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Kim Jong Un Says South Korea is the Principal Enemy; China's Population Falls Again as Economy Stumbles; Politicians Hope to Knock Out Opponents in Busy Election Year; Source: Biden Administration Is Expected To Again Label Houthis A "Specially Designated Global Terrorist Entity"; United States Launches New Strikes Against Yemen's Houthi Rebels; Iran Fires Missiles At Sunni Militants In Pakistan; Hamas' Tactics Appear To Mirror ISIS In October 7 Video. Zelenskyy. Aired 2-3a ET

Aired January 17, 2024 - 02:00   ET

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

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[02:00:30]

ROSEMARY CHURCH, CNN INTERNATIONAL ANCHOR: Hello, and welcome to our viewers joining us from all around the world and everyone streaming us on CNN Max. I'm Rosemary Church.

Just ahead, the US carries out a third round of strikes on Houthi targets in Yemen. But could America's attempts at deterring attacks in the Red Sea end up fueling more violence?

With his troops facing weapons shortages on the front lines, Ukraine's president arrives in Davos with an impassioned plea for his allies.

And North Korea is ramping up its military rhetoric, but does it signal a true threat? We will talk to one expert, who believes Kim Jong-un may be preparing for war.

(BEGIN VIDEO CLIP)

ANNOUNCER: Live from Atlanta. This is CNN NEWSROOM with ROSEMARY CHURCH.

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CHURCH: Good to have you with us.

A third round of U.S. strikes against Houthi militants in Yemen has not stopped them from attacking vessels in the Red Sea. A U.S. defense official says American forces destroyed several anti-ship missiles on Tuesday that the Iran-backed militants were preparing to launch from Houthi controlled areas of Yemen.

But just a few hours after the U.S. strikes, the Houthis claimed to have carried out a direct hit on another carrier, which they say was bringing missiles to Israel. A Houthi spokesman stressed on Tuesday that only Israel-link ships are being targeted. Meanwhile, a source tells CNN, that Biden administration is planning to re designate the Houthis as specially designated global terrorist entity. More now from CNN's Oren Liebermann.

OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT: For the third time in the past several days, the U.S. has carried out strikes in Yemen, and targeting the Houthis.

This time, U.S. centrical man says they went after anti-ship ballistic missiles that were preparing to be launched and posed an imminent threat to international shipping lanes. The U.S. has tried to limit and disrupt the Houthis ability to target international shipping lanes, because of the effect that's had on international shipping, forcing many of the world's largest carriers to go around Africa, adding thousands to international shipping routes.

The U.S. has tried to degrade the ability of the Houthis to launch the sorts of missiles, ballistic missiles, cruise missiles, and drones that they have used to target shipping.

But they have not completely destroyed that ability. And several hours after the U.S. strike. The Houthi has launched an anti-ship ballistic missile at a Maltese-flagged carrier. They struck that carrier according to U.S. Central Command, doing minor damage.

The ship was able to continue on its way, but it shows you the threat the Houthi still pose. And that's on top of a missile on Monday that damage the U.S. owned and operated vessel, the Gibraltar Eagle. That vessel too suffered minor damage, no injuries and was able to continue on its way.

But it's because of this ongoing threat that the U.S. transportation department has recommended that U.S. flagged or U.S. own ships for now, avoid the Red Sea.

This is an upgrade of a warning or a recommendation they made last week which was supposed to have an end date on it. Now, that recommendation to avoid the critical waterway is at least as of right now indefinite.

So, although, the U.S. with the strikes that it conducted with the U.K. was trying to restore safety and security to the Red Sea. You can see the turbulence there. You can see the threat still post international shipping and the fallout from the Houthi attacks on one of the world's most critical waterways.

Oren Liebermann, CNN, in the Pentagon.

CHURCH: The White House says the strikes on the Houthis were never intended to fully deter the militants, and that more may be needed.

However, the Qatari prime minister says the British and American strikes will only escalate the Middle East conflict and increase the risk of a wider war. (BEGIN VIDEO CLIP)

SHEIKH MOHAMMED BIN ABDULRAHMAN BIN JASSIM AL THANI, PRIME MINISTER OF QATAR: Now, we see that there are some retaliations from the U.S. and U.K. on the host is trying to reframe them from disrupting the international trade. But yet, this is also will create a higher risk of further escalation and further expansion.

What we have right now in the region is a recipe of escalation everywhere.

And even we cannot disconnect this from that attack, for example, in Tehran in Iran a few weeks ago by ISIS.

Normally, when you see any turbulence in the region you start to see different players popping up.

(END VIDEO CLIP)

[02:05:04]

CHURCH: And I want to bring in Ibrahim Jalal from Vienna. He is a non- resident scholar in the is a non-resident scholar in the Arabian Peninsula Program at the Middle East Institute.

Thank you so much for joining us.

IBRAHIM JALAL, NON-RESIDENT SCHOLAR, ARABIAN PENINSULA PROGRAM, MIDDLE EAST INSTITUTE: Thanks for having me, Rosemary.

CHURCH: So, another joint U.S.-U.K. attack on Houthi targets in Yemen. But how effective are they given these strikes, as opposed to make the Red Sea safer, but the reverse appears to be happening, doesn't it?

JALAL: The result is expected, the chance is extremely unlikely to be accomplished as seen by at least five rounds of Houthi anti-ship ballistic missiles in both the Red Sea and the expanding scope into the Gulf of Aden.

Potential in the future of the Arabian Sea. That means the signaling continued attacks on maritime trade, particularly now, U.S.-related commercial vessels as made by several statements of the Houthis.

Which means now that the risk of entanglement is higher. The risk of expanding the geographic scope of the conflict is also higher, as we've seen sort of major tactical attacks in Iraq, in Iraqi Kurdistan, as well as impact some by Iran and the axis.

And this is sort of to diversify the sources of that creators and distract the focus in the Red Sea.

CHURCH: Yes, and this is a big concern, isn't it? Something that the U.S. says it's trying to avoid, but as you say, this could be playing into it and creating the opposite outcome.

So, how will the Houthis likely retaliate going forward, given they do claim to have already attacked another vessel, this time a Maltese- flagged carrier?

JALAL: They will continue these attacks on several directions and levels. They will of course, continue to focus on the Red Sea front, or to expand the geographic of these attacks into the Gulf of Aden and the Arabian Peninsula.

And potentially, at some point even expand, targeting U.S. interests or British deployed in the Gulf, including in the UAE, in Saudi Arabia.

This sort of gives them the diversification of threat, creators, especially given the deployment made by Operation Guardian Prosperity, as well as the U.S.-led coalition in Red Sea. And now, the E.U. maritime operation that will join.

But what options do the United States and the West have generally? We've seen, obviously failure to contain and engage the threat, sort of in, you know, realistic manner, moving forward, buildings have signaled commitments to continue to use the Red Sea territory and Hudaydah to continue these attacks.

So, this highlights two things. First, the dire need to address this sort of strategic threat in a -- in a multidimensional strategy. At the first level, you need to help the Yemeni government sort of secure its defensive posture, but also secure, you know, the rest of the Red Sea and second, deny control of the Red Sea territory in that direction.

And that would need sort of expanded a thing over what causes for action is the United States and allies are willing to make today, given the inflationary effects of the global supply disruptions caused by the Houthis.

And the third, obviously, the specially designated terrorist entity will play out in different ways.

But it must be accompanied by activation of military pressure on the ground to address the power imbalance that we see, to focus on degrading the capability, isolating them into the mountains, but also ensuring the security -- the long-term security of maritime trade routes.

CHURCH: I mean, that is a big picture solution to this situation, but how likely is it that the United States would and the United Kingdom would embrace a larger approach like that, rather than the solution they have come up with, which is military, but perhaps more symbolic than strategic?

And what's interesting is they have actually come out and said that they were never expecting these strikes to deter fully any house. What do you make of all of that?

JALAL: I think that the limits of policymaking and the short termism that has continued over the Yemen fight, particularly, since the past decade. And we've seen that miscalculation being made in 2018, when the two countries jointly normalize the status quo by preventing the government from recapturing Hudaydah and imposing (INAUDIBLE), despite military advantage, the Stockholm Agreement.

This is not the time to make further mistakes. It's the time to fix them, and fixing them require zoom out from the symbolic engagement that's tactical in nature into a strategic multi-dimensional strategy.

[02:10:06]

That focuses on a building trust and cooperation, but also long-term partnerships with its allies and partners on the ground.

And this requires a thing, because the public and the U.K. and in the United States, the consumers will feel the economic pinch, which will reflect in the prices of goods and commodities as a result of the significant hikes with low premium insurances, the costs of logistics, and shipping. And, of course, the delays attached to these given the use of the Cape of Good Hope.

So, this is not the time of sort of making weak, fragile choices that are short term. It's the time to correct the past mistakes, by learning from them, and applying them today to avoid this happening in the future.

Because they -- there a time attack site in 2016, but no one cared. They were contained within the region, within Yemen. Now, they have demonstrated their capability with Iranian culpability sort of, you know, demonstrates a strategic threat internationally, and they have to be regarded as such.

CHURCH: Ibrahim Jalal, many thanks for joining us and sharing your perspective on this. Appreciate it.

JALAL: Thanks for having me.

CHURCH: Meanwhile, Iran is ramping up attacks against regional enemies. It fired missiles at Sunni militants in western Pakistan on Tuesday, killing two children, according to authorities.

The Pakistani foreign affairs ministry condemned the strike inside its territory as an unprovoked violation of its airspace by Iran and warned of retaliation.

This attack comes a day after Iran launched missiles into northern Iraq and northern Syria. And Iranian foreign ministry spokesperson claims the strikes were precise and targeted operations against what it called terrorist headquarters in Idlib, Syria, and a Mossad affiliate in Erbil, Iraq.

Well, CNN's Sophia Saifi is following all of this, live from Islamabad.

Good to see you, Sophia. So, what more are you learning about this attack?

SOPHIA SAIFI, CNN PRODUCER: Well, Rosemary, what's happened in Pakistan, specifically, I mean, you spoke about what Iran has been doing towards its western borders, or towards the west, but here on -- in Pakistan western border with Iran.

These kinds of strikes, so deep into Pakistan, sovereign territory has not happened at this scale before. I mean, there were strikes by Iran back in 2017, but nothing so deep into Pakistan.

And this happened late Tuesday night. According to Pakistan's Ministry of Foreign Affairs, 8-year-old and a 12-year-old girl have been killed. A mosque was targeted. And Iran is claiming that that its targeted Jaish al-Adl, which is a Sunni separatist militant group, which operates both in Iran as well as in Pakistan.

That border with both Iran and Pakistan has been very porous, very tumultuous. The many separatist groups that operate against Pakistan there as well.

There is a sense of betrayal in Pakistan at the moment, because generally, over the past couple of months, there has been a lot of support amongst the Pakistani public with regards to Iran's actions, direct or indirect in the Middle East.

But the Pakistan has always had a fragile relationship with Iran. It's got a very problem historically concerning border problem with India to its east. It's got issues, Pakistan has had issues with the Taliban, all of last year, with many militant attacks happening within the country. But again, with a front opening or any extreme retaliation by Pakistan.

It's going to be concerning. We'll have to wait and see. The military has not released a statement yet. There is -- it will cost Pakistan a lot specially with three weeks left for a very important election in this country to see how this will unfold, but we'll have to wait and see how Pakistan reacts.

CHURCH: All right. Thanks to Sophia Saifi, joining us live from Islamabad.

I want to turn to Gaza now we're international doctors at the largest hospital in Khan Younis say people are fleeing the compound as the Israeli military moves closer to the southern city.

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CHURCH (voice over): Video show people carrying blankets, mattresses, and personal belongings as they leave the Al-Nasser Hospital area, where some have taken shelter. In the background, explosions and sounds of small arms fire.

Earlier Tuesday, the Israeli military claimed Hamas had carried out a recent launch from within the hospital compound.

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CHURCH (on camera): Well, Qatar says it has brokered a new deal between Israel and Hamas.

[02:15:00] As part of that agreement, medicine and other humanitarian aid will be delivered to Palestinian civilians in exchange for the delivery of medicine to Israeli hostages in Gaza.

Qatar says the aide is expected to leave Doha on Wednesday and head to Egypt before being transported to Gaza.

Meantime, a kibbutz in southern Israel has announced the death of two men held hostage in Gaza and featured in recent videos released by Hamas.

The kibbutz says the bodies of Yossi Sharabi, and Itay Svirsky, are still being held by the militant group.

Israel has likened Hamas to ISIS, following the group's brutal October 7th attack on Israel. CNN's Matthew Chance takes a closer look at the tactics of the terror groups, how they're similar and where they differ.

But first, we want to warn you, his report contains graphic images.

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UNIDENTIFIED MALE: (INAUDIBLE).

UNIDENTIFIED MALE: (INAUDIBLE).

MATTHEW CHANCE, CNN CHIEF GLOBAL AFFAIRS CORRESPONDENT (voice-over): It's hard to imagine the sheer brutality of the rampage. In more than 20 Israeli communities, Hamas gunman moving house to house, room to room in an orgy of violence.

You can barely show the horrors of October the 7th. But the torture, mutilation and killing of more than 1,200 people, as well as abductions of hostages still held in Gaza went to a radical gut- wrenching shift in tactics.

This is one video shared with CNN by an Israeli source that we are showing you. Security cameras the Nir Oz kibbutz in southern Israel, show a knife wielding gunman soaring the necks of dead Israelis.

Evidence of beheadings cementing an Israeli view that Hamas is now akin to jihadi groups like al-Qaeda and the Islamic State or ISIS.

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: Hamas is ISIS. And just as ISIS was crushed, so too will Hamas be crushed. And Hamas should be treated exactly the way ISIS was treated. They should be spit out from the community of nations.

CHANCE (voice-over): ISIS, which controlled parts of Iraq and Syria before being dispersed in a multinational effort, also used to beheadings, torture and sexual violence against their captives. While the two groups use similar brutal tactics, their goals remain different.

PETER NEUMANN, PROFESSOR OF WAR STUDIES, KING'S COLLEGE LONDON: So, Hamas is an Islamist organization, but its principal enemy is Israel. Now, ISIS is a global transnational jihadist organization that wants to establish a global caliphate, who considers every country in the world to be its enemy.

Hamas doesn't attract foreign fighters. Hamas only wants Palestinians to fight for it. ISIS wants people from all over the world to come and fight for it.

CHANCE: But is it becoming -- is Hamas becoming more, more like ISIS?

NEUMANN: So, I would say that ideologically, it's not becoming more like ISIS, but tactically and strategically it is. It is widening its area of operations. It's considering terrorist attacks abroad, and also, its tactics are becoming more like ISIS.

CHANCE (voice-over): Recently, Western security services say they've identified several Hamas threats, policing Germany, Denmark, and the Netherlands, making arrests in suspected Hamas length plots to strike European targets. This, amid growing international outrage over Israel's hardline response.

CHANCE: And that response in which thousands of Palestinian civilians have been killed in Israeli strikes, has further thrust Hamas into the spotlight, raising concerns say analysts that the October the 7th rampage and the Gaza war could inspire a whole new generation of terror attacks in the West.

CHANCE (voice-over): Attacks with groups other than Hamas exploiting the crisis.

NEUMANN: Groups like ISIS, even though they weren't responsible for October 7th, are now trying to jump on the bandwagon. They are trying to say, look, look what's happening in Israel-Palestine, get inspired by that. Join us and commit acts of violence and terrorism abroad.

CHANCE (voice-over): Revitalizing an ISIS campaign in Western countries may not have been a driving force behind the Hamas attacks on October the 7th. But ISIS could now benefit from the atrocities Hamas carried out.

Matthew Chance, CNN, London.

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CHURCH: Western military support is proving to be critical for Ukraine's defense against Russia's invasion.

[02:20:03]

We will take you on the front lines with Ukrainian troops and their U.S.-made Bradley tanks. That's next.

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CHURCH: Welcome back, everyone. Well, for months now, the frontlines in Ukraine have barely moved. The country's much anticipated counter offensive has stalled against Russian positions. And now, Ukraine's president is urging world leaders to prevent the war from becoming a frozen conflict.

Volodymyr Zelenskyy delivered his passionate plea in person at the World Economic Forum in Davos on Tuesday, calling on Ukraine's allies to deliver more weapons and resources needed to win the war.

He expressed gratitude for their support, but also criticize them for not doing enough sooner.

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VOLODYMYR ZELENSKYY, PRESIDENT OF UKRAINE (through translator): Full force of the sanctions could have forced Putin to concessions, because of don't escalate time was lost. And the lives of many -- of many of our most experienced warriors, who fought since 2014 were lost, some opportunities were lost.

(END VIDEO CLIP)

CHURCH: NATO secretary general tells CNN, he is confident U.S. lawmakers will agree on a package for Ukraine, as talks on additional funding have been stalled for weeks in Washington.

Now, CNN's Frederik Pleitgen reports, its U.S.-made Bradleys that have proved critical for Ukraine on the frontlines.

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FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): As the Russian army assaults Avdiivka in eastern Ukraine, U.S. provided Bradley infantry fighting vehicles are key to keeping the Ukrainians in the fight.

We're ready, the crews say. And then unleash their powerful 25- millimeter gun on Russian troops in nearby tree lines, helping Ukrainian infantry blunt an assault.

The vehicle's commander's call sign is Barbie. And he tells me the Bradleys are making all the difference.

I doubt that we'd be talking with you doing this interview if we didn't have the Bradleys, he says. Most likely, the northern flank would have been already lost without the Bradleys.

They have no time to lose. The next task waiting as the Russians try to press forward.

PLEITGEN: The Ukrainians say the Bradley is now one of their most effective tools in the defense of Avdiivka, because of its armor and its strong canon, it can easily defeat Russian armored vehicles.

PLEITGEN (voice-over): The Bradleys also own the dark, the crew says. Able to find and target Russian troops with their thermal scopes. You can see the rounds impact after they fire a salvo at Russian forces.

I asked Barbie if the Russians fear the Bradley.

The Russians are very afraid of the Bradley, he says. We were getting radio intercepts where we could hear their infantry shouting that the Bradley was coming and they couldn't do anything against it.

[02:25:01]

They have come a long way since Ukraine's failed counteroffensive this past summer, when Bradleys and other Western vehicles were often bogged down by minefields and Russian artillery barrages, unable to unleash their firepower.

Now, it often looks like this, Ukraine's 47th Mechanized Brigade provided us with these videos of what they say is Bradley's firing at Russian infantry positions.

They also provided several videos purporting to show a Bradley beating Russia's most capable main battle tank, the T-90, in a duel.

The Bradley fires salvos at the Russian tank, after taking many hits, the T-90 seems to be out of control, its turret spinning. The vehicle then hits a tree before the Ukrainians send a drone to finish it off. The Russian crew manages to bail.

But the Ukrainians fear this could end at soon if U.S. Congress doesn't OK additional funding for military aid. And both U.S. and Ukrainian officials have said that Ukraine is already forced to ration some ammunition.

JOHN KIRBY, U.S. NATIONAL SECURITY COUNCIL COORDINATOR FOR STRATEGIC COMMUNICATIONS: The assistance that we provided, has now ground to a halt. The attacks that the Russians are conducting are only increasing.

PLEITGEN (voice-over): Barbie and his crew say, so far, they have no shortages of ammo or spare parts for the Bradleys, a key weapon as they try to hold the line against a massive Russian invasion force.

Fred Pleitgen, CNN, near Avdiivka, Ukraine.

(END VIDEO CLIP)

CHURCH: Russian president, Vladimir Putin, hosted the North Korean foreign minister in Moscow Tuesday, the latest sign of the two countries deepening ties. The Kremlin says the visit was meant to advance agreements reached during North Korean leader Kim Jong-un's trip to the Russian capital last year.

In November, South Korea's National Intelligence Service said North Korea had exported over a million shells to Russia in recent months.

Well, as North Korea cozies up to Moscow it's taking an increasingly hostile stance toward its closest neighbor, South Korea.

On Monday, Kim Jong-un declared South Korea his country's primary foe and invisible principal enemy. He vowed to dismantle Pyongyang's arch of reunification, which signifies the possible peaceful unity of those two nations, calling it an eyesore.

In recent weeks, North Korea's military fired hundreds of artillery rounds into waters close to a disputed border with South Korea.

Sig Hecker is a professor of practice at the Middlebury Institute of International Studies at Monterey, and the former director of the Los Alamos National Laboratory. Appreciate you joining us.

SIEGFRIED HECKER, PROFESSOR OF PRACTICE, MIDDLEBURY INSTITUTE OF INTERNATIONAL STUDIES, MONTEREY: Thank you. It's my pleasure, Rosemary.

Now, Sig, you recently wrote that the Korean Peninsula is the most dangerous it's been since 1950. So, is Kim Jong-un preparing for war, or is this just more saber rattling, do you think?

HECKER: So, I don't think it's saber rattling this time. And to really understand that, you have to follow the North Korean situation, you know, quite a ways back. And that's what I've done. I was there first 20 years ago. My (INAUDIBLE), my colleague, Bob Karlan, has actually been working in 50 years. So, I think this time, Rosemary, it's different.

CHURCH: And why do you think that? How is it different?

HECKER: So, what we've seen is that North Korea actually had one policy for some 30 years, 1990 to just about 2020, of trying to seek normalization with the United States. And for a number of reasons, after a failed summit in Hanoi, the North Koreans and Kim Jong-un has sort of revisited what they want to do, when they decided they're going to give up on the United States.

So, we've watched that now for a couple of years. And now, what's coming out is indeed what we've heard for these few years. And that is, they are talking about war. They are talking about war preparations for their country. And so, we're quite concerned.

CHURCH: And if Kim Jong-un, were to go to war, as you suggest, what are South Korea, Japan, and the United States doing to prepare for such an outcome? And how would they respond to a threat of war from North Korea?

HECKER: So, part of the reason we spoke up at this time was, I think it's essentially a warning for us. So, a shot across the bow to get our attention. What we're trying to do is to get the American government to understand they look this as really serious.

They changed the way that they want to work with us, and it is time to be prepared.

Essentially, how you prepared? Of course, that's our government's job.

[02:30:00] CHURCH: Right and what would a war waged by Kim Jong-un look like do you think?

HECKER: So, that's -- you know, that's not at all clear. We can't really understand you know -- he has nuclear weapons and of course, that's what I've been looking at for a whole number of years. But, it's not going to be nuclear weapons certainly at the beginning.

But we are just worried that indeed -- that he may have decided in the end -- we don't really understand what he is thinking. He may have decided that it is time to actually take some actions.

CHURCH: But he has to know that should he wage war with South Korea, Japan, or the United States, that's potentially the end of his regime, isn't it really?

HECKER: So that's certainly what I've said all along and I've always said, look, he is not suicidal. You know, he is not going to take on something where his regime and his country is going to end. However, we don't really know how he's thinking and there are a lot of things that changed here in the past couple of years, that he may believe that there actually -- there is some way sort of what one would say, what's the path to victory? What would it mean?

And that's what we are concerned about, that he may be thinking very differently than what our conventional thinking is.

CHURCH: Do you say South Korea as the greatest threat of war at this -- at this juncture?

HECKER: So yes, before we had always thought, well, maybe if there is some war, it may just not be South Korea. But, his recent statements and those are the ones that have really gotten everyone's attention, both in a party forum, just a day or so ago, and then the New Year speech. And what he has now said is that, that South Korea, they don't belong together anymore. And in the end, he thinks that indeed South Korea shouldn't even exist

CHURCH: Sieg Hecker, thank you so much for joining us. We appreciate and (ph) your perspective.

HECKER: Thank you.

CHURCH: Time for a short break. When we come back, a look at China's population problem and how it could potentially affect the economy. We are live in Beijing, that's next.

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[02:35:00]

CHURCH: Welcome back everyone. Well, new numbers out of China show the country's population declined for the second year in a row in 2023 and its economy. So, one of its weakest performances in more than three decades. CNN's Marc Stewart is live in Beijing for us. He joins us now. So Marc, how significant of these latest numbers and how might this trend impact the economy?

MARC STEWART, CNN INTERNATIONAL CORRESPONDENT: Hi there, Rosemary. Two big issues and the Chinese government is well aware of both. Let's first talk about the economy. It was during a New Year's Eve speech that President Xi Jinping made this rare admission that the Chinese economy is in trouble. Yes, in 2023, it did see growth. We saw some new numbers of about 5.2 percent. And yes, it was higher than projected, but it is still not what the Chinese economy was once was when it was thriving.

In fact, some of this data that were looking at is the worst in over 30 years. So, what's at play here? There's an ongoing real estate crisis. Young people are having a hard time finding work. And then there's this population decline and this population decline is significant because if you do not have a growing and a robust workforce, it's hard to contribute, it's hard to create productivity and that's what the economy driver is in China. So, what's going on with the population?

Well, it is declining. Right now, China still has about 1.4 billion people, but it's 2 million less than it was the year before and that is a notable decline. So, what's happening with the population? Well, there was a policy in place for many years in China, it was ended in 2016 -- that families could only have one child. Well, it's been difficult to get people to have more children, especially young people who want the freedom to make choices about their future.

They feel that having a child is a big burden on them, both physically and financially. They want to pursue graduate degrees. They want to travel and those are very compelling reasons, and one reason why the population is declining. So what we are seeing, Rosemary, is a big push by the Chinese government to create some incentives for young people have children. And while it may be financial incentives that may be enough, because a lot of this is about choice and quality of life. So, two big hurdles facing China right now and the government well aware of both, Rosemary.

CHURCH: All right. Thanks to Marc Stewart joining us live from Beijing. And we'll be right back.

(COMMERCIAL BREAK)

CHURCH: Challenges to the global economy are front and center in Davos, Switzerland where the World Economic Forum is now in full swing. CNN's Richard Quest took a break from the conference rooms to show us how the global economy, politics, and more are apparently a lot like the sport of curling.

[02:40:00]

(BEGIN VIDEOTAPE)

RICHARD QUEST, CNN ANCHOR "QUEST MEANS BUSINESS" (voice-over): It is a scene of alpine beauty, the landscapes of winter at Davos. The peaks, (inaudible), the snow -- the World Economic Forum's theme this year "Rebuilding Trust," where it aims to hit the target. That's also the philosophy of the Davos Curling Club.

UNIDENTIFIED MALE: So when the skip says, here, you make (inaudible) like at.

QUEST: So that's why it is called curling, because you -- it curls.

UNIDENTIFIED MALE: Yes.

QUEST: Think of these stones as being the economy. Various governments, prime ministers, presidents, finance ministers, they set their course and send it on its way (ph).

QUEST (voice-over): So many factors threaten to sweep the economy (inaudible). For starters, interest rates. Central bankers have hiked them to the point where economies have slowed down to kill inflation. And now, they're trying to hit that target, 2 percent, without knocking themselves off.

Global growth is expected to slow this year. I hope it's not going to spiral down.

QUEST: That's a nothing. That's a nothing. Because I wasn't able to swift enough (ph) out the way and so, the economy came to a stop.

QUEST (voice-over): It is also the year of elections. Political candidates charting their collision course to victory, hoping to knock rivals off the stage

AI is like a curling stone. Have one set (ph) free, maybe difficult to control and even if all do the right things, well, accidents can still happen.

UNIDENTIFIED MALE: It's unbelievable (ph).

QUEST: The world of curling can teach us much about today's global economy. Having raised interest rates and then still trying to keep things going without coming to a complete stop. And then, when all said and done, in a competitive environment, you want to knock your competitors to one side but you don't want to completely ruin the game.

Richard Quest, CNN, Davos.

(END VIDEOTAPE)

CHURCH: And thank you for joining us. "World Sport" is coming next.

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