know the answers to those questions.

Chiwenga: Look, the number of atrocities from land grabs to murder to corruption to the destruction of the economy, under the Mugabe years is

legendary. But why should this particular move, the sacking of the vice president, even if he does have impeccable revolutionary credentials. Why

was it this that tips them over the edge? Was it a pro-vice president move, or an anti-Mrs. Mugabe move?

SEVENZO: I would have to say it's the latter, Richard. Because, remember, for the last three years, Mrs. Mugabe has been pivotal. She had this

meteoric rise to the center of power and politics with absolutely no credentials at all. And remember, when Mrs. Chiwenga was first arrested

for political activism back in the Rhodesian days of 1960, Mrs. Mugabe had not yet been born.

The army had always been saying they want to get rid of all the criminals and what looters in Mrs. Mugabe and Mr. Mugabe's circle who have been

looting the country dry. Remember, even President Mugabe just a few months ago, he went on state television to announce all the new-found diamonds in

the eastern part of the country, near the Mozambican border, that the country had lost 15 billion U.S. dollars' worth of diamond sales. To

where? Nobody knows where it went.

And, of course, there is such an opulence and serious money going on. People driving Range Rovers all over the place, when the majority of people

are truly suffering. So, in a way, they use that as an excuse to try and get rid of G 40 faction belonging to Mrs. Mugabe. And it looks like it

succeeded, Richard.

QUEST: Farai, stay on top of the story please, when there is more to report, come back immediately.

As we continue tonight from Riyadh, it's called vision 2030, a kingdom built on oil is banking on a future without it. It is is

unprecedented. Live from Saudi Arabia, tonight.


QUEST: One of the world's largest oil producers says it is selling its oil and gas stocks. Norway wealth fund which holds stakes in Shell, Mobil and

BP wants to protect against falling oil prices. A fellow producer of Saudi Arabia is no exception, making major change towards diversifying the

economy as part of vision 2030. CNN's Anna Stuart explains.

ANNA STUART, CNNMONEY CORRESPONDENT: A crash in oil prices exposed Saudi Arabia's addiction to oil. An economy cruising at prices over $100 a

barrel was suddenly struck with crude oil trading at $30 and less. It left Saudi Arabia with a gaping budget hole, and serious economic challenges,

the answer? Vision 2030.

It's an ambitious set of reforms led by the 32 -year-old heir to the throne, Crown Prince Mohammed bin Salman. There are the economic shifts,

tax hikes, spending cuts and ending subsidies. And the business shakeups. Such as the IPO of state oil giant, Saudi Aramco. And then there is the

huge investment project in military, education and infrastructure. One project includes building neon. $500 billion super city powered entirely

by energy. Saudi Arabia is also turning to tourism that will create holiday resource across its Red Sea coastline. Vision 2030 has already run

into problems. It's had to back pedal a number of targets and still faces revisions today. Anna Stewart, CNNMoney, London.

QUEST: Unprecedented, Vision 2030. Still some way to go. Joining me now, Siya Xuza, the founder of Galactic Energy Ventures. And you are here at

the MiSK Global Forum today. This idea of diversification, away from oil into other energy sources. Obviously, the solar. How realistic is it?

SIYA XUZA, FOUNDER, GALACTIC ENERGY VENTURES: There could not be a better time to be pursuing this agenda for diversification, because, as you know,

one of the largest automotive manufacturers announced that by 2030, the entire fleet of vehicles will all be electric.

So, the center of gravity in the energy industry is moving away from oil, fossil-fuel based towards storage battery technologies. So, it is

realistic. The prices have come down, the technology has matured and entrepreneurs like myself developing and working to create business out of


QUEST: So, I do love the word entrepreneurs. Because your product, your batteries, how far from full-scale fruition are you in this?

XUZA: Well, it's always a cost -- always a function of how much capital you can get in order to accelerate the pace of the innovation. But the

concepts have been proven.

QUEST: So, are you here to try and convince people to buy the product or invest in the company? Or both?

XUZA: It's about investing in the company. It's about investing in an African startup that aspires to be at the forefront of this disruption.

Currently at the moment, 625 million people in Africa, sub-Saharan Africa who do not have access to power. And the cost of electrifying those

people, the cost of setting up that infrastructure, can be significantly reduced if we go towards renewables. The challenge with renewables has

always been storage.

QUEST: And the challenge, as we heard from Elon Musk, with Tesla, is to create enough of these batteries at an economic price with a suitable

degree of performance.

XUZA: Absolutely.

Quest: Well, do you agree?

XUZA: Yes.

QUEST: Therefore, what are the Saudi's telling you about your project?

XUZA: They have been very receptive, hence why they have invited me. They are planning for a world without oil.

[16:45:00] And instead of, you know -- instead of letting -- they want to be a part of that transition to too. They have the capital, they have the

-- they have the know-how. And it's about making those strategic collaborations with innovators such as myself to create the next big energy

company, all clean.

QUEST: So how far are you along your track in this regard?

XUZA: Well, I'm now currently in my investment-raising. Technology, I was at Harvard for a period of four years and subsequently MIT developing my

research perfecting my prototypes. And we are now at the stage we are courting investors, raising more capital, but we want to do this out of


QUEST: Where abouts in Africa?

XUZA: Johannesburg

QUEST: you want to go to South Africa, it is perhaps probably the most sophisticated economy in that sense. But not the largest economy, say, for

example, Nigeria.

XUZA: Absolutely, I am South African. More important, we want to change the narrative out of Africa from being a resource-based economy to where an

economy that is developing these technologies.

QUEST: Fascinating. Finally, you want to change the narrative from a resource-based to another -- to technology and you've come to a resource-

based place to seek the investment to which to do it.

XUZA: Absolutely.

QUEST: XUZA, good luck. By the way, because I know. When you talk about an investment, what sort of sums are you talking about? I'm not being too

imprudent when I ask. I'm not talking about a million, 5 million, 100 million. What sort of sums?

XUZA: About 10 million U.S. dollars to get the needle going.

QUEST: I would give it if I had it, but I don't. As we continue, the chief executive of AeroFarms, who has also been here, says that women will

be a big part of its work force in Saudi Arabia. The U.S.-based company specializes in the vertical farming of leafy green vegetables, literally

you grow them like this vertically in urban farms. And AeroFarms want to help transform agriculture in Saudi Arabia. I asked the chief executive,

David Rosenberg, what makes the kingdom an attractive investment?


DAVID ROSENBERG, CEO, AEROFARMS: The economics change, depending on the region. Here they're particularly attractive because energy is so cheap.

So, energy is one of our bigger cost of goods sold. And here it's less. They're obviously an oil energy-rich country. There's a lot of sun, for

solar power solar power and also the economics of the dry climate help, because of the transpiration of the plants, we have to fight humanity, it's

a dry climate.

QUEST: When you look at the changes taking place and we can't ignore them. The economic changes, the crackdown on corruption, the second -- I'm

hearing two different views from business people. I'm hearing great, they're getting their house in order. And then on the other side, people

say, great, they're getting their house in order, but there's a lot of uncertainty about the way forward.

Which house are you in?

ROSENBERG: Great. They are getting their house in order. And by that, I would think a year ago, even, of going into Saudi Arabia and telling people

at AeroFarms in the United States, how we're going to the country at the same time, women don't have the same freedoms as men do. That's tough and

it doesn't really coincide with our values.

Now with the changes that the crown prince announced at the future of investment summit a few weeks ago, you feel the energy. And I'm proud to

be part of this movement to help where we can. You talk to the people, they're energized, they want change. I think the timing is right. People

are very open-minded to innovation, and open-minded to people from other countries.

The United States, Europe, and so forth being part of that change.

QUEST: I am fascinated by this point. You're not the first business leader who I've heard sort of say that in the past, particularly on the

women driving issue, or the role of women in this society, that it is quite difficult to defend a Western country coming in here in that sense.

ROSENBERG: Yes. And we're going to go further. When we come in here, I think a big part of our business plan is going to be hiring women. All of

a sudden, you have half of the population that's not in the work force, and obviously women are just as smart as men. So, we could incorporate them in

our work force, I think have a very good work force at the -- at the same rate where we -- where we pay someone, hiring a woman, maybe would get

someone better because they did not have the opportunities.

QUEST: OK. Now, on this question of the crackdown on corruption, of the crackdown on corruption, of course, it's going to take time for this

process of change. It's very fast, we know. I've heard you talk about it and others. I think -- I guess I'm saying you have the stomach for the

process. This is not something that's going to happen. It could get mess y before it gets clean.

ROSENBERG: We are here for the long term. So, we're willing to invest and understand what the process is. Corruption is the killer of progress. So,

if our antenna goes up to that, we'll take a pause. But as long as we don't encounter that in the process, we'll continue forward.


[16:50:00] QUEST: There you have all different points of view from the African point of view to the U.S. commercial point of view. How they're

handling what's happening here in Saudi Arabia. You can download our podcast, it's available from all the main providers, and, of course, you

CNN. Com/ podcast. The sea of change. What's happening. It's being driven by the country's youth I'll speak to a 14-year-old entrepreneur with

success well beyond his years.


QUEST: Saudi Arabia's crown prince is driving the biggest transformation this country has seen in decades. And a young generation of Saudis fed up

with high youth unemployment appear to be firmly behind the crown prince making that change. Almost three quarters of Saudi's population is under

30. Now, a real-live proof of this, I discovered the age gap while hosting at the global forum here in Riyadh.

Put your hands up if you're aged between 40 and 50. 30 and 40. 20 and 30.

Now you see what you're dealing with.

Of all the young entrepreneurs here in Riyadh, for the MiSK forum, Winston Matthews is the youngest. And maybe one of the youngest yes that we have

had on Quest Means Business. At 14 years old, his corporate contacts would be the envy of the most seasoned entrepreneurs. He's met with Bill Gates,

as well as executives from Google. And the members of the Saudi royal family.

Winston learn to write code at six. Today he's one of the youngest VR software developers in Silicon Valley. And as you can tell he joins me

now. It's good to see you, sir.


QUEST: Apologies for keeping you up to the best part of 1 o'clock in the morning. After what must've been a very long day. All right. You are one

of the brightest and best of your generation. That's not me being flattering. That's what everybody says about you.

What do you make of what you're seeing here in Saudi Arabia?

MATHEWS: it's just amazing how much change there is especially like in just the last six months, how much Saudi Arabia has really changed. And

they're really trying to make it more of a technologically more advanced here.

QUEST: So, what can you tell them, or what can you help them understand about this nature of technological revolution?

MATHEWS: Well, I mean, technology is changing everything. I mean, it's changing our entertainment, our sports, and education soon.

QUEST: So, you've been writing code since you were 6.


QUEST: When -- at what point did you realize this was somewhat extraordinary? And that your abilities are extraordinary?

MATHEWS: Probably have not realized it yet, because it's just so surreal being all the way out here in Saudi Arabia, giving speeches to people and

just people are coming up to me saying how inspired they are with my speeches. And that's just so amazing.

QUEST: What's the core message? You know, you've got the viewers there watching. What's the core of your message?

MATHEWS: Just to, like -- how education and technology, how it's going to be enhanced or changed for better, and getting technology to the kids who

really need it the most for education. And VR.

QUEST: VR, can you -- but it is going to require huge changes, isn't it, in the world? You have grown up with this. By the time you get to my age,

it's all very different and very difficult to understand. How you make someone like me understand?

MATHEWS: Well, I mean, it's just like -- like, accepting the change, and kind of just like going -- going with it. Find --

QUEST: What is it you want to do? You're an entrepreneur. You're in VR. What is it you want to do?

MATHEWS: Well, I want to start creating, like, educational virtual reality courses. So, I can get these courses to the kids who really need it the

most, so they can get a quality education.

QUEST: Which kids are those? Have you met them? Are they in places like Saudi, are they in places like the United States where you live or in

Africa? Which kids need this most do you think?

MATHEWS: Well, I've already met with the MiSK school, and they want me to be an innovator in residence there. So, I will go there, and I can test

out my VR games there. But the kids who really need it the most are the people who really can't afford or have access to really quality education

in their area.

QUEST: You're 14 years old correct?


QUEST: Who knows what you will have done by the time you're 21. Thank you very much indeed for joining us. Really lovely to have you on the program


MATHEWS: Thank you.

QUEST: Thank you very much indeed. As we continue tonight, we'll have our Profitable Moment after the break.


QUEST: Tonight's Profitable Moment. Shock or remarkable, extraordinary, worrying, dictatorial, all sorts of words that are used about the crackdown

here in Saudi Arabia by the crown prince and the government on corruption.

201 princes, top business leaders, leaders in the army are still locked up in the Ritz-Carlton hotel. They are basically accused of corruption.

Those here that I have spoken to say this is not a land grab or a power grab. Or a way of managing how to get rid of opposition. Oh, they'll

admit privately that that might be an ancillary benefit to it, but what they're really getting to is the level of corruption, which in this country

was epidemic.

And interestingly they came to repeat again and again, the rule of law as seen in Saudi

will be maintained. But perhaps the most important aspect of this is, the youth of this country, more that 30 to 50 percent are firmly behind the

policy that has been put in place. It merely now requires the government not to mess it up and ensure that the rule of law really is maintained.

Tonight. I'm Richard Quest.