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Global Markets Plunge Amid Banking Troubles; Senior Russian Defense Officials Approved Harassment Of U.S. Drone; Students Worldwide Stand Up Against Human Trafficking And Modern Day Slavery; South Korean President In Tokyo For Rare Summit With Japan's Prime Minister. Aired 1-2a ET
Aired March 16, 2023 - 01:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIM BRUNHUBER, CNN ANCHOR: Hello, I'm Kim Brunhuber, ahead on CNN Newsroom. Asian markets opening sharply lower on fears of global banking crisis is looming that as Credit Suisse borrows billions and hopes to stay afloat and calm those fears.
The Ukrainian soldier appears to shoot down a Russian fighter jet in the ongoing battle over the city of Bakhmut, and today is known as My Freedom Day. The students worldwide stand up against human trafficking and modern day slavery.
UNIDENTIFIED MALE: Live from Atlanta, This is CNN Newsroom with Kim Brunhuber.
BRUNHUBER: We begin with turmoil in the global financial sector as another bank teeters on the brink of failure. Just hours ago, Credit Suisse announced it will borrow up to $54 billion from the Swiss National Bank after a slump in its shares left investors on a an edge. In a statement the lender said quote, Credit Suisse is taking decisive action to preemptively strengthen its liquidity.
The bank shares dropped 24 percent Wednesday after its biggest shareholder. Saudi National Bank ruled out further support. Now this comes just days after the collapse of two US banks that make global markets jittery and sparked worries of a broader banking crisis.
Now, markets across Asia are also seeing declines amid fears of instability in the banking sector. CNN's Marc Stewart joins us live from Tokyo. Marc, the fear seems to be spreading worldwide.
MARC STEWART, CNN CORRESPONDENT: You know, Kim, when we talked last hour we saw declines across the markets in Asia and started earlier in the day. And unfortunately, now one hour later, we are still seeing a lot of markets in Asia in the red, including both Hong Kong and the Nikkei, where I am here in Tokyo, Japan.
We look ahead to the rest of the trading day as we move over to Europe, Europe markets have also had a lot of hardship. Right now what investors worldwide are really craving is some kind of indication of stability. We saw that the Swiss government has agreed to lend to Credit Suisse some much needed funds to try to stabilize things there. We saw action earlier in the week by the U.S. government. But is that going to be enough? Is this fear of contagion going to spread?
You know, when one bank becomes under the microscope, as we have seen in the United States, banks elsewhere also are going to face scrutiny, not just by the government by investors. And that's what creates concern. And that's what creates some of the sell off that we are seeing in markets today.
So, the losses in Asia right now are not the biggest that we have seen during the week, but they are significant. The hope is that by the time Europe wakes up and traders begin their work there. Those reassurances by the Swiss government will hopefully mean something, Kim.
BRUNHUBER: I mean, for many they fear reassurances won't be enough. So will the existing safeguards be enough to prevent a repeat of 2008?
STEWART: Well, I think 2008 is a critical date. And I'm glad you mentioned that because that is when we saw some of the giants in banking in the United States go under. We saw banks fail. But since that time safeguards have been put into place through legislation, through regulation. And while there have been some struggles, big picture, those regulations really did help.
If we look back in the past two years, at least in the United States, we have not seen any banks go under. The big challenge that is facing banks in the U.S. that's facing banks in Europe and here in Asia, is inflation. We know inflation makes it difficult for everyone in our own households to pay our bills, and also makes it difficult for banks to balance the books because it's yet more pressure. That's what we saw happen with Silicon Valley Bank, it had a hard time making losses and making gains, basically reconcile.
So, until this issue of inflation is under control, banks as well as other sectors of the economy are going to face some challenges, Kim.
BRUNHUBER: Absolutely. All right. All right. Marc Stewart live in Tokyo, thanks so much. So as Marc just mentioned here in the U.S. worries continue about the banking system after the collapse of Silicon Valley Bank and Signature Bank.
Shares of regional lenders First Republic Bank fell more than 20 percent after its credit rating was downgraded by both Fitch and S&P over concerns that depositors could pull their money and another regional bank. West Bank Corp. was down nearly 13 percent, which placed the bank on watch for potential credit ratings downgrade.
Some major U.S. banks also got hammered at JP Morgan Chase stock dropped 4.7 percent, Citi 5.4 percent and Wells Fargo closed down about 3.2 percent.
The last hour I spoke with Ryan Patel, senior fellow at Claremont Graduate University's Drucker School of Management. And here's what he had to say about bank failures.
(BEGIN VIDEO CLIP)
RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT: We hear this good news from obviously out of Switzerland, that the bank is going to be back. That doesn't mean it's all over Kim. People are going to be asking about, you know, the stability about their own banks and questioning the systems of regulations. And rightfully so because if you think about it here in the U.S., we have the second longest run between no bank failures, guess what, since 1933, was the Silicon Valley Bank. We hadn't had a bank failure in over 167 days.
So over the last three, four years, been pretty stable for bank failures. However, we're -- that was two years ago. We are in a different world now. We're in a different aspect. And if you think of what happened in Silicon Valley Bank, right, the deposits were a lot larger in 2021 and put them in that situation.
But again, why I tell you that story, because each bank has its own story, Kim, and they you mentioned Credit Suisse, the story that we were just talking about Switzerland, they were already in trouble. They were looking to be in trouble over the last few years. This has amplified what happened and, you know, they did the right move by ensuring to get those that loans back. So that can create some stability.
BRUNHUBER: So I'm wondering, how bad can this gets? I mean, will the existing safeguards be enough to prevent a repeat of 2008 which is top of mind for so many people?
PATEL: Yes, you know, that's a great question. You know, the answer to that is, it should be, right. From 2008-2009 and the regulations to what it is now it is -- it has been changed. And there are more safeguards in place, and the banks are more like the wild, wild west back then.
Again, back to the -- to what, why we're in this issue right now, is that we are different queue (ph). The economy is lot more interconnected. We are fighting inflation. And we're also, you know, there's a second component, which you can't really ignore, right? This fear of running deposits and getting it from the bank and social media. I'm not blaming all those things. But that's a part of this as well and in the trust aspect and credibility.
We haven't seen something like this where people are trusting of their money, let alone people asking me over the weekend, what is my money go in the bank? And it tell what does it mean?
BRUNHUBER: Yes, exactly right. Yes. You know, plenty of experts and politicians here as well in the U.S. are saying this proves we need to put back some of the regulations that were rolled back during the Trump years, which was passed with bipartisan support, I should say, What's your take on that?
PATEL: Well, that's a part of it. But you know what, truth, Kim. I mean, risk management, let me just be really clear. If you're leading a bank, you know, you need to put more efforts. We thought we learned that from 20 --2008-2009. I understand that people may hate me when I say stuff like that, well, the economy is different. It's where we put -- you have risk management, you have to continue to put money in system information so you don't put your bank or put those things in those places that you don't put yourself in that bad spot.
So yes, we can have more regulation. That's a part of it. People are blaming the fed. The Feds a piece of it of the interest rates as well. But so as, you know, you got a whole accountability toward these leadership and banks. And I don't think we've seen that over the years. And I think hopefully, moving forward this will be something that will be held accountable so we can avoid these things.
(END VIDEO CLIP)
BRUNHUBER: U.S. sources say senior officials in the Russian defense ministry gave the order for its fighter jets to harass a U.S. drone over the Black Sea near Ukraine. But there's no indication that anyone in the Kremlin including Vladimir Putin knew about the planned aggression in advance. Two U.S. officials say the Russians have reached the site where the drone crashed. But the Pentagon and the State Department say well, they won't find much less.
(BEGIN VIDEO CLIP)
NED PRICE, U.S. STATE DEPARTMENT SPOKESPERSON: This drone was operating dozens of miles away from the nearest land. And so when it was forced to go down, it went down in a part of the Black Sea that probably is four or 5,000 feet at depth that is going to make it difficult, perhaps exceedingly difficult for anyone to recover this drone.
It probably didn't crash and hit the water in a single piece. There may be a wide debris field. It may span several miles again at those extreme depths. And then finally, we -- as we always do took prudent measures to see to it that should this aircraft fall into the wrong hands that there would be little to no intelligence value that anyone, friend or foe would be able to derive from it.
(END VIDEO CLIP)
BRUNHUBER: The U.S. claims one of them Russian jets clip the drones propeller forcing it down and it says there is surveillance video of the incident which may be released to the public.
Now Russia denies its jet came into contact with the drone. Moscow is blaming the U.S. for operating in the zone of what it calls its special military operation in Ukraine. CNN's David McKenzie has more.
DAVID MCKENZIE, CNN SENIOR INTERNATIONAL CORRESPONDENT (voiceover): Russian President Vladimir Putin in East Siberia on Tuesday, touring of all things and aviation factory taking to the virtual skies in a helicopter simulation.
Well over the Black Sea, Russian Sukhoi fighter jets like this in a dangerous encounter with a U.S. MQ-9 Reaper drone. U.S. Defense Secretary Lloyd Austin saying the Russian aircraft dump fuel on the drone, then made contact with the unmanned aircraft crashing it out of the sky.
LLOYD AUSTIN, U.S. DEFENSE SECRETARY: This hazardous episode is part of a pattern of aggressive, risky and unsafe actions by Russian pilots in international airspace. Now, I just got off the phone with my Russian counterpart, Minister Shoigu. As I've said repeatedly, it's important that great powers be models of transparency and communication. And the United States will continue to fly and to operate wherever international law allows.
MCKENZIE: Russian officials have unilaterally declared the airspace part of their so called special military operation. But it's an area of routine U.S. surveillance. Russia denying they brought the UAV down. They claimed the drones transponder was off and say they will attempt to retrieve and study the piece of American hardware with millions.
NIKOLAI PATRUSHEV, RUSSIAN SECURITY COUNCIL SECRETARY (through translator): As for the drone, the Americans keep saying that they are not participating in hostilities. Yet this is another confirmation that they are directly involved in these events in the war.
JOHN KIRBY, U.S. NATIONAL SECURITY COUNCIL: We took steps to protect the information and to protect -- to minimize any effort by anybody else to exploit that drone.
MCKENZIE: International reaction has been swift. The United Kingdom called for Russia to respect international airspace and Turkey said it's working to resolve the matter in a quote, logical way. A Ukrainian officials saying the move signaled Putin's readiness to quote expand the conflict zone. And the White House says that this isn't the first close call between Russia and U.S. assets in the last few weeks. This aerial incident is just the latest sign of the broader risk in this war of the U.S. and Russia coming into direct conflict. David McKenzie, CNN, Kyiv.
BRUNHUBER: Well still ahead, Seoul calls it an important milestone the first meeting between leaders of South Korea and Japan in more than a decade. That comes during a critical time for the region. Coming up, I'll speak U.S. Ambassador to Japan. Plus, raising awareness of modern day slavery. Students from Hong Kong to Kosovo are speaking out on My Freedom Day.
BRUNHUBER: It's called My Freedom Day and CNN is teaming up with young people worldwide for a student led day of action against human trafficking and modern day slavery. One student in Ecuador sent us her take on trafficking. Listen to this.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Every year thousands of men, women and children are recruited by traffickers using deceit, violence or coercion. Every country in the world is affected by trafficking whether as a country of origin, transit or destination. Human trafficking is a type of organized crime and a serious violation of human rights.
(END VIDEO CLIP)
BRUNHUBER: CNN correspondents are covering this day of action at schools around the globe. Vedika Sud is standing by at the American Embassy school in New Delhi and Kristie Lu Stout is live for us at the Hong Kong International School. So let's start Kristie with you. There were students telling you.
KRISTIE LU STOUT, CNN CORRESPONDENT: You know, young people came are very often the victims of human trafficking, but they have emerged as some of the most passionate activists fighting against modern day slavery here in Hong Kong. I'm at the Hong Kong International School, one of many schools across the region around the world marking My Freedom Day, a day of student led action to raise awareness about modern day slavery.
And you see it once you come onto campus, you probably see the painted stone behind me, a boulder that was painted by the students with the question what does freedom mean to you? And some of the students providing their answers I mean self-determination or power over your own life.
In addition to this type of activity, they've also been engaging in impactful classroom discussions workshops, including a sweatshop simulation challenge. And joining us to talk about that is Matt Friedman, the CEO of Mekong Club, as well as two stints here at HKS. Queon and also Regina, thank you for joining us.
And Matt, you've been leading this sweatshop simulation challenge for well over a decade now. What does it entail?
MATT FRIEDMAN, CEO, THE MEKONG CLUB: Basically, what it is, is students are asked to do a repetitive activity, putting in that on and off a boat continuously for a period of time. We do this to give them a sense of what modern slavery could be like. And as they're doing it, we asked them to think in their mind, imagine if you had to do this from six to 11, every single day, seven days a week and you never got a break. How would your life be?
So you're able to walk the talk, experienced it a little bit and then use this as a basis of understanding? Not just intellectually, but emotionally.
LU STOUT: Yes, I had students at KG5 (ph) as well as Hong Kong International Art.
FRIEDMAN: That's right. LU STOUT: You were part of this, what did it feel like?
QUEON ERNST, STUDENT: It was quite scary, knowing that there's people going through things like this. This was obviously just a little simulation of that, but knowing that people have to go through this for days and days working nonstop, getting less and less hours of sleep, facing things such as sickness, all of that it's just inhumane, and indicative of how these things tolerate within society nowadays.
LU STOUT: Well said.
ERNST: And I just feel like that this simulation was really worth experiencing. And I feel like it really meant a lot to not only me and all the students that were there. But I feel like people, this helps people realize and come to a conclusion of what modern slavery is.
LU STOUT: Good to hear, Queon. Regina wanted to get your thoughts as well, because you also took part in this exercise. What does it feel like?
REGINA UY-TIOCO, STUDENT: Honestly, it was terrifying. Like, before the sweatshop challenge I was thinking, Man, I'm going to have to sit in a classroom, do nothing, don't talk, don't smile, and just twist the bolt on and off for one hour. And I wasn't even like being beaten up. I wasn't even getting yelled at that seriously. I like I can hardly imagine what it's like for these people to be going through that every single day of their lives at such a higher -- much higher like extent. And I just felt like horrible about it when I was thinking about it.
LU STOUT: Yes, a really powerful exercise in this year for my freedom days knowing the signs of slavery. And Matt, you've also been here teaching the students about that. What have you been telling them?
FRIEDMAN: Well, basically, people think that human trafficking is something that happens to somebody else.
LU STOUT: Yes.
FRIEDMAN: You know, sex trafficking is over here, force slavers here. But with sexploitation with kind of the situation in Asia, where you basically see young people being tricked into see to go to places like Cambodia and then forced to scam. So their traffic into the scamming things. I know CNN has done a profile of this.
LU STOUT: Yes.
FRIEDMAN: The point is, is that young people need to know about this. If they don't, they can be tricked and deceived and coerced into something that basically could force them to do things that they don't want to do related to human trafficking.
LU STOUT: And a final thought from both of you. You learned more. You're helping to raise awareness about the issue of human trafficking and modern day slavery. What do you plan to do with that knowledge now?
ERNST: I definitely plan to maybe even friends from overseas that I have definitely reached out to them post on social media. Nowadays, social media, I think is the easiest way of getting the word out there. And I think I'll definitely be involved in that.
LU STOUT: Helping to raise awareness. Yes. Regina.
UY-TIOCO: Me definitely I'll join the club that works with that at our school.
LU STOUT: Yes.
UY-TIOCO: And on top of that, these like scams, they're very common. I've actually received like WhatsApp messages offering me like $3,000, $5,000. And I think the best thing to do to prevent this is to tell people to let people know, so I would definitely the social media thing, getting people aware that this is a scam and that it is dangerous. And because most people don't see it that way. I didn't know it was a scam until I was told that it was.
LU STOUT: Yes, it's a scam that sometimes involves human trafficking. Thank you so much for joining us. And, you know, we're just now Regina was making reference to a story that we filed here on CNN, about how human traffickers are targeting Asian professionals, tech literate multilingual professionals, trafficking them into the cyber scam compounds in Cambodia, Myanmar, and other Southeast Asian countries. They believe that they're going to be entering and having a dream job, but it turns out to be a nightmare. You can find out more about that on cnn.com, also on our social media feeds.
But bringing the focus back to the students again, just so inspiring to hear them talk about raising awareness and learning about modern day slavery when according to ILO, 50 million people around the world are currently enslaved. Back to you.
BRUNHUBER: Yes, such an important message to get out there. Kristie Lu Stout in Hong Kong. Appreciate that. All right, well, I head now to CNN Vedika Sud who's live in New Delhi. So Vedika, how are students they're marking the day.
VEDIKA SUD, CNN REPORTER: While I'm inside the American Embassy School here in New Delhi, we were under the banyan tree talking about child trafficking with high school students. Now we're inside the clear class. As you can see, these high school students here are busy chipping away came at their sculptures. They've been at it for over a month now.
Now, the brief from their art teacher June (ph) was very clear. Here's the clay, do what you want to with it manifest your thoughts, emotions perspective. And it's really interesting to see what they've come up with. I want to go across to Victoria, who is from the high school here, Victoria, tell us more about your sculpture. And how does this indicator reflect modern day slavery to you?
UNIDENTIFIED FEMALE: This piece to me was to represent how no matter how I look, because as a Mexican America, I can -- a Mexican American, I can still be silenced because of who I am and my nationality.
SUD: Well, she's talking about race here. She's talking about gender, she's talking about nationality. At this point, it's very interesting to even note and let you all know that in this room itself, you have students from different nationalities under one roof, it's so interesting to get this perspective from them.
I'm going to go across a Maddie now. I want you to just first take a look at her sculpture, it's beautiful. It says so much Kim, doesn't it? I mean, you really don't have to have words to express what modern day slavery means to students here.
Let's talk to you, Maddie. What have you been working on for over a month now and tell us what is this all about? What are you trying to manifest through your artwork here?
UNIDENTIFIED FEMALE: So my main focus with this piece was the silencing of women specifically, and the oppression. I feel like with my piece that speaks so much yet, the contrast with like, the lack of words really shows how women can be put down and can't speak up about things that are so important.
SUD: And how important is this to you, Maddie? How do you think in the future you can take this up, these issues up for people who are oppressed?
UNIDENTIFIED FEMALE: I feel like the media can really play a role in that. Like, it just starts with people like us, our generation, specifically, they can really like take action. And it starts with like us in this room, especially women speaking up, and then it shows the younger generations that you don't have to stay silent and really.
SUD: Well said. So there you have it. We talked about oppressed women. We're talking about race, nationality. These students here, talking out voicing their opinion, which is so important, Kim. They're showing us the way -- in a way isn't it the generations before them and after them about how speaking out is so important raising awareness on the 16th of March, which guys is --
UNIDENTIFIED SPEAKER (in unison): My Freedom Day.
SUD: Back to you, Kim.
BRUNHUBER: All right, looking at those sculptures, Vedika, such beautiful work for such an ugly practice.
BRUNHUBER: Thank you so much for bringing that to us.
BRUNHUBER: And you can join us on My Freedom Day and tell us what freedom means to you and you can share your message on social media using the hashtag My Freedom Day.
An aerial drone that was never meant to be a weapon has found its way onto the battlefield in Ukraine. So we'll have an exclusive report on how this Chinese made civilian drone is now being used in combat. Stay with us.
BRUNHUBER: For the first time in more than a decade, the leaders of Japan and South Korea are getting ready for a major summit that could reset their country's relationship and move them past decades of historical grievances.
South Korean president Yoon Suk Yeol arrived in Tokyo a few hours ago and will meet with Japanese Prime Minister Fumio Kishida in the coming day. Now the U.S. is eager to see its staunch Pacific allies strengthen their ties. North Korea of course isn't. It fired off a long range ballistic missile ahead of the meeting that landed in the East Sea or Sea of Japan. The White House strongly condemned the launch Japan lodged a protest in North Korea through its diplomatic channels in China. And the South Korean President released a statement warning the North quote, will pay the price for its reckless provocations.
Last hour, I spoke with Rahm Emanuel, the U.S. Ambassador to Japan and I asked him about the U.S. view on North Korea's missile tests. Here he is.
(BEGIN VIDCEO CLIP)
RAHM EMANUEL, U.S. AMBASSADOR TO JAPAN: As you know, all year they've been launching missiles, but they're always in reaction to the advancement of something like this, which is both cooperation, collaboration and coordination in shared interest. So, I -- you know, I'm not being lamppost post about it, but it's not the first one is I think, the 82nd one, and it's more of a reaction to the progress being made and then attempt to make a statement of relevance.
BRUNHUBER: Well, in the reaction to that launch, Japan's Chief Secretary said among other things that Japan, South Korea and the U.S. will, quote, work closely to work together towards the complete denuclearization of North Korea today's upcoming Japan-South Korea summit meeting. But of course, North Korea has been unwilling to negotiate with any of the countries involved. So what steps will be discussed?
EMANUEL: Well, I think it would you take reassurances that are working together not only on the political front, but on the strategic front on the deterrence front is what North Korea is scared about. It's also what China doesn't want to see happen.
So I think it's -- we're going to be obviously doing things and taking appropriate steps to make sure that not only the progress being made in the next few days is a reflection of what I believe is the first day of a new chapter in Japan and Korea's relationship but more significantly, it is a shared determination to project the terms and I think the collective interests of the United States, Japan and Korea.
BRUNHUBER: So let's talk about that new chapter between Japan and South Korea. Relations obviously were at a relatively low point, plenty of historical grievances to overcome. So what was the U.S. role in bringing to two nations closer together and how much pressure is the U.S. exerting for them to come to meaningful agreements on the main issues?
EMANUEL: I think it's something a little different. Over the last year, the United States from the president and on down, and you saw the president with the two leaders in Cambodia, two leaders of Spain on the side of NATO. We have had over 40 trilateral meetings.
Secretary of state level, secretary of defense level, at many different levels. That familiarity, that institutionalizing (INAUDIBLE) conversation, the building of trust is probably their greatest accomplishment. And again those 40 plus meetings more in 12 months than the preceding five years combined.
Second, it's actually a role (ph) of restraint. This was directly handled by Japan and the Republic of Korea. (INAUDIBLE) And they actually did the most important part of that was talking to each other, meeting (ph) each other and addressing each other's concerns.
United States role was a convenor of the trilateral meetings that allowed bilateral meetings to occur and trust between the parties to be built.
And nothing advances America's interest as the president's primary goal whether it's on the Transatlantic or the Indo-Pacific is to re- energize our alliances, re-energize our allies with shared interests, shared values and shared goals.
This is example one of exactly that strategy by the president. But it's also a step back. This week we announced AUKUS the collaboration between the United States, the U.K. and Australia under new submarine nuclear technology.
We also -- the Japanese announced a new jet fighter with Italy, U.K. and Japan. Two weeks ago, the Philippine president visited Japan and we're having multiple discussions about what I call the trilateral relationship (INAUDIBLE).
Those are all part of our alliances and our allies working together. Now what is that cooperation standing (INAUDIBLE) better, when you see China in the last two months, it had two border conflicts with India. It had two coast guard conflicts with the Philippines. They've strayed (ph) the United States planes and the Canadian friends, they flew all these spy balloon over the United States and they constantly challenge allies in the Pacific island nation.
That is China's modus operandi. Conflict, confrontation, the collaboration -- the United States collaboration and cooperation with our allies. And it stands in contrast. And that's why more and more countries in this region, both allies,
friends and partners want to see America's presence, both economically, strategically and at a deterrence level because they know that China unhinged is a China (INAUDIBLE) of confrontation. It's all that they do.
(END VIDEO CLIP)
BRUNHUBER: Taiwan is warning Honduras not to believe what it calls China's false promises after Honduras chose to break ties with Taipei in favor of stronger relations with Beijing. But that warning may be too late.
Honduras says it wants the investment and trade that comes with access to China's economy. And the decision is a done deal.
Stefano Pozzebon reports.
STEFANO POZZEBON, JOURNALIST: Nothing lasts forever as the saying goes and in politics everything is fair, even dumping your diplomatic partner of decades in favor of its arch rival when empty coffers demand it.
On Tuesday, Honduras president Xiomara Castro announced the Central American nation would open diplomatic relations with mainland China, effectively ending its relationship with Taiwan. A decision Honduras says that came after deep reflection and whose rationale was purely economic.
ENRIQUE REINA, HONDURAN FOREIGN MINISTER (through translator): We are very grateful for our historic relationship with Taiwan, but Honduras has great needs and this pushed us to make a decision. And in this case, the decision from the president is to open relations with China.
POZZEBON: Honduras is one of Taiwan's only 14 diplomatic allies. Beijing mandates foreign countries to cease relationship with of Taiwan once they open ties with China. And countries that switch allegiance are proudly celebrated and handsomely rewarded by the People's Republic.
WANG WENON, SPOKESPERSON, CHINESE MINISTRY OF FOREIGN AFFAIRS: We welcome the relevant statement by the Honduran side. The fact that 181 countries in the world have established diplomatic relationship with China on the basis of the one China principle is fully evidence that establishing a diplomatic relationship with China is the right choice.
POZZEBON: Taiwan warned Honduras not to fall into China's trap, but China is already financing the construction of a hydroelectric dam in Honduras and the opening of diplomatic ties with Beijing was one of President Castro's campaign promises in 2021.
One analyst says that the ultimate winner Xi Jinping freshly reelected as China's leader for five more years who can boast one more diplomatic achievement.
PARSIFAL D'SOLA, CHINESE FOREIGN POLICY ANALYST, ATLANTIC COUNCIL: Because part of Xi Jinping's long term agenda is the reunification of Taiwan with the mainland. So the more isolated Taiwan is internationally, the closer he gets to its goal.
POZZEBON: The United States which is Taiwan's closest unofficial ally has yet to react to Honduras announcement. China is already the main trading partner of many countries in Latin America and that economic influence carries diplomatic weight.
Over the last five years, at least four central American countries have all switched allegiance from Taiwan to China. In a world that is more and more polarized between two main superpowers, Latin America's loyalty comes at a price.
For CNN, this is Stefano Pozzebon, Bogota.
BRUNHUBER: A growing number of Republicans including former U.S. Vice President Mike Pence are disagreeing with Florida Governor Ron DeSantis' comments on Ukraine. The potential 2024 presidential contender said this week that continued U.S. support for Ukraine is not a vital national interest. He characterized the brutal war as quote, "a territorial dispute".
Now here's how others in his party are reacting to those comments.
(BEGIN VIDEO CLIP)
SENATOR MITT ROMNEY (R-UT): I have a different point of view. I believe it's very much in the interest of America to honor our word.
SENATOR TODD YOUNG, (R-IN): I can't imagine what Xi Jinping or the leadership in Iran would give if we took that course of action.
SENATOR LINDSEY GRAHAM (R-SC): To say this doesn't matter, so say that war crimes don't matter.
SENATOR MARCO RUBIO (R-FL): I don't know what he's trying to do or what the goal is. Obviously he doesn't deal with foreign every day --
SENATOR SHELLEY MOORE-CAPITO (R-WV): I think this is a much bigger issue than a territorial dispute.
(END VIDEO CLIP)
BRUNHUBER: Meanwhile, on the battlefield in eastern Ukraine, one commander says a Ukrainian soldier destroyed a Russian military jet near Bakhmut, with new video appearing to show that very moment. Have a look.
You can see there that dramatic video shows the jet's wreckage burning and what appears to be a white parachute suggesting the pilot may have been able to eject from the plane. Ukraine says its military has downed more that 300 Russian aircraft
since the start of the war but CNN isn't able to independently verify that number.
And a new type of drone is appeared in the skies over Ukraine. It's made in China but it was never meant to be used for military purposes. Still both Russia and Ukraine claimed the other side is using them on the battlefield.
Here's more now from CNN's Ivan Watson in this exclusive report.
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Ukrainian military footage of a drone strike at a Russian rocket launcher. The bloody war between Russia and Ukraine is being fought on the ground and in the sky using drones and unmanned aerial vehicles or UAVs, some of which were never intended for military use.
This is one of the weapons in this war, a drone that could fly far behind the front lines carrying a powerful bomb rigged to hurl deadly pieces of shrapnel like this.
Ukraine's territorial defense gave CNN an exclusive look at what's left of a weaponized UAV originally manufactured in China.
Ukrainian state security service says an agent reported the launch of the drone from Russian occupied territory and troops shot it down at 2:00 a.m. on Saturday.
This is remarkable. The officer is explaining that his man shut this drone down using rifles. Rifles.
UNIDENTIFIED MALE: Rifles yes.
WATSON: So the drone was flying low?
"The drone was flying low and visible to the naked eye," he tells me.
This is where the bomb landed. The explosive device on the drone.
Troops rigged the unexploded 20 kilogram bomb with explosives and then sprinted for cover.
WATSON: Officers identified the drone as a Mugen 5 which the manufacturer Mugen Limited also confirmed to CNN. The company is based in Xiamen (ph), China, designing UAV air frames for activities like forest fire prevention and agriculture.
Mugen drones have been available for sale on Chinese online marketplaces like Alibaba and Taobao for about up to $15,000 prompting some tech bloggers to give it the nickname the Alibaba drone. Mugen 5 condemns any use of its drones on the battlefield, adding that the company ceased to accept orders from both Russia and Ukraine since the start of the war.
But in January, Russian forces displayed these images of what is also a Mugen 5. The Russian military claims it was a Ukrainian UAV that it shot down.
Drone expert Chris Lincoln Jones calls these militarized UAVs dumb bombs.
CHRIS LINCOLN JONES, DRONE EXPERT: This particular drone we've been looking at would be much more effective if it had a decent camera on it.
WATSON: The former British Army officer, who specialized in drone warfare says he expected more from a military superpower like Russia.
JONES: This seems to be a very crude, unsophisticated, not very technologically advanced way of conducting operations.
WATSON: Ivan Watson, CNN -- in eastern Ukraine.
BRUNHUBER: Finland's president is hoping for some good news about his country's NATO application when he begins a visit to Turkey on Thursday. President Sauli Niinisto said his Turkish counterpart has made it clear he wants to meet face to face when he makes a decision about Finland's application. Earlier, the Turkish leader Recep Tayyip Erdogan hinted he may give the go ahead to Finland before the neighboring Sweden. Turkey has been blocking their accession to NATO saying they harbor Kurdish militants, but NATO'S chief said Ankara is now more concerned about Sweden.
Opponents push back against proposed judicial reforms in Israel.
Still ahead, huge traffic jam sends a blaring message to Prime Minister Benjamin Netanyahu, when we come back.
Stay with us.
BRUNHUBER: Protesters against Israel's proposed judicial reform found a new way to send a message to Prime Minister Benjamin Netanyahu. On Wednesday they slowed traffic to a crawl near in Tel Aviv ahead of his flight to Germany. Israel has been rattled by weeks of protest against the reforms his opponents say would undermine the system of checks and balances in the country's government.
As Hadas Gold reports Israel's president is now proposing a compromise and issuing a blunt warning.
HADAS GOLD, CNN CORRESPONDENT: As hundreds of thousands of Israelis have been taking to the streets for weeks now to protest the Israeli government's judicial overhaul plan, Israeli president Isaac Herzog made another impassioned plea as he unveiled his own compromise proposal on the reform that the Netanyahu government is facing.
In a televised speech Isaac Herzog warned that the country is in worrying crisis and is facing a possible civil war.
ISAAC HERZOG, ISRAELI PRESIDENT (through translator): I'm going to use a phrase I haven't used before, an expression that there is no Israeli who is not horrified when he hears it.
Whoever thinks that a real civil war of human lives is a limit that we will not reach has no idea. Precisely now in the 75th year of the state of Israel, that this is within touching distance.
GOLD: Herzog acknowledge that some structural changes are necessary he says rebalance the relationship between the Israeli branches of government. But he said that these changes need to be made with common sense and buy in from as many people as possible.
The current judicial overhaul which has already passed some of its first votes gives the Israeli and therefore the politicians empower the ability to overturn Supreme Court decisions and more power over appointing judges.
But that proposal limits what the Supreme Court can overturn but still gives them the power of overturning some laws while requiring a larger majority of justices in order for laws to be overturned. The proposal also creates a new framework for appointing judges.
But almost as soon as the Israeli president was done speaking, the ruling coalition rejected the proposal.
BENJAMIN NETANYAHU ISRAELI PRIME MINISTER: Unfortunately the things presented by the president were not agreed upon by the coalition representatives. Key sections of the outline he presented only perpetuate the existing situation and do not bring the required ballots to the Israeli branches of government. This is the unfortunate truth.
GOLD: Meanwhile, another massive day of protests is planned for Thursday when tens of thousands if not more of Israelis are expected to once again take to the streets in what has become one of the largest and longest running demonstrations in Israeli history.
Hadas Gold, CNN -- Jerusalem.
BRUNHUBER: We are waiting to see if Pakistani police will make another attempt to arrest former Prime Minister Imran Khan. He greeted his supporters outside his home on Wednesday. That's after a court suspended an operation to arrest him, but the order expired a short time ago.
Police have already tried to detain him which to clashes with his supporters outside his home. Khan is wanted on corruption charges which he's dismissed as politically motivated. On Wednesday, a court rejected his petition to throw out his arrest warrant.
In the coming hours, the French parliament will take up the controversial Pension Reform Plan that triggered months of nationwide strikes and outrage.
Wednesday marked the eighth day of demonstrations since January, but turnout was significantly lower, less than half a million people according to the interior ministry. Many workers are furious over the Macron government's push to raise the retirement age from 62 to 64.
Some unions have already announced plans to continue strikes and protests. The parliament approved the draft law.
The world's nuclear watchdog says it can't account for the whereabouts of several drums of nuclear material in Libya. In a statement to CNN an IAEA spokesman says about approximately 2.5 tons of natural uranium in the form of uranium ore concentrate were not present as previously declared at a location in the state of Libya. The agency says it's working to clarify how the material was removed and where it ended up.
Fans of the German football club Eintracht Frankfurt clashed with Italian police in Naples on Wednesday ahead of a key match. Video shows groups of men attacking riot police with flamethrowers and other objects. Cars were also set on fire.
Italian authorities banned German fans from attending the match against Napoli over concerns of possible violence, but some Eintracht supporters made the trip anyway. The Italian team ultimately won the match three-nil.
U.S. authorities have arrested an exiled Chinese billionaire with ties to former Donald Trump advisor Steve Bannon. Guo Wengui is accused of funneling investor money into various schemes and using some of the money to fund his lavish lifestyle.
CNN's Kara Scannell reports.
KARA SCANNELL, CNN CORRESPONDENT: FBI agents arrested Chinese billionaire Guo Wengui early Wednesday morning at his Manhattan penthouse. The self proclaimed Chinese dissident and ally of former president Donald Trump advisor Steve Bannon charged with multiple counts of fraud, conspiracy and money laundering.
SCANNELL: Prosecutors allege Guo stole billions of dollars from his social media followers, through a complex scheme involving media company GTV. And a crypto currency will allegedly use the money to pay millions of dollars in maintenance on his luxury yacht, the Lady May, where Bannon was arrested in 2020 on unrelated fraud charges. Bannon was later pardoned. He'll also use the money to buy exotic cars, a $26 million mansion in
New Jersey and mattresses that cost $36,000 prosecutors allege. Earlier Wednesday when FBI agents executed a search warrant at Guo's apartment a fire broke out. No one was injured but a spokesman for the U.S. attorney's office said the cause of the fire is under investigation.
Guo's attorney did not have an immediate comment on the charges. A federal judge denied Guo bail. Prosecutors said Guo is not only a serious flight risk but also a dangerous economic threat to the community.
Kara Scannell, CNN -- New York.
BRUNHUBER: Still to come. Dangerous mudslides in California after rain hammered the state. Next we'll hear from some residents about (INAUDIBLE) their property disappeared. Stay with us.
BRUNHUBER: A federal judge in Texas is promising to issue an opinion as soon as possible following a high stakes hearing in the medication abortion case. He now has to decide whether to grant a preliminary injunction that will require the U.S. Food and Drug Administration to suspend or withdraw approval of an abortion pill that has been widely available for more than 20 years.
CNN's Rosa Flores has the details.
ROSA FLORES, CNN CORRESPONDENT: During the four hour preliminary injunction hearing, the judge raised one possible scenario where he could keep the approval of the drug mifepristone intact and instead blocked the FDA's more recent move to make the abortion pills easier to obtain.
UNIDENTIFIED FEMALE: It's a 20-year-old drug that's actually used to save women's lives.
FLORES: Legal concerns, already restricting access. Walgreens announcing it plans to stop the sale of abortion pills in states where abortion remains legal after Republican-led states threatened to sue.
In this case the plaintiffs are arguing the drug is unsafe, and the FDA's approval process was flawed. Mainstream medical groups saying the plaintiffs used misleading information in the filing. And the drug company's attorney says serious side effects occur in less than 1 percent of patients, with the risk of death nonexistent.
The Women's March and other abortion advocacy group say the plaintiff went quote, "judge shopping" to find someone they believe will rule in their favor. By filing the case in Amarillo where there is one federal judge, Matthew Kacsmaryk (ph) a President Trump appointee who went from working at a religious liberty law firm on antiabortion advocacy to the federal bench.
JENNIFER RODGERS, FORMER U.S. FEDERAL PROSECUTOR: It'll be unprecedented for a judge, a single judge to say the FDA got it wrong 23 years ago. There's never been an instance where anyone has overturned a ruling of the FDA against the FDA's wishes.
FLORES: Judge Kacsmaryk handling of today's hearing had been shrouded in the secrecy. The judge saying he didn't want to publicize the proceeding out of security concerns, pointing to unnecessary death threats and voice mail and harassment sparking outrage over the lack of transparency.
UNIDENTIFIED FEMALE: I'm dressed like a clown to show what a circus he's created. It's just a joke. He's making the American court system into a circus.
FLORES: More than half of all abortions in the U.S. in recent years were medication abortions most using mifepristone and a ruling against this drug would have wide implications.
DR. KATHERINE MCHUGH, FELLOW, AMERICAN COLLEGE OF OBSTETRICIANS AND GYNECOLOGISTS: Mifepristone is not just use in abortion care it is also used for miscarriage management.
FLORES: The judge didn't rule from the bench today, and instead he'd issue an opinion as soon as possible.
About that order. Look, there is no question that the judge is sympathetic to the plaintiffs here, no question about it. But the nuance is important because practically what the plaintiffs are asking this judge to do is yanked this medication from the shelves.
But if you listen to the many questions that the judge asks the plaintiffs, he shows skepticism of being that aggressive in one clear swoop.
Rosa Flores, CNN -- Amarillo, Texas.
BRUNHUBER: A storm system that hammered California this week is heading east but not before dousing the state with more rain and knocking out power with ferocious winds.
California's governor proclaimed a state of emergency for 43 out of the state's 58 counties to support storm response and relief efforts. The torrential rain caused landslides in some areas causing many residents to flee their apartment buildings.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It started o bang and then just went outside and realize that (INAUDIBLE) of the patio is gone. It's just frustrating you know. Lever spot. UNIDENTIFIED FEMALE: Had you had any hint?
UNIDENTIFIED MALE: No, no, no. I mean it was rebuilt not too long ago. We are pretty confident that but the rains just keep on coming so I guess, it's inevitable, you know.
UNIDENTIFIED MALE: The yard is just gone. I guess it's down the hill all the way to the trail.
UNIDENTIFIED FEMALE: What do you do now?
UNIDENTIFIED MALE: That's a good question. We call the insurance and they are not so sure, and so we are not quite so sure with the governor's announcement of the emergencies, we certainly fall into that right now.
(END VIDEO CLIP)
BRUNHUBER: And a mudslide in Orange County caused evacuations of several homes and closed access to a beach trail. No injuries or deaths have been reported from the incident so far.
Now in the city of Colfax, in Placer County, this home has been deemed unsafe after a massive mudslide. You can see the walls, the windows, the doors all blown out on one side of the structure.
Residents inside said it's sounded like thunder when the mud came crashing into their house.
I'm Kim Brunhuber, thanks so much for watching. And don't forget you can join CNN My Freedom Day. Tell us what freedom means to you and share your message using the hashtag #MyFreedomDay.
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