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QUEST MEANS BUSINESS
French Government Abandons Fuel Tax; China Issues Upbeat But Vague U.S. Trade Statement; U.K. Deal Under Fire Over Legal Advice; May Responds to Brexit Legal Memo Over Alleged U.K. Trap; Zimbabwe Grapples with Ongoing Currency Crisis; USA Gymnastics Files for Bankruptcy; Burger King Fires Up 1 Cent Whopper Ploy. Aired 3-4p ET
Aired December 5, 2018 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST, QUEST MEANS BUSINESS: A somber goodbye to President George H.W. Bush. The United States has paused today to remember the
country's 41st President. The Federal government is closed as are the stock markets, the mail has not been delivered. And at this moment, the
former President's body is flying back to Texas for its final resting place.
Throughout the hours ahead, CNN will continue to bring you all the memorials. We will continue to keep you informed.
To this hour, the business news from around the world. President Trump calls on OPEC to maintain output. The cartel is set to defy the
President's call in a few hours' time. We have got the government for you on big issues. We've got the former Australian Prime Minister, Kevin Rudd
on the trade war, the former Mexican President Vicente Fox on NAFTA and Zimbabwe's Finance Minister on how to clean up the economy after decades
And if government leaders weren't enough, we have a king. Well, sort of, Burger King. Burger King wants you to visit McDonald's and will actually
pay you, sort of to do so. We'll explain why.
From the world's Financial Capital, New York City, on Wednesday, December the 5th. I'm Richard Quest. I mean business.
Good evening. President Trump is calling on OPEC not to cut oil production. Only a day before a crunch meeting between members of the
cartel. Now, crude prices are mostly lower at the moment, investors are looking for direction. So the prices have fluctuated throughout the day
and indeed over the week. The expectation is that OPEC will define Mr. Trump and cut output to boost prices. You can see why.
After rising from most of the year, Brent crude is now back to where it was some 12 months ago and beyond. And now the price you pay at the pump rests
with those three men. Even though only one's country is in OPEC. Saudi Arabia and Russia and the U.S., they are the largest producers in the world
and the deal supposedly is that Saudi and Russia will continue the cuts.
That's what they want to do to push the prices up. President Trump on the other hand wants them to stay down. Our emerging markets editor John
Defterios is in Vienna in Austria where OPEC will meet. What is the latest thinking of what they will decide?
JOHN DEFTERIOS, EMERGING MARKETS EDITOR, CNN: Well, Richard, let's start with a very difficult cross currents that are place here. Very difficult
for OPEC to navigate to get to the finish line, which is a clear signal of how to cut probably 1.3, 1.4 millions barrels a day. Sources tell me they
are having bilateral meetings to try to close the gap. So we're about 12 hours away from the start of that meeting.
To give you a sense of the drama, though, they had a monitoring committee meeting that started about three hours late here at OPEC headquarters.
When they did arrive, they used the underground entrance to avoid the limelight and then people like me in the media were not invited in, which
DEFTERIOS: And then an hour into the meeting, Richard, a key player that was around the table sent me Donald Trump's tweet, suggesting not to
restrict supplies. And the message was, "We're watching and we're listening what's taking place." But they need to shut out that noise.
It's interesting, Bank of America was suggesting that their target price for Brent in 2019 is about $70.00 a barrel; to get that, they need to leave
Vienna with some clarity here and send a strong message that Donald Trump is not overwhelming the proceedings here between OPEC and non-OPEC players.
They're not there yet, Richard and that's the challenge.
QUEST: Yes, but it is overwhelming them in a sense? Isn't he? Because effectively to agree to cut or at least to agree to maintain the cuts or
even strengthen the cuts would be against the President and I wonder, is MBS, the Crown Prince of Saudi Arabia, is he in any form of position to try
and go against the U.S. President bearing in mind his own weakened position following the Khashoggi murder?
DEFTERIOS: Well, it does play into the precedence here, Richard. We can't shut out the politics. So let's go to the key points that you raised here.
We had the CIA briefing, linking the Crown Prince to the murder of Jamal Khashoggi. That's a view of U.S. senators, including Republicans. We have
the U.S. Special Representative to Iran, Brian Hook in Vienna today talking to the OPEC members and suggesting keep the supplies going because we plan
to tighten down on Iran. This met resistance from the Iranian Oil Minister, Bijan Zangeneh. And don't forget, we have Qatar leaving the
organization in January.
So what is Donald Trump and his team trying to do? Prevent any unity between Saudi Arabia and Russia and the other - all 25 members of the OPEC,
non-OPEC players. Does this limit the ability for Saudi Arabia to move forward? Clearly, and I think the key point here, though, Richard, is that
Saudi Arabia alone cannot leave this process.
When I saw the minister in Abu Dhabi a month ago, he said, we are going to cut a half a million barrels a day. We don't hear that language for Saudi
Arabia leading the charge here. They need support from Russia and the other key players and close the gap. So Richard, 1.2 to 1.4 million
barrels a day and explaining to Donald Trump why they did it. Anything less, it looks like they're caving into the U.S. pressure.
QUEST: John, we'll know those numbers and we will watch out and see tomorrow. Thank you, sir.
Les Moonves, the former CEO of CBS may lose his $120 million severance package. Lawyers are investigating allegations of misconduct against
Moonves found he destroyed evidence and misled investigators. According to the "New York Times," Moonves stepped down from CBS in September. CNN's
chief media correspondent is Brian Stelter.
Brian, last week, you and I were talking about the "If Bobbie speaks, we're all - I'm finished," and the agent and the actress, what's this bit about?
BRIAN STELTER, CHIEF MEDIA CORRESPONDENT, CNN: This is about more of the cover-up. This is even more evidence of the cover-up that Moonves
allegedly engaged in, when he knew that there are stories about harassment and assault that were published by the "New Yorker." He tried to keep
other stories quiet by trying to keep this actress on a - get this actress on a payroll at CBS.
Now, what the "New York Times" is reporting is that the two law firms that had been investigating the alleged misconduct have found a ton of it, have
found a lot of inappropriate behavior, by Moonves, both sexual misconduct, as well as corporate misconduct, meaning he was destroying evidence and not
cooperating with the investigation.
QUEST: What sort of evidence?
STELTER: Well for example, Moonves' lawyer says he fully cooperated, but according to the law firms, when he was told to hand over his iPad to go
through his text messages, he handed over his son's iPad instead. That would be an example of trying to hide damaging text messages that he was
sending and receiving.
So that's the kind of thing these law firms found and they are going to share with the CBS Board of Directors. According to the Board records,
they have not received this report yet, so the "New York Times" actually has seen it first. The "New York Times" received a draft copy. But by
this time next week, the CBS Board will be holding its annual meeting and this company is going to have to decide what to do about that $120 million.
QUEST: All right, a rock and a hard place. They keep - they pay him the money and there is an outcry from the various women's groups and others ...
QUEST: ... about this. But don't pay him the money and he then goes to war.
STELTER: He goes to arbitration. He goes to court. Yes, Moonves could argue or try to fight --
QUEST: Dirty linen to fight more dirty linen in public.
STELTER: Because look, this is not just about Moonves. Yes, Moonves is a big part of this story, but it's also about who else knew around him? Once
again, in this #MeToo age, we're finding ourselves asking, how did so many people know for so long?
QUEST: How is it - is it possible that they don't pay him the $120 million but do a deal to pay him something less?
STELTER: There could be some sort of compromise, I wouldn't rule that out. We know the deadline for all of this is the end of January. That is when
the CBS Board has said it will make some sort of decision about the money for Moonves. Meanwhile, CBS, it just wants to move on, it wants to be past
all this. But it can't be because we still have not addressed all of these skeletons, all of these sordid stories in the past.
QUEST: How bad was it?
STELTER: Honestly, I thought I knew Moonves. I thought I knew the man. He was a famed Fortune 500 CEO, but he was engaging allegedly in harassment
and assault for decades. It seems like time and time again, we're learning entirely different sides of the man we thought we knew atop these
QUEST: Good to see you, sir. Thank you.
QUEST: Keep watching.
QUEST: U.S. markets were closed because it is the funeral of President George H.W. Bush. European markets tumbled. Now, we're going to take the
European fold with a certain pinch of salt because it is the result of what they saw yesterday when New York finished 800 points down. But it is
renewed trades concerns, its fears of a downturn in the United States and Deutsche Bank shares, well the German lender has fallen amid money
laundering probes. And that's why you see the sharp fall in that market.
Britain's Parliament has released hundreds of pages of internal Facebook e- mails, which the tech giant want to keep secret, including some by chief executive Mark Zuckerberg. The released documents include conversations
amongst senior Facebook executives, as well as e-mails with outside app companies. CNN's Hadas Gold reports.
(BEGIN VIDEO TAPE)
HADAS GOLD, CORRESPONDENT, CNN: More than 200 pages of internal Facebook e-mails were released on Wednesday by a UK Parliamentary committee
investigating disinformation and data privacy. The e-mails mostly from 2012 until 2015 include conversations among executives like CEO Mark
Zuckerberg, as well as external companies who worked with Facebook's platforms like Microsoft, Lyft, Tinder and Airbnb. Some of the e-mail show
Mark Zuckerberg discussing how to better gain value for the platform by leveraging access to user data.
Others show how the company restricted competitors from accessing Facebook data. The Chair of the Parliamentary Committee, Damian Collins said they
released the documents because they raise important questions about Facebook's approach to user data.
The documents stem from a lawsuit brought against Facebook by a small app company called Six4Three. Now, Facebook didn't want these internal e-mails
to be released and they are still technically under seal by order of a California judge.
But last month, the UK Parliamentary Committee got their hands on them in dramatic fashion when Six4Three CEO was escorted to Parliament after a
Sergeant-At-Arms appeared at his London hotel.
A Facebook spokesperson told CNN that Six4Three's lawsuit is baseless and the documents are only part of the story and have been presented in what
they say is a misleading way. The spokesperson emphasized that they have never sold user data. The UK Parliamentary Committee continues to request
Mark Zuckerberg to appear before them to answer questions. Thus far, he is resistant. We'll see if these documents change the equation. Hadas Gold,
(END VIDEO TAPE)
QUEST: Wall Street was closed today and as China signals the chance of a trade deal with President Trump, the former Australian Prime Minister Kevin
Rudd joins me live a little later in the program. Also tonight --
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I push on here, and it said order a Whopper for a penny at McDonald's.
UNIDENTIFIED MALE: That's a lie. That's a fake thing.
(END VIDEO CLIP)
QUEST: The question of ordering burgers, a battle Royale with cheese. Burger King shows McDonald's with a new offering.
QUEST: Our leaders once again descended on the National Cathedral in Washington, this time to remember President George Herbert Walker Bush.
The president was known for his modesty. And today, the 41st President received all the pageantry of a state funeral at the National Cathedral and
Jordan's King, Britain's Prince of Wales the German Chancellor and the Polish President were on hand as were all five living presidents -- Jimmy
Carter, Bill Clinton, Barack Obama and Donald Trump.
His eldest son, President in his own right, President George W. Bush, delivered the final eulogy.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: As he aged, he taught us to grow with dignity, humor and kindness, and when the Good Lord
finally called, how to meet him courage and with the joy of the promise of what lies ahead.
He was a genuinely optimistic man and that optimism guided his children and made each of us believe that anything was possible. Dad could relate to
people from all walks of life. He was an empathetic man. He valued character over pedigree and he was no cynic.
He looks for the good in each person and he usually found it. George Bush knew how to be a true and loyal friend. He nurtured and honored his many
friendships with a generous and giving soul. He showed me what it means to be a President who serves with integrity, leads with courage and acts with
love in his heart for the citizens of our country.
When the history books are written, they will say that George H.W. Bush was a great President of the United States, a diplomat of unmasked skill, a
Commander-in-Chief of formidable accomplishment and a gentleman who executed the duties of his office with dignity and honor.
Through our tears, let us know the blessings of knowing and loving you. A great and noble man. The best father a son or daughter could have. And in
our grief, by the smile knowing that dad is hugging Robin and holding mom's hand again.
(END VIDEO CLIP)
QUEST: The former President is now aboard the presidential aircraft being named Special Air Mission 41. He's on his way to his final resting place
in his adopted hometown of Houston, in Texas.
Jeff Engel is with me in Washington. He co-wrote "The China Diary" alongside George H.W. Bush and is the Presidential History Director at the
Southern Methodist University is with me now. What do you think President H.W. Bush, who was a scholar of China certainly was no stranger to trade
policy and a maestro at diplomacy. What would he have made of the current situation between the U.S. and China?
JEFF ENGEL, PRESIDENTIAL HISTORY DIRECTOR, SOUTHERN METHODIST UNIVERSITY: I think he'd be rather distraught to be honest. Because the entire purpose
of Bush's foreign policy was to try to create a more integrated, multi- lateral world system with China's rise and China's economic development being a critical part of that. We have to remember that after Tiananmen
Square when others were asking for the Chinese to be sanctioned by America and other countries, Bush argued the opposite.
He said that we need to make sure that China's economy keeps on growing, because the more integrated they are with the rest of the world, the more
democratic they will be. That theory has not certainly proved out entirely but he certainly would be against the idea of rolling it back.
QUEST: Well, on the economic front, he also was largely responsible. It happened on his watch of China joining the WTO, at least leading China into
the WTO. Now the current President says that that is one of the biggest mistakes ever made because China has robbed the WTO, taken advantage of it
and enjoyed unfair economic growth because of an uneven level playing field. I mean, there is some validity to this, isn't there?
ENGEL: Well, there is, but you have to remember there is really a broader picture here. In fact, one of the sad lessons I think we can take from
looking back at George Bush years - George H.W. Bush years, is that the same issues that were affecting American policy, the de-industrialization
of American industry, essentially the hollowing out, if you will, of much of the heartland, that was the same issue that was on the table in 1988 and
especially in 1992.
I'm hard pressed to think of any significant economic issue that would have dominated the 2016 election that wasn't already prevalent in Bush's age.
So really that tells me that American policy makers across generations have had difficulty dealing with this problem, not necessarily Bush and Bush had
a theory, at least.
QUEST: And we would be remiss if we just left this economic legacy to China because Bush 41 left an economic stamp on America, not surprising for
a man who majored in Economics at Yale and came to prominence as an oil executive. Now the Americans with Disabilities Act opened doors for
millions of people who had been excluded from the workforce. The Clean Air Act was an experiment with market-based approach to cut emissions, that's
now the norm and he paved the way for a balanced Federal budget.
It meant he had to break no new taxes and crippled his own chance of re- election. In later years, how at peace was he with the fact he did break his own word and it might have cost him the next election?
ENGEL: Oh, I think he was actually at peace with it at the time that he made it. He made with his eyes fully wide open, breaking that pledge,
which his advisers told him was good economic policy, it would lead to a greater prosperity down the road - a balanced budget down the road and more
importantly, it was politically necessary at that time.
He knew breaking that pledge was going to hurt him, perhaps deal him a death blow, politically. But he also knew it was the right thing to do for
the country. And that's the thing we find in the archives time and again Bush recognizes and says to his advisers, "I have to follow the following
policy even though I know it is going to hurt me personally because that's the president's job to do what's best for the country, not just for me."
QUEST: Sir, thank you.
ENGEL: Great talking to you.
QUEST: A great significant piece of George H.W.'s legacy, is of course NAFTA. Now Bill Clinton may have signed it, but Bush 41 paved the way. He
started the process. I spoke to the former Mexican President, Vicente Fox about the new NAFTA, and as you know, the USMCA, and I asked him if the
update signed by Donald Trump makes for a better agreement.
(BEGIN VIDEO TAPE)
VICENTE FOX, FORMER PRESIDENT OF MEXICO: It is better in farming, agriculture and food products, and the real defenders were U.S. farmers,
three million of them that sell to Mexico, $40 billion worth of grain. So they didn't want to lose that market.
But in the animal industry, we lost a little bit. We had to make some concessions, very small, not significant, and finally, I think the best
thing is that we have a NAFTA that will keep working for the benefit of the three economies, because this economy needs NAFTA more than us. I mean
QUEST: Is it your feeling that a renegotiation or modification of NAFTA could have happened without all the fuss and hoo-ha that the U.S. brought
to the table or perhaps, truthfully, it needed Donald Trump to say we are going to renege on this, we are going to withdraw from it unless you
renegotiate? Because anybody else would have dragged their heels.
FOX: Donald Trump did not make any contribution. In my terms, 2006, we all really were working with President Bush, 43, by the way. I am sorry
for the loss of 41. He was a great man and a great friend of Mexico. But at that time we were talking about a NAFTA plus and we presented to
Congress in the United States, not a plus. But it's been sitting there.
So everybody thinks we should have renewed 25 years, it was getting a little bit obsolete, but it worked. It brought competitiveness to this
(END VIDEO TAPE)
QUEST: As we continue, the Presidents of the U.S. and China like to keep things cool. The old Beijing is finally talking about U.S. trade. The
former Australian Prime Minister Kevin Rudd helps me read the signs and the signals and interpret exactly where we are, in a moment.
QUEST: Hello, I'm Richard Quest. There's more "Quest Means Business" in just a moment when China breaks its silence on the trade talks with
President Trump, Kevin Rudd is with me in the C-suite to make sense of it all. And Burger King wants you to go to McDonald's, now that's bizarre,
but there method in the madness and we'll show you.
As we continue tonight, this is CNN and on this network, the facts always come first.
The body of George H.W. Bush is being flown back to his home state of Texas, where the former President will be buried next to his wife from a
few hours from now. Earlier today, 3,000 people attended the state funeral for the 41st US President. Bush was remembered as a man of courage and
compassion who was fiercely loyal to his friends and family.
Coordinated raids across Europe have netted dozens of suspected members of a notorious mafia clan based in Italy. Law enforcement officials say the
crew is responsible for a large part of Europe's cocaine traffic. The suspects are also accused of money laundering and bribery.
The special counsel in the Russia investigation in the U.S. is recommending no jail time for Donald Trump's former national security adviser, Michael
Flynn. Now, Flynn pleaded guilty to lying to investigators. Robert Mueller says Flynn has provided substantial assistance, including
information about contacts between Mr. Trump's transition team and Russia.
And news just in to CNN, the French government just confirmed there have been no fuel tax rise in 2019. On Tuesday, it said the rises will be
delayed for six months. It follows weeks of demonstrations with some rioters setting cars ablaze. Three people have been killed. CNN's Jim
Bittermann is in Paris, a terrible climb-down by the look of it, whichever way you dress it up, even if next year, they come back with it again, to go
from a six-month delay to a withdraw until next year, a total climb-down.
JIM BITTERMANN, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's about a close to a climb-down as can you get, Richard. Basically, if the government had
done this at the very beginning, there probably wouldn't have been any of the scenes that we've seen over the last couple of weeks.
But yes, indeed, this is a real backup by the government, they wanted to get this tax in place to help finance a very psychological missions that
they have. In any case, the taxes will not come about, now the question of course really is, what happens now, will the so-called yellow vests, will
they abandon their blockades.
But their problem is that, in the three weeks or so since this whole thing started, there has been a lot of sort of people climbing on and adding
their own kinds of demands to this. By one of the news station here that counts, there is 51 demands now being made by the various factions behind
these yellow vests.
And they're totally autonomous. People can join in and say they are a member of the movement, and they've got their own demand. So to what
extent this will diffuse the situation remains an open question. Listening to some of them being interviewed tonight, however, they're
saying that they're going to maintain their actions for this Saturday, Richard.
QUEST: Jim Bittermann in Paris. China is promising action on its trade talks with the United States. Details are still to emerge, yet, Beijing's
first statement on last weekend's chat between President Trump and President Xi is upbeat, saying China is confident a trade deal can be
worked out. Kevin Rudd is the former Australian Prime Minister currently president of the Asia Society joins me now. Good to see you sir.
KEVIN RUDD, FORMER PRIME MINISTER OF AUSTRALIA & PRESIDENT, ASIA SOCIETY: Good morning, Richard.
QUEST: Now, should you be surprised at this confusion over who agreed what at this dinner? Shouldn't they have been a little more responsible about
how this was to be portrayed?
RUDD: Well, there's a world of things called "should" with the Trump administration than there is what is. And the bottom line is, it's three
hours of conversation over dinner. The advisors do not know which way President Trump would land at the end of it.
And I think that Chinese have kind of gotten used to that now. So when you have slightly different narratives about what actually happened, that's
kind of just the way it is. We could wish it was more perfect, more clean, more bureaucratic, but it ain't.
QUEST: But if this had been -- I mean, from your experience, is it usual to have trade negotiations other than in the most general terms over dinner
when you have a dispute like this in tariffs, you need to have a proper negotiating session face-to-face like we are.
RUDD: Well, bottom line is your officials would actually line up what the fundamental disagreements are. I think being at it for weeks, months and
sometimes years. Then there is political argy-bargy as we would call it in Australia, which is this big concession for that, this big concession for
OK, we've exchanged the chess pieces, that's the deal. But President Trump is just radically different. He forms an impression about his interlocutor
Xi Jinping, he says he likes him, secondly, he wants a big trade deal and he wants big reductions in tariffs. And that seems to be the mandate which
these officials are given.
QUEST: How realistic is his -- what he said last night in a tweet about, he wants a fair trade deal, and if he gets it, it will be great for
everybody, but if he doesn't, then he'll walk away, it's no big deal.
RUDD: Well, it's President Trump's standard negotiating tactic from --
QUEST: Is it -- is it -- is it -- you've been in government a year or two, is his strategy much different from how you've negotiated with other world
RUDD: It's radically different. It's not the way the rest of international community does business. But it's the way he does business,
and the Chinese recognize this that, that is him. Furthermore, the Chinese through the statement by the Commerce Ministry overnight have come to do a
They know that this trade war, if it expands and develops is more harmful for them than it is for the U.S. so, therefore, they're adjusting to the
reality which is Trump land.
QUEST: Right, but, there in Trump land, we've seen a deal masked as something less. So the Europeans, they go on auto tariffs, for example,
time and again, something that you thought was going to be big wasn't. But it got him off the hook of having taken a definitive stand.
[15:35:00] Is it your view that the Chinese in wanting to make a deal will make structural and systemic change or will they hope to buy it off with
buying a few more goods here and there?
RUDD: I think there are three boxes here.
RUDD: There is number one box, which is reduce the trade deficit.
QUEST: That's relatively easy to do on a short-term basis.
RUDD: Yes, it can be. The columns he's talking about is hard, and if you're an Australian LNG producer at the moment, selling lots to China on
long-term contracts --
QUEST: Right --
RUDD: It's time to worry about and wonder about what's going to happen with geopolitically-induced LNG sales from the United States --
QUEST: So that's box one --
RUDD: Let's just say that's doable, I think that is in the probable --
QUEST: Right --
RUDD: Basket. Box two is massive tariff changes by the Chinese. Is that probable?
QUEST: It's the easiest thing to do.
RUDD: It is because the general tariff rate in China right now is 9.8 percent. U.S. is 3.4 percent. I think there's a deal to be done there.
QUEST: Right --
RUDD: Though my trade adviser Tippes(ph) would say "90 days to do something tariff line by tariff line." That's the toughest I'll say
they've ever seen. But I think that is quite possible. Box three, we move on to structure. And there are three bits of structure.
One is IP laws to force transfer three-state support for China's high- technology --
QUEST: That's the hardest bid --
RUDD: The high technology --
QUEST: Because that's the --
RUDD: Ambition --
QUEST: Because that's the bid that you can make the promise about, but it's the enforcement, the monitoring and enforcement further down the road.
RUDD: Well, that's true. I think the one about so-called false technology transfer, that actually is doable.
QUEST: Right --
RUDD: Because that's a matter of contract, interpretation as well. The two structural ones which are hard, one's more cultural and structural, IP
fifth as the Americans would say, we've had so many agreements with the Chinese --
QUEST: Right --
RUDD: And IP protection. It's almost as old as the Old Testament. It's been going for a while now. The key thing for the Chinese there is to work
out an enforcement mechanism for IP protection laws which the rest of us would have confidence in.
QUEST: Final, are you optimistic?
RUDD: I give it a six out of a ten that will be pulled off, why? Because the Chinese want this to happen.
QUEST: As always, it is good to see you, sir.
RUDD: Likewise --
QUEST: Thank you, thank you. It was the document that the British government didn't want the public to see, legal advice given to the Prime
Minister, warning her about her Brexit deal, that the U.K. could be stuck in endless rounds of negotiation. Half in, half out of the EU.
RUDD: That it could be trapped in an Irish border stalemate and without the power to walk away. And Mrs. May was quick to answer critics in the
House of Commons.
(BEGIN VIDEO CLIP)
THERESA MAY, PRIME MINISTER, UNITED KINGDOM: I have myself said on the floor of this house that there is, indeed, no unilateral right to pull out
of the backstop. What I have also said is, it is not the intention of either party that the backstop should, A, be used in the first place or
should, B, if it is used to be anything other than temporary.
(END VIDEO CLIP)
QUEST: Nina dos Santos reports on the Brexit battle from our London bureau.
NINA DOS SANTOS, CNN CORRESPONDENT: Well, this is just day two of the five days worth of debates that had taken place in the run-up to that crucial
vote on December the 11th. And Theresa May is still facing some pretty, tricky parliamentary arithmetic.
Unless you can table some amendment softening her Brexit deal as it currently stands, this withdrawal agreement particularly to address
concerns that MPs have over the Irish banks' stop agreement. It is looking increasingly unlikely that it will pass.
If that happens, the U.K. could face a new Prime Minister, new leader of the conservative party, a new election or indeed, a new vote on Brexit
itself. Nina dos Santos, Cnn, London.
QUEST: Tears of joy when Zimbabwe's strong man Robert Mugabe was ousted from power. A year on and hopes of a brighter future are fading as the
country grapples with its currency crisis. Zimbabwe's Finance Minister is next.
[15:40:00] (COMMERCIAL BREAK)
QUEST: A currency crisis striking doctors and opposition protests. It's a year since the ouster of Zimbabwe's strong man Robert Mugabe, and the
country's troubles are far from over. The new government hoping an ambitious reform program can help change its economic fortunes.
Unfortunately, soaring inflation and mounting debts mean progress of reform has been slow. I spoke to the man tasked with getting Zimbabwe's economy
back on track. The Finance Minister Mthuli Ncube has just delivered his first budget, and told me his plan to tackle the country's economic
(BEGIN VIDEO CLIP)
MTHULI NCUBE, FINANCE MINISTER, ZIMBABWE: Well, the budget recognizes that we have a twin deficit challenge which is that we have a fiscal deficit as
well as a calendar-count deficit. But also, we need to deal with our external arrears in terms of debt restructuring. So two things that are
confounded or rather, you know, magnified by the arrears.
QUEST: Right, so the budget deficit, though, you can deal with by what -- I mean, you can't really cut too much because the nation is already
extremely poor and further cuts would hit the hardest hard.
NCUBE: Well, I'll push this in two-fold. One is obviously budget cuts in terms of the wage rationalization, and on that front, the president of the
country, his Excellency Mnangagwa is leading from the front. He cut his salary by 5 percent. We all cut our salaries by 5 percent as ministers to
show leadership in terms of cost containment, in terms of austerity.
We have also expanded the revenue base by following on the informal sector which is expanded by the way. The economy is 40 percent bigger than we
thought. So in order to expand the coverage, we introduced a 2 percent financial transactions tax.
So those two together, cost-containment and revenue expansion have worked very well for us in terms of fiscal discipline and fiscal consolidation.
Which you'd be surprised that in the last month of October, we balanced the budget. In fact, we have a primary surplus. So we are making progress
after only three months, you know, in this new government.
QUEST: You still need the -- your lenders to write off or redo your debts.
NCUBE: That's correct. We need to have our debts restructured, shall we say, so that we can open up Zimbabwe for investment and international
credit lines. We are re-engaging. And that is a two-step procedure.
First of all, we had to get our economic reform program, which is enshrined in a document called The Transitional Stabilization Program, accepted
globally. We've done that, we've sold it initially. And then we'll move really into first phase which is to clear the debt arrears for the African
Development Bank and the World Bank, which is what you call the preferred creditor IFIs.
What determine that in the next 12 months, that is done, and then we move on to the second, the third phase which is basically the Paris Club
negotiations with the bilateral --
QUEST: Good luck with that --
NCUBE: Credits --
QUEST: Good luck with that --
NCUBE: Thank you.
QUEST: And in terms of how you are going to open the economy, make it more -- make it more attractive for foreign investment who looked for a rule of
law, who looked for stability, looked for good gains, obviously, and what can you promise them on those fronts, particularly the rule of law?
[15:45:00] NCUBE: First of all, let me say that Zimbabwe is opened for business already. Zimbabwe is really the biggest buy in Africa right now,
on any asset. You talk about the rule of law, literally, this is about property rights at the end of the day.
Property rights are secured in Zimbabwe with the judiciary level works, where contract enforceability conditions that work will have rule of law
that works. And with a list of other institutional reforms that will put you in place, including the improving the ease of doing business conditions
and putting in place a one-stop shop to make it easy for investors to come in. Clearly, Zimbabwe is the biggest buy in Africa right now.
QUEST: And the problem with the biggest buy is that it also gives the opportunity for the biggest corruption. You are aware that the more
opportunity and a nation opening up, a selling off of assets give -- can give -- we saw it in Russia.
We've seen it elsewhere, it's not new. You're familiar with it. What are you going to do to deal with the transparency and corruption issue?
NCUBE: We are dealing with corruption. We are becoming more transparent with zero tolerance policies on corruption. This is enshrined in the
QUEST: How many people have been locked up?
NCUBE: Oh, a lot of people have been locked up, absolutely. We have intolerance of corruption, we're dealing with it and we're desirous to
engender transparency everywhere. We have seen so in our budget, we have seen -- you know, tiers period, consider stabilization programs.
And in our vision 2030 which seeks to put Zimbabwe in upper middle income status by that date. We have zero tolerance and corruption.
QUEST: Can you understand why some might be at least skeptical, some would even be cynical, though, at the ability of Zimbabwe to clean up the economy
and to run a well-ordered economy? The history is against the country.
NCUBE: In the new dispensation, we'll say that we don't want to focus on politics, we're focusing on economic revival. That's how we have launched
this new stabilization program, and you know, as an enactment, you know, program for our vision 2030.
We're focusing on the economy, we're determined to put it on the right path for prosperity and for investors to profit from as long as they work with
us. They should believe in us, we have strong --
QUEST: Why? Why should they believe in you?
NCUBE: Because we're walking the talk. For the first time, we're walking the talk. We're doing everything that we said we will do. We're measuring
the result, we're very results-oriented. If you look at our transitional stabilization program, it is a results-based policy enactment program.
(END VIDEO CLIP)
QUEST: And as the minister of Zimbabwe. And news just into Cnn, USA Gymnastics filed for bankruptcy protection. In a statement, the
organization says this filing will enable USA Gymnasts -- Gymnastics to fully operate and to resolve the claims made by the survivors of sexual
abuse perpetrated by Larry Nassar.
The Chair of the U.S. Gymnastics said, "we owe it to the survivors to resolve fully and finally claims based on the horrific acts of the past."
We'll be back in just a moment.
[15:50:00] (COMMERCIAL BREAK)
QUEST: It's a strange old world, Burger King wants you to come here, yes to McDonald's. Because if you come within 200 meters or 600 feet of a
McDonald's and check your phone, you'll find that you're entitled to a 1 cent burger at which point you'll be directed to the Burger King to get
there and to go and eat.
It's a very strange marketing process, designed to bring the full effect or used the full effect of the abilities of geo-location and mobile phones.
It's an old marketing skill, it's in the United States. And the idea is to promote Burger King's new app. You get the Whopper of Burger King for 1
cent, but only if you do order it on the Apple with the app Near a McDonald's.
Fernando Machado is the Chief Marketing Officer of Burger King, he joins us now from London. And I think I've explained the technicalities of this.
It's an interesting idea, isn't it? It's a sort of way of putting a boot into the competition, getting people to load -- to buy or load up your app
and giving up something in return?
FERNANDO MACHADO, CHIEF MARKETING OFFICER, BURGER KING: Yes, well, we are always trying to find clever and creative ways to engage our fans. We are
launching mobile ordering payment as part of our app. We have like a huge effort in technology and to improve their service. And we -- like we are
Burger King, so we need to do things differently, we need to do things like in a creative way.
So one of our key partner agencies brought this idea to us. We thought it would be like tongue in cheek fun and engaging, and we brought it to life.
QUEST: And what's it -- how is it going?
MACHADO: It's going really well. Well, I think it's actually going better than my most optimistic dream around this specific activation. The mobile
app for Burger King has around 6 million downloads so far. In the past 36 hours, since we launched Whopper the Tour, we got around a million
downloads for the app.
QUEST: Whopper --
MACHADO: We have more than -- yes --
QUEST: Whopper the Tour, what if those -- what if you're near a McDonald's and there's not a Burger King nearby. I know that's impossible
to imagine. But if it was possible, what would you do then?
MACHADO: Well, I think that you would probably drive because flame(ph) really tastes better and it's worth the drive.
QUEST: So even if there's not a Burger King for miles, you'll still -- if you do it within 600 feet of a McDonald's, even if your nearest Burger King
is miles away, you'll still get the 1 cent Whopper?
MACHADO: You'll get a 1 cent Whopper and we direct you to the closest Burger King, and you'll have kind of like an hour to get there. Reality is
that Burger King has a pretty strong presence in the U.S., so it shouldn't be that difficult to find one nearby.
QUEST: So the Burger battle, the Burger war, if you like, has never been more intense in many ways. But it's not just between the two of you now,
there are so many other fast food options, Chipotle and others, all coming into the market, that why do you target -- do you think McDonald's? Is it
more than the others? When actually the race is much greater than this?
MACHADO: Well, I think that like -- we honestly, we don't really see it as a war. I -- we see fast food as a cultivated -- as a fun category and our
guests, our fans, they like when we do fun things, when we have fun. And in this specific case, we did against the largest competitor because they
are the ones that have the largest number of locations. So --
QUEST: Right --
MACHADO: Because we are doing the order, phone their locations, we are almost like turning their locations into our locations.
QUEST: Brilliant, it is a brilliant ambush form of advertising. Thank you, sir, thank you for joining us.
MACHADO: No, thanks for the invitation.
[15:55:00] QUEST: Much appreciate now. As for you -- well, what's this? Which is it to be to Whopper or the Big Mac. If you look at the fries, and
they are the genuine fries from each. Maybe a little cold, but you know something, you can't eat a cold fry. Actually, yes, you can -- oh.
QUEST: When George H.W. Bush became president, I was a young correspondent, a financial reporter based in New York. Over the course of
his presidency, I followed closely. I saw how he started the whole NAFTA process. I watched how he engaged China, of course, where he had been
ambassador envoy and engaged China and brought them ever closer to the WTO.
And I saw how he was elected on a "no new taxes", and then had to face the political reality of rising deficits from the Reagan years and a Congress -
- a Democrat Congress, that was determined to force down some form of resolution. Hence, the budget resolution of the Omnibus Budget Act of
1990, which eventually led to "read my lips", no new taxes being broken.
Why do I go through all of this? Because it's a sharp reminder today as he's buried, that the legacy of one president carries so much further into
the legacies of the next. Which is even more remarkable when you look at how the current president is undoing many of the ties that George Bush,
President Bush 41 put in place.
There's a lot to be said for what George H.W. Bush did during his presidency. But perhaps, forget the economics, perhaps forget the natures
of the agreements, ultimately, it comes down to the decency of the man and the work that he did.