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China's U.S. Ambassador Calls CNN Report on Uyghur Children a "Fabrication"; H&M and Nike are Facing a Boycott in China; Harrowing Stories Out of Ethiopia's Tigray; Critics Point Out Contradictions in Harry and Meghan's Tell-All; $10 Billion A Day Suez Canal Blockage, Worldwide Impact On Supply Chains; North Korea's Second Test Evokes Response From Biden; North Korea Now Number One U.S. Foreign Policy Priority; The COVID Crisis Is The World's Crisis, 120 Million Now Forced Into Extreme Poverty; Netanyahu Wins Israeli Election But Must Form Coalition. Aired 1-2a ET
Aired March 26, 2021 - 01:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[01:00:00]
JOHN VAUSE, ANCHOR, CNN NEWSROOM: You're watching CNN NEWSROOM live around the world. Hello, I'm John Vause. And coming up this hour.
The nearly $10 billion dollar a day traffic jam. That massive cargo ship, still stuck in the Suez Canal. And how that could affect supply chains could affect around the world.
The U.N. warning about the global coronavirus pandemic and another consequence; more than 100 million people now back to living in extreme poverty.
And a show of force by North Korea met with condemnation by the U.S. president. Keep it up, and you'll get a response.
Two dredgers, four diggers, nine tugboats and a very big container ship which refuses to budge. The "Ever Given" has been compared to a very heavy beached whale, run aground and blocking the Suez Canal for three days now.
So there's a new plan. To dig 16 meters down around the front end of the bow, move up to twenty cubic thousand meters of sand, and hope that will be enough to refloat the ship.
There's no timeline on this. But the longer it takes, the greater the cost to the world economy.
Oil markets have already been rattled as dozens of tankers carrying millions of barrels of crude still waiting to pass. Nearly a third of the world's shipping container volume passes through the canal every day. Now all of that at a standstill.
CNN's John Defterios tracking all of this from us from Abu Dhabi.
So, John, they've got a plan in place, you just don't know how long it will take. And right now, time is crucial. JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Yes, it certainly is, John. And it's amazing because the narrative is starting to change as they bring in international salvage companies, one from the Netherlands, and the other one from Japan.
SMIT is the advisor from the Netherlands working with a group called Boskalis. And they're suggesting here on the advisory that you need to take out 20,000 cubic meters within a short span of time to get to the depths that you were talking about there in your lead in.
Then we also have, according to shipping sources I've been speaking to overnight -- very high levels one, by the way -- who are suggesting there's a unique opportunity by Mother Nature here with a seasonal high tide between Sunday and Monday.
I can't imagine it can dig that fast, but the tide may offer a chance to get this moving, a slim chance but one that the industry is hoping for.
Let's take a look at the task at hand here, John.
A traffic jam like no other in the world of trade. At least 160 ships are waiting to transit through the Suez Canal after efforts to dislodge the giant vessel wedged across it failed.
Attempts were made to free the 224,0000 ton "Ever Given" using eight tug boats and dredging the surrounding mud and sand. But so far, the vessel won't budge.
Canal authorities suspended traffic through the vital waterway Thursday when it became clear the rescue plan wasn't going to be quick or easy.
A team of Dutch and Japanese salvage experts were drafted in to help and expressed caution over the time it could take.
PETER BERDOWSKI, CEO, BOSKALIS: It can be days to weeks, depending on what you come across. You have to realize that the equipment you need is, of course, not necessarily around the corner.
DEFTERIOS: Around 12 percent of the world trade volume passes through the Canal normally and it usually handles the equivalent of $10 billion a day in cargo.
Industry experts are concerned if the situation is not resolved soon, there could be a big impact on the oil market. Shipping and container rates leading to a rise in the cost of goods we all depend on.
The "Ever Given" first became stuck on Tuesday after being caught in high winds and a ferocious sandstorm which caused low visibility and poor navigation.
Its owner, Japanese shipping company, Shoei Kisen KK (ph) is bracing itself for lawsuits from affected parties but says their main focus at this critical juncture is re-floating the ship. VAUSE: John, the question now is what happens, I guess, on the global
shipping market and the oil market and these global supply chains if there is no solution if this boat -- or ship, I should say -- is not moved by next week?
DEFTERIOS: Well, this an eerie calm before the storm, John. Again, I was speaking to some sources overnight, one from the shipping community and one from the legal community.
Let's cover the shipping rates. They're suggesting that the rates have not spiked up with hope of a breakthrough here with the international contractors joining the Suez Canal Authority.
But they say within four or five days once they see this doesn't get solved, if that's the case, shipping rates, container rates, will skyrocket.
[01:05:00]
And I'm looking at the oil market. It's not priced in, John, we're back up maybe eight-tenths to one percent on oil prices. But they've fallen about six, seven dollars a barrel over the last week because of what's taking place in Europe. That could quickly shift.
And the legal advisor that I spoke to last night said that the claims are coming thick and fast against the owner of the vessel and they're looking at others that could be responsible for paying reparations for what's taken place there over the last five days.
VAUSE: Yes. Interesting times, John. Thank you. John Defterios in Abu Dhabi.
Don Maier is back with us again. He's the dean of the school of maritime transportation logistics and management at CAL Maritime.
Don, thank you for being our returning champion coming back for another night.
If we look at this, the numbers are really starting to add up in terms of delayed trade. Lloyd's List did a rough calculation, it is rough, but each day they say just over $5 billion of goods are shipped westbound, $4.5 billion heads in the other direction. That gives you a total of $9.6 billion worth of cargo.
It's a delay of $400 million for every hour the canal remains blocked.
And this comes at a time when shipping schedules were in disarray because of the pandemic and congestion has been building at ports because of virus restrictions. And seems we're now heading into, what, worst-case scenario territory?
DON MAIER, DEAN, SCHOOL OF MARINE TRANSPORTATION & LOGISTICS, CAL MARITIME: Yes. It's one of times, John, that all of the different factors are all coming together at once time. So yes, this definitely is not one of those times where you want to have a ship get stuck in the canal at this point. Especially with us coming -- or with the global economy coming out of the pandemic and things are just starting to turn around.
So like you just pointed out, there's so much global trade going through the canal that everything is starting to be disrupted.
VAUSE: Lloyd based their calculations on the value of containerized goods which is goods moved in a cargo container which make up about a quarter of the Suez Canal traffic.
But what about the containers themselves? There's been a global shortage of them for some time. It would seem even more containers would be out of the system now for a significant period of time. And that's part of this chain reaction, right?
MAIER: Yes, that is going to be a huge reaction, as you just pointed out, John. Once that ship gets into Rotterdam to be off-loaded then all of those containers are going to be unloaded themselves.
But in the meantime, you have a number of the manufacturers in Asia, primarily in China, that are going to be looking for empty containers to be reloaded. But they don't have those empty containers back because obviously the "Ever Given" is still going to be in Rotterdam.
So now you have an imbalance in just containers themselves to be reloaded to be shipped back to put more supplies back into the supply chain. So it's an imbalance of not just the goods themselves but also about containers.
So then all of a sudden now you have an increase in the prices of the containers being moved from one coast to another.
VAUSE: Is there a basic calculation here? If the Canal is closed, say, for four days it'll take four extra days after re-opening to clear the backlog?
MAIER: That's correct. So, yes, usually we -- when I was in the industry, we will use about three days that -- I'll have about three or four days of extra delays that I'd build into my schedule anyway in every container.
So figure about those two or three days, maybe four days of that delay going into a port may then be caused by an extra six days of delays too.
So right now, I would be forecasting about at least a week, maybe a week-and-a-half in terms of what that impact is going to be to my supply chain.
So I need to measure that now in terms of my production schedule, my capacity planning, as well as my inventory (inaudible) as well. So I want to make sure that I can kind of limit the amount of impact I have on my end customers.
VAUSE: There are other routes that shipping can take but there's a reason why they built the Suez Canal. Because all the alternatives basically take a whole lot longer, basically a week or so maybe 10 days -- and that means extra costs. But we also have this -- according to a just declassified memorandum -- in 1963, the U.S. government looked at the feasibility of using 520 two-megaton nuclear devices, spaced at four per mile for 130 miles to carve a canal from the Mediterranean to the Red Sea via Israel.
Clearly, that never happened.
But this is my question. Given there is so much world trade right now, so much shipping out there, is there a need for another canal somewhere preferably not built by nuclear devices?
MAIER: Yes. If we don't have to use nuclear devices that would probably be the best option to go with.
It is going to start to be one of those points in time the infrastructure really starts to try to keep pace with the global economy. So the Panama Canal was just expanded in 2014, roughly, the Suez Canal was also expanded.
But in the meantime, our container ships like the "Ever Given" have expanded so much that they're actually larger than the canals themselves again.
So that's part of the reason why the "Ever Given" is actually jammed into the canal right now is because of the size of the infrastructure -- or the size of the ship given the size of the infrastructure.
[01:10:00]
So I agree with you, John. That at some point, I think the governments around the world are going to have to get together and try to figure out another different local route in order to move all of our goods throughout the world.
VAUSE: At the risk of creating another Suez Canal crisis, is there an argument though to be made that there's a case for better investment, better maintaining, better upgrades of the Suez Canal itself?
MAIER: Yes. So there's also been a lot of discussion and some investment already in terms of the Silk Road through China. So rather than going the sea route, maybe actually taking the land route over from China to Europe.
That's pretty much the land bridge here we have in the United States. That when a container comes into the port of L.A. Long Beach, we go put it on a train and then rail it all the way across the United States into New York or into Chicago.
So we have those kind of options. And I think that's probably the next best option that we start to look at. Because, at least in terms of the sea routes, we're going to be limited based on the size of our ships and the draft the ships will have going into certain areas.
VAUSE: Don, as always, thank you so much. Really appreciate you being with us.
MAIER: Always, John. Thank you very much for your time tonight.
VAUSE: Brazil continues to set new records for the number of daily infections; more than 100,000 on Thursday, just a day after the deadliest day of the pandemic.
Medical supply shortages and the government's failure to impose consistent restrictions to slow the spread are all partly to blame for the surging numbers.
So too are lack of vaccines with many waiting in long lines in sweltering heat and humidity, just to be turned away.
Meanwhile France expanding a strict lockdown from 16 to 19 regions. Non-essential stores are closed and movements are limited to no more than a 10-kilometer radius.
(BEGIN VIDEO CLIP)
OLIVIER VERAN, HEALTH MINISTER, FRANCE (Through Translator): In three additional departments, as you know, the situation is even worse.
The epidemic pressure has reached alarming levels. The health pressure is strongly felt in hospitals, and with town doctors the epidemic dynamic is strong.
These are the Nievre, Rhone and Aube departments. For these three departments after consultation with the elected representatives but also with the state services and the health establishments, it seemed essential to amplify the protection measures.
(END VIDEO CLIP)
VAUSE: And with a successful vaccination rollout, the U.K. government is debating so called pub passports which would allow vaccinated people to go to the pub, have a beer.
But the prime minister says it's too soon to make any decisions because of moral complexities and ethical problems.
Meanwhile, Argentina is suspending all incoming flights from Brazil, Chile, and Mexico because of a surging number of cases in those countries.
Authorities say all travelers will be tested before boarding a plane to Argentina. Then again, on arrival plus seven days later. Anyone who tests positive will be placed in isolation by the government.
Argentina has already suspending flights from Britain and Northern Ireland.
The pandemic has killed millions of people worldwide and it's causing a more sharply unequal world. A new U.N. report says the global economy is entering its worst recession in 90 years with an estimated 120 million people plunged back into extreme poverty.
Vaccine nationalism is not helping. Experts say that when vaccines started rolling out earlier this year, the vast majority went to the wealthier developed countries.
The U.N. is now calling for financing to address the expanding inequities.
(BEGIN VIDEO CLIP)
AMINA MOHAMMED, U.N. DEPUTY SECRETARY GENERAL: The message of the report is clear and it's stark. COVID-19 is leading a sharply bifurcated world, leaving hundreds of millions of people behind.
And putting the development agenda seriously at risk, without immediate action on financing for development.
(END VIDEO CLIP)
VAUSE: Catherine Rampell joins us now. She's CNN's economic and political commentator and opinion writer for "The Washington Post".
Catherine, it's been a while. Thanks for being with us.
CATHERINE RAMPELL, CNN ECONOMICS & POLITICAL COMMENTATOR: Great to be here.
VAUSE: OK. The one thing this U.N. report actually makes clear, when it comes to the impact from the pandemic especially in economic terms, we are not all in this together.
On almost every benchmark, minority groups and less wealthy nations have been hit the hardest. Here's a little more from the Deputy U.N. Secretary General.
(BEGIN VIDEO CLIP)
MOHAMMED: The pandemic has caused the worst recession in 90 years and disproportionately affected the most vulnerable segments of our societies including women and youth.
We're seeing between 119 and 124 million people estimated to be the newly pushed into extreme poverty. And the world has lost the equivalent of 255 million full-time jobs.
(END VIDEO CLIP)
VAUSE: Those numbers are staggering. And the U.N. is warning of a potential lost decade for development in many countries.
So the big picture here. If these inequities are left unchecked, what will be the ultimate impact on everyone?
[01:15:00]
RAMPELL: Well, certainly, the poorest countries will be hurt the worst, right? That's obviously true just based on the astronomical number of people who've been pushed into extreme poverty in the past year. Those countries have been suffering the most. And I think one of the big takeaways of this past year is that every
country has turned inward, right, and has been thinking solely about its own problems, perhaps understandably, but not really thinking about how interconnected we are with other countries.
And if we in the United States, for example, a rich country, are able to if not exactly eradicate the pandemic here, at least keep it at bay, we won't be protected so long as there is still suffering somewhere else, so long as the virus is still spreading out of control and potentially mutating somewhere else. That's partly how some of the variants have come about.
So we should be thinking of this as a global project, much more than we have. And not as we'll deal with our problem, you'll deal with yours, they have no relation to one another.
In fact, there are self-interested reasons to care about what happens in the very -- most vulnerable places of the world.
VAUSE: Yes. The reality is if you're a white male professional in a wealthy nation able to work from home then those lockdowns and restrictions they've been an inconvenience but yes, life's pretty good.
It's a different story for a lot of other people. Pew Research found lower-income families have taken the biggest economic hit during the pandemic. Other studies have found unemployment and lost wages have impacted women and workers of color the most.
This seems to be one of those moments right now in history where not just in the U.S. but in countries around the world that, if -- you can take this as an opportunity to fix a whole lot of social problems which have been ignored for generations like gender and racial inequality and wages and employment.
But given the impact has been so uneven around the world and in different sectors, is there a will to tackle these big issues and to take on these things?
RAMPELL: It's hard to say at this point. I think the pandemic has thrown into greater relief a lot of problems that were already there, as you point out.
Even here within the United States, as we were just discussing, the U.S. has been better situated than a lot of other countries because it's a much richer country.
There are deep, deep inequities here. And the people who are suffering the most are the lowest income people, they're losing jobs, they're losing hours, their rents are going up, in fact, while rents are falling for richer people -- I wrote a story about this earlier this week.
And it doesn't really seem like there is much of a will to tackle that kind of bifurcation even within the United States much less think about how much worse it is in other parts of the world.
But my hope is that, again, some of these problems that predated the pandemic may have been thrown into starker relief. And at least there is more attention being paid to them even if we don't exactly have solutions yet.
VAUSE: Catherine, we're going to leave it there, but thank you. Good to see you. Thank you so much for your insights, it's been a good conversation. Appreciate it.
RAMPELL: Thank you.
VAUSE: Israel's election results are finally in. And Prime Minister Benjamin Netanyahu will lead the party with the most seats in the coming parliament. Not enough though to form a government in its own right so he now faces the uphill battle to form a coalition.
The right-wing Likud won 30 seats in the upcoming Knesset, the closest challenger Yair Lapid's party on 17. That means the prime minister needs to cobble together support from the other parties, from the right wing and from the religious parties to try and stay in power, 61 is the magic number.
Any deal-making comes against the backdrop of Mr. Netanyahu's corruption trial. He's pleaded not guilty to bribery as well as fraud charges.
The court will begin hearing evidence on the next phase of the trial, April 5th, the Knesset sits April 6th.
The U.S. president is not laughing off the latest missile test by North Korea.
Coming up. With North Korea claiming to have tested new, more advanced missiles, it's now Joe Biden's top foreign policy issue.
[01:20:00]
VAUSE: In his first news conference since becoming president, Joe Biden said North Korea is now his administration's most pressing foreign policy issue.
In less than a week, Pyongyang has carried out two separate missile tests, the first last weekend was also the first on Biden's watch.
U.S. officials say the missiles involved were not ballistic and not a serious enough threat. On Thursday, though, they were ballistic missiles and Washington says that changes everything.
North Korea now says those missile tests were a success. Those comments came in state media.
CNN's Brian Todd has more.
(BEGIN VIDEOTAPE) BRIAN TODD, CNN CORRESPONDENT: A warning from President Biden to North Korea's 37-year old dictator who just launched two sets of missiles within a few days. The latest a test firing of ballistic missiles nearly 300 miles into the sea.
JOE BIDEN, PRESIDENT OF THE UNITED STATES: There will be responses if they choose to escalate. We will respond accordingly. But I'm also prepared for some form of diplomacy but it has to be conditioned upon the end result of denuclearization.
TODD: But analysts tell us denuclearization is not in Kim Jong-un's playbook.
SUE TERRY, CENTER FOR STRATEGIC & INTERNATIONAL STUDIES: What they want to talk about is potential interim freeze, potentially capping their program. And that's the maximum that they will go.
They have said multiple times that they're not interested in denuclearization talks.
TODD: The president was also asked about the broader North Korean threat.
REPORTER: Former President Obama warned the incoming President Trump that North Korea was the top foreign policy issue that he was watching. Is that how you assess the crisis in North Korea?
BIDEN: Yes.
TODD: Experts say these missile launches are classic moves from the Kim regime, that the North Koreans love to greet new American presidents with shows of force; part intimidation, part bluster. It's a dodge and weave with specific goals in mind.
MICHAEL GREEN, FORMER U.S. NATIONAL SECURITY COUNCIL OFFICIAL FOR ASIA: Kim is sending the message that Joe Biden can't ignore him, that Biden has to come back to the negotiating table.
And from Kim Jong-un's perspective, he would like for Joe Biden to offer what Donald Trump appeared to be offering, which is a big deal.
TODD: But a big deal never came to pass between Kim and President Trump despite the fanfare of two summits and a high-profile meeting at the demilitarized zone in 2019, the first time a sitting U.S. president set foot on North Korean soil.
DONALD TRUMP, FORMER PRESIDENT OF THE UNITED STATES: This has been in particular a great friendship.
TODD: There was correspondence which included what Trump termed love letters between the two leaders.
TRUMP: We met and we liked each other from day one.
TODD: Kim did draw down his missile tests for an extended period as he kept trying to leverage his relationship with Trump for concessions. But analysts say while Kim was courting Donald Trump, he continued to modernize his nuclear warheads and missile arsenals.
GREEN: They've been clearly perfectly weapons capable of hitting U.S. allies and U.S. bases in the Pacific.
TODD: Last October, Kim displayed his biggest missile yet called a Hwasong-15 rumbling it through the streets of Pyongyang on a mobile launch platform.
Experts say the red line to watch out for is if Kim Jong-un decides to test another long-range missile capable of hitting the Continental U.S., specifically a missile that can reenter the earth's atmosphere without burning up.
GREEN: I think what you're seeing is North Korea ratcheting up the pressure to indicate that that could be coming if the Biden Administration doesn't talk to them.
TODD: Experts say Kim Jong-un has another move that he could leverage against President Biden.
They say Kim knows just how bad America's relationship with China is right now and is eager to play the superpowers off against each other to try to win more concessions.
TODD (On Camera): Brian Todd, CNN, Washington.
(END VIDEOTAPE)
VAUSE: And according to North Korea, the missiles have new technology, more advanced technology.
CNN's Paula Hancocks following that side of the story for us from Seoul.
[01:25:00]
VAUSE: The other side of these missile tests too often is that they often be like a sales pitch to other countries around the world that may be interested in buying weapons illegally from the North Koreans. That's happened in the past.
So this talk about new technology is as much to intimidate the U.S. as it is to increase sales.
PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, certainly, that's -- the intention of the sanctions is to prevent that. But there is proof that is exactly what has happened in the past, John.
But what we know from the North Korean side is that they believe that this is something very new. That they say that it's a newly developed, new type tactical guided projectile.
And we know there are many experts poring over those photos that have just come through this morning to see if there's any indication as to what kind of missile it was. Now at an October last year parade, there were a number of new weapon
systems that were put on show. And Kim Jong-un has made it very clear that he intends to test those weapons.
He's already said that his self-imposed moratorium on certain testing is now over -- he said that several months ago. And so what we are seeing now is what we really were expecting.
Something to herald the new U.S. president in but also North Korea showing that it is diverting itself back to testing and improving weapons systems.
Now one interesting thing, John, is the fact that Kim Jong-un himself wasn't there, he's usually front and center at these kinds of tests and cheering when they are successful.
Now we know that he has been seen elsewhere opening new roads et cetera, so potentially focusing on the economy whilst his chief weapons producer actually deals with developing and testing the new technologies.
VAUSE: Paula, thank you. Paula Hancocks in Seoul.
We'll take a short break.
When we come back the hashtag #supportxinjiangcotton has been viewed more than four billion times.
That's after people in China called for boycotts of Western companies like H&M and Nike after they took a stand against alleged use of forced labor which has been -- produced cotton in Xinjiang.
(COMMERCIAL BREAK)
VAUSE: Welcome back. You're watching CNN NEWSROOM, I'm John Vause.
Well, the Chinese ambassador to the U.S. says a CNN investigation into Uyghur children separated from their families was fabricated. He offered no evidence to support his claim, provided no factual rebuke.
CNN traveled to China's Xinjiang Province after Amnesty International accused the Chinese government of splitting thousands of Uyghur Muslim families.
The U.S. and other countries have labeled China's treatment of Uyghurs genocide. But the Chinese ambassador to (...) (COMMERCIAL BREAK)
[01:29:44]
JOHN VAUSE, CNN ANCHOR: Welcome back.
You are watching CNN NEWSROOM. I'm John Vause.
So the Chinese ambassador to the U.S. says a CNN investigation into Uyghur children separated from their families was fabricated. He offered no evidence to support his claim, provided no factual rebuke.
CNN traveled to China's Xinjiang province after Amnesty International accused the Chinese government of splitting thousands of Uyghur Muslim families. The U.S. and other countries have labeled China's treatment of the Uyghurs genocide.
But the Chinese ambassador denied all the allegations during an exclusive interview with CNN's Christiane Amanpour.
(BEGIN VIDEO CLIP)
CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL ANCHOR: Ambassador, it turned out later that the children were interrogated in this orphanage for hours about a conversation that they had had with our reporter.
What is your reaction? And I guess, why not let these children go? Why detain children in an orphanage? What can be the political reason for stopping them leaving the country and sending them back to Xinjiang from Shanghai?
CUI TIANKAI, CHINESE AMBASSADOR TO THE U.S.: There has been so much fabrication so far. So I cannot just --
AMANPOUR: But you know that that's not fabricated, Ambassador. Right?
(CROSSTALK)
TIANKAI: It's very unfortunate. It's very unfortunate. I think it's very unfortunate. It's immoral to take advantage of any particular family situation and manipulate. This is not true journalism. It's very unfortunate for CNN.
(END VIDEO CLIP)
VAUSE: He also insisted until recently terrorism was the biggest security threat in Xinjiang province. Driven by spreading extremist ideology which China stopped with those education and training centers which were an advantage though, he said, to the entire community.
Well, a number of western apparel brands are facing a boycott in China. This comes after big names like H&M and Nike said they were concerned about allegations that forced labor was being used to produce cotton in Xinjiang.
They are now facing heavy criticism on Chinese social media. China is opposing the allegations, saying they're malicious attacks based on quote, "rumors and lies".
(BEGIN VIDEO CLIP)
TUANKAI: We have no problem with open and fair competition. Actually we very much stand for that. But the problem is, if you look at what happened in the last few years between China and the United States, between the United States and the rest of the world. How can we have fair competition when Chinese companies are discriminated against, when Chinese CEOs are detained without any reason, when there is such a clear attempt to criticize everything, such a clear attempt of nationalism and protectionism against international rules.
So in order to open fair competition, I think of these past mistakes will have to be corrected first. Otherwise there is no basis for us to engage in such competition.
(END VIDEO CLIP)
VAUSE: Kristie Lu Stout live for us from Hong Kong. The ambassador fairly adamant there about China's stance.
So clearly one thing seems really obviously about this is that, you know, this is a campaign against these companies being driven from the very top and they are in it for the long haul.
KRISTIE LU STOUT, CNN CORRESPONDENT: Yes they are, and it's going to get particularly bad this year because it's look, it's the 100th anniversary of the Chinese Communist Party. And tensions between China and the west are at an all-time high.
The fallout from Xinjiang is now hitting major international retailers like H&M, Nike, Adidas. You know, they are facing a big boycott in China for taking a stand against the alleged use of force labor in the production of cotton in Xinjiang.
Now this all started when the Chinese Communist Youth League, this a group that's affiliated with the ruling communist party, dug up an old statement from H&M and posted it on Sina Weibo social media platform.
The statement went viral. And in that statement, H&M said that they were deeply concerned about reports of the use of forced labor in Xinjiang. That re-posting of this old statement went viral, and it just focused, the online fury of China's netizens against H&M, the hashtag has gone viral, the "I love Xinjiang cotton" hashtag has been seen 4.5 billion times in China.
And H&M is hurting. It has been de-platformed from e-commerce sites. there are reports that it has been scrubbed off of online maps in China. Ride hailing services, you won't be able to see H&M stores pop up on those maps as well. Celebrities have cut off ties with H&M.
And it's not just H&M. It's Adidas, it's Nike, it's Burberry. You know, the list goes on. I want you to listen to the anger coming from these Chinese consumers in Beijing who fully support the boycott.
(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: We should boycott them and let them know that China is not a country to be trifled with.
UNIDENTIFIED FEMALE: I'll resist any brand that has any bad comments about our motherland.
UNIDENTIFIED FEMALE: This is our country. They should get out of China. We can choose not to use it, not to wear it. It is just not necessary for us.
I think you should respect our country. They won't have a future here if they tried to smear China.
(END VIDEO CLIP)
[01:35:05]
STOUT: Now, Xinjiang of course, has been a major point of friction between China and western powers. It was back in December when the United States made that decision to block all imports of Xinjiang cotton over concerns of forced labor.
In the past week, the U.S., the E.U., the U.K. slapped fresh sanctions on Chinese officials were undermining human rights in Xinjiang. Beijing
has responded in retaliation slapping sanctions not just on the E.U. entities and officials but British entities and officials accusing them of maliciously spreading lies and disinformation, John.
VAUSE: Kristie, thank you. Kristie Lu Stout, live for us in Hong Kong.
Let's stay with this story for a little while. Ryan Patel is a senior fellow at the Drucker School of Management at Claremont Graduate University. He is with us live from, excuse me, from Los Angeles.
Ryan, it's been a while. Nice to see you.
RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT: Great seeing you, John.
VAUSE: Ok. You know, it's worth going back taking a closer look at these statements from Nike and H&M, because they're pretty much standard corporate stuff, right.
The first one from Nike expresses concern about reports of forced labor in Xinjiang saying to CNN Nike does not source products from there. And you know, this is kind what you would expect, you know.
H&M is fairly similar in what they put out there adding if verified cases of forced labor is discovered at a supplier, it will take action. You know, this is not only the morally correct thing, and the right thing to do, it's usually good for business.
But here is the rub, you know. This is a Sophie's Choice, isn't it when it comes to doing business in China. PATEL: Yes. And the statements were not done recently. They were done
a little while ago and what's the catch-22, if there is, if you want to call it that, is Nike and many of these retail brands have a mission and ethos that they represent. So this is not something that they said about a certain culture or certain country. It's about the things that they value mission-wise. And if they go off of that and they don't follow those things, they have a detriment to their consumer. So this is the catch 22.
Now, you are in a situation where their comments are now being pulled in into a geopolitical situation, because it's conveniently brought in back into where there is obviously some tension between many different countries.
And now, what do you do? Like you said, that is a pretty much kind of a statement that they have to do. Now they have to choose. Are they going to say more? Do businesses have to get into the geopolitical research on what is fair, what is human rights? Because that is kind of now what has to be deemed if you're quiet now.
VAUSE: You know, one thing which is really different about this also, there've been consumer boycotts in China before when it comes to foreign brands, this time it's really being driven by the government.
Here is an example of what is, I think, an outrageous narrative coming from China's foreign ministry. This is an official briefing for the international news outlets in Beijing in response to allegations of forced labor in Xinjiang. Listen to this.
(BEGIN VIDEO CLIP)
HUN CHUNYING, CHINESE FOREIGN MINISTRY SPOKESPERSON (through translator): Today -- I was talking to my colleagues and I saw a picture.
This was the U.S. black slaves were forced to pick cotton in the fields. I saw it online and I asked my colleague to print it out for me.
This is in Xinjiang and the cotton fields are more than 40 percent of the cotton in Xinjian was -- is harvested by machinery.
(END VIDEO CLIP)
VAUSE: You know -- and for good measure, she later posted the same photos on Twitter saying, you know, a shotgun and hounds versus the smiles of forced labor -- question mark. This is sort of what-ism of (INAUDIBLE) which has gone insane and this is coming directly from the government.
PATEL: And if you're -- I mean this is a really bad situation for everybody involved because the whole thing is to be able to do business and still do good. And when you have these kind of waters where you have companies going I need to kind of look at my suppliers and correct issues, guess what, you can't ignore this. This is something that a brand has to take a stance one way or the
other. There isn't any corporate pc, you know, in the middle of this, because obviously like you said, you know, the Chinese government is stating you know, either -- we're not doing this, you either believe them or you don't believe them and then that means the brands have to make a decision on who and what they are going to do.
And if one decision gets some -- the economics that they are wanting to do because they won't be able to be in the Chinese consumer, and the other one is to walk away. And they have to make that decisions most likely for themselves.
VAUSE: You know, "The Global Times", which you know, is one of the state-controlled tabloid newspapers there, one of the newspapers fanning the flames, had a quote from the Communist Youth League on Wednesday. The quote was "Spreading rumors to boycott Xinjiang cotton while also wanting to make money in China, it is wishful thinking."
[01:39:59]
VAUSE: You know the boycott, which they refer to as the better cotton initiative which urge corporations to stop using cotton from Xinjiang. It adds Adidas, New Balance, Burberry, a whole bunch of companies into this sort of campaign on social media, by the Chinese.
And that quote sort of sums up the dilemma here. You know, it can either be -- corporate responsibility or you can make money in China.
And obviously, the long term better choice is to do the right thing, the moral and right thing. But we all know corporations have a 5-year- plan and that is to maximize profits over a very short period of time.
And so that is the big problem which these companies will now be facing and so they know what to do, but it's the immediate term which is the problem.
PATEL: Yes. And, you know, if you are Nike -- if you're Nike, H&M and Adidas, unfortunately if you have said those comments in the past and you believe those comments, how can you do business in China? That's the clear thing.
Now there's going to be companies in the middle where you saw (INAUDIBLE) a Japanese based company was quoted saying that their company is still going to be buying that cotton and that it's the supply chain -- it's the suppliers issue to correct that where they're passing the buck down.
That's another vertical route if other companies want to defect to that region or that reasoning. And to your point, John, you've got to make a stance, and that's what makes this really difficult. You and I have covered many stories in the past with these scandals of retailers and brands of saying things and then two days later that come off of it.
This is coming from the Chinese government. Either you choose to abide by the rules to do business in China, which is a part of what this is being included or you don't. And now the values and morals are being in question.
VAUSE: Very quickly, is it possible for some kind of corporate united stand here like either we all do business in China or we don't -- none of us do business in China?
PATEL: Are you living in Utopia?
VAUSE: No. Right.
PATEL: You know, I want to say yes but if I say yes, you'll just laugh and smile and then you say -- yes. Because it's always competitive, right. There's always competitors. Big corporations can come together, but there is always the start ups and midsize. It will be hard to kind of rally together.
But, you know, I'm not saying never but it would take more than just the businesses. It will take governments, the U.N., it will have to take a lot of people to come together to support that aspect.
VAUSE: Well, we may see it, you never know. I mean there is a lot of movement on the issue in Xinjiang recently so, who knows.
Ryan, good to see you. Thank you. Ryan Patel there in Los Angeles.
Well, there are shocking stories coming from the Tigray region. And there is now international reaction to that. Ethiopia's U.N. ambassador says he is thankful for all that reaction but there is a better way to help he says.
Back in a moment.
(COMMERCIAL BREAK)
VAUSE: At least another nine people have been killed by Myanmar's military during pro democracy protests on Thursday. That is according to a local advocacy group, which counts at least 320 people dead, since last month's coup.
[01:44:55]
VAUSE: A U.N. (ph) official says the international response so far is falling short. Limited sanctions by individual countries are not enough to stop the bloodshed.
One reason for that -- the military deeply embedded in the country's economic system.
We have more on that now from CNN's Ivan Watson.
(BEGIN VIDEOTAPE)
IVAN WATSON, CNN INTERNATIONAL CORRESPONDENT: The military in Myanmar is responsible for much more than the February 1st coup and ensuing crackdown against protesters. The military has also long been heavily involved in the business of making money. CHRIS SIDOTI, U.N. INDEPENDENT INTERNATIONAL FACT FINDING MISSION ON
MYANMAR: The military has a tentacle in almost every part of the Myanmar economy.
WATSON: Chris Sidoti was a member of the United Nations Fact Finding Mission, which published a 2019 report on the economic interests of the Myanmar military.
It concluded that the same generals who've been accused by the U.N. of committing human rights abuses against ethnic groups like the Rohingyas are also in charge of two of the biggest conglomerates in the country. Myanmar Economic Holdings Limited and Myanmar Economic Corporation.
UNIDENTIFIED MALE: MEC is one of Myanmar's leading conglomerates.
WATSON: Their portfolios include banks, oil and gas extraction, mining, ports, hotels, telecommunications, breweries, and even a golf resort.
A separate 2020 report by Amnesty International exposed the unique relationship between individual combat divisions and the conglomerate MEHL.
MONISE FERRER, AMNESTY INTERNATIONAL: Almost every single top officer of the military holds shares in this large business conglomerate that's collecting profit and dividends.
WATSON: At the top of the pyramid, this man, Min Aung Hlaing. The commander in chief of Myanmar's armed forces. He declared himself ruler of the country during the coup of February 1st.
But the U.N. report, also identifies him as chairman of the Patron Group, part of MEHL's corporate leadership. He is essentially a business mogul in an army general's uniform.
That unusual position highlighted at the 2018 ceremony for MyTel, a cell phone company joint venture between a Myanmar military-owned conglomerate, and a telecommunications company owned by the Vietnamese military.
Min Aung Hlaing shared the stage with Vietnamese top brass. At a press conference weeks after the coup, a military spokesman seemed to anticipate the junta would face international criticism.
He said, "Sanctions are expected. And they have come from mainly western governments".
JOE BIDEN, PRESIDENT OF THE UNITED STATES: New executive order enabling us to immediately sanction the military leaders who directed the coup, their business interests, as well as close family members.
WATSON: The Treasury Department targeted two adult children of Myanmar's top general accusing them of benefiting, quote, "from their father's position and malign influence". Washington also sanction the adult children's companies including a restaurant, a media production company and a chain of gyms called Ever Fit.
(on camera): Despite the sanctions, I can still access an app from Ever Fit on my iPhone's app store. I can also download another app called OCCDS, and that stands for the Office of the Commander in Chief of the Defense Services. It is basically a public relations media platform for Min Aung Hlaing, the military dictator of Myanmar.
(voice over): On the bloody streets of Myanmar's cities and towns, the death toll continues to grow. The military seeks to crush the popular uprising against the coup. The struggle over the future of democracy in Myanmar is also a battle over who will control the countries economy.
Ivan Watson, CNN -- Hong Kong.
(END VIDEOTAPE)
VAUSE: More disturbing claims of atrocities being committed by soldiers on the people of Ethiopia's Tigray region. Among the allegations, thousands of women who say they have been sexually abused by soldiers from neighboring Eritrea.
According to the U.N. these rapes are ongoing. Ethiopia's ambassador to the U.N. says those responsible will be prosecuted. He also had a message for those who are trying to help.
(BEGIN VIDEO CLIP)
TAYE ATSKE, SELASSIE, ETHIOPIAN AMBASSADOR TO THE U.N.: We have seen and read so many statements issued by many U.N. agencies. We fully understand and recognize concerns for Ethiopia. We have never ever second guessed your statements, but you're individual, or collective pronouncement should be supplemented with tangible and meaningful assistance.
We encourage humanitarian works to keep their (INAUDIBLE) and as well as to come with much needed support. We love statements, as also mentioned earlier, but we don't eat statements. Our people don't eat statements. We love to see Twitter, see your concerns. We very much appreciate it, but we don't eat tweets.
(END VIDEO CLIP)
[01:50:05]
VAUSE: Yes. Well, food security is a big problem in the Tigray region. And the government has been accused of blocking humanitarian supplies from reaching the region.
And we will be right back.
(COMMERCIAL BREAK) VAUSE: Apparently, we're still talking about that CBS interview weeks ago between Harry and Meghan the Duke and Duchess of Sussex, and Oprah Winfrey. And now, critics are pointing out all the inconsistencies in their story.
Here's Max Foster.
(BEGIN VIDEOTAPE)
MAX FOSTER, CNN CORRESPONDENT (voice over): Whether or not your Team Sussex, it's hard to argue against the profound issues raised by the Oprah Winfrey interview especially around suicide prevention, and confronting racism wherever it may live.
But critics of the couple are pointing to inconsistencies in the tell- all interview. Starting with their choice of platform. A major U.S. network, with the most established interviewer on the planet, one that previously pledged to engage with grassroots media organizations and young up and coming journalists.
Then, there was this line.
MEGHAN MARKLE, DUCHESS OF SUSSEX: No. I have never looked up my husband online.
FOSTER: Twitter blew up with genuine disbelief especially in light of what former best friend Ninaki Priddy told "The Daily Mail". "She was always fascinated by the royal family. She wants to be Princess Diana 2.0."
OPRAH WINFREY, TV HOST: But you were certainly aware of the royals.
MARKLE: Of course.
FOSTER: And what about critics claim that Meghan lied about when they were married?
MARKLE: You know, three days before our wedding, we got married. No one knows that, the vows that we have framed in our room were just the two of us in our back yard with the archbishop of Canterbury.
FOSTER: "The Sun" getting hold of a copy of the marriage license showing the legally-binding wedding, was in the church, not the backyard.
A spokesperson clarified, "The couple exchanged personal vows a few days before their official/legal wedding on May 19th."
The couple unknown for their distrust in the tabloid media and voiced their frustration with how the palace tries to appease certain titles.
MARKLE: I think there is a reason that these tabloids have holiday parties at the palace. They are hosted by the palace, the tabloids are. You know, there is a construct at play there.
FOSTER: But tabloid reporters say they have no memory of such parties. Russell Myers, royal editor of the "Daily Mirror" tweeting, "Meghan has just claimed Buckingham Palace throw holiday parties for the U.K. tabloids. And now I am wondering why I never got a ticket."
WINFREY: Were you silent or were you silenced?
FOSTER: Oprah's question here has been the subject of countless memes. But the answer is being deconstructed too.
MARKLE: I have advocated for so long for women to use their voice. And then I was silent.
FOSTER: Is that true? Palace insiders will point to many occasions that show that Meghan was allowed a voice, they say. Particularly, on feminist issues.
MARKLE: And I think right now in the climate that we are seeing with so many campaigns, with MeToo and Time's Up, there is no better time than to really continue to shine a light on women feeling empowered, and people really helping to support them.
[01:54:59]
FOSTER: Insiders will also tell you they showed full support in Meghan. A junior member of her staff who has now left the palace told CNN, "They bent over backwards as far as I could see. I think there was complete hospitality and kindness and grace."
"Everyone wanted to make it a success," a current royal source added. The Queen's senior team were directed to avail themselves, to ensure she had all the support needed.
MARKLE: Unlike what you see in the movies, there is no class on how to speak, how to cross your legs, how to be royal. There is none of that trend. That might exist for other members of the family. That was not something that was offered.
FOSTER: But CNN has been told, the Queen dispatched her closest aides to Kensington Palace. Lady in waiting, Lady Susan Hussy (ph), and dresser, Angela Kelly to offer advice, guidance, and tutelage to the duchess.
Royal aides say this was an unprecedented gesture of support for a new member of the family. And that every department of the Queen's household was open to Meghan.
Then, there is the question of titles.
MARKLE: They were saying that they didn't want him to be a prince or a princess, not knowing what the gender would be which would be different from protocol.
FOSTER: The protocol the duchess referred to was issued by King George the 5th. And it limits princely titles to children and grandchildren of the serving monarch, as well as the first born child of the Prince of Wales. None of which, applying to Archie. Though, he will automatically become a prince, when Charles becomes king. Max Foster, CNN -- Hampshire, England.
(END VIDEOTAPE)
VAUSE: Thank goodness we have clarified that. For more now on the British royal family, visit our Web site at CNN.com/royal news and sign up for CNN's royal newsletter. Don't miss it.
Finally here, the Olympic flame has been lit in Japan. The torch relay began in Fukushima on Thursday, 10 years after that deadly tsunami. Athletes will carry the torch across Japan before reaching Tokyo for the opening ceremony, July 23rd.
The games were delayed a year because of the pandemic. And there will not be international spectators at the summer games. It's a pandemic precaution.
But hope springs eternal, Japan's famous cherry b7lossoms have bloomed early. There is always something to find happiness in.
I'm John Vause. Thank you for watching.
CNN NEWSROOM continues the top of the break with Michael Holmes. Thanks for watching.
[01:57:22]
(COMMERCIAL BREAK)
MICHAEL HOLMES, CNN ANCHOR: North Korea claims it tested new technology with its ballistic missile.
