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North Korea Summit Back On; Tariff Troubles; Spain's New Prime Minister. Aired 3-3:30a ET

Aired June 2, 2018 - 03:00   ET

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


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DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: I think it is a getting-to-know-you meeting-plus. And that can be a very positive thing.

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CYRIL VANIER, CNN ANCHOR (voice-over): Ahead of the June 12th summit, Donald Trump says the U.S. is getting along with North Korea. But Republican leaders are urging caution.

Also fears that the U.S. is sparking a global trade war with North America, Europe and China.

Plus, Italy's new eurosceptic government takes office. We'll tell you about that.

Live from the CNN Center here in Atlanta, I'm Cyril Vanier. It's great to have you with us.

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VANIER: That historic summit between U.S. President Donald Trump and North Korean leader Kim Jong-un will apparently happen as scheduled on June 12th in Singapore. The announcement that it is back on follows something that took place at the White House on Friday that has never happened before.

The second most powerful man in North Korea, the country's former spy chief, you see him there, sitting down face to face with a U.S. president in the Oval Office. And he brought a personal letter for the president from the North Korean leader. CNN global affairs correspondent Elise Labott has the details.

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ELISE LABOTT, CNN GLOBAL AFFAIRS CORRESPONDENT: President Trump and Kim Yong-chol emerged from the Oval Office smiling after nearly a two- hour meeting, with Trump telling reporters a summit with North Korean leader Kim Jong-un in Singapore is back on. TRUMP: We're going to meet June 12. We will be in Singapore. It will be a beginning. I don't say and I have never said it happens in one meeting. You're talking about years of hostility, years of problems, years of really hatred between so many different nations.

LABOTT: Kim Yong-chol arrived at the White House earlier, hand- delivering a letter to President Trump from Kim Jong-un.

TRUMP: I haven't seen the letter yet. I purposely didn't open the letter. I haven't opened it. I didn't open it in front of the director.

I said, would you want me to open it?

He said, you can read it later.

LABOTT: While there was no firm commitment from North Korea on denuclearization, a top demand for Trump, the president said the meeting was still worth having.

TRUMP: I think it's going to be a process that we deserve to have. I mean, we really deserve -- they want it. We think it's important. And I think we would be making a big mistake if we didn't have it.

LABOTT: But the president said he was prepared if the talks with Kim in Singapore are not productive.

TRUMP: One thing I did do and it was very important, we had hundreds of new sanctions ready to go on and he did not -- the director did not ask, but I said I'm not going to put them on until such time as the talks break down.

We have very significant sanctions on them, but we had hundreds -- we have hundreds that are ready to go. But I said, I'm not going to -- why would I do that when we're talking so nicely?

LABOTT: A word of warning earlier today from the top Senate Republican.

SEN. MITCH MCCONNELL (R), KENTUCKY, MAJORITY LEADER: If you fall in love with the deal and it's too important for you to get it and the details become less significant, you could get snookered.

LABOTT: Concluding that a deal is not possible by June 12th, President Trump has lowered expectations. And he's now calling the meeting with Kim the beginning of a process, a get-to-know-you-plus.

Instead of being a condition of the summit, President Trump's challenge at the meeting is to convince Kim Jong-un to abandon his nuclear program, instead of the president falling trap to the North Korea's familiar playbook of playing for time and giving up as little as possible -- Elise Labott, CNN, Washington.

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VANIER: U.S. Defense Secretary James Mattis is already in Singapore for a previously scheduled event. He said one thing not on the table, the upcoming summit, the U.S. troop presence in South Korea.

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GEN. JAMES MATTIS, U.S. SECRETARY OF DEFENSE: (INAUDIBLE) its troops in the Republic of Korea is subject to one, the Republic of Korea's invitation to have them there and the discussions between the United States and the Republic of Korea, separate and distinct from the negotiations that are going on with DPRK.

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VANIER: CNN's Alexandra Field is in Seoul.

Do we have a better idea of what a deal between Donald Trump and Kim Jong-un might actually look like?

I ask because the U.S. president was short on details earlier.

ALEXANDRA FIELD, CNN CORRESPONDENT: Yes, and frankly he went so far as to say that we shouldn't expect anything to get signed on June 12th. This could really just be the start of the process. This does signal the tempering of expectations from the administration and administration officials in recent days as they talk more and more about the complexity of this issue.

They're trying to boil it down into pretty simple terms. The acronym that you're going to hear a lot, CVID --

[03:05:00]

FIELD: -- complete, verifiable, irreversible denuclearization. That's what they say the goal is, essentially that means ridding the peninsula of nuclear weapons, ridding North Korea of nuclear weapons.

Of course there's a lot of debate over how quickly that could happen and how willing Kim Jong-un would be to give up those weapons all at once, which is something that has certainly never seemed like a likelihood for North Korea or over a period of time, one more step by step process.

But the big question, does the U.S. and North Korea have the same understanding of what denuclearization is?

For North Koreans, when you talk about the concept of denuclearizing the peninsula, they're talking about ridding the peninsula entirely of nuclear weapons. That means removing the protection of the U.S. nuclear umbrella that South Korea is covered under.

So these are the kinds of conversations that need to go on right now. These are, intricate and high level talks that are happening. Certainly the president is signaling we shouldn't expect any of this would be worked out by June 12th.

The secretary of state Mike Pompeo went so far to say administration officials won't be talking about the shape or the elements of any kind of agreement. President Trump now saying this meeting on June 12th will be the start of something that we could see several meetings to come after this, perhaps involving the leaders or other senior officials.

It's really just the beginning point now, it seems, Cyril.

VANIER: One thing that was interesting to me. Mr. Trump also talked about money. He said that this whole negotiation could end up costing a lot.

What was that about?

FIELD: One of the key issues here is that North Korea has always regarded its nuclear weapons as key to regime survival. They see it as their defense against the United States.

So how do you convince the regime to give up those weapons?

How do you ensure the regime's security?

The message that the regime is getting from the U.S. right now is that they're safer without the weapons than they would be with the weapons. You've heard that from top-level officials repeatedly in recent days and weeks.

It's something they want North Korea to understand. You are also hearing the administration, President Trump himself, talking about the great possibilities for North Korea in the future for economic development.

It seems that when he talked about money he was maybe suggesting economic aid down the line, not entirely clear, but he also said that these were issues that he felt that South Korea, Japan, China would be helping with.

He said this isn't going to cost the U.S. a lot of money. The news of this summit is being regarded here in the region as a step forward. This is what we heard from the defense minister from South Korea and also from Japan a little earlier today.

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UNIDENTIFIED MALE (through translator): In light of how North Korea has behaved in the past, I believe it is important not to reward North Korea solely for agreeing to have a dialogue.

UNIDENTIFIED MALE (through translator): Please understand North Korea, as they are making a decisive action, just because we have been tricked by North Korea before does not guarantee we will be tricked in the future. If we start to think like this, we can never negotiate with them. And we can never look to achieve peace with them.

Please believe the agreements by the two leaders of South and North Korea are a new promise to open a new era.

(END VIDEO CLIP) FIELD: So, Cyril, bottom line here, South Korea has been pushing for dialogue, they see this as a step forward. Japan also supporting the idea of the summit but really feeling it is key to remember North Korea's past when trying to set the course for the future here -- Cyril.

VANIER: Alexandra Field in Seoul, South Korea. Thank you very much.

Jasper Kim is director of the Center for Conflict Management in Seoul. He's also the author of "Persuasion: The Hidden Forces That Influence Negotiations."

That's interesting, given the topic. Jasper, you listened to Donald Trump, touting the summit over the last few weeks and the potential breakthroughs that could come from this summit.

And then you listened to Donald Trump on Friday, sounding a much more cautious tone. It sounds like he just got a reality check.

JASPER KIM, CENTER FOR CONFLICT MANAGEMENT: Yes, the title of this could be "Great Expectations." So we don't want this to turn into a tale of two different conflicts. What Donald Trump wants are the optics of meeting. That in itself is historic. That in itself is something he can put in his transaction list (INAUDIBLE).

VANIER: Well, look does he only want the optics?

Because ultimately its going to come become to haunt him if all he has to show for it is two hours at a table with Kim Jong-un.

I mean he does need to get something out of it.

KIM: Well, let's remember this president is very different from previous presidents. He is all about optics. He has a media background. The way that he sees things, the panorama upon which he sees counter parties and states, is very, very media driven.

So that's a first thing. The second thing is that he views this as a process. In fact, the definition of negotiation is the communication process that results (INAUDIBLE). So he sees this as step one, not the final step, in a very long complex series of negotiations.

VANIER: I want to go back to the title of your book.

What do you feel are the hidden forces that influence --

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VANIER: -- these negotiations?

KIM: I'm glad you asked that question. A lot of it is the nonverbals, the psychological games, the Jedi mind tricks, if you will that the two sides, not just one, are playing with one another. That deals with scarcity, with, threats, good cop-bad cop and walking away from the negotiation table before they even walked into the room.

And, as the expression goes, the war is won before it is ever fought. And it rings very, very true in negotiation science.

VANIER: So in other words, you're telling us that what Donald Trump is doing now, this signaling that he is doing now, that he has done over the past few weeks, whether it's saying that he will work away from the table if the deal doesn't look good, whether it is canceling the summit, everything he has been saying until now, that's what is setting him up?

KIM: Yes, and what is even more powerful than just saying something are the nonverbal. And that in itself is transmitting a lot of information. And let's keep in mind that persuasion and negotiation, it's number one an information game. And number two, it's a perception game.

So the perception, the optics that he wants to send the other side from Kim Jong-un to Donald Trump, that is extraordinarily interesting. What these two are trying to basically figure out about each other, can I trust this person. Can I deal with the person? Who needs whom more?

And, in information, that's what the two sides will get from one another when they meet face to face. But they're getting information now as we speak.

VANIER: So give me an example, because you said nonverbal several times.

What is Kim Jong-un getting from Donald Trump's nonverbal cues at this stage, before they have even met?

KIM: Right. Well, Kim Jong-un is a stallness (ph) inspired leader. And if he understands anything, it is the fact of the use of force and signals of dominance. And I think this president, Donald Trump, seems to use that, leverage that, know that quite well and basically is saying, well, listen, I am not someone who is a cooperator at first just for cooperation's sake.

I want something in return. This is going to be a quid pro quo and I am not going to trust just for nothing. I am going to trust but verify. So on that basis, give me what I want. And I will give you what you want.

And we see that sort of at play and being applied right now. There's security assurances that North Korea wants. On the other side of the coin is economic assistance.

And let's keep in mind, North Korea is the new, new frontier in the global economy. The average person in North Korea, based on very scarce data, makes about $1,500 to $2,000 per person.

Compare that to just south of the border where I am here in South Korea, a thriving economy, a thriving democracy, making about $25,000 per person. There is so much upside in North Korea.

VANIER: Oh, that's interesting. And Donald Trump clearly has an eye on North Korea's economic potential. He's tweeted that they have a potentially brilliant economic and financial future.

So that, that what you mentioned, is definitely something the U.S. president has on the mind. Jasper Kim, thank you very much. Very interesting; the nonverbal cues, we'll look out for those in the 10, 11 days that now separate us from the summit. Thank you.

KIM: Thank you.

VANIER: Another top-level summit that may be in the works. This one between Donald Trump and Russian president Vladimir Putin. "The Wall Street Journal" it says planning for this is still in the early stages. The paper says the U.S. ambassador to Russia has been in Washington to help arrange face to face talks between the two leaders.

There is no word yet on date or location. But there is on content: Syria and Ukraine would likely be on the agenda. Presidents Putin and Trump have met before but on the sidelines of gatherings last year in Vietnam and Germany.

The U.S. Defense Secretary has a blunt message for China. James Mattis says the United States is in the Indo-Pacific to stay. During a speech he called out Beijing for turning artificial islands it built up in the South China Sea into military outposts bristling with heavy weapons.

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GEN. JAMES MATTIS, U.S. SECRETARY OF DEFENSE: Despite China's claims to the contrary, the placement of these weapons systems is tied directly to military use for the purposes of intimidation and coercion.

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VANIER: China claims 90 percent of the entire South China Sea even though six other countries have competing claims. In May, the Chinese military landed nuclear-capable bombers on the islands for the first time.

U.S. allies are fighting back against new tariffs imposed by President Trump. And China warns a trade war with the U.S. is possible. The U.S. Commerce Secretary heads to Beijing to work out a deal if he can.

Plus, two countries, two new leaders, the dramatic changes in European politics. That's also ahead.

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VANIER: Turning now to the threat of a global trade war. U.S. Commerce Secretary Wilbur Ross is in China this weekend to continue trade talks. Beijing was caught off-guard this week when the White House said it would pursue tariffs on $50 billion of Chinese imports.

On another front, Mexico, Canada and the European Union are fighting back against new U.S. tariffs on steel and aluminum. The E.U. filed a formal complaint with the World Trade Organization and the Canadian finance minister gave a piece of his mind to his American counterparts.

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UNIDENTIFIED MALE: I did exactly what I said I would do, which is express in strong terms our opposition to these tariffs in the steel and aluminum sector.

Our absolute view that this is absurd to think that Canada could in any way be a security risk to the United States and also to say that what happens when you put tariffs in place is you harm people. You harm people in the United States, you harm people in Canada.

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VANIER: All of this could make for an awkward meeting next week when Mr. Trump goes to Canada for the G7 summit. Some are now calling it G6+1. But President Trump is unapologetic.

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TRUMP: They're our allies, but they take advantage of us economically and so I agree. I love Canada. I love Mexico. I love them.

But Mexico is making over $100 billion a year.

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VANIER: To understand just how disruptive Mr. Trump's trade policies could be to the complex global economy, here is CNN's John Defterios.

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JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: The Europeans are not rushing out of the gate to put tariffs on the U.S., but trade confrontation seems inevitable.

It was a measured response Friday from E.U. trade commissioner Cecilia Malmstrom, but the reality is, the U.S. tariffs will spark a reaction by Europe and possibly, trigger a chain reaction in the U.S.

As soon as June 20th, 28 countries of the E.U. will put forth their final response to match the tariffs of 10 percent to 25 percent on European aluminum and steel respectively. The E.U. list of U.S. products to target in an exhaustive one, ranging from motorcycles to peanut butter and, ironically, U.S. steel products as well.

Malmstrom suggested that the E.U. --

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DEFTERIOS: -- use all channels to avoid confrontation and clearly did not appreciate the added heat by the U.S.

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CECILIA MALMSTROM, E.U. TRADE COMMISSIONER: Our offer was that you take this gun away from us, we sit together as friends and equals and we discuss and eventually this could lead to negotiation. This would of course require a mandate from the member states.

So we never got this. And now, that door, for the moment, is closed.

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DEFTERIOS: And Malmstrom challenged the legislation and premise that President Trump is using to slap on tariffs, based on national security, which dates back over a half-century.

The Europeans, however, introduce a subtle change in strategy to perhaps appease Washington. Like the U.S., they, too, are pointing the finger at China for the global glut of steel. The big difference is, the E.U. supports the World Trade Organization as a means to solve disputes. Donald Trump and his team are adamantly against it -- John Defterios, CNNMoney, London.

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VANIER: The E.U. is also dealing with a political shakeup in Italy.

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VANIER: Giuseppe Conte was sworn in as the prime minister. The law professor and political novice will lead Italy's new populist eurosceptic government.

Let's bring in Barbie Nadeau. She's in Rome.

Barbie, this is a government built on anti-establishment, anti- immigration and eurosceptic rhetoric.

What is Italy actually going to look like under this government?

BARBIE NADEAU, CNN CORRESPONDENT: Well, I think it is going to be very complicated. These ministers, the choice of these ministers, many of them send mixed messages. The euro, European affairs minister is a eurosceptic. The minister of family affairs is anti-same-sex marriage. The health minister is anti-mandatory vaccination.

I think that is going to be very difficult because a lot of these policies that these leaders are going to try to put forward are in contrast with some of the European Union policies. And, you know, they're going to have another problem just in agreeing with themselves.

One of the populist leaders hails from the far right. The others, strictly anti-establishment. It's going to be a rough ride I think -- Cyril. VANIER: Look, the president had drawn a red line when they last attempted to form a government a few days ago. He did not want the Italian government to pull Italy out of the euro and threaten its place in the European Union. So you started touching on this.

But, is this government now euro compatible?

NADEAU: During this week of crisis, I think we saw a lot of rhetoric from the parties, the rhetoric they used to campaign on, the rhetoric that won them these majorities in parliament, we saw that sort of tempered back. They really were assuring everyone that they have no intention to take Italy out of the euro.

Today is the Republic Day. It's the day of celebration, 1946, the founding of the republic. Both of these leaders have always shunned this particular holiday. Today they find themselves with the president in the VIP box, having to put on a bold face.

I think we are going to see a lot of that sort of strategy, making it look good for the good of the country.

VANIER: OK, Barbie Nadeau, you're making it look good in Rome. You'll keep following this story for us. Thank you very much, Barbie, always a pleasure.

And another European country we want to cover for you today, Spain. The seismic shift in European politics continues there. Socialist Party leader Pedro Sanchez is to be sworn in as the new prime minister in a few hours.

He takes over after Mariano Rajoy lost a no confidence vote. Corruption allegations against Rajoy's party came to a head last week when a court convicted some of his former aides.

With Sanchez now the man in power, he says he understands the gravity of his new position.

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PEDRO SANCHEZ, SPANISH PRIME MINISTER (through translator): I am aware of the responsibilities that I assume in such a complex political moment in our country.

What I can say is that, apart from being totally aware of it, I'm going to face all our country's challenges with humility and commitment and, above all, with a lot of determination, first, to transform and modernize our country.

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VANIER: Some tough talk at the United Nations after the U.S. vetoed a resolution involving Palestinians in Gaza. The draft motion from Kuwait was supposedly meant to protect Palestinian civilians.

And Turkey criticized the American move, saying the U.S. is not with the righteous. But U.S. ambassador Nikki Haley called the motion one- sided because it didn't mention Hamas.

The U.S. holds Hamas militants responsible for violence last month on the Gaza border with Israel. When Israeli forces killed dozens of Palestinians, the clashes occurred as the U.S. opened its new embassy in Jerusalem.

Beg your pardon.

The man in charge of Brazil's state-owned oil company has called it quits. The markets reacted by wiping $12 billion off the value of Petrobras' stock. CEO Pedro Barente resigned after strikes by truckers and oil workers paralyzed much of the country's economy.

The dispute forced the government to lower diesel prices for 60 days. Petrobras has often played a role in political and economic turmoil in Brazil. An investigation into a massive bribery scandal at the company led to the impeachment of former president Dilma Rousseff in 2016.

On Hawaii's big island, vigorous lava eruptions are threatening homes and authorities are desperate to get people out of danger. Nearby residents had two options: get out by Friday afternoon or get arrested.

Lava is now covering more than 14 square kilometers of the island. And the eruptions are far from over. One fissure is shooting persistent fountains of the red-hot molten rock nearly 80 meters into the air. At least 87 homes on Hawaii's big island have been swallowed by the fast-moving lava. That's 10 more than on Thursday.

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VANIER: OK. A bird's eye view of a bird. This curious cockatoo perched itself on a security camera high over a roadway in Australia. It peeks in and out of the frame, even appearing to -- what is it doing?

Tapping on the glass?

Traffic controllers are trying to figure out what to do about the feathery intruder so they can keep an eagle eye on the highway.

And that does it for us. I'm Cyril Vanier, I'll be back with the headlines in just a moment.