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World Leaders Meets in Davos for World Economic Forum; Trump's America First Policy Criticized by other Nations; Theresa May To Address World Economic Forum; Macron, Europe Needs A 10 Year Strategy; Zimbabwe Wants Global Investment; Disgraced Doctor Sentencing; Pope Points Out Ways To Spot The Truth. Aired 3-4a ET
Aired January 25, 2018 - 03:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN ANCHOR: A very good morning to you from Davos in Switzerland.
In the next hour the Canadian foreign minister and Britain Chancellor of the Exchequer will be joining us to discuss the big issues.
We're at the World Economic Forum in Davos. I'm Richard Quest.
ROSEMARY CHURCH, CNN ANCHOR: And I'm Rosemary Church at CNN center.
Also coming up, Donald Trump has just signaled a major concession in the immigration debate.
Plus, the disgrace doctor is heading to jai1. The dramatic sentencing after a week of gut-wrenching testimony from Larry Nassar victims.
QUEST: A warm welcome to cold Davos. The sun isn't up yet but it will be soon.
Globalization meets America first today at the World Economic Forum. U.S. President Donald Trump is set to arrive in a few hours from now in the air at the moment heading towards Zurich. He is schedule to meet with the British and the Israeli prime ministers where they will discuss North Korea, Iran, and Syria.
And then to west where his protectionist message to the World Economic Forum seems likely to clash with what we've been hearing from other world leaders.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, GERMAN CHANCELLOR (through translator): We think that shutting ourselves off from the rest of the world isolating ourselves will not lead us into a good future. Protectionism is not the answer.
MICHEL TEMER, PRESIDENT OF BRAZIL (through translator): Protectionist is not solution. When we are close within ourselves we are close to new technologies. We are close to new ideas, new possibilities.
And we therefore remain closed to extra effective solutions to our shared problems.
JACK MA, FOUNDER AND EXECUTIVE CHAIRMAN, ALIBABA GROUP: I think globalization cannot be stop. Nobody can stop globalization. Nobody can stop trade. And I believe if trade stops wars starts. Trade is the way to solve- to dissolve the war not to cause the wars.
(END VIDEO CLIP)
QUEST: A number of President Trump's cabinet secretaries are already here in Davos laying the ground work for his America first agenda. I spoke here earlier to the former White House communications director Anthony Scaramucci.
ANTHONY SCARAMUCCI, FORMER WHITE HOUSE COMMUNICATIONS DIRECTOR: He more or less means a nation first policy. His idea is that each nation's leader should take care of their citizens first but then also be part of the global community.
QUEST: Nobody would disagree with that. It's when you take a very narrow definition of what the trade policy should be, in other words almost and I have a trade deficit with you it must be that.
Whereas here of course, people like Angela Merkel today, Justin Trudeau yesterday all said globalization is at risk.
SCARAMUCCI: Yes I don't believe that. I mean, that's also politics on their part. I think what is totally true if you look at the trade over the last year of anything the U.S. economy strength has led to more global trade as oppose to last global trade versus 2016.
So, for me, I think the president's message is I'm working on building the aggregate demand and purchasing power for working class families and middle class families. That is a positive engine for growth for the world will lead to more global peace more global prosperity.
QUEST: The Davos conference has long championed globalism and international cooperation. President Trump has proven he's willing and able to work under his predecessors since taking his pull to U.S. from the Trans-Pacific partnership deal and now that the U.S. will stop participating in the Paris climate agreement, and he has threatened to end more trade deal if he doesn't what he believes is in America's interest including the North American Free Trade Agreement, NAFTA.
Now let's talk about NAFTA. Speaking of this, round six between -- the negotiations between the U.S., Mexico, and Canada are now getting underway. No major progress has been made on key issues to the first five. Mexico remains optimistic.
(BEGIN VIDEO CLIP) ILDEFONSO GUAJARDO, ECONOMY MINISTER OF MEXICO: Let me tell you that a negotiator is never optimistic. I'm positive that they can reach a very nice result. I hope. But let me also tell you this that it is normal for our negotiation to be like a roller coaster, sometimes it's up, sometimes it's down.
QUEST: So where are you now?
UNIDENTIFIED MALE: I think we are in the wheel.
(END VIDEO CLIP)
QUEST: Joining me Chrystia Freeland, the Canadian Foreign Affairs Minister. Good morning to you.
CHRYSTIA FREELAND, FOREIGN AFFAIRS MINISTER OF CANADA: Great to see you, Richard.
[03:04:58] QUEST: Good to see you. Now let's begin with NAFTA and the latest negotiations. Ildefonso Guajardo of Mexico says he is positive. There have been five rounds so far, the six is underway. This is the crucial make or break on the two remaining big issues.
FREELAND: I think this round is important. I share Ildefonso's positive approach. He and I actually met in Toronto on Monday to get ready for the round, and I will be seeing Ambassador Lighthizer of the U.S. lead on the NAFTA negotiations this afternoon.
So, yes. We, Canada approaches this with a real spirit of positive intent and we see some real opportunities. You know, I think it's important to remember this free trade agreement has been around for more than two decades. This is the 21st century. Now there are really good opportunities to modernize this agreement, to cut a lot of the red tape to make it fit for the 21st century and we can do that.
QUEST: But the areas of things like telecoms and modernization that has been agreed in the previous. I mean, did that much of that work has been under TPP anyway. It's local content, regional content, it is the sunset clauses. These are the difficult ones that the U.S. wants that the other two are not prepared to give ground on.
FREELAND: You're quite right, Richard. There is, you know, we divide the negotiation into sort of two parts. There is sort of the bread and butter trade issues, things like sanitary and phyto-sanitary rules, technical barriers to trade, electronic forms at the border. That kind of stuff. And I think the negotiations are going pretty well, it's a pretty standard negotiation.
And then there is a set of what we call the unconventional U.S. proposals in areas like rules of origin, particularly for the car sector like the sunset clause proposal. And there have been -- there is a greater distance between the parties. We have Canada going into this round.
We have put forward some creative ideas on the sunset clause on ISDS and create idea on rules of origin which we hope will help us move towards having a real conversation on these issues.
QUEST: When the fifth round ended the (Inaudible) was very pessimistic in total if not necessarily in words about the way forward. And it would be a tragedy they say if NAFTA were to collapse over these issues.
FREELAND: Yes. Canada very much support NAFTA. We think that it has been a really good deal for Canada and the United States and we think a win, win, win renegotiation is absolutely possible. So, we're all in here.
QUEST: And now let's look at the other deal because the U.S. walked away from, the TPP which imaginatively is now being called the CPTPP. What message is the rest of world sending do you think by proceeding with these very much is what the message we heard from Angela Merkel here, from Macron, from your own prime minister yesterday on globalization?
FREELAND: Yes. I mean, you know, as far as Canada is concern we feel we really have to charts our own clear and sovereign course. And our view is that globalization is being part of the global community is good for Canadians.
We believe in an open society. We believe in trade. We believe in immigration. We believe it's very important and this was one of my prime minister's message here in Davos that the fruits of economic globalization are widely shared across society and we're working in Canada. But yes, we are trading nation and we're proud of that.
QUEST: Are you concerned that the new tax regime in the United States creates a race to the bottom. The president admitted it. He's coming here. I mean, he said in words and word syllable. He is coming here to tell people bring your money into the United States. Lower taxes, less regulation, a more business friendly environment to do business.
That I know it's not a zero-sum game but is a zero-sum game because dollars that go to the U.S. don't go to Canada.
FREELAND: So, Richard, it's like you're a mind reader. I was about to remind you trade and the global economy is not a zero-sum game. It's the opposite when we -- when one country grows it helps everybody else. And that's actually what we're seeing right now on the global economy.
When it comes to picking one country as a place investors should go I'm going to say Canada is the place people should be coming. And that's what one of stories that we're telling here in Davos.
You know, we have one of the lowest unemployment rates right now in Canada we have ever recorded. We had last year the strongest economic growth in the G7. We have a stable government. We are open to immigration so you can bring talented employees to your companies in Canada.
So I want to say if we're talking about, you know, who is pitching for foreign investment. Consider Canada. QUEST: Minister, finally you kindly invited me to Toronto.
FREELAND: Yes, please, come.
QUEST: Plus this business will come from Toronto.
FREELAND: OK. It's a deal.
QUEST: I do have a coat on but the Canadian minister bravely took her coat often I followed through.
[03:10:02] FREELAND: It's not that cold.
QUEST: By Canadian standards.
FREELAND: That's true.
QUEST: Good to see you, minister.
FREELAND: OK. It's really nice to see you. OK. Take care.
QUEST: Thank you very much, indeed.
Rosemary, back to you at the CNN center.
CHURCH: I notice you without coat both of you. Incredible. And we will come back to in Davos in just a moment, Richard.
But just before he left for Switzerland, President Trump surprised some reporters at the White House and briefly took questions one headline from the impromptu news conference. Mr. Trump says he's looking forward to meeting with special counsel Robert Mueller and testifying under oath in Russia investigation.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I would love to do that. I like to do it as soon as possible. Good luck, everybody.
UNIDENTIFIED FEMALE: Do you have a date set?
TRUMP: So here is the story.
UNIDENTIFIED FEMALE: Do you have a date set?
TRUMP: I don't know. No, I think just talking about two or three weeks but I would love to do it.
UNIDENTIFIED FEMALE: In person?
TRUMP: You know, again, I have to say, subject to my lawyers and all of that but I would love to do it.
(END VIDEO CLIP) CHURCH: Meanwhile, President Trump says he is open to a pathway to citizenship for so-called DREAMers. Those are people brought as children to the United States illegally by their parents. Many of them have never known any other country. Mr. Trump says DREAMers should worry about being deported if they do a great job, he says, they could become citizens over the next 10 to 12 years.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Do you think you're going to get a deal on immigration, Mr. President?
TRUMP: I think so. Yes. I think so.
UNIDENTIFIED FEMALE: What do you think it's going to look like?
TRUMP: We're going to get a wall. We're going to get great border security. In fact, I just wrote something out, you may talk about it, chief, if you want, otherwise we'll do it tomorrow. But I just wrote something out, what we're looking, we want great border security.
We want to do a great job with DACA. I think it's our issue. I think it's better issue for the republicans and for the democrats.
UNIDENTIFIED FEMALE: Do you want citizenship for the DREAMers?
TRUMP: But we're going to -- we're going to morph into it. It's going to happen, at some point in the future.
UNIDENTIFIED FEMALE: What does that mean? What is morph into it? What do you mean?
TRUMP: Over a period. Over a period of 10 to 12 years, somebody does a great job. They've worked hard. It gives incentive to do a great job but they've worked hard. They've done terrifically, whether they have a little company, or whether they work, or whatever they're doing if they do a great job. I think it's a nice thing to have the incentive, of after a period of years, being able to become a citizen.
UNIDENTIFIED FEMALE: How many years, Mr. President.
TRUMP: We're looking to 10 or 12.
UNIDENTIFIED FEMALE: Ten or twelve years.
UNIDENTIFIED MALE: If there's no agreement (Inaudible) you're going to protect and you're going to extend the deadline?
TRUMP: Yes, I might do that. I might do that. I'm not guaranteeing it because I don't to do -- I don't want to put a little bit of that, but I certainly have the right to do if I want.
(END VIDEO CLIP)
CHURCH: Close to 800,000 people are protected by the local DACA in the United States but they could be sent back to their home countries if Congress doesn't strike a deal by March 5.
President Trump says he might consider extending that deadline. The lead democratic negotiator on DACA, Senator Dick Durbin says, and I'm quoting him, "The president is headed in the right direction here."
And his republican counterpart Lindsey Graham says, "This statement represents presidential leadership on immigration that will allow us to solve a difficult problem. I truly appreciate President Trump making it clear that he supports a path to citizenship for DACA recipients. This will greatly help the Senate efforts to craft a proposal which President Trump can sign into law."
And still to come, we will take you back to Davos in Switzerland. The governor of Washington State is there for the World Economic Forum and we will speak with him about a bold plan in his state to tax carbon emission.
We're back with that in a moment.
[03:15:00] (COMMERCIAL BREAK)
QUEST: OK. So, in Davos everybody awaits the arrival of President Trump in some shape or form he arrives in Zurich in just a few hours from now. Helicopters up to mountain to here and then it's a variety of meeting. Theresa May and Benjamin Netanyahu.
Nic Robertson our international diplomatic editor joins me to...
NIC ROBERTSON, INTERNATIONAL DIPLOMATIC EDITOR, CNN: Good morning.
QUEST: ... give us some understanding of these meetings that the president is going to have.
ROBERTSON: I think they are going to meet you very warm meeting they are going to have this afternoon. Theresa May and Prime Minister Benjamin Netanyahu are friends of President Trump. You know what's interesting is right before Theresa meet to Donald Trump she gives her speech. When you look at her speech it's very different to the circling of wagons the sort of criticism of President Trump we heard from all the other leaders so far.
QUEST: OK. When gives that speech we've heard is the way from Macron, Merkel, but Theresa May has a much more difficult task.
Yes. Because the president and her have already had spats over the president's tweets.
ROBERTSON: And she's moved beyond that. There was one tweet where he was precisely critical of her that she decided not response it. However, in the social media domain she has a very strong message, there's a narrative she's been putting up for six months or so. That is that social media companies need to be more responsible for their audiences, they need to crack down and clamped down on the amount of sort of traffic terrorist propaganda that can get in the social media these days.
This is going to be music to President Trump's ears. There's a mutual -- they can have some mutual conversation about it that she needs his support on that and many other things.
QUEST: But back at home if we remember that first White House meeting that the Prime Minister had the holding of hands as they walk along the (Inaudible) the president taking the prime minister's hand. She is damned if she do and damned if she doesn't. If she offends the president she risks possibly trade and an agreement on post-Brexit.
If she gets too close to the president she gets excoriated by the British media.
ROBERTSON: She went from Washington to Ankara to meet with the Turkish president. She was in trouble by the time she got to Ankara because she had been critical enough of President Trump's immigration policies that he was introducing literally watchers on the ground to the United States. It was something that didn't sit well with the British audience.
There were people on the streets protesting should offer President Trump a state visit -- a state visit to Britain where he'd meet the queen. And there were 1.8 million people within days of the handholding saying that he should be allowed to meet the queen that really this was the right kind of moment.
That movement is going but she's on different, different political space. Think about it. Her biggest challenger was Prime Minister Boris Johnson is the one who is openly saying we cannot be having a fractured relationship with the United States. So she's between many (Inaudible).
QUEST: OK. Nic, finally, we are here in Davos. This is your first Davos in...
ROBERTSON: This is (Inaudible).
QUEST: But I'm curious to see what we call a Davos virgin makes of all of this.
ROBERTSON: It's interesting. Look, I've come from the mountains of Yemen where they were higher than this where there is a war going on, it's the worst humanitarian disaster on the planet according to the United Nations.
And you know, when you step into this environment I do wonder if some of the people that we're hearing from here if they could walk just two minutes in their shoes I just walked in Yemen they might have an entirely different feeling about where they would place himself on the fractured board and how they would view the planet.
I taught in a university that a young man with -- I've never seen a 3D printing press before (Inaudible) they were using it. They were making -- they were making as spare lumes for people with 3D printing press. They learned about how to go in YouTube. These are guys who want jobs in the future.
But you know what, if they don't get jobs in the future in Yemen they are going to be crossing the Mediterranean with millions of other people to Europe to sharing globalization.
QUEST: Good to have you here.
ROBERTSON: Thanks for having me.
QUEST: It's so refreshing to get your perspective.
ROBERTSON: My pleasure.
QUEST: I mean, after war we're also up talking to ourselves.
ROBERTSON: I did that already.
QUEST: The narrative just goes round and round. Good to see you, Nic. Thank you very much, indeed.
Yes, as you can probably tell it's fresh, and some would say cold up in the streets out. We have more snow this year around that we had even this time of year. It's all quite normal at this time of the year. Now listen to the French President Emmanuel Macron as he use the weather in Davos to make a subtle dig against President Trump and those who deny climate change.
(BEGIN VIDEO CLIP)
[03:20:01] EMMANUEL MACRON, PRESIDENT OF FRANCE: For sure it was Davos when you look outside, especially coming and arriving in this building, I believe it could be hard to believe in global warming.
Obviously, and importantly you didn't invite anybody skeptical with global warming this year.
(END VIDEO CLIP)
QUEST: Now with me is one of the many Americans who take climate change extremely seriously. Governor Jay Inslee of Washington State has made a bold proposal for his state to do something about it. Good to see you, governor.
JAY INSLEE, GOVERNOR OF WASHINGTON STATE: Thanks for having me.
QUEST: Thanks for joining us here. I appreciate it.
Now U.S. has moved off from Paris but many states and companies have said no, we will abide by the Paris climate accord. And your proposal takes towards that move.
INSLEE: It very much so. Basically, the message from 14 states. We have a group called the United States Climate Alliance we're moving forward we're going to defeat change, we're going to grow clean energy jobs in our states. And Donald Trump cannot us.
And the reason he cannot stop us is we have innovative entrepreneurs, we have governors like myself who are adopting policies to restrain carbon pollution and invest in the clean energy sector. That's happening big-time in our country.
QUEST: But you can out your state it's an economic disadvantage.
QUEST: And give other states within the U.S. do not follow the same measures thereby gain a competitive advantage or be it at the cost of the environment.
INSLEE: So that is one of the great miss of climate change because we are actually growing our economy, we are rated as the number one economy in my state in the United States in part because we're growing clean energy jobs. We have 90,000 people who are in our clean energy sector and embracing investment strategies to put investment into solar and wind and multimodal.
These things grow jobs. And we look around the world you'll find out with the highest sector job creation frequently the place where you have leaders like myself who want to create a clean energy future. This is an investment strategy.
QUEST: When you hear the president during the sort of actions he did over solar panels...
QUEST: ... on washing machines and then you see the reaction in the rest of the world. A trading country like (Inaudible) like us trading state. Agriculture. They got Microsoft, they got lots of their large international companies within the state.
Do you agree with those sorts of measures and their imposition of tariffs in this way?
INSLEE: Well, you can make big mistakes when you spend more time tweeting than you do reading. And I would suggest that is happened here because this proposal probably will end up costing us thousands of jobs because we have a robust very rapidly growing solar industry in our country.
There is 250,000 people working in it today. It's growing 17,000...
QUEST: Not just -- not just in manufacturing. INSLEE: Yes. But manufacturing is only 1 percent of the job. Ninety percent of the jobs are installation steel for the frames and those jobs are going to hurt. So the national solar industry is already predicted 24,000 job loss in all of these jobs associated with contracting and building the solar plants. This is big deal.
Look, I just talked to executive here who wants to build the solar facility here in my state Richland, Washington. This just made it more expensive for him to do that. We want to put people to work in the solar industry. Unfortunately, the president's proposal may end up going backwards on solar employment.
QUEST: There's general agreements hear in Davos. The president's tax cuts. This won't surprise you by the way, governor.
INSLEE: Thank you.
QUEST: I'm in here. This won't surprise you. I beg to people who are here.
QUEST: That the president's tax cuts and the new U.S. tax regime territorial versus worldwide is a good idea. It was needed within your structure.
INSLEE: Well, you'll hear a big disagreement from my state where you find out that creating another big deficit and some of the folks in Davos aren't going to have to pick up the pieces to fill the deficit spending that the president gave to my grandchildren.
We would rather put that in an investment vehicles to invest in our infrastructure. Now D.C. can't build birdhouse. My state just deducted a big capital $4 billion investment for infrastructure. That's what we should be doing and we didn't do it in this bill.
QUEST: Choose a color, you can choose a color to go on the board.
INSLEE: Well, blue obviously. Here's a blue one from a blue state. That's the future of America by the way.
QUEST: That's OK. It's way too early.
INSLEE: I'll take blue.
QUEST: You take blue.
INSLEE: I'll take blue.
QUEST: With this on the fractured board.
QUEST: This is where we are not fractured at all.
INSLEE: OK. QUEST: This is where we are very fractured.
QUEST: That's the prime minister of Norway. That's one of your largest constituent companies.
QUEST: That's Microsoft.
QUEST: So very fractured but things are getting better
QUEST: Governor, where were you?
INSLEE: Well, I'm going to put my W over here which is my state and the reason I believe that is Washington states with the rest of the world, we're going to defeat climate change and we're going to do that because we have an innovative state.
[03:24:59] And so, I believe we're not fractured with the rest of the world and Donald Trump is not going to stop us from that relationship.
QUEST: Good to see you.
INSLEE: Thank you. Good luck with the fractures.
QUEST: Hopefully the fracture...
INSLEE: Keep hope for life.
QUEST: Good to see you.
INSLEE: Thank you.
QUEST: Rosemary, back to you at the CNN center. Thank you, governor.
INSLEE: My pleasure.
CHURCH: All right. Richard, we'll see you again soon.
President Donald Trump is urging Turkey to rein in its military operation in northern Syria. For five days the U.S. ally has carried out an air and ground assault against Syrian Kurds. The Kurds also U.S. allies against ISIS but Turkey sees them as terrorists.
Turkish President Recep Tayyip Erdogan has threatened to extend the offensive into Kurdish territory. That may put U.S. troops at risk. The White House says Mr. Trump warn him against bringing U.S. and Turkish forces into conflict. The aid agency Save the Children has temporarily suspended all operations in Afghanistan after militants staged a deadly attack on his office in Jalalabad.
This exclusive video shows the battle between security forces and four attackers. They stormed the building after a suicide bomber blew up a car outside the charity. At least four people were killed and dozens more were wounded during the 10-hour siege. The attackers were also killed.
CNN's Nick Paton Walsh reports.
NICK PATON WALSH, INTERNATIONAL CORRESPONDENT, CNN: ISIS have claimed responsibility for this attack in Jalalabad. That's the provincial capital of Nangarhar in an area in east Afghanistan where they do have quite a substantial presence since recently their capacity is even flow often due to sustain American back their campaign against them an Afghan military operations.
But the fact they choose the target like Save the Children, a charity, but it's obviously been out to maintain a presence there when this force to secure area to such a quite a number of years. It shows the kind of soft targets there and for how they seem to be certainly publicly and sort of battle with other insurgent factions to appear more extreme and more hard core.
And none of this any comfort for those who lost their lives there and it comes just after the attack by it seem the Taliban faction Haqqani network on this continental hotel in Kabul which killed a number of Americans and Afghans and then other foreigners too.
So, more broadly, a real sign of having security in key cities in Afghanistan.
Nick Paton Walsh, CNN, London.
CHURCH: Thanks, Nick.
And we will get back to the World Economic Summit in Davos after a short break. British Prime Minister Theresa May takes the stage today. We will see what she might have to say about Brexit.
Back in a moment.
[03:30:00] (COMMERCIAL BREAK)
QUEST: British Prime Minister Theresa May will speak to delegates at the world economic forum here in Davos a few hours from now and everyone will be paying close attention to what she says about Brexit. It is a question of globalization, it is right for discussion was European leaders of the past few days.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: My view is that we have to design strategy because it's a nice strategy, the Kenya strategy to make your financial economy, social green scientific and political for it sure that's what we have to build which means we need more ambition in order to have the more sovereign united.
UNIDENTIFIED MALE: During the next year we have the president of France to relaunch all the European Union. The difficult years characterized by the Brexit vote by the economic crisis and unchecked migrants insults and by the perfect storm of this three elements converging, these years are now behind our back. Those who have back on the final crisis of the E.U. have clearly lost.
(END VIDEO CLIP)
QUEST: Joining me now the British Chancellor Exchequer Philip Hammond. Good morning.
PHILIP HAMMOND, BRITISH CHANCELLOR EXCHEQUER: Good morning.
QUEST: It is interesting to hear this other European leaders during as they go one way. The UK goes the other and now everybody is watching anxiously to see the economic impact of this, of Brexit. What more can you tell us about what you're seeing in the economy as the U.K has towards it?
HAMMOND: First of all let me say this, many in Europe always aspired to have a close-up more integrated union that wasn't right for the U.K. we decided to leave but does leave the European Union free now to chart a different course in the future without also acting as a break on that ambition. In terms of the economy, the U.K. economy has been remarkably resilient since the Brexit referendum vote, of course there is a degree of uncertainty in the business climate, because we are in negotiations about our future relationship. I'm very optimistic for the next few months we will see more and more clarity about the future and that will have a positive effect on the economy.
QUEST: The IMF in its recent upgrade, upgrade everybody else except the U.K., the reason I said was because of the Brexit uncertainty that exists. That is sour news in many ways, to those who wanted Brexit. The economic chickens are coming home to roost.
HAMMOND: It is the uncertainty of business investor's height uncertainty and when they know that there will be clarity to the point in the not-too-distant future. It's not surprising that many investors holding off waiting for that clarity so I'll challenge is to ensure that as we go forward during the course of this year we give investors and businesses an increasing in the sense of clarity, uncertainty about the future. I'm confident that they will then get their checkbooks out and start investing in our economy again.
QUEST: That clarity relates to the length of the transitional period. First, the amount of involvement of the U.K. will except from the European court the four freedoms join us. What comes next? How close are you in reaching the deal?
HAMMOND: So on the transitional period, the two-year period the rules of pretty clear of the European Union sets out its proposal in its original negotiating mandate. We have set the realty we accept that proposal. The CJ will still have jurisdiction. We will still contribute up markets will remain open, business will go on much as it does now.
QUEST: The four freedoms will be maintained?
HAMMOND: The four freedoms will be maintained during that transition period. So that much is pretty clear what business would obviously like is the agreement in writing, we need to have that much European Council and then beyond that to start substantial negotiations about the long-term relationship and to deliver more clarity about that during the course of the year.
[03:35:00] QUEST: On this question will come to the second I don't - on this question of a second referendum, was muted by Nigel Farage said he would be happy he took footage (inaudible) reinforced 1.5 versus the other, can you see any merit. Once the final deal is sat saying to the British people, all right this is a generational not just an electoral cycle, this is a generational issue, we are going to give you another choice, but can I give you another question. Do you want this or not?
HAMMOND: I don't think so British people of made the decision in principle, referendum is an extraordinary event in our constitutional system is made that decision in principle that we revert to the normal mechanism, it is Parliament that will look at the detail of the negotiation of the deal that is agreed on its parliament that will vote on that.
QUEST: Once post Brexit the UK is independent of the EU. This is globalization really becomes extremely important for you, doesn't it? In that sense and here in Davos we have neat disagreement in the sense of the one side there is a espousing globalism, globalization and the US with its American first which many are interpreting as a protectionist policy, where do you stand?
HAMMOND: Well the U.K. always been for open markets and free trade. We are a very medium-sized economy. We believe that the benefits of globalization outweigh its benefits, but we do recognize for individual groups in society that have been challenges from globalization. We have to address those we also believe that we can make globalization feel fairer in the advanced economies. If we make some progress on liberalizing services. So far globalization is mainly been about trading goods where the advanced economies have comparative advantage is in services and liberalizing services would be good for both of advance and emerging economies alike.
QUEST: Before we go, I do want just to get your thoughts, your reaction, president's club dinner that took place in London two weeks ago the men's descriptions of this by groupings and sexual harassment in the city of London as the chancellor, you must have read this as something approaching amazing that anybody in their right minds could ever think to it dinner like this in a stone age.
HAMMOND: Obviously it is a completely inappropriate forums for charity fundraising, I think it is a right decision to abandon it is the right decision by the hospital to return money that was received from this organization. I think everybody will be glad to put this behind us and move on.
QUEST: How do we environments where this sort of thing. Where the financial industry does not gets the message that you don't behave like this at all. It dint even happen is extraordinary.
HAMMOND: My people will not buying the tickets, they are not going to that type of events.
QUEST: Good to see you.
HAMMOND: Good to see you.
QUEST: thank you very much indeed. Zimbabwe's new leader is telling Davos and the world this country is open for business, Emmerson Mnangagwa is here to make a pitch for international investment that modernized the country's infrastructure. I sat down with him to hear his thoughts on Zimbabwe's troubled past as he looks to the future.
EMMERSON MNANGAGWA, ZIMBABWEAN PRESIDENT: Those who want to live on the past, can continue to live in the past. But those who want to see the future where we are going can look at what we are doing. And let judgment of what we are doing not on the issues of the omissions of the past.
QUEST: It is convenient to say that, sir it is convenient to wish to put aside the past saying that will only look to the future, but as South Africa discovered when it's truth and reconciliation commission dealing with the past, is essential to future.
MNANGAGWA: We can have the lessons of the mistakes of the past. It is a lesson for us in the future. But all we wish and feel, we cannot carry in the future. The ideal position for us is to see why are the province growing? Why do we not have find direct investment coming into Zimbabwe? Also we must have a dialogue with people like you, with people who want to come in to Zimbabwe have dialogue and say what did you see which constraints you to come into our environment (inaudible).
QUEST: Now all the highlights from the engineer with Zimbabwe's new leader, he promise you election later this year and says international observers will be present to ensure they are free and fair. He says he has no regrets about the controversial land reforms under Robert Mugabe.
[03:40:12] It was a situation where most of the lands was owned by a small minority of white farmers and he says as long as the country constitutional forbids same-sex marriage. You will uphold it and tell the question of whether that could change or was for in favor of change he says it's not my duty to complain for this.
Saudi Arabia (inaudible) is looking for new business opportunities and his eyeing the United States it is ready to launch in initial public offering. Considering listings shows in New York and other places, John Defterios joins me now, good morning to you John.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Thanks very much Richard. It is really interesting because yes, it is not about interview about the IPO. I am the second half of 2018 and he acknowledged that the market is the evaluation based on the price of oil today was nearly a $70 a barrel last night we have the CNN Money roundtable with a Khalid Al-Falih the ministry of energy from Russia and his counterparts from Russia rather Alexander (inaudible) the first being from Saudi Arabia. What is fascinating we talked about the surge of shale production coming on, perhaps 700,000 barrels a day. The tone has changed. Now the two leading producers in the world going against the United States. They can handle the actual production is coming on the 2018. As a result of the higher prices. Let is take a listen to both of them.
(BEGIN VIDEO CLIP)
KHALID AL FALIH, SAUDI ENERGY MINISTRY: And we are approaching the century mark of 100 million barrels per day for the obviously for the first time in history. I don't see sign of significance slowdown. That ultimately needs to slow down because of (inaudible) resources that we are talking about today, but it is going to grow in a healthy rate between the million for a few more years that will decline a little bit. So I am thinking that in the next 25 years or so to see another 20 million barrels of demand. We are going to hit 120, I remember here, probably in this room, were one of my colleagues back then said we are going to peak at 95 million barrels of demand. And here we are talking about 100. So I don't think we should worry, obviously the world market is very sensitive to inventory, we saw that two years ago and if we don't keep our eyes on the inventory we could go out of balance, but in the long term a very healthy market, I think we can accommodate the kind of numbers that are coming out of the U.S., even if there as bullies as that chart shows.
ALEXANDER NOVAK, RUSSIAN ENERGY MINISTRY: We should not be afraid of shale oil production in general, except in the general supply and demands on the market. As my friend Khalid said we have hundreds million barrels a day. This is the markets demand as it stands today and shows 5.7 million barrels of shingle per day which is 6 percent even if they are six more million barrels by 2021 as he showed it on the slide, this will add 3 percent to the overall demand. So you should understand that this is merely one way of satisfying the markets.
(END VIDEO CLIP)
QUEST: John how does the market absorb 700,000 extra without collapse.
DEFTERIOS: It is all demand from Asia Richard for the last three years. It was the surprise of the upside, rising 1.5 million barrels a day to agent to grow to 1.5 million millions information on the new demands.
QUEST: I do like this gloves. DEFTERIOS: I really got this very quickly. It is at the OPEC meeting
I was freezing and find a great shop to get them. I will give you those if you want.
QUEST: I will give you the gloves?
As we continue tonight, he is not silent for seven days, though more than 150's victims who described the ordeal of what they had gone through, the former Olympic sports doctor and the term in prison.
[03:41:36] CHURCH: For decades Larry Nassar sexually abuse the athletes who came to him for help with injuries. It was the team doctor for USA gymnastics for Olympic Games and also worked at Michigan State University more than 150 of his victims told their stories during his sentencing hearing now thousand a letter to the court and in it he said the women were lying and he was manipulated into pleading guilty. That led to this exchange with the judge.
(BEGIN VIDEO CLIP)
LARRY NASSAR, FORMER USA GYMNASTIC DOCTOR: No your honor.
UNIDENTIFIED FEMALE: (inaudible).
NASSAR: I have said my plea exactly.
UNIDENTIFIED FEMALE: You have not yet owned what you did, that you still think that somehow you were right, that you are a doctor that you are entitled, that you don't have to listen and then you do treatment. I would send my daughters to you sir. You do not deserve to walk outside of the prison ever again. You have done nothing to control those (inaudible) and anywhere you walked, destruction will occur to those most vulnerable. My page only goes 400 years, sir I am giving you 175 years which is 2100 months. I just signed your death warrant.
(END VIDEO CLIP)
CHURCH: The impact of the Nassar case is just beginning, the leader of the US Olympic Committee apologized to the victims and amounted USA gymnastics board member quit or face decertification. And hours after sentencing on Wednesday, the president of Michigan State University resigned under pressure. Jake Tapper reports on the many ways the accusers were dismiss.
JAKE TAPPER, CNN ANCHOR: Dr. Larry Nassar will almost certainly die in prison, but his victims say he is not the only one to blame for the systematic sexual abuse of young athletes in his care.
UNIDENTIFIED FEMALE: The MSU and the USAT and whoever else is responsible for creating an environment unsupervised, uninterrupted, unprecedented access to the hundreds of victims, you should have prevented this.
TAPPER: Michigan State University, USA gymnastics employ the serial child molester for two decades.
UNIDENTIFIED FEMALE: And I standing by sweeping under the rug. You are just as disgusting.
TAPPER: The NCAA is now investigating Michigan State for its role in scandal. The University conducted an investigation in 2014 and temporarily suspended Nassar. He was ultimately cleared and able to return to his role seeing and preying upon young patients.
UNIDENTIFIED FEMALE: My last treated was on August 2016. A week later he was let go by MSU. I am possibly the last child he will ever assault.
TAPPER: MSU says there is no school officials believe Nassar committed abuse and told media reports emerged two years later, in 2016. These allegations of a cover-up or simply false.
[03:50:02] UNIDENTIFIED FEMALE: The disturbing truth is you could've been stopped back in 1997.
TAPPER: Survivor Larissa Boy says when she told MSU had gymnastics coach Kathy Clegg is of her abuse in 1997, she was not believe.
UNIDENTIFIED FEMALE: It sounds eerily familiar to what every single woman was taught all the way back to 1997. We were all wrong, we are all just confused.
TAPPER: Coach Clegg is retired in February.
UNIDENTIFIED FEMALE: He molest my friend and my teammates, how could you?
TAPPER: USA gymnastics has first received similar reports of Nassar's abuse in 2015, but he was not fired until six weeks later, according to attorney for 107 of Nassar's victims, USA gymnastics did not notify Michigan State about any issues with the doctor. The group says claims they covered up the investigation are baseless. Adding we are sorry for any athlete has been harmed during her his gymnastics career. Jake Tapper, CNN Washington.
CHURCH: And we will take a short break here. And still to come, the Pope says fake news dates back to the Garden of Eden, his tips for finding the truth. Plus back to Davos to see what is coming up today at the world economic forum.
CHURCH: Pope Francis has released a message condemning fake news, it is part of the church celebration of world communication day in May. CNN's Rosa Flores explained how Pope is helping people see the truth.
UNIDENTIFIED MALE: We are living in a fake news here.
ROSA FLORES, CNN CORRESPONDENT: Some world leaders have used the phrase fake news. To attack journalist and stories that shine light on the truth.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You are fake news.
FLORES: And now the leader of the Catholic Church is making an intervention releasing a message condemning fake news and encouraging journalism that seeks the truth.
UNIDENTIFIED MALE: The message is be careful about fake news. Be careful about disinformation. This is a causes division and we should be working for unity.
FLORES: the Pope's message is part of world communications day which is been observed by Catholics since 1967, but Faithfull's at St. Peter's Square see current relevance.
UNIDENTIFIED FEMALE: This may be a message here for Donald Trump.
UNIDENTIFIED FEMALE: If you I definitely need think that it is a message to Donald it is pretty obvious.
FLORES: Vatican spokesperson Greg Burke says that's not the case.
UNIDENTIFIED FEMALE: It is his message toward Donald Trump.
UNIDENTIFIED MALE: I'm sure everybody thinking U.S. They think fake news and us, no this is because fake news is spreading around the world.
FLORES: Disinformation that mimics real news that is meant to deceive and manipulate for political and economic gain, and leads only to the spread of arrogance and hatred. He became victim of fake news when a site falsely reported he endorsed Hillary Clinton and then Donald Trump for president.
UNIDENTIFIED FEMALE: Pope Francis said that the first fake news is in the Bible, in the book of Genesis. When the crafty serpent lies to the woman and launches human sin.
FLORES: In modern day the fast-paced digital world help spread false information, the Pope says and getting news from only one source and not seeking diverse opinions helps breed disinformation overcoming the phenomenon of fake news Pope Francis explained requires journalists to be in a constant search for the truth.
[03:55:13] UNIDENTIFIED MALE: The Pope I think is very interested in real communication. The Pope is interested and that is his job, bringing people to the truth.
FLORES: Rosa Flores, CNN Rome.
CHURCH: He has sold millions of albums and has dozens of top 40 hit and now Elton John is saying farewell to the yellow brick road. Whatever you call him Captain fantastic, rocket man or tells him the music superstar is now 17 years old with a husband and two sons so he will give up a half century of life on the road, but not for a three- year 300 show global tour that stops is full.
ELTON JOHN, MUSICIAN: This has been a work in progress. Leading up to the day's announcement. I am looking forward during the tour, because I don't really do picture, I like - I am always working, I do a 100 shows a year. So this is an elaborate stage that I am going to be saying thank you to all they people around the world that made my career so successful. And the boys will be a big part of that. And when I finished then they will have my full attention.
CHURCH: Elton's farewell yellow brick tour is not goodbye, he has a Las Vegas residency right now and working on a Broadway musical and he plans to continue making music and recording after the big tour. All right let us head back one more time to Davos Switzerland, where Richard Quest is standing by. Richard, what do you got on the tap for the rest of the day?
QUEST: Well we will be watching the British Prime Minister Theresa May, she will be talking to the people in a few hours' time. Then of course you got all the guest that are coming out proud, the cause of the day. I will be speaking to the Dutch Prime Minister Mark (inaudible), the Pakistani prime minister (inaudible) will be with me and the Saudi finance (inaudible) will also joins us.
As we continue for this hour, that is where we leave you, I am Richard Quest West in Davos.
CHURCH: And I am Rosemary Church, CNN center in Atlanta. The news continues after a short break. Do stay with us here on CNN.