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Donald Trump: Will Invite Kim to U.S. if Things Go Well; U.S. Announces Deal to Save China's ZTE; Guatemala Volcano Search Halted; Chinese Foreign Ministry Says the U.S. Has Not Reached Out To Beijing About New Cases in a Possible Sonic Attack; Jordan PM Withdraws Controversial Tax Law; U.K. High Street Crisis Deepens with House of Fraser Closures; European Markets Finish Lower; U.S. Lawmakers Slam ZTE Deal on Security Grounds; Scott Pruitt Faces 12 Inquiries into Past Actions. Aired 4-5p ET

Aired June 7, 2018 - 16:00   ET


UNIDENTIFIED MALE: What controls about what opinions you have formed with Kim Jong-un as a person?

MIKE POMPEO, US SECRETARY OF STATE: Yes, so I haven't spent that much time with him. What I have said publicly is he has indicated to me personally

that he is prepared to denuclearize, that he understands that the current model doesn't work, that he is prepared to denuclearize and that, too, he

understands that we can't do it the way we have done it before, that this has to be big and bold and we have to agree to making major changes, we

can't step through this over years, but rather, need to acknowledge it will take some amount of time, but this doesn't happen instantaneously, but that

the model for succeeding.

Security assurance and political normalization and denuclearization is completely verifiable and irreversibly -- for that to take place, we have

got to make bold decisions and I am hopeful that Chairman Kim Jong-un is prepared to make that decision for his country. A big shift in his

strategic understanding of his security.

UNIDENTIFIED FEMALE: Thank you, so you said that the President is prepared to talk about security guarantees for North Korea, we have seen in this

administration that you can then -- when new administrations come in, they can undo things that prior administrations have done. How can President

Trump guarantee long-term security for North Korea and for Kim in particular?

POMPEO: Look, we are going to do have to do things that convince Chairman Kim that that is the case. Right? That's what we'll have to do. So, let

me give you an example, we are hopeful that we will put ourselves in the position where we can do something the previous administration didn't do,

right? They signed a flimsy piece of paper and we're hoping to submit a document that Congress would also have a say in that would give currency

and strength and elongation to the process so that when administrations do change, as they inevitably do, and this one will, six and a half years from


When that takes place, that Chairman Kim will have comfort that American policy will continue down the same path on the course that we hope we are

able to set in Singapore.

UNIDENTIFIED FEMALE: We'll take one last question.

UNIDENTIFIED MALE: Thank you, Secretary, (inaudible) your remark. First, follow up (inaudible) comes to Asia, we see a document that the Congressmen

signed online, I mean, you're referring to the treaty and then second, the topic with the (inaudible) allies from North Korea's WMD and (inaudible)

missiles, is that a condition of the President to get any negotiation agreement with Chairman Kim that (inaudible) missile program and chemical

weapons also be part of that; and third, finally, can you tell us the format of the meeting between Kim and President Trump and what will it look

like (inaudible)?

POMPEO: So I'll leave to the White House to talk about the format of the meetings when the time is right. With respect to proliferation risk, it's

very real. There is a history of that with respect to North Korea and some of our difficult challenges in the world today. They are connected. The

reason you want complete, verifiable and irreversible is precisely that to the extent there remains stockpiles, knowledge bases, warehouses, systems,

infrastructure, fissile material production facilities. I could go on, to the extent those remain, the risk of proliferation continues and it's our

aim through the CDID process and providing the security assurance as the Chairman Kim will want that we can greatly reduce the risk of proliferation

ever happen as a result of North Korea actions.

UNIDENTIFIED MALE: Sir, one more please, sir.


UNIDENTIFIED MALE: Secretary, did you plan the President shifted when he'd gone from talking about defining success (inaudible) nuclear relation of

the Peninsula now talking about the need for more (inaudible), can you clear what happened there and why does (inaudible) and can you also

describe your disagreement over North Korea internally with the national security adviser?

POMPEO: Yes, with respect to the second one, I have read a little bit about this and I love good fiction as next as -- as much as the next

person, but it is without foundation, so much so that you know, I will beat the lights in some of the diplomats now, suffice to say those articles are

unfounded and a complete joke.

Sure, Ambassador Bolton and I will disagree with great consistency over time, I am confident. Hey, we're two individuals, we are each going to

present our views, I am confident that will happen on issues from how long this press conference ought to go to issues that really matter to the


So, it's absolutely the case that Ambassador Bolton and I won't always agree. I think the President demands that we need to give them our own



POMPEO: Yes, so your first question, I will try to answer your first question. I don't see the shift as disjunctive as you do. The President

has always understood that this was a process. It's been very clear that that would always take a great deal of work to do this, so I think you can

interpret how you want, but I think your characterization of that also doesn't...


POMPEO: ... the President's understanding. I think his understanding about this process has been pretty consistent since I have been working

with him now, almost a year and a half ago.


ZAIN ASHER, CORRESPONDENT, CNN: All right, you've just been watching a live news conference with Mike Pompeo, US Secretary of State who talked

about this highly anticipated meeting between the North Korean leader, Kim Jong-un coming up in five days from now and of course, with President Trump

that is set to take place in Singapore.

So, I just want to recap a few things in terms of what the Secretary of State here in the United States talked about. He said that Donald Trump is

fully committed -- fully committed in terms of ridding the world of the nuclear threat that has been posed by the North Koreans.

But Pompeo really did reiterate and explain and underscored that fact that Americans' expectation going into this meeting is really that North Korea

is going to denuclearize. He says that he anticipates that the North Koreans will denuclearize and that is the expectation and that if they do,

if they do, there is a brighter future for them in terms of their economy, in terms of bringing them back online, in terms of interaction and

cooperation with the global community.

I want to bring in Samantha Vinograd who served as a senior adviser to the US National Security Adviser. Sam joins us live now from Washington, DC.

So, Sam, it's not just about trust. It's not just about trusting that the North Koreans are going to denuclearize because they say that they will.

It's also about being able to verify that they are doing what they said and what they promised that they are going to do, which has been as you know,

an issue in the past. How do they go about that?

SAMANTHA VINOGRAD, NATIONAL SECURITY ANALYST, CNN: Well, it's pretty easy. We have internationally recognized experts whose only job it is, is to

verify these exact kinds of things, so if you think about what a process could look like, a first step is going to be inventorying all of the WMD

materials that North Korea has in its country.

And then second, you have to set up something perhaps with the IAEA or International Weapons Inspectors from the United States, from the UK. We

did do that in Libya. I don't want to bring up Libya because that upsets the North Koreans, but there are experts whose only job it is to verify

these stuff, and Secretary Pompeo does not like to talk about the Iran nuclear deal, but let's remember that Iran has regular inspections to

verify its denuclearization under the agreement that we signed with Iran and several other countries.

So, we don't have to reinvent the wheel here. There are weapons experts that verify this stuff.

ASHER: So, in terms of just given your background, I mean how optimistic are you that this time next week, there will be a deal in place that the

North Koreans will actually agree to denuclearize and as a result, sanctions will be lifted and there will be no reason to talk about maximum

pressure anymore? How confident are you in the process that the North Koreans are actually going to be trustworthy this time around?

VINOGRAD: I am confident that we will have a meeting next week and a process will be announced. I think that there is still, even if there is a

document that comes out saying that North Korea is committed to for example, ridding the Korean peninsula nuclear weapons, I don't think that

we have fully fleshed out what that means for North Korea. I think we know what that means, but I am confident, I do feel good that there will be a

process announced to try to define that and that's why I think we are seeing members of the administration lower expectations a bit.

ASHER: All right, Samantha Vinograd, live for us there. Thank you so much. We are going to go back to Samantha in just a moment to talk about

business news, but just to sort of talk about our business agenda for tonight, the main story is really ZTE.

ZTE does have a deal, seven weeks after the Trump administration cut ZTE off from its suppliers and forced the business to shut down, the door of

the US is reopening for the Chinese tech giant. The deal comes with major conditions though. Number one, ZTE is going to be forced to pay a billion

dollars in terms of a fine. The company will also need to put an American monitoring team in place as well.

The US Commerce Secretary says the penalties send a message to all businesses that operate in the United States. Take a listen.


WILBUR ROSS, US COMMERCE SECRETARY: It imposes the most strict compliance that we have ever had in any company, American or foreign. I think this is

a very, very well-publicized, very important message to other parties -- don't fool around with our export controls or you're really going to get



ASHER: Wilbur Ross speaking there. So, this is how the US short-circuited China's second largest producer of telecom equipment. The first link, the

suppliers. More than a quarter of ZTE's parts come from the United States, processors from Qualcomm, glass from Corning and the Android operating

system -- take those away and ZTE's business certainly cannot go on.

The second link, the violations. The US says that ZTE illegally shipped equipment to Iran and North Korea who could then effectively...


ASHER: ... use American technology against US interest. Remember, ZTE makes telecom equipment of all sorts, from smart phones to the routers and

switches that phones rely on. That leads us to the third link, China's government.

American officials say ZTE's devices pose a threat, a security threat to their users. Other countries like Australia, and the UK have made similar

claims as well. ZTE is the only company on the board, Huawei faces similar accusations about its equipment as well. The company has denied the claims

because they have caused lawmakers of both sides of the aisle to oppose any leniency for ZTE.

Speaking with CNN, Senator John Kennedy said, "The company is too close for comfort for the Chinese government."


JOHN KENNEDY, US SENATOR, REPUBLICAN: I am not a big ZTE fan. I am sure ZTE makes a fine cell phone, but they are a little close to the Communist

Party of China for my taste, and on top of that, they cheated. ZTE violated our sanctions and thereby helped North Korea. I want to read

exactly the terms of the settlement, but color me doubtful.


ASHER: All right, Samantha Vinograd is actually back with me. As you just heard, Samantha, the US lawmaker there basically saying that, you know, one

of the issues is that ZTE is a bit too close to the Chinese government for comfort. Just explain to us the actual national security threat in terms

of digital espionage that is posed by ZTE to the United States.

VINOGRAD: Certainly, I think we have to look at this in two different ways. The first is, as you mentioned, ZTE has repeatedly violated US

sanctions on Iran and North Korea. They are a repeat offender and the Commerce Department today basically said, "Okay, third time is a charm.

You are found to be violating sanctions, not once but twice, and we are going to give you a third bite at the apple." That is not strong

deterrence to me.

What Commerce specifically did not address today is this cyber espionage point. The Chinese government has a policy of using its companies which

sometimes, it purports to be "private," and the air quotes are important here, to obtain business sensitive information on other foreign companies

and on users and on intellectual property.

So, the Department of Commerce today in the United States has been allotting this moment as the biggest ever settlement that is reached and

the fact that there is going to be a US compliance team within ZTE.

Now, the problem is that that again does nothing to address the cyber espionage risk, so to me, this is a government saying, "Okay, we slapped

you on the wrist with a big fine for sanctions violations, but we are going to turn a blind eye to this issue of cyber espionage."

ASHER: So, then, how does the US go about trying to curb the threat in terms of cyber espionage from Chinese tech companies?

VINOGRAD: Well, under President Obama, we tried this actually. I was at the US summit with China at Sunnylands. We tried very hard and the fact of

the matter is, we have not come up with a way to do this yet, what we do know is that lifting penalties after 68 days, remember, it's only been 68

days since Commerce put on these penalties back in April.

You don't lift penalties after 68 days and say, "Okay, now we are going to let you go back and do business." That's really just telling companies

that he threw enough money at the problem. If you swap out your personnel that you're getting a get-out-of-jail free card, that's not going to solve

the problem.

ASHER: All right, Samantha Vinograd live for us there, thank you so much. And we will have actually more on this issue in terms of ZTE and the

politics behind it. Later on in the program, I am actually going to be speaking to the Democratic Congressman Gregory Meeks, but now, I want to

get you caught up to speed on some breaking news.

United Nations has placed international sanctions on six people, on six individuals for their roles in trafficking migrants through Libya to Europe

and this -- no need to tell you this, this is certainly an unprecedented move which is huge because these sanctions actually come after CNN's

shocking expose of slave auctions in Libya last year.

I want to bring in our Nima Elbagir who is the reporter that actually broke this exclusive story. She is joining us live now from London. So, Nima,

you know, this really does go to show the power of gritty and extraordinary journalism, which is what you exhibited when your piece came out last year.

Just walk us through who these individuals actually are and how your specific report led the UN to these six people.

NIMA ELBAGIR, CORRESPONDENT, CNN: Well, this is an initiative that was led by the Netherlands and something that they had been working on actually for

quite some time, but they were gracious enough to credit us with creating the momentum that allowed for them to go deeper and also got a lot of the

information that we were able to bring to light...


ELBAGIR: ... what we understand also helpful, but mostly, it was just the visceral nature of the images. The Dutch Foreign Minister spoke to Hala

Gorani in an exclusive interview and he said it was really the awakening of the consciences. It was the way that seeing those images had such an

impact that really -- well, we should say in spite of that, it did take a little bit of diplomatic wrangling to get this through. This didn't get

through cleanly on first go, but it changed the environment at the table.

And so, it mean that people were much more serious about seeing individuals sanctioned and treating this as what it is, which is a trade in human

misery. It is people making money off the misery and unfortunately, the hopes of others, which is something we have spoken so often about and


ASHER: So, beyond the sanctions against these six people, which I understand include asset freezes and travel bans and that sort of thing,

how do you go about actually curbing the wider problem, because obviously, six individuals, yes it's certainly a start, but it's only a start. There

is a wider issue that needs to be addressed as well.

ELBAGIR: Absolutely. And that's why the Dutch Foreign Minister was clear that this is just the start and these sanctions, the evidentiary base of

these sanctions is extraordinarily detailed. These sanctions, they are very reliant on what they call open source, so media reports, things that

are in the public domain, but these sanctions go a lot deeper, so when you look at the evidentiary base put forth, one of the individual sanctioned is

actually a Commander in the Coast Guard.

So, this is someone -- there is private organization that is not just the recipient of European Union funding, but European Union and Italian

training, which sends a message that even if you are of use to us in Europe or in the West, in curbing the flow of migrants, you are still not above

feeling the impact of consequences. This is a blow against impunity.

But also, what I found really interesting when I was looking at the details of these sanctions is that these are young wealthy men. Most of them are

in their 30s, one I think is in his -- between 30s and early 40s. They are multimillionaires and they want to spend their money and these assets.

Some of them are within the European Union.

So, while money may be movable, bricks and mortar aren't, so you're stopping them from going and enjoying their money. You are keeping them

locked and contained within Libya, which isn't the most pleasant of places to be a lot of the time.

So, it is actually having a direct impact on their quality of life and sending a message that, okay, so legally, the criminal justice system at

this moment in time can't get you, but that is the road you're heading down towards.

ASHER: Nima, I just have to congratulate you once again for that astonishing report.

ELBAGIR: Thank you.

ASHER: Because not only did it raise awareness to the entire world, I mean, I saw protest everywhere from London to different parts of Europe.

Not only did it raise awareness about such an important issue, but it has actually led to change and that is just wonderful. I can't praise you

enough. Nima Elbagir, live for us there. Thank you so much.

ELBAGIR: Thank you, Zain.

ASHER: We appreciate you. Okay, so another day, another data scandal for Facebook. The social network has just revealed a bug that affected

millions of accounts last month. We will explain what it is after the break.


ASHER: Welcome back everybody. Donald Trump has been getting an early start on this weekend's bilateral meetings at the G7 Summit. Earlier, he

met with Japan's Prime Minister, Shinzo Abe at the White House, they discussed President Trump's historic meeting in Singapore that is coming up

in about five days from now with none other than the North Korean leader.

Trump says, if things go well, if things go well, Kim Jong-un could actually be invited to Washington. Earlier this morning, Donald Trump said

the US has the worst trade deals ever made. The President used an ear- catching phrase to tee up the G7 Summit.

Isn't it ironic? Oldies but goodies there with Alanis Morissette. Mr. Trump certainly thinks so. He says that he is ready to fight for his

country on trade this weekend in Quebec. At the same time, Trump says he is ironically under political pressure from Democrats back home. He is not

the only one getting a head start on meetings.

Earlier, French President Emmanuel Macron met the Canadian Prime Minister in Ottawa. Mr. Macron says he is not ruling out an agreement that excludes

the United States.


EMMANUEL MACRON, PRESIDENT OF FRANCE: (Through an interpreter). If you say today that President Trump doesn't care at all, maybe, but nobody

amongst us is forever and so our countries, the commitment we've taken are bigger than us because also, let's face it, none of us can once elected say

the commitments which were in place now disappear. It is not true.


ASHER: The Head of Canada's Foreign Affairs Committee says the country is already in a trade war with the United States, but Bob Nault has been

speaking to US lawmakers about the dispute between the two neighbors.

He told me Prime Minister Trudeau should not change the approach with Mr. Trump come this weekend.


BOB NAULT, HEAD OF CANADA'S FOREIGN AFFAIRS COMMITTEE: I think it should be the same as it has been all along, very factual, very professional.

This is a business deal. It is not -- the adviser for the President has suggested a family squabble. This is very much a business deal that is

important to all Americans and Canadians and the people who make their livelihood by this.

So, we are not going to change our approach. We are not going to be more conciliatory, which means basically, watering down an agreement that we

think is very balanced and very fair. If you look at the real numbers, it shows that the agreement is working very well for Canada and the United

States and so, when you talk to Parliamentarians, when you talk to Senators, Congressmen, which I had been doing over the last few days, they

very much agree with us that this is not the right approach that the President has taken and he should back off and rethink the strategy as it

relates to long term relationships and trade agreements with countries like Canada.

ASHER: So what is the best case scenario by the end of the G7 Summit? What would be the ideal sort of long-term achievement after the G7 Summit

if Trudeau just sort of continues with the same approach he has been taking all along?

NAULT: Well, I think the long-term approach is going to be that Congress and the Senate in the United States will have to step in as Senator Corker

is now stepping in to bring in legislation to restrict the President from putting in place these kinds of tariffs that have no place in a

relationship like ours where it is going to be easily proven and will be that the World Trade Organization that we are not dumping and it is not a

security issue and get back to real negotiation in a way that benefits both countries.

Now, it wasn't too long ago that President Bush brought in tariffs like this, 18 months later, it did so much damage to Americans as it relates to

their quality of life and the cost of goods that they had to cancel, and we expect that will be the same thing here.

ASHER: Even if the other leaders don't intend to isolate him, I mean, I think that just the dynamics have shifted so much, a lot of people are

referring to this as the G6 plus one with America standing on its own.

But, if Donald Trump doesn't rethink tariffs, he doesn't sort of rethink this America first, protectionist viewpoint he has, which is what by the

way he promised his voters, what will that mean for the long term relationship between the US and Canada in terms of how much damage this

could really do?

NAULT: I think that's the key question to all of this. Some people think this is trade skirmish. We have seen this before. We have...


NAULT: ... countervailing duties that we are going to put on July 1s as are other countries. I think the long-term damage is that Canada will

start to look for partners that they can trust, and so we will start to look to China. We will start to look to Asia. We will start to look to

Europe even more so than we have in the past, then I think that's troubling for the agreements that businesses have now between Canada, US and Mexico

and we have to make sure that doesn't happen.

So, that's the danger I think we see with all of these.


ASHER: All right, let's give you a quick check of the US markets. There is certainly no sign of trade war, fears about a trade war affecting the

Dow. It closed the day's session -- actually almost, almost a triple digit gain up about 95 points. The fall in tech shares including Facebook

actually pulled the NASDAQ down from its records.

Speaking of tech shares, for four days last month, about 14 million Facebook users had their default sharing setting, the new post, set to

public. It had their default sharing settings set to public. This happened to about 14 million Facebook users. The company actually just

issued a statement admitting the mistake.

I want to bring in Dylan Byers who is joining us live now from Los Angeles, so Dylan, what happened here? Just walk us through what happened because

this is not very -- as a Facebook user myself, this is not very reassuring especially in the wake of what happened with Cambridge Analytica.

DYLAN BYERS, CORRESPONDENT, CNN: No, that's absolutely right, and so the issue for Facebook for so many months has been, are they responsible stores

of your data when they share it with third parties. Really, that's not something they can ultimately control. The issue here, they are not even

responsible stores of your data when they are not sharing it with third parties.

So, what happened or what Facebook says happened is that they were trying to introduce some new features to the platform, new ways that you could

share information and photos, and effectively, you know, they accidentally hit a switch so that your default settings if they said private and you

wanted to share things privately, all of a sudden that became public.

Now, what that means or what that might mean is that things that you were writing that you were hoping to sort of keep to yourself or keep within a

small community of friends, all of a sudden were available for everyone on the internet to see, and you're right about how significant this is for

Facebook coming in the wake of the Cambridge Analytica scandal and a litany of scandals.

The biggest issue for Facebook now is how many issues it has. It has so many scandals and it is trying so hard, pouring so much time, energy,

money, resources into restoring public perception, restoring user trust -- every day now, or at least every week, there seems to be a new controversy,

a new scandal and this is really mounting up and undermining those efforts to restore the trust of folks like you and me.

ASHER: But speaking of trust, I guess one good thing to come out of that, just really the fact that Facebook obviously learned its lessons from the

last time because this time, they were very proactive about coming out ahead of it and issuing a statement and just showing, "Hey, listen, we are

going to own up to the problem before it has leaked to the press or other people find out about it. We are going to be transparent."

That does show some effort which restores trust.

BYERS: That's right. That is the silver lining, if there is any to this whole controversy, which is that they told us about it. It was not as if

we had to read about it in the pages of the "New York Times" or the "Wall Street Journal" or see about it in a report on CNN. They now own that


And I think what they've realized is that if there is one more report where they're being exposed for not coming clean or not being forthright about

something they knew about, then that is an issue of privacy or user trust or fake news or anything else, there is going to be a point where the

public just brakes and says, "Okay, I don't know how to trust you guys because you have come to us time and again and asked for our trust, and yet

time and again, it looks like you're hiding something." So, yes that is the silver lining that they came to us with this first.

We can only hope that as we go down the line there, being as forthright with us about everything else.

ASHER: It's interesting because one thing I have learned is that you know, just because they may be losing trust, it doesn't necessarily mean they are

going to end up losing users as well because that's a very different...

BYERS: That's absolutely right.

ASHER: Yes, but Dylan, we have to leave it there. Thank you so much. Appreciate that.

BYERS: Thank you.

ASHER: Welcome. All right, the US has reached a deal to restart ZTE's business. American lawmakers on both sides of the aisle say that's quite

simply, that is a very big mistake. You'll hear why after the break.


[16:30:00] ZAIN ASHER, HOST, QUEST MEANS BUSINESS: Hello everyone, I'm Zain Asher, coming up on the next half hour of QUEST MEANS BUSINESS,

thousands of jobs are at risk in the U.K. after a new retail calamity, and Donald Trump's environmental chief has a new passion for just getting his

wife to open a fried chicken restaurant.

Now, his critics are certainly far from happy, but first though, these are the top news headlines we are following for you at this hour. Right, not

long ago, the U.S. president just said he could end up inviting the North Korean leader to the United States if and only if their meeting next week

in Singapore goes well during a news conference with the Japanese Prime Minister.

Donald Trump also revealed that while sanctions against the North remains in place, he is no longer going to be using the term "maximum pressure".

The U.S. has reached a deal with China to restart ZTE's business. The Trump administration had barred American companies from supplying parts

through the ZTE after the company violated U.S. sanctions on Iran and North Korea.

As part of the deal, ZTE is going to have to pay a $1 billion fine and also install an American compliance team. Meantime, in Guatemala, the search

for survivors on Sunday's massive volcanic eruption has now been suspended. Officials say fallen ash and the red sea of avalanche makes rescue

operations far too dangerous.

The death toll is now 99 with almost 200 people missing. And the Chinese foreign ministry says the U.S. has not reached out to Beijing about new

cases in a possible sonic attack. The State Department brought some of its staff in China home for health screening after concerns over reports of

mysterious incidents similar to the Cuba sonic attacks as well.

And Jordan's Prime Minister Omar al-Razzaz will withdraw a controversial income tax bill after nationwide protest. On Tuesday, al-Razzaz was tasked

with forming a new government after the cabinet resigned following daily anti-austerity protests.

All right, so British high street stores are under new pressure as another famous name is about to become harder to find. House of Fraser deciding to

close more than half, more than half of its stores including its London flagship store with a loss of up to 6,000 jobs.

This year has certainly been a particularly difficult one, not for shops and restaurants, let me tell you, it's certainly been a blood bath.

[16:35:00] "The Guardian" newspaper estimates that 35,000 jobs have gone or are at risk in the U.K., and almost a fifth, almost one-fifth, about

roughly around 20 percent of British retail sales are on line and with the economy on a pre-Brexit squeeze, shoppers are certainly looking for a bag

on high streets have already lost famous names like Woolworths, British home stores and Toys R Us as well.

The CEO of Retail Economics Richard Lim joins us live now from London. So Richard, just tell us, what exactly is the problem? Is it really just sort

of what's happening everywhere else in the world or just that more and more people are shopping online or is it also the sort of pre-Brexit environment

as well.

Which one has it more to do with at this point?

RICHARD LIM, CHIEF EXECUTIVE OFFICER, RETAIL ECONOMICS: I mean, interesting sort of combination of factors. And what we've seen in the

U.K. over the last 12 months or so is that the consumer environment in critique pretty soft. So inflation has been -- was running at a five-year

high, running into the beginning of this year.

And this has really put personal finances under a lot of pressure. We are seeing that pressure beginning to ease now, but people are worried, they're

worried about Brexit, they're worried about levels of debt, they're worried about potential interest rate rises.

And so the propensity to spend, the willingness to spend is really under pressure. And that's one side of the equation, and the other side of the

equation retailers have just dealt with a wave of rising sourcing cost, contrition via from the ups of the pound and also operating cost.

Operating cost we estimate are rising by about 3 percent year-on-year. And that's how pasting sales growth for many retailers.

ASHER: All right, so an issue of operating costs for retailers and just rising costs of retailers combined with inflation and therefore real wages

of ordinary consumers are now being forced lower.

So what action would it take at this point to try and bring British consumers back to high street stores? Is it still possible?

LIM: Well, of course, I mean, absolutely, it's still possible. What we haven't mentioned is, you know, these seismic changes that we're seeing in

consumer behavior, so as you mentioned at the beginning of your program, 20 percent -- roughly 20 percent of sales in the U.K. are now online.

And also it's the rise of the experience economy, the way the shoppers are interacting with brands and interacting with retailers has changed. And

so, they want better and more meaningful experiences. And so the way that retailers were interacting with their customers, they need to -- they need

to provide a point of difference, they need to really stand for something.

And also they just need to provide a seamless only channel experience. The consumers are really often resonating well with them.

ASHER: So Richard, you know, given just the number of stores -- I mean, I grew up going to Woolworths, I lived next to a Woolworths when I was

younger and just seeing what happened to Woolworths and what happened to British Home stores, et cetera, and of course now Toys R Us.

With all these closures, what will an ordinary British high street in London look like in 50 years from now?

LIM: Well, I mean, we've got working assumption essentially that the proportion of online sales will reach about 50 percent of the market in the

next 10 years. And so it's about the evolution of the high street in the U.K. And so we see more and more sales migrate online, particularly with


But also the way that we're spending money is changing, and actually, if you look at the proportion of consumer spending that's going on in retail,

that has fallen pretty much every year over the last 30 years or so. And so people are spending more money on leisure, they're spending more money

on eating out at hotels, bars, restaurants.

And so this has really -- this has really changed the proportion of where people are spending their money. So the future of the high street is about

changing the mix, changing and having the high street as the center of communities, we're likely to see the -- you know, the turn-up mix change

that involves more leisure and more eating out at restaurants, but also more residential as well.

ASHER: So --

LIM: So essentially, turning a lot of these empty shops into residential properties as well.

ASHER: Right, but in terms of people going out and spending money, it's going to be much more about the experience and sort of like restaurants and

bars and having experience as the first actually, you know, traditional high street retail.

Richard Lim live for us there, got to leave it there, thank you so much, appreciate that, thank you. Right, so European markets closed the session,

mainly in the red in London, the FTSE 100 got off to a rocky start, trading was delayed for one hour due to a technical glitch.

Bank stocks were lifted by European Central Bank, it continues to hint, it could soon wind down its stimulus program of bond buying. And the U.S. has

reached a deal to restart ZTE's business as we've been talking about throughout the show.

American lawmakers on both sides of the aisle say upping the stakes, we'll hear why next.


ASHER: Welcome back everybody. American lawmakers on both sides of the aisle are slamming the Trump administration's deal to restart ZTE's

business. Democratic Senator Mark Warner sits on the Intelligence Committee, he tweeted, I'll read for you here and we've highlighted.

He tweeted: "Beijing is about to get one heck of a deal on a back door into U.S. telecom networks." He was a sentiment echoed by Republican Senator

Marco Rubio, he warned Congress will take action on its own.

Joining me now is Representative Gregory Meek who sits on the House Foreign Affairs Committee. So Congressman, thank you so much for being with us.

So some might say that it seems as though Donald Trump is going easy on ZTE, which is a company that has violated U.S. sanctions when it comes to

Iran and North Korea.

But at the same time, given American allies like European allies for example, a much tougher time. How do you square those two things do you


REP. GREGORY MEEKS (D), NEW YORK: I can't, I think that those are legitimate concerns. Here you have one company that clearly has violated

the sanction that the United States has had with violated with North Korea and Iran.

And on the other hand, we try to punish individuals that are friendly to us and you do it -- the punishment saying that it's a threat to our national

security. When clearly, the threat to our national security has been ZTE.

We've had some of our telecommunication companies not being able to not utilizing the equipment from ZTE because of the national security threat.

So it just simply does not make sense, and that's why I think we see it by promising numbers of members on both the house and the Senate.

That says that we have to take action in Congress to question this deal.

ASHER: OK, so that's my next question on what action can Congress take separately of the president. I mean, it's something that Marco Rubio

touched on.

MEEKS: Well, I think that we can pass a law both in the House and the Senate, and I think that there's enough bipartisanship that if the

president should veto it, we can override his veto with separate branches of government.

And I think that if you look at the members that's in Congress, we have raised similar concerns because there's something that we've lived with for

a while. This kind of private back room deal should not be taken twice.

ASHER: You know, I think some of Donald Trump supporters might say, listen, you know, maybe the U.S. does have a deal with ZTE, now it might

not surprise some people, however, they managed to slap ZTE with a $1 billion fine, number one.

Number two, they forced American compliance managers into ZTE as a company which is -- which is quite unprecedented. I mean, would you give the Trump

administration some credit for that at least?

MEEKS: Well, this is bigger than just a dollar and sets fine. What else did the United States get out of this? This various other concerns that we

have with China.

[16:45:00] For example, if you talk about the services industry, financial services, you're worried about intellectual property.

You worry about other evasions of laws of which China has done. So, are we getting any concessions on those matters? There's so many other things that

we've got to confront China with. That's why, you know, I for one was a strong supporter of TPP because then they will put a number of us together

to put pressure on China to make sure that it plays by rules that the majority want -- that the majority plays with them.

ASHER: So then, I mean, what happens now? Do you anticipate that this deal with ZTE is the first step in allowing the United States or rather the

Trump administration to eventually cut abroad a deal with China. What do you anticipate happening next?

MEEKS: Well, I anticipate that those of us in Congress, we're going to come up with a bill to try to -- to try to stop this from happening. But I

also think that there's been a number of Republican senators and members of the house also that have gone up to the White House because we've got to

stop this being a tariff deal that the president has put on our allies.

And I think that the two have some relationship, because on one hand, you want a deal, make a trade deal basically with China where you can argue

that there's some threats to our national interests.

And yet, you want to put tremendous tariffs on places like the U.K. and the EU and Canada who are our allies, who stood by us for a long time. And so

I think it's the right thing for Congress to exert its power because we're a separate and equal branch of government.

ASHER: I mean, a lot of people are saying that's the part that doesn't make sense, because if you are concerned about national security, then why

would you punish Europe, but then allow this Chinese firm, this Chinese technology firm to get away with what it's been getting away with.

My question to you, final question is what does this deal with ZTE mean for other Chinese tech companies as well, that have also been suspected of

doing so espionage.

MEEKS: It means that if they can get away with violating our sanctions and other rules also without any real (INAUDIBLE) other than having to pay some

money. You know, you're talking about a billion-dollar pay-up, but when you look at what the take in is, it's far substantial than a billion


And so they're willing to pay a billion dollars and continue to move as had been done in the past. And so it sends the wrong message to other Chinese

companies, it sends the wrong message to our close and allies who we depend upon and within, who helps the United States with its security, now a

threat to our national security because we work together unlike China.

ASHER: All right, Congressman Meeks, appreciate you being on the program, thank you so much, have a great evening.

MEEKS: Thank you, good to be with you.

ASHER: You're very welcome. All right, so it seems that Chick-fil-A has friends in high places, after the break, why the end of the Environmental

Protection Agency wants to see more of them. It's advertising that money certainly can never ever buy that story -- after the break.


[16:50:00] ASHER: It smells absolutely delicious, I'm talking about Chick- fil-A, this for our non-American friends who might be watching, this is an American brand Chick-fil-A, American restaurant chain that they go all the

way back to 1946.

And now in 2018, it's actually been enjoying some free advertising, courtesy of none other than the head of the Environmental Protection

Agency. It said specifically, Scott Pruitt appear to confirm his wife was interested in opening a franchise.

He said America needs more of them. Take a listen.


SCOTT PRUITT, ADMINISTRATOR, ENVIRONMENTAL PROTECTION AGENCY, USA: With my wife is an entrepreneur herself, I love, she loves, we love, we -- Chick-

fil-A as a franchise, her faith and is one of the best in the country.

And so that was something we were very excited about. So and we need more of them until, so we need more of them across the country.


ASHER: Gosh, advertising that money can't buy. Sara Ganim is here to explain why eyebrows have been raised. So a lot of people, Sarah, are

saying, gosh, this is tempting, isn't it?


ASHER: Too good -- oh, my gosh, I would offer you some, but you can't talk and eat at the same time. So anyway, a lot of people are basically saying

that Scott Pruitt used his government position to try and get his wife a deal.

Just walk us, people who might not be familiar with this story, just walk us through what exactly he's been accused of.

GANIM: Yes, and that's what makes this go from like a bizarre story and eyebrow-raising stories to one that actually is very questionable when it

comes to ethics. Because you're not supposed to do it, you're not supposed to use your government position for personal gain.

And that's the allegation, that he was using his position -- he had a staff member at the EPA use EPA e-mail to reach out to the CEO of Chick-fil-A and

say, hey, let's have a meeting, and it turns out the meeting was to get his wife a franchise and she didn't end up following through with it.

She applied but didn't go through with the process. But this isn't the first time this week that he's been accused of something like this.

Earlier in the week it came out through Congressional testimony that another staffer was on company down -- government time, going apartment

hunting for him.

And even went as far as to inquire with the Trump International Hotel in Washington at least whether or not she could get a used mattress --

ASHER: A used mattress --

GANIM: For him. So I mean, what was his staff doing on government taxpayer time? That's the question. And of course this comes as, you know,

a laundry list of allegations of ethical wrongdoing by Scott Pruitt.

ASHER: It is so strange because none of these allegations, not at least sort of accusations of corruption or ethical wrongdoing as you put it ever

seem to really stick because he does seem to have the president on his side, why?

GANIM: Yes, he does, and as soon as yesterday, the president was praising him publicly, saying, you know, more people should stay off the great work

that he's been doing at the EPA. But he is losing some of the support from fellow Republicans.

Earlier this week, the Republican Senator from Louisiana John Kennedy said Scott Pruitt is acting like a moron. And I mean, some sentiment within the

Republican Party was in the Republican side is leaning that way, because look, 12 inquiries in the last couple of months that have popped up.

And this is everything from getting a below market apartment from a lobbyist ways of flying first class on the taxpayer dime, and you said just

being like what he's doing at the EPA as far as deregulation, these are a nuisance to people, even his supporters.

I mean, the constant bad headlines are just not good for him, and thinks like the only person laughs who's vocally supporting him is the president.

ASHER: Of course, that's the only one that really matters --

GANIM: Yes --

ASHER: Right? It's really interesting because at the end of the day, typically Trump doesn't like people within his cabinet who sort of have

negative headlines and distract away from him. But this time he's left Scott Pruitt alone, I'm not sure why, but Sara Ganim live for us there.

GANIM: Here's my -- here's my gift to you.

ASHER: Oh, this is my parting gift --

GANIM: Use it tonight on me and I'll --



These are the best. All right, Chick-fil-A is one of the older fast-food chains in America, tracing its history back to 1946, but still not enough

to make it into a 100 club which is companies that have been doing business for a century or more.

In tonight's episode, how one Japanese microscope company ended up becoming a household name, take a look.


UNIDENTIFIED MALE: For some photography enthusiasts, this could be considered Mecca. And for life-long picture taker, Takashi Suyama working

at the Nikon history museum is a dream job.

TAKASHI SUYAMA, PHOTOGRAPHER (through translator): I bought a Nikon camera and fell in love with it. I wanted to work for the company that was

producing such wonderful cameras.

UNIDENTIFIED MALE: Suyama is a memory people, preserving 100-plus years of the Tokyo-base camera makers history. A history which began in 1917 when

the Nippon Kogaku or Japan Optical Industry's Corporation was formed.

[16:55:00] Japan optical's first major success came in 1925 when the invention of a revolutionary microscope. That technology was improved upon

and went on to be used all over the world for ground-breaking research including the cloning of Dolly the sheep in the mid-'90s and with NASA.

But it wasn't until the end of World War II that the company's first camera was released. Though the company itself wouldn't be called that until

1988. And according Nikon CFO Masashi Oka, the company is in it for the long term.

Looking beyond the last 100 years and towards the next 100 even with camera sales declining industry-wide. Much of that due to cellphone camera

quality continuing to improve.

MASASHI OKA, CHIEF FINANCIAL OFFICER, NIKON: IPhone has become sort of a social infrastructure. So rather than consider them rivals, I think we

have to consider ways to co-exist and new step(ph).

For example, once we take a picture, and we have the technology to transmit the images immediately to the iPhones so that people can share those with

their friends and family.

UNIDENTIFIED MALE: This isn't the first time the industry has had to adapt and it probably won't be the last, remember these? Although Nikon still

makes film cameras, the company's focus shifted to digital in 1997 with the introduction of its first compact digital camera called the Coolpix.

For an industry that focuses on freezing moments in time, keeping up with changing times will be the key to its future success.


ASHER: And that is QUEST MEANS BUSINESS, I am Zain Asher, the news continues right here on CNN.