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QUEST MEANS BUSINESS

Jacob Zuma Defies Party's Calls to Step Down; Trump Vows to Revise U.S.-Korea Trade Deal; Republicans Want Immigration Deal Done This Week; Maurice Levy: Macron Delivering on Reforms; Israel Police: Sufficient Evidence to Indict Netanyahu; Haitians React to Oxfam Scandal; Apple Holds Investor Meeting after Homepod Release; U.S. Intel Chief: No Doubt Russia Will Interfere in Midterms; Meghan Markle's Handbag Sells Out. Aired 4-5p ET

Aired February 13, 2018 - 16:00   ET

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


[16:00:00]

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BIANNA GOLODRYGA, CNN HOST: It's a rare day of calm for the stock market as trading comes to an end. It's Tuesday, the 13th of February.

Tonight: Zuma must fall. South Africa's ruling party tells the president to quit. The country's finance minister is live on this program.

Donald Trump tears into South Korea over a trade deal disaster.

And Tim Cook faces Apple shareholders in California with a brand-new gadget up his sleeve.

I'm Bianna Golodryga and this is QUEST MEANS BUSINESS.

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GOLODRYGA: An unprecedented political drama is playing out in South Africa. The country's ruling party has turned against its president and

the fracture threatens to plunge the country into political turmoil.

President Jacob Zuma is defying an urgent demand from his own party to step down. Zuma has dominated South African politics for over a decade. He

survived repeated challenges to his leadership even as officials charged him with hundreds of counts of money laundering and corruption.

But after a marathon meeting Tuesday, top members of Zuma's ANC party said it's finally time for the president to go.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: When we recall our employee, we expect our employee to do what the organization expects him to do. So I don't know what will

happen but let's leave it to President Jacob Zuma.

(INAUDIBLE) we were not going to him but I think (INAUDIBLE) believe that this is an Asian matter so it must be treated with agency.

(END VIDEO CLIP)

GOLODRYGA: And for the latest from South Africa I'm joined by Eleni Giokos in Johannesburg.

So, Eleni, the party says he must go.

What is next?

ELENI GIOKOS, CNNMONEY CORRESPONDENT: Yes, this is a man that has been clinging onto power for quite some time, despite the fact that we've seen

calls for him to step down in the past. Corpus South Africa has been talking about it globally as the rest of the community has made their views

very evident in the way that the local currency has been performing coming under significant pressure through the years because of the series of

scandals that have been miring his presidency.

But and this is now the question.

Is he going to heed to those calls to resign?

What is the next step?

We know that Jacob Zuma's presidency overall has bought a lot of demise to the economy, GDP growth barely hitting 2 percent on an annual basis since

2009, hitting two recessions over that time as well. And you've got employment on the rise. The list goes on of the negative impact that Jacob

Zuma has had on the economy.

What's interesting though is that since Cyril Ramaphosa was elected as the new ANC president, the rad has rallied by over 10 percent and perhaps it's

a signal that investors are feeling hopeful that change could be imminent.

GOLODRYGA: Well, investors probably were assuming the change would happened sooner rather than later, he was elected back in December.

What does this mean for the ANC party as a whole if Zuma is defiant and doesn't step down?

GIOKOS: This is the interesting thing. So what else can the ANC do?

From what we understand, the ANC has said we're recalling you; the right thing to do is to resign so that there is a smooth transition of power. If

he refuses to do that, then the ANC might take this to parliament and set a motion of no confidence against Jacob Zuma.

But of course that is not going to be the scenario for the party that has again been under the spotlight for factionalism, for perhaps being torn

apart by the series of scandals that have hit the country surrounding Jacob Zuma.

So those are the other options. We know that Jacob Zuma again, (INAUDIBLE) who said earlier today that Jacob Zuma wants to negotiate 3-6 months before

he steps down. Of course, he's trying to see if he can buy himself a little more time, something that he's been very good at in the past.

GOLODRYGA: We shall see. But of course an act of urgency from the party, unprecedented urgency there, asking him, demanding that he step down.

Eleni, thank you so much.

South Africa's economy has faltered in the last few months. As mentioned, Mr. Zuma's presidency. Growth has been mediocre with the IMF saying the

political uncertainty is hurting confidence and investment.

Unemployment is falling, according to new figures today but it is still at a high of almost 27 percent. And in Cape Town, a water crisis means --

[16:05:00]

GOLODRYGA: -- the city is about to run dry, almost 80 percent of companies say operations are under threat if the taps will be turned off.

And over the past few months, the men in charge of South Africa's economy have told this program that change is sorely needed.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There are many, including myself, who would say that perhaps the time has come that the president should allow somebody to take

over and restore South Africa to its pride of place amongst the legal nations around the world and make sure that we begin to do the right thing,

not only for current generations but for future generations as well.

UNIDENTIFIED MALE: (INAUDIBLE) business confidence you are going to have to do more than just (INAUDIBLE) dealing with (INAUDIBLE). Policy setting,

too, and what that means is that in particular sections where there are outstanding policies or where there is indecision by government, those

decisions have got to be taken swiftly.

UNIDENTIFIED MALE: The political uncertainty which came with the preparations for the conference and who was going to be electric has been

dealt with. There is -- now the new leadership is focusing on resolving the structural reforms in the economy and getting the economy to grow

beyond what is -- what was projected in the budget, in the medium-term budget policy statement.

(END VIDEO CLIP)

GOLODRYGA: And I am joined now by South Africa's finance Minister, Malusi Gigaba. He is live from Cape Town.

Minister Gigaba, thank you so much for joining us in this late hour, a lot to talk about right now.

First, I want to ask you, are you a supporter for the president to step down as the party has demanded he do?

MALUSI GIGABA, SOUTH AFRICAN FINANCE MINISTER: Well, of course. We all support the view that the president needs to step down and to step down

immediately, to allow the new leadership to manage the transition process from the previous leadership to the new leadership.

And so I'm fully supportive of the measures that are undertaken particular because they are going to bring about the much required political certainty

and policy certainty that we need in order to get the South African economy growing beyond the levels at which it's growing at the present moment.

We've already seen positive indicators in the economy; the bond yields (INAUDIBLE). We've seen the rand strengthening against the dollar. We've

also seen a number of other factors, including declining unemployment.

All of those are positive signals. They are big decisions which have been taken by the new leadership in the space of four months -- of four weeks,

which indicates that we are living through a very significant transition which will augur very well for the people of South Africa.

GOLODRYGA: Declining unemployment but we're talking about 27.7 percent to 26.7 percent, hardly anything to brag about. Your president has refused to

step down. He says he is going to be there for another six months.

What happens next?

Is there going to be a no-confidence vote in parliament?

GIGABA: Any move at the present moment, any shift in -- towards a positive direction (INAUDIBLE) in unemployment figures or the rate of growth of GDP

is a welcome signal. And we will take it -- we don't celebrate anything. We know that the road ahead is still very long.

And so we continue to move forward. I think what we expect now is that the deadline which has been set for the president by the national executive

committee is for tomorrow. We expect that tomorrow he is going to do the right thing as the industry expects.

The secretary-general was very clear today that we expect of the cadas (ph) of the ANC to do the right thing when called upon. This president

(INAUDIBLE) himself did so in 2008.

We expect that President Zuma would also do the same thing and if that does not happen, the NEC (ph) has put in mechanisms to address that situation.

There is an ANC caucus tomorrow in the national parliament, where members of the ANC will deliberate on the issue and plan the next way forward.

It is going to take place an hour after President Zuma would have addressed the nation at 10 o'clock in the morning so we will know by then what is the

cause of direction we are going to take.

But surely if -- should he continue to refuse, should he refuse, we will then have to result on a parliamentary process that with a 62 percent

majority and the support of other opposition parties, we are certain it will pass.

But it is not --

[16:10:00]

GIGABA: -- the be the direction we wanted to go towards. But if we are left with no other option, of course, we would resort to those measures.

GOLODRYGA: And of course, the president has been hit by corruption scandals now for years.

Your name also has been implicated in corruption scandals.

Are you concerned that your fate is tied to that of President Zuma's?

GIGABA: The state of (INAUDIBLE) commission of inquiry is true to (INAUDIBLE) very soon. We all are excited about that prospect because it

is going to assist the country to get to the grips of all the allegations which have been made.

The issue of corruption in South Africa is not merely a perception, it is a reality. It affects not only the public sector, including state-owned

companies, it also affects the private sector.

We do need to get to the grips of this and to get to the bottom of it and ensure that we clear the names of those need to be cleared and those who

need to be charged are charged.

The truth is going to come out so I do not think anybody should feel apprehensive about this process. It is a necessary process which is going

to restore confidence in South Africa's public and private institutions and ensure that we will restore the trust between the people of our country and

the leadership of the country and then provide the country with an opportunity to embark on a renewal (INAUDIBLE) and move forward.

GOLODRYGA: So it sounds like you maintain your innocence. Let me ask you something quickly. Our final question, a Moody's rating review could see

South Africa's rating cut to junk and the country's bond ejected from key index.

You said earlier on this issue that you are confident that will not happen. Of course, that was earlier in the -- this year and late last year.

Are you still as confident, given the chaos taking place in your own government?

GIGABA: There is absolutely no chaos in government. Government is continuing to function. All ministers are in place. They are continuing

to execute their mandates as assigned to them. The only thing that is outstanding is a decision on the president, which is going to provide

political certainty.

That will be very supportive of the structural reforms in the economy that have begun to take place. We have seen recently major decisions being

taken about from state-owned companies, including South African Airways has come. There is an imminent change in the board of directors of nine

executive directors of denel (ph). A number of decisions are being taken.

We expect that the state to have captured commission of inquiry is going to start. The commission of inquiry on our tax administration. The South

African revenue service is also going to take place.

So government is continuing to function. There is no chaos. I think that onlookers, observers and the people of South Africa should take comfort in

the fact that continue to make progress.

You see the economy continuing to perform well. We are quite positive about what the state of the economy during the course of this is going to

be and we look forward to presenting the budget next Wednesday, which is going to outline the economic outlook, the fiscal framework, the division

of revenue, the state of state-owned enterprises and the additional measures we are undertaking in order to stabilize debt and ensure that we

keep our budget deficit within reasonable limits.

So I feel confident that we have done everything we had promised to do in order to stave off another ratings downgrade.

GOLODRYGA: OK, hard to take comfort, though, in some of these headlines that we're seeing, including a major water crisis in your second-largest

city.

Minister Gigaba, we're going to have to leave it there. I'm so sorry for cutting this interview short, but thank you so much for joining us. We

appreciate it.

U.S. athletes, meantime, are aiming for gold in South Korea. President Trump is aiming for a trade agreement with South Korea that works for him

and the president is threatening to walk away if he doesn't get it.

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[16:15:00]

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GOLODRYGA: President Trump is doubling down on his trade threats. During a meeting with members of Congress, the president said he was mulling trade

sanctions against China.

He also bashed the U.S.-South Korea trade agreement currently being renegotiated. Mr. Trump insisted if the talks do not yield a fair deal, he

will scrap the agreement altogether.

(BEGIN VIDEO CLIP)

TRUMP: We have a very bad trade deal with Korea, very, very bad trade deal. It's a deal that -- it's incompetent that somebody could have made a

deal like that. I was supposed to produce 150,000-200,000 jobs and it did -- for Korea.

For us, it produced nothing but losses.

(END VIDEO CLIP) GOLODRYGA: And we're covering this from the U.S. and from South Korea. Here with me on set, CNNMoney's Patrick Gillespie and from PyeongChang,

CNN's Ivan Watson.

Welcome to you both.

Let me start with you here on set because the president seems to be issuing this intense threat, saying that he is not even ruling out trade tariffs.

PATRICK GILLESPIE, CNNMONEY CORRESPONDENT: Yes, last year we got a lot of the Trump administration's America first bite on trade policy. Now we are

starting to see a lot more bark because the Trump administration has two major investigations on trade going on into steel and aluminum

investigations, imports into the country.

And whether they risk U.S. national security. These could result in widespread tariffs on countries like South Korea and China, among several

others, including Canada. And at the same time the U.S. is negotiating with South Korea and with Canada and Mexico on a litany of trade agreements

that the -- President Trump says have been unfair to the U.S.

So we're trying to see a lot more serious, concrete steps coming out of the Trump administration and it could ultimately lead to retaliatory measures

from other countries and for higher prices for American consumers, from everything from the cost of a beer can to a car.

GOLODRYGA: Yes, you are seeing retaliation and pushback from members of his own party, including as Senator Mike Lee and Pat Toomey, who said

invoking national security when I think it is really hard to make this case, raise rates, retaliation just how you said.

Ivan, reaction right now, specifically in regard to timing for the president to be pressing this issue from the South Koreans?

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: You know, he paid a visit to Korea a couple of months ago and while spending much of the time

talking about North Korea, he also did address the trade concerns and criticisms that he's had.

So he has tended to compartmentalize, President Trump, his glowing support for South Korea as a military ally and the security concerns with the trade

concerns. But this is clearly an issue. There been several rounds of negotiations already about this trade deal. Last month that South Korea

filed a complaint with the World Trade Organization. When the Trump administrations slapped tariffs on the import of washing machines. And

South Korea has imported -- exported to the U.S. some $160 billion worth of washing machines in 2016 alone.

So this is a concern here and it is a source of tension. The question about whether it could bleed into the political and security relationship

between Washington and Seoul, I think that is far-fetched right now. But it is it is a concern. It is something that Koreans are looking at and

does affect the biggest --

[16:20:00]

WATSON: -- corporations here in this country.

GOLODRYGA: Yes, of course, the vice president just leaving South Korea on Saturday.

Ivan, the president invoked China again and this is not the first time we've hearing him issue threats with regard to trade in retaliation with

China, saying that it is unfair and one-sided.

From a Chinese perspective, are they getting to the point where they are saying it is all bark no bite?

Or are they really concerned about the president perhaps taking measures?

WATSON: That's another stop previously on President Trump's tour through Asia and it was remarkable to see how the Chinese kind of lavished

hospitality on President Trump and how he responded in kind.

And he was very pleased with that. But one of the main friction points with all of the East Asian economies, frankly, is trade. Where Trump has

consistently accused East Asian economies of effectively taking jobs away from the U.S. because of trade surpluses, that is his real bogeyman when it

does come to trade.

So this is something that the Chinese have heard before. This is something that the Koreans have heard before and the Japanese as well. He sits down

with each one of these leaders, shakes hands. They make nice and then he complains about the trade deals and it does seem to be a negotiating

tactic; that is, until we saw some of these tariffs slashed down in recent weeks.

GOLODRYGA: One that continues to rattle nerves, nonetheless.

Ivan, we appreciate you joining us. Get back to covering those games and having fun and stay warm. Get inside.

Ivan Watson, Patrick Gillespie, good to see you. Thank you so much for joining us.

Well, the U.S. Congress is trying to solve immigration reform before the weekend. Donald Trump has urged both parties to make a deal.

This morning, though, he tweeted, "Wouldn't it be great if we could finally, after so many years, solve the DACA puzzle?"

He warned this would be the last chance for Congress to solve the issue.

The former Mexican foreign minister is calling for both the United States and Mexico to find the whole enchilada. Jorge Castaneda joins me live from

Mexico City.

The whole enchilada: that's a lot to be asking for at this time, Mr. Castaneda. Thank you so much for joining us, though.

What are the odds that both sides will address the whole enchilada?

JORGE CASTANEDA, FORMER MEXICO FOREIGN MINISTER: Well, in the Congress and on DACAs or DREAMers, it is not impossible that they could reach a deal,

especially if Democrats decide that giving Trump some money for his wall is worth legalizing the situation, not only of 800,000 DREAMers that were

legalized, at least temporarily, under President Obama.

But the whole 1.8 million that President Trump and Chief of Staff John Kelly have been saying would be included in his package.

Now for Mexico, that is enormously important because of that 1.8 million, somewhere around 1.5 million are Mexican. That's one out of every four

Mexicans in the United States who do not have papers.

Legalizing one-fourth of all Mexicans, of all undocumented Mexicans in the United States, would be a huge step forward for immigration for Mexico and

for the United States.

So if this is possible, it is a big deal and it may be less faraway than many people suspect -- Bianna.

GOLODRYGA: We're spending a lot of time focusing on the president and the Republican Party. There is internal debate, though, within the Democratic

Party, too, as to how much they should be focusing on DACA. We had a spending bill pass and did not include a DACA resolution. Nancy Pelosi

spent eight hours on the floor in favor and obviously in support of DACA being passed and reformed.

Yet she supported this spending bill.

Are Democrats, in your opinion, doing enough to push this cause?

CASTANEDA: Well, I think they could do more and particularly they should be more open to the idea that getting this done the right way and perhaps

also looking at future flows of people coming from Mexico that are needed by the U.S. economy.

For example, reconstruction after Hurricanes Harvey and Irma in Texas and in Florida, with H-2A and H-2B visas is also a very important issue. Now

this can be done by the executive without congressional approval. But the Democrats could be in favor of this.

In other words, the Democrats should understand, I think, that getting some of these things done may be worthwhile, even if they have to give Trump

something. And what Trump wants more than anything else is his wall.

[16:25:00]

CASTANEDA: This is what makes him very happy. He gets all excited about the wall. Well, that is fair enough. Let him have part of his wall in

Mexico. We believe, one, that the wall will never see the light of day and, two, that, even if it does, it will be totally useless.

Americans want to spend $20 billion, $25 billion on a silly wall, spend it. If we can get the other things done, which are, of course, much more

important than the wall, DACAs and a larger number of Mexicans going to the United States to work legally with papers, with temporary worker visas,

H-2As and H-2Bs, in jobs that the American economy needs and that Americans do not want to do or cannot do for a number of reasons.

GOLODRYGA: And I'm sure you agree with many in this country, who have long said that Mexico, as the president had promised, will not be paying

for that wall. Jorge Castaneda, thank you so much for joining us. We appreciate it.

We're going to turn to markets now. A lunchtime rally pulled the Dow into positive territory. It closed up 39 points. Investors are looking ahead

to Wednesday's crucial report on consumer prices.

Remember, it was fears about rising inflation that were largely blamed for the recent market volatility. The early pullback in New York hurt stocks

on the other side of the Atlantic as well. The major European indices all closed lower; mining shares limited the losses in London.

In France, job growth has reached pre-crisis levels. New numbers show the French economy added 53,000 jobs in the final quarter of 2017. This as

business optimism is booming.

Maurice Levy served as CEO of the ad giant Publicis. He told Richard Quest President Macron's reforms are working.

(BEGIN VIDEO CLIP)

MAURICE LEVY, FORMER CEO, PUBLICIS: Macron is doing a great job. First, he has been election without playing the role of populism and supporting

Europe, which is not very popular (ph) in France as you know, because of the Brexit. And he -- everyone was fighting against Europe.

And he promised a lot of reforms and the good news is that he is trying his program and he is doing the reform one after the other.

RICHARD QUEST, CNNMONEY EDITOR AT LARGE: Which reforms at the moment are the most important in your view?

LEVY: Labor law (ph), which is probably the most important one; tax reform with the tax wealth (ph), which has been removed, which is more important

because it's not so much the money which was spent but the idea that people had to sell something in order to pay their taxes.

And what's happening now, regarding health and (INAUDIBLE). So he is attacking the issue very seriously and he is doing the job.

QUEST: So labor, taxation, health, education, what is next?

What do you want to -- what do you want to see on the agenda?

Because he really only has a limited amount of time to put the next thing on the agenda before you really start thinking about elections again.

LEVY: There are two things that we are expecting to see, something that he has started to announce. One is the cut on public spendings; because we

have 57 percent of GDP which is eaten by public spendings. And we need to bring this to below 50 percent over time.

So this is something that we want to see and he's taking the pension reform.

QUEST: At what point do you think -- maybe never. Maybe it doesn't happen. But the traditional French resistance to change kicks in?

I'm not saying that you'll have marches or protests on the Champs-Elysees but the establishment will say or the people will say this is too much too

fast?

LEVY: No, the establishment will not say it's too much too fast because currently it has the full support of every single part of the

establishment. (INAUDIBLE) that we have been too slow to reform. And the good news is that the people trust him and trust that he is doing the right

reforms for the future.

So I don't believe that we will see a lot of resistance and I don't believe that we will see the (INAUDIBLE) of the French coming back anytime soon.

QUEST: Finally, the French, to some extent, no matter what his policies are, the French must --

[16:30:00]

QUEST: -- be very pleased and like the fact that, again, a French president is so respected and is leading the way. It has put France back

on the map.

LEVY: We have been bashed for years by every Anglo-Saxon person that there is on Earth. We were not able to make a reform; we were stupid. We were

not able to take (INAUDIBLE) growth, et cetera, et cetera. And all of a sudden there is a young president, modern, good-looking, with a view which

is extremely positive, who is -- has no fear of showing that, yes, there is a balance between being good socially but at the same time open to the

world and open to the free markets.

All this is positive and I can tell you something, Richard, France is back.

(END VIDEO CLIP)

GOLODRYGA: France is back. I'd better learn how to say that in French.

And when we return, Oxfam promises it will get past its sexual exploitation scandal.

And information sharing is the key. We'll hear what the executive director plans to do next.

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GOLODRYGA: Hello, I'm Bianna Golodryga. There's more QUEST MEANS BUSINESS in just a moment but first, these are the top headlines we're following at

this hour.

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[16:00:00]

GOLODRYGA: And more now on that news that Benjamin Netanyahu may be facing criminal charges. Oren Liebermann is live in Jerusalem.

Oren, good to see you. Obviously a bombshell announcement but it is not up to the police though. Now it is up to prosecutors and the attorney general

to decide whether or not they will be actually pressing charges, correct?

OREN LIEBERMANN, CNN CORRESPONDENT: Correct, that's exactly right. It's the attorney general who in a sense now becomes the most important in

Israel now the police have taken what is a more than a year-long investigation.

They've taken all of their work, all of that evidence and handed it to the attorney general. And the expectations is that he will take his time in

deciding whether to indict Prime Minister Benjamin Netanyahu on charges of bribery, fraud and breach of trust in two separate cases.

Bianna, I will walk you quickly through these cases. They are known locally as case 1,000 and case 2,000. In case 1,000, police say Netanyahu

received 1 million shekels, roughly $300,000 of gifts in the form of cigars, champagne and other goods in exchange for favors.

In case 2,000, police say Netanyahu was working on a deal with a local newspaper publisher to get more favorable coverage in exchange for

hampering circulation of that newspaper's rival.

Netanyahu, as he has from the very beginning here over the course of the last 14-15 months, said he will be cleared of all charges. He has used

what has become his catchphrase: there will be nothing because there is nothing -- Bianna.

GOLODRYGA: He gave a 12-minute speech there, saying that he will not be stepping aside. This is his third consecutive term as prime minister. Let

me ask you, though, where does this leave him as far as having faith from the Israeli public and being able to actually move forward on anything,

including a potential peace deal?

LIEBERMANN: The analogy here is actually a pretty easy and apt analogy to President Donald Trump, who faces his own investigations. You can look at

it while they're not perfectly aligned, but you can look at it in much the same way as Trump faces these investigations.

Those who stand by his side are more formally entrenched in standing by him. They are more convinced he is in the right. Those who are critical

of him are more convinced he is in the wrong and it is very much the same thing here with Prime Minister Benjamin Netanyahu.

Those who back him still back him and back him even more, seeing this investigation as what he would call a witch hunt. And much of his

language, in a sense, echoed Trump's, whereas those who are critical of the prime minister are even more critical now.

It is a question of politics at the moment because he has a number of coalition partners in the form of different parties.

How do they see this playing out?

If they decide that Netanyahu has gone from a liability to an asset, as you point out, he has won three consecutive terms here, then Netanyahu is in

trouble because he doesn't have much wiggle room within his coalition.

One coalition party came in favor of him. We're waiting for more statements; those will come tomorrow and that is when we will get a much

better sense of how firmly is Netanyahu's footing at this moment.

GOLODRYGA: First, these findings implicate some of Israel's richest and most powerful business executives as well. Oren Liebermann, thank you so

much for joining us. You'll the following this story for CNN throughout the day and the week. Thank you.

The chairman of Oxfam International has been detained in Guatemala on corruption charges. They relate to a deal he made when he was a finance

minister before he joined Oxfam.

As the charity tries to defuse its child exploitation crisis, the executive director has promised more transparency. Winnie Byanyima told Hala Gorani

that they need new ways of sharing information about their workers.

(BEGIN VIDEO CLIP)

WINNIE BYANYIMA, EXECUTIVE DIRECTOR, OXFAM INTERNATIONAL: When people have offended, we should have a system where we share information and they are

not rehired to go and re-offend.

Again, that is something we must build in our system, where we can share this information across this sector.

It cannot be possible for one organization to inform thousands and thousands of organizations worldwide, working in the humanitarian sector.

We need, again, a systemwide response and we are going to lead in our sector to put these things in place.

HALA GORANI, CNN HOST: But do you think Oxfam can recover?

Do you think that the reputation of this organization is a reputation that can -- that can get can get back to a place where the organization is not

associated with this type of scandal?

BYANYIMA: Hala, we've been hurt. I'm personally hurt. I come from the women's movement. I know about powerlessness. I escaped a crisis country.

I know what abuse can do to someone.

But I know that Oxfam was -- will recover because these are a few people who have abused the power that they had --

[16:40:00]

BYANYIMA: -- and turned and abused the very people they went to protect.

But the majority, the thousands of Oxfam staff around the world are saving lives, are helping people who are fleeing, are giving food and water in the

most difficult places in South Sudan, in Chad, in Yemen, in Iraq. They are risking their lives every hour.

And this is --

(CROSSTALK)

GORANI: And that is an important point to make --

BYANYIMA: -- continue to do.

(END VIDEO CLIP)

GOLODRYGA: Huge crisis for Oxfam.

Coming up, we have the PC wars and the phone wars. Now the battle for the living room is raging. Apple's entry has arrived. Investors want to know

if the Homepod can compete with Alexa and Google Home.

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(COMMERCIAL BREAK)

(MUSIC PLAYING) (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Is it worth buying the Homepod?

UNIDENTIFIED FEMALE: Homepod is a breakthrough wireless speaker from Apple. It delivers amazing audio quality.

(END VIDEO CLIP)

GOLODRYGA: So the Homepod sounds good. But critics say it is not very bright. Apple prioritized music with this device. It sounded apps to

whatever room it is in but it falls behind Amazon's Echo and Google Home. And especially when it comes to trivia.

Homepod, by the way, is very pricy. Amazon and Google are trying to get into as many homes as possible. They sell versions of their assistants,

like this Google Home Mini that costs less than $50.

And then there is the one Homepod. And that costs about $350.

Jeffrey Cole founded USC Annenberg Center from digital future and he's joining me now from Washington.

So are your reviews as mixed as most others?

JEFFREY COLE, USC ANNENBERG CENTER: Yes, I think I would agree with that. This really is a battle for the universe, as far as Apple, Google and

Amazon are concerned. He or she who controls the digital assistant controls the home, controls the car. Volkswagen and Ford already are

putting Alexa in their car.

And, ironically, Apple came to this first with Siri and yet this is a pretty disappointing entry this many years later. It is a great speaker.

It is not much of a digital assistant. It of course will get better but Google and Amazon are already winning this war.

GOLODRYGA: Right, so it is something that's already a crowded field, where many would expect more from Apple. Tim Cook spoke to investors today.

Anything noteworthy out from him?

COLE: I think the fact that they understand how valuable this space is and want to be in it, and this is an acknowledgment that it is still worth

competing. But, no, it is a rather disappointing effort, which comes on the tail of the iPhone 8 and 10, which were great incremental improvements.

But what people want from Apple is not incremental or as good as the other guy. They want game changers.

[16:45:00]

GOLODRYGA: And do you think that's too much pressure, unrealistic for Apple?

Or do you think the onus is on Tim Cook to deliver?

COLE: I do not think there has ever been a CEO in history under more pressure than Tim Cook because what people want from him is not an

incremental improvement. They want to see him in a pair of jeans and a black turtleneck sweater on stage at the Moscone Center, coming to the end

of his presentation and saying, almost as if he forgot, oh, and one more thing, and introducing the product that changes the world, even though they

do not know what it is they want changed.

That is Apple's role and that is his burden.

GOLODRYGA: Of course, there was only one Steve Jobs and, aside from his genius and changing the world, he had his failures as well.

Are shareholders going to give up on Tim Cook anytime soon, in your opinion?

COLE: Well, even though the iPhone 8 and 10 were incremental improvements, by and large, the last couple of Apple phones have done very well. Their

customers are not abandoning them. It is the reputation for innovation that has taken a hit more than the bottom line.

So no, I do not think they are unhappy with Tim Cook. But do keep in mind the only attempted game changer they have introduced since Jobs passed away

was the Apple Watch and that has been somewhat of a disappointment as well.

GOLODRYGA: I don't know, I like mine, Jeffrey. I like mine. I wear it every day. I'm a convert.

COLE: It is a great watch but it is not a game changer.

GOLODRYGA: It's not a game changer.

COLE: It is not so easy to change games.

GOLODRYGA: It really is difficult, a lot of pressure on Mr. Cook.

Thank you so much for joining us. We appreciate it.

COLE: Oh, Bianna, my pleasure. Thank you.

GOLODRYGA: Thank you.

Well, U.S. intelligence chiefs say cyber attacks are still a major threat to the United States and that this year's midterm elections will likely be

targeted by -- guess who -- Russia.

At a Senate hearing earlier, the head of national intelligence said he has no doubt Russia will try to interfere and laid bare the scale of the threat

that the U.S. faces.

(BEGIN VIDEO CLIP)

DAN COATS, DIRECTOR, U.S. NATIONAL INTELLIGENCE: Frankly, the United States is under attack, under attack by entities that are using cyber to

penetrate virtually every major action that takes place in the United States.

From U.S. businesses to the federal government, to state and local governments, the United States is threatened by cyber attacks every day.

(END VIDEO CLIP)

GOLODRYGA: Jessica Schneider is joining us in Washington.

Jessica, not really a surprise from Director Coats, given the scale that we've seen Russia conduct these attacks in the last election.

And yet what does seem to be surprising is very little action has been taken and very little has come from the White House on this.

JESSICA SCHNEIDER, CNN CORRESPONDENT: That was exactly the juxtaposition here, Bianna. So you had the six intelligence chief. They put it bluntly

and simply throughout this hearing.

They said that Russia is already at work set to interfere in the 2018 midterm elections and that they'll similarly meddle in 2020. In addition

to DNI Coats, their national security agency director, Mike Rogers, he put it like this.

He said this is not going to change or stop. But then on the other side, lawmakers were expressing frustration because this is so clear to the

intelligence chiefs but, of course, President Trump himself has really refused to call out Russia for its interference.

And he continues to cast doubt on the entire Russia investigation, which does not just encompass whether or not there was any collusion with the

Trump campaign but it also encompasses how exactly the Russians interfered.

So lawmakers, they put it plainly, they asked the intelligence chiefs has President Trump specifically directed you to confront Russian meddling?

And no one among those six intelligence chiefs could directly say yes. They sort of all danced around the issue. They said that the president has

made clear that foreign threats should be protected from in general.

But really, Bianna, you put it well. There was a lot of frustration stemming today from lawmakers that this election threat still exists, that

there does not seem to be a concrete plan as to how exactly to combat this Russian meddling. No direction from the president, no direction in

general.

And these intelligence chiefs saying, yes, this is happening now. This will continue to happen and of course it continues to be a huge issue, just

like we saw in 2016 -- Bianna.

GOLODRYGA: We're getting confirmation that Russia does, in fact, continue to meddle in the U.S. elections and plans on it and you juxtapose that with

the president saying that now is not the time to implement sanctions that were passed in a bipartisan Congress.

How do you square the two?

SCHULTZ: Well, that's exactly what lawmakers were asking. The ranking Democrat on the Senate Intelligence Committee, he put it exactly that way,

Bianna. He said you have a president here who continues to deny this threat and when presented with the option to perhaps do something about

this threat, impose those Russian sanctions, they say that, of course, the president did not act.

So there is a lot of frustration here from --

[16:00:00]

SCHNEIDER: -- these lawmakers. And it really looked like these intelligence chiefs, their hands were tied. They sat there and they tried

to express the fact that their intelligence agencies are working to combat this threat, they couldn't give a lot of information because of course a

lot of it is classified. They said that they would give more details when they went behind closed doors at 2:30 this afternoon.

But still, that underlying frustration, that the president hasn't outrightly acknowledged that the Russians did meddle in the 2016 election.

He continues to call the investigation into Russian meddling, in general, "a hoax," says is it is all brought about by the Democrats.

And then lawmakers saying something needs to be done about it and they pressed on the intelligence chiefs. They said get the president to at

least acknowledge it because at least that will be somewhat of a first step here.

GOLODRYGA: Yes, that was quite something from Senator Angus King, to hear him beg them to please have the president confirm what you are telling us

right now.

A busy day in Washington, Jessica Schneider, thank you so much for joining us.

SCHNEIDER: Thanks.

GOLODRYGA: Meghan Markle has the Midas touch when it comes to the fashion world. Everything she wears turns to gold and purses sold. No wonder they

are calling it the Markle sparkle.

(MUSIC PLAYING)

(COMMERCIAL BREAK)

(MUSIC PLAYING)

GOLODRYGA: Prince Harry's fiancee, Meghan Markle, has been flying the British flag when it comes to her dress sense. The green Strathberry

handbag she used for a trip to Edinburgh today has sold out, much like her wardrobe.

Anna Stewart digs deeper into the Markle effect.

(BEGIN VIDEOTAPE)

(MUSIC PLAYING)

ANNA STEWART, CNN CORRESPONDENT (voice-over): A sleepy town in Wales, complete with castle and cobbled streets, recently awoke to international

headlines.

Cardigan, which sounds like it's home to knitwear, actually has a long history of jean making. It's home to fashion brand Hiut Denim, which rely

made jeans fit for a princess -- or at least a soon-to-be Princess Henry of Wales.

Nottingham, Brixton, Cardiff, wherever Meghan Markle goes, she leaves behind a trail of magic.

UNIDENTIFIED FEMALE: It's the Meghan sparkle, isn't it?

The Markle sparkle, I think I heard this morning. She (INAUDIBLE) beautiful women.

STEWART (voice-over): Markle sparkle, it's an economic phenomenon. Whatever Meghan sets out in, becomes an instant sellout success.

Still the handbag by Scottish brand Strathberry, a sweater from High Street store Marks and Spencer and more recently the Hiut Denim jeans from Wales.

Meghan Markle is wielding her sparkle power with care, promoting British brands and some, like Hiut Denim, with a special story to tell.

Cardigan was home to a much bigger denim factory for three decades up until 2002.

[16:55:00]

UNIDENTIFIED MALE: The powers that be decided to move all production over to Tangiers. They started to close the factories down. Made a lot of

people redundant, not just single people, families.

STEWART (voice-over): Fast forward nine years and David and his wife, Clare, brought denim making back to town by founding Hiut Denim.

They're hoping to move to a bigger factory and even sooner than planned, now Meghan Markle has raised their profile.

UNIDENTIFIED FEMALE: The morale of the staff and the excitement when they discovered that she was wearing our jeans was amazing. So yes, it has had

a really good effect on sales and (INAUDIBLE) everywhere.

UNIDENTIFIED MALE: I think what Meghan and Prince Harry are doing is, well, we have this fame.

How do we use it for the good?

STEWART: The big brands with big factories, often production is fairly simple. So for a smaller business like this, where one pair of hands makes

one pair of jeans, it's not so easy. Apart from this bit. This bit even I can do.

STEWART (voice-over): You want a pair, you're going to have to wait until mid-March. There are some 75 processes involved in making each pair and it

takes an hour and 10 minutes.

Meghan Markle has put Hiut Denim on the map, a boost for business here and for the craftsmanship of Cardigan's resilient artists -- Anna Stewart,

CNNMoney, Cardigan, Wales.

(END VIDEOTAPE)

GOLODRYGA: The next question, what and who will she wear for the wedding?

Before we leave you, we have some news just in to CNN. The actress, Minnie Driver, has quit her role as Oxfam ambassador. Oxfam says the decision

saddens them but understands and respects her choice.

As we have been reporting, the charity is responding to a sex exploitation scandal and the fallout continues.

And that QUEST MEANS BUSINESS for tonight. I am Bianna Golodryga in New York. Thank you so much for watching. Have a great day.

END