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United Nations' Key Agency Faces Dire Consequences Following International Funding Pullouts; Ukrainian President Expects to Sack their Top General by the Week's End; Lawmakers Grilled Social Media Heads on the Effects of Social Media among Children; Iranian official warns of any unanswered threats to the United States. Hong Kong residents Crossed the Border to Shop in Shenzhen for Cheaper Prices. Explorers Discovered an Apparent Plane where Amelia Earhart Traversed Before Her Disappearance. Aired 3-4a ET
Aired February 01, 2024 - 03:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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ROSEMARY CHURCH, CNN ANCHOR: Hello and welcome to our viewers joining us from all around the world and to everyone streaming us on CNN Max. I'm Rosemary Church.
Just ahead, a growing number of countries pulled their funding for the main U.N. relief agency in Gaza. Despite warnings, the cuts to UNRWA could have catastrophic consequences.
An alarming report on the atrocities and looming hunger in Sudan's Darfur region. I'll speak to the author of the report about his findings. Plus --
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SEN. LINDSEY GRAHAM (R-SC), SENATE JUDICIARY COMMITTEE RANKING MEMBER: Mr. Zuckerberg, you and the companies before us, I know you don't mean it to be so, but you have blood on your hands.
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CHURCH: Social media titans testify in Washington over claims their apps are harmful to teens. We'll bring you the highlights from that tense hearing.
UNKNOWN (voice-over): Live from Atlanta, this is CNN Newsroom with Rosemary Church.
CHURCH: Good to have you with us. The U.N.'s key aid agency in Gaza is facing a crisis that threatens its very existence. Israeli Prime Minister Benjamin Netanyahu is now calling for an end to UNRWA. He is also specifically accusing UNRWA officials of being complicit in the October 7th Hamas attack against Israel.
His comments come as Sweden joins a growing list of countries that have suspended funding to the agency after Israel claims 13 staffers were involved in the massacre. U.N. Secretary-General Antonio Guterres says he was, quote, "personally horrified by the allegations," but the U.N. acted immediately and terminated the staffers. And if UNRWA is shut down, the situation in Gaza could become catastrophic.
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ANTONIO GUTERRES, UNITED NATIONS SECRETARY GENERAL: I underscore the importance of keeping UNRWA's vital work going to meet the dire needs of civilians in Gaza and to ensure its continuity of services to Palestine refugees. UNRWA is the backbone of all humanitarian response in Gaza.
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CHURCH: Meantime, the Palestine Red Crescent Society says the situation around Al Amal Hospital in Khan Younis remains precarious and the sounds of explosions and gunfire can be heard regularly from the hospital.
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The PRCS says this video was taken Tuesday and a day after entering the complex, Israeli forces are still there and snipers are on the roofs of the houses surrounding the hospital.
The aid group also says that even though the hospital's stock of fuel and medical equipment is low, the Israel Defense Forces are prohibiting anyone from going out to the street, even to retrieve the body of a Red Crescent employee who was killed outside the hospital door. CNN cannot independently confirm these claims and has reached out to the IDF for comment.
Israeli Prime Minister Benjamin Netanyahu is telling families of hostages in Gaza that quote, "we are making every effort to bring them home." Mr. Netanyahu spoke with representatives of 18 families in Jerusalem on Wednesday. He told them efforts are underway, quote, "in these moments in these very hours to return their loved ones."
The Israeli government has faced accusations that it's not doing enough to free the hostages. Right now negotiations are underway for a hostage release and pause in fighting.
But Mr. Netanyahu insists he would not agree to Hamas' demands to release thousands of Palestinian prisoners or to withdraw from Gaza. Still, Israel's partners are not giving up hope that it will strike a deal. U.S. Secretary of State Antony Blinken will travel back to the region this week for more discussions and the U.S. National Security Council spokesman is expressing cautious optimism.
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JOHN KIRBY, U.S. NATIONAL SECURITY COUNCIL SPOKESPERSON: We believe, and I don't want to sound too sanguine here, but we believe that the discussions have been productive. They've been moving in the right direction. And that we have some -- that we have some basic understandings of what this could look like, the parameters of it.
That doesn't mean that we have some sort of framework that everybody signed up to. Again, I want to be very careful. I don't get ahead of where we are right now. But we believe that there has been good progress.
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CHURCH: Journalist Elliott Gotkine is following developments. He joins us live from London. Good morning to Elliot. So what is the latest on UNRWA and Prime Minister Netanyahu's call for its mission to end?
ELLIOTT GOTKINE, JOURNALIST: Rosemary, I think it's fair to say that Israel and the United Nations more broadly have had an uneasy relationship for the past few decades, but Israel reserves particular ire for UNRWA itself. It says that UNRWA effectively perpetuates the Israeli-Palestinian conflict by, among other things, conferring refugee status not just on Palestinians that were displaced in 1948 when Israel was created, but on all of their descendants, and that it's the only agency that does that, that it keeps Palestinians in refugee camps and holds out the hope that they may one day be able to return to the homes they lost in 1948 inside of Israel, something that Israel says is never going to happen.
And I suppose what these allegations that Israel has presented to the U.N., the United States, and others that about a dozen employees of UNRWA were actively involved in the Hamas-led massacre of October the 7th, is it gives Israel a kind of smoking gun to say that UNRWA is not fit for purpose. And indeed, Prime Minister Benjamin Netanyahu, addressing U.N. ambassadors yesterday, saying that I think it's time the international community and the U.N. itself understand that UNRWA's mission has to end.
The problem, of course, is that it's not clear if UNRWA can be reformed, which is what the United States says needs to happen for it to resume funding the agency. But if it is going to be replaced, what would come along in its stead, because as we've heard from the U.N. Secretary-General for Humanitarian Affairs Martin Griffiths, so many of the two million Palestinians inside the Gaza Strip are completely reliant on UNRWA for their humanitarian needs, for food, for shelter, for medicine and the like.
And that if UNRWA cannot continue beyond the end of this month, as it says will happen, if it doesn't manage to plug the gap in funding that all these countries freezing their funding has created, then the question is what will come in its place. And I suppose, politically speaking, Rosemary, Israel, of course, doesn't want to be the one to step into the breach and to be responsible for all of those Palestinians' humanitarian needs.
CHURCH: And Elliott, what more are you learning about those negotiations for a ceasefire in exchange for the release of hostages?
GOTKINE: So the Mossad director, David Barnea, he presented the plan that was, or the framework as it's being called that was discussed in Paris along with the Qataris, the Egyptians and the Americans. He presented that to the war cabinet yesterday. It seems that the full cabinet is going to be discussing it later. We've been talking for a number of days about the various possibilities. We were talking about the potential for a six-week truce. Now it seems that it might be a seven-week truce.
That would enable the 100-plus, or at least some of the 100-plus hostages to be released in phases, those that were abducted on October the 7th in exchange for Palestinian prisoners being released.
Netanyahu trying to reassure the representatives of these 18 families that he met with yesterday in Jerusalem that he's doing everything that he possibly can to bring them home, but he won't do a deal that will, in his words, see the release of thousands of Palestinian terrorists, and he will not do a deal that conflicts with Israel's war objectives of dismantling Hamas and preventing it from ever visiting the kind of attack that it did on October the 7th, again, or to continue governing in the Gaza Strip. Rosemary?
CHURCH: All right, our thanks to Elliott Gotkine joining us live from London.
A new report from the U.N. highlights the unprecedented scale of destruction and impact from the war in Gaza. The U.N. Conference on Trade and Development says it will take tens of billions of dollars and decades of work to reverse the damage done by this war. The U.N. report says the military campaign in the enclave has led to a precipitous decline in living conditions as well as soaring poverty and unemployment.
The report says the level of destruction has rendered Gaza uninhabitable. And economic activity has ground to a halt with the exception of minimum health and food services. The war has dealt a massive blow to living conditions in Gaza which were already precarious before the outbreak of this war.
Well, joining me now is Richard Kozul-Wright, the Director of Globalization and Development Strategies at the U.N. Conference on Trade and Development. Appreciate you being with us.
RICHARD KOZUL-WRIGHT, DIRECTOR OF GLOBALIZATION AND DEVELOPMENT STRATEGIES, UNCTAD: Thanks Rosemary.
CHURCH: So even as this war grinds on, your organization just released a report with revised numbers on the cost of rebuilding Gaza. Once this conflict ends, how much will reconstruction cost and how did you calculate that amount?
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KOZUL-WRIGHT: Yeah, I mean, it's a difficult task, as you can imagine, as the war is still ongoing. We've tried to, and you can't go in and make the necessary needs assessment on the ground. So we've used satellite technology, energy use, and some familiar economic tools to try and make the assessment. And we've also used a parallel with the previous significant military
operation in 2014. The assessment of that damage by the U.N. team and the World Bank at that time was 3.9 billion in terms of the cost of recovery. Clearly the scale and intensity of this operation is much greater.
So far, something like 37,000 buildings have been destroyed or damaged. It was only 22,000 that were destroyed or damaged in 2014. And that figure of 37,000 is only till the end of November, where we have reliable data. So we're talking probably something like four times so far, four times the scale of the damage and the cost of recovery from previously.
So that's a figure in 15 to 20 billion, just to recover from where we were in October, let alone the bigger question. And it's a very big question about how this figures into issues around actually creating a state, a two-state solution that is at least now back on the international agenda. So it's a huge task.
CHURCH: Yeah, huge. And who pays the bill for rebuilding Gaza? And how long would reconstruction take, do you think?
KOZUL-WRIGHT: Well, clearly the Palestinian Authority, which has been in its own very difficult economic circumstances now for years, cannot foot that kind of bill. So it's the international community and the occupying power that is responsible for reconstruction.
The length of time depends on lots of factors. It depends upon when the military operation ends. It depends upon how quickly we can get growth going in Gaza, because obviously reconstruction of that level also requires domestic resource mobilization. So we need to see a growth recovery in the Gaza Strip.
I think what we say in the report is, if we don't do this, then we're talking about decades just to get back to where we were before, before this current military operation began. And business as usual really is not an option given not only the consequences for the people of Gaza, but for the wider geopolitical consequences of an ongoing conflict.
CHURCH: Yeah, let's look at that because this report paints a dire economic picture of the situation in Gaza that extends beyond this conflict and calls for a break in the cycle of economic destruction that has left most of the population dependent on international aid. But how can that be done successfully? Where do you start?
KOZUL-WRIGHT: I mean, you know, and often in these circumstances, people return to the one successful model of recovery and reconstruction that we know work, which of course was the Marshall Plan that the United States implemented after the end of the Second World War.
And obviously, the circumstances are different, the times are different, but, you know, the principles of being generous, which the Marshall Plan was, both in terms of scale and also in terms of the kind of aid, it was not debt, it was grants that were given with the Marshall Plan. You need to be sustained. The Marshall Plan lasted for five years.
This has to be more than that, and we need institution building that will deliver on that kind of agenda. And it needs to be inclusive. It needs to involve the people in the Palestinian territories, as the Marshall Plan involved the Europeans in their own reconstruction.
So we have models of that in the past. You know, this was 80 years ago, the Marshall Plan. One would hope that the international community can stand up and deliver on that kind of model in the 21st century.
CHURCH: Alright. Richard Kozul-Wright, thank you so much for joining us. I Appreciate it.
KOZUL-WRIGHT: Thank you.
CHURCH: Ukrainian President Volodymyr Zelenskyy is reportedly expected to fire his top general. A source tells CNN that General Valeriy Zaluzhny is still on the job right now, but Mr. Zelenskyy is expected to make it official by the end of the week.
Meanwhile, Ukraine says four people were wounded in a Russian strike on a hospital in the Kharkiv region on Wednesday. The city of Kharkiv was reportedly hit by drones, but there's still no word about possible damage.
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Despite the fighting, Ukraine and Russia still carried out a prisoner exchange on Wednesday. They say the swap included about 200 POWs from both sides. According to President Zelenskyy, almost half of the Ukrainians fought in the brutal siege of the city of Mariupol, which happened in the first months of the war.
European Union leaders are arriving in Brussels this hour to debate what some consider a make or break issue for Ukraine. E.U. aid has been stalled for weeks because of internal political disputes but that's happening as Russia is turning up the pressure across the battlefield and Ukraine could use all the help it can get. The E.U. now says it expects to deliver only about half of the artillery shells it promised to keep by March. And according to the Union's foreign policy chief, the consequences are already showing on the battlefield.
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JOSEP BORELL, E.U. FOREIGN POLICY CHIEF: Ukraine's need more ammunition. There is a big imbalance on the fire capacity from one side to the other. And this gap has to be filled.
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CHURCH: Melissa Bell is monitoring those developments from Paris. She joins us now live. Good to see you, Melissa. So what's expected to come out of this extraordinary European summit getting underway now to discuss help for Ukraine? MELISSA BELL, CNN CORRESPONDENT: Well, there's a great deal of hope in Brussels this morning that the situation that we've seen blocked since the month of December when Viktor Orban, the Hungarian leader, vetoed this new tranch, 50 billion euros worth of aid to Ukraine.
The idea is that the 27 leaders will meet in Brussels, arriving, as you say, even now, and that either some kind of deal will be struck where Viktor Orban -- that gets the backing of Viktor Orban. We understand, for instance, that he's asking for things like an annual vote on whether further funding will be released. He had objected to the amount and to the fact that it came from E.U. budgets.
Whether a deal can be reached with him or without him, the idea is that new tranche of aid should be unblocked for Ukraine, as you mentioned a moment ago, given also how crucial, how critical this moment is, the sacking of Ukraine's top military commander, the end of much speculation about, Rosemary, the relationship between President Zelenskyy and this leader and who will now replace him at a crucial moment when the second counteroffensive has proved as disappointing as it has. Rosemary.
CHURCH: Yeah, let's talk more about that because the president of course seems very disappointed with his top military commander, according to CNN sources, about to dismiss him officially, although apparently he's told him their his intentions. Talk to us about what that could mean for the war with Russia.
BELL: Well, for a start, uncertainty at the top, and that can never be a good thing. You're talking about a top general who is extremely popular. In fact, one poll that had emerged after the rift had become public knowledge or the speculation around it had grown more feverish, showed that Valeriy Zaluzhny had 88 percent support amongst Ukrainians. President Zelenskyy just 68. Now, that's pretty high. But that rift had apparently been growing.
Lots of speculation now, of course, about who will take over. But much more importantly, as you heard a moment ago, and this has been something of a complaint for months, if not since very quickly into this war, the lack of ammunition, the fact that this stalemate appears to have been reached on the battlefield.
And in fact, Valeriy Zaluzhny had spoken about that fairly openly in an article in an interview in November. The fact that this was the First World War they were in so far, Rosemary, technologically, they were now at a stalemate. That is how crucial the money that the Europeans will be talking about today in Brussels is. It's about keeping up with an already difficult situation on the ground, Rosemary.
CHURCH: All right, our thanks to Melissa Bell joining us live from Paris.
All right, let's bring up these live pictures from Brussels outside the E.U. building, parliament building. Farmers are protesting ahead of today's meeting. They are angry over costs, cheap imports, and environmental rules. Protests have been spreading across France, Germany, and Romania in recent days. And now Spanish and Italian farmers are joining as well, hoping to press E.U. leaders for some relief.
It's been more than a week since a Russian military plane crashed in the Belgorod region near the Ukrainian border. And now Russian President Vladimir Putin is calling for an international investigation and claiming the plane was shot down by U.S.-made missiles. Take a listen.
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VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): We asked to send international experts to conduct this analysis, to assess the existing physical evidence that the plane was shot down by the Patriot system from a specific place and at a specific time.
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I have already said at 11:10 a.m. two launches were made from the territory controlled by the Ukrainian authorities. We asked for international experts to come.
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CHURCH: He claims two U.S. Patriot missiles were launched from Ukraine and caused the plane to crash. Ukraine, for its part, has persistently said it will not use missiles donated by Western allies beyond its own borders. And Kyiv has not taken responsibility for the incident.
Moscow claims the crash killed 65 Ukrainian prisoners of war who were set to be exchanged in a prisoner swap. Ukraine says there's no evidence any POWs were on board. CNN is not able to independently verify claims by either side.
We are following a developing story out of London where nine people, including two children and three police officers were injured when a corrosive substance was thrown at people in a district in southwest London. All nine were taken to hospitals for treatment. The Metropolitan Police say they are conducting tests to determine the makeup of the substance. Police say a man was seen fleeing the scene, but they have not arrested anyone at this point.
Just ahead, Houthi rebel attacks are scaring more ships away from the Red Sea. How soon before the rising costs are passed on to consumers?
Plus tech leaders grilled on Capitol Hill. Top social media executives lay out their plans to protect children, but lawmakers say it's too little, too late.
And the FBI is warning of another tech threat, this time from China, whose hackers could wreak havoc on the United States. We'll take a look.
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CHURCH: Welcome back everyone. The FBI director has issued an ominous warning to U.S. lawmakers. Chinese hackers are getting ready to target critical American infrastructure. On Wednesday, Christopher Wray told a U.S. House committee that hackers are waiting for their moment to destroy or degrade facilities like pipelines, water treatment plants, and the electrical grid.
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CHRISTOPHER WRAY, FBI DIRECTOR: China's hackers are positioning on American infrastructure in preparation to wreak havoc and cause real world harm to American citizens and communities if and when China decides the time has come to strike.
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CHURCH: The Chinese government has previously denied allegations of state-sponsored hacking.
Top social media executives endured steering criticism on Capitol Hill Wednesday over concerns for online safety for kids. The heads of X, TikTok, Snap, Meta and Discord testified about efforts to block material that damage young people's mental health or exposes them to sexual exploitation.
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It was clear there was an urgency from lawmakers to address the issue.
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SEN. DICK DURBIN (D-IL), SENATE JUDICIARY COMMITTEE CHAIRMAN: Online child sexual exploitation is a crisis in America.
SEN. TED CRUZ (R-TX): Every parent I know and I think every parent in America is terrified about the garbage that is directed at our kids.
SEN. JOHN NEELY KENNEDY (R-LA): To some extent, your platform has become a killing field for the truth, hasn't it?
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CHURCH: Meta CEO Mark Zuckerberg pushed back against some of the criticism from lawmakers, but in a dramatic moment, he stood up and personally apologized to families of people harmed by social media.
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SEN. JOSH HAWLEY (R-MO): You're on national television. Would you like now to apologize to the victims who have been harmed by your product? Show them the pictures. Would you like to apologize for what you've done to these good people?
MARK ZUCKERBURG, META CEO: I'm sorry for everything you have all been through. No one should go through the things that your families have suffered.
(END VIDEO CLIP) CHURCH: CNN's Tom Foreman has more details on the Senate hearing.
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GRAHAM: But you have blood on your hands.
HAWLEY: Your product is killing people. Will you set up a victim's compensation fund with your money, the money you made on these families sitting behind you, yes or no?
TOM FOREMAN, CNN CORRESPONDENT (voice-over): Mark Zuckerberg, founder of Facebook, whose company owns Instagram, pushed into apologizing to families who say they were harmed by online content, some waving pictures of children who died or killed themselves. It was an astonishing moment, yet the billionaire head of Meta dug in anyway.
ZUCKERBERG: And this is why we invested so much and are going to continue doing industry-being efforts to make sure that no one has to go through the types of things that your families have to suffer.
SHN. SHELDON WHITEHOUSE (D-RI): Your platforms really suck at policing themselves.
FOREMAN (voice-over): Against a torrent of accusations from the Senate committee about enabling sexual exploitation, election meddling, fake news, drug abuse, and child endangerment, the heads of five tech giants tried to push back.
JASON CITRON, DISCORD CEO: We very much believe that this content is disgusting.
LINDA YACCARINO, CEO, X: X will be active and a part of this solution.
FOREMAN (voice-over): But the fury kept coming in a rare show of unity between Democrats --
SEN. AMY KLOBUCHAR (D-MN): One third of fentanyl cases investigated over five months had direct ties to social media.
FOREMAN (voice-over): -- and Republicans.
HAWLEY: 37 percent of teenage girls between 13 and 15 were exposed to unwanted nudity in a week on Instagram. You knew about it. Who did you fire?
ZUCKERBERG: Senator, this is why we're building all these tools.
HAWLEY: Who did you fire?
ZUCKERBERG: I'm not going to answer that.
FOREMAN (voice-over): There was plenty of heat to go around as the tech bosses were scorched with claims their products promote anxiety, depression, and violence, especially among young people.
SEN. MARSHA BLACKBURN (R-TN): Children are not your priority. Children are your product.
FOREMAN (voice-over): But no one was hit harder than Zuckerberg, whose attempts at defense at times were literally laughed at.
ZUCKERBERG: My understanding is that we don't allow sexually explicit content on the service for people of any age.
SEN. MIKE LEE (R-UT): How is that going? Is there any one of you willing to say now that you support this bill?
FOREMAN (voice-over): Many of the lawmakers are intent on overturning a longstanding federal law that immunizes those companies from lawsuits over user-generated content and putting tough regulations in place.
KLOBUCHAR: It's time to actually pass them. And the reason they haven't passed is because of the power of your company. So let's be really, really clear about that.
FOREMAN (voice-over): And while the tech bosses say they're happy to work on safeguards, skepticism ran rampant.
GRAHAM: Nothing will change until the courtroom door is open to victims of social media.
FOREMAN: Sometimes in hearings like this, lawmakers seem like they just don't understand how tech really works. But they do understand human suffering, they know the political power of that, and they know how to count votes, as one of them noted today. And Big Tech could be on the wrong side of the next one and facing regulations like never before.
Tom Foreman, CNN, Washington.
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CHURCH: Still to come, Iran warns it will respond to any threats from the US as America readies its response to a drone attack on U.S. troops. The details just ahead.
Plus crossing the border for bargains. Why some in Hong Kong say the savings in mainland China are just too good to pass up? Back in just a moment.
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CHURCH: A look now at our top story this hour. Prime Minister Benjamin Netanyahu says the U.N.'s Palestinian refugee agency must be shut down after Israel accused 13 of UNRWA's staff members of involvement in Hamas' October 7th attack.
A growing number of countries, including the U.S., have suspended funding for the aid agency since those claims. And the U.S. says before it resumes funding, UNRWA will have to undergo fundamental changes to prevent such an incident from happening again.
Meantime, journalists in Gaza told CNN the Israel Defense Forces have stepped up airstrikes on Khan Younis in southern Gaza and are bombarding parts of the city. And UNRWA says nearly 200,000 people have registered for humanitarian assistance after being forced to flee the area in recent days.
Well, now to a warning from Iran where one official says any threats made by the U.S. won't go unanswered. That word from the chief of the Islamic Revolutionary Guard just one day after U.S. President Joe Biden said he had made a decision on how to respond to the drone strike that killed three U.S. soldiers and injured dozens more. Iran pointed to the quote "words of American officials in the announcement Wednesday without elaborating further."
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GEN. HOSSEIN SALAMI, CHIEF COMMANDER, ISLAMIC REVOLUTIONARY ARMY CORPS (through translator): The common chapter between the U.S. and Iran is that we know each other. You know that we do not leave any threats unanswered. While we are not looking for war, we are not afraid of war, and we do not run away from it.
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CHURCH: That warning comes as the White House formally assigns blame for the drone strike, saying the U.S. believes the Islamic resistance in Iraq was behind it. That is an umbrella group of a number of Iran- backed militia, including Kataib Hezbollah. The attack in Jordan on Sunday targeted a small U.S. military base and marked the first time U.S. troops have died under direct fire in the Middle East since Hamas' October 7 attack on Israel.
According to U.S. Central Command, American forces have carried out a new round of airstrikes in Yemen. This time against 10 Houthi drones and a drone control station. This is the latest in a series of attacks meant to destroy the weapons of the Iran-backed rebel group before they can be launched at shipping lanes.
The strikes follow a close call in the Red Sea. We're told a Houthi missile came within a mile of a U.S. destroyer, the USS Gravely, before it was shot down, that is the closest any Houthi attack has ever come to a U.S. warship.
CNN's Paula Hancocks looks at how the ongoing militant threat has disrupted international shipping.
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PAULA HANCOCKS, CNN CORRESPONDENT (voice-over): Bab al-Mandab, a small bottleneck in the Red Sea, which translates as Gate of Grief. For centuries, it was mainly the undercurrents and reefs that captains feared. Today, it is the Houthi rebel attacks from neighboring Yemen sparking global diversions away from the Red Sea.
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Shipping research from the London Stock Exchange Group estimates that diverting a tanker from Asia to Northwest Europe around the Cape of Good Hope adds almost $1 million per voyage while doubling the shipping time.
How much of that will be passed on to the consumer is not yet clear, but some analysts say the impact may not be as dire as feared in the short term.
SIMON MACADAM, CAPITAL ECONOMICS: In terms of how this could actually feed down the supply chain to the end consumer and boost the price level of goods and services that we consume in our economies. The value of the shipping service is actually a very, very small fraction of the total value of the goods or services that you're buying. So there is actually limited scope for that to seriously cause inflation.
HANCOCKS (voice-over): The severity of the impact will inevitably depend on the length of the crisis.
VINCENT CLERC, MAERSK CEO: Initially we thought this was going to be a fairly short disruption. Now, I think our base case is more going towards months of disruptions and that means a lot more cost.
HANCOCKS: The International Monetary Fund warned this week that attacks in the Red Sea coupled with the ongoing war in Ukraine risked spikes in food, energy and transportation costs. They also warned that if there were to be an escalation into a wider conflict in the Middle East it would threaten global growth.
MACADAM: It's not the shipping costs themselves that are getting out of hand. It is this endangered energy supplies, then we'd see oil prices rise, then we'd see gas prices rise, and against that is the sort of thing that is going to spoil the party.
HANCOCKS (voice-over): China, just the latest affected country to call for an end to the disruption on Tuesday.
WANG WENBIN, CHINESE MINISTER OF FOREIGN AFFAIRS (through translator): The Red Sea is a crucial international trade route for goods and energy. We hope to avoid tensions in the Red Sea and call for an end to attacks on civilian vessels.
HANCOCKS (voice-over): Disruption in the Red Sea follows disruption of Ukraine's wheat exports after Russia's invasion. It also follows chaos in the shipping industry during the COVID pandemic, another reminder of just how sensitive global supply chains can be to unpredicted shock.
Paula Hancocks, CNN, Abu Dhabi.
(END VIDEOTAPE)
CHURCH: And those attacks in the Red Sea have had an unexpected consequence for a ship full of livestock. Right now, more than 14,000 sheep and 2,000 cattle are stranded in a ship off the coast of Western Australia in the middle of a heat wave. 15 days into its trip to the Middle East, the ship had to divert from the Red Sea because of these security concerns there.
Now it's right back where it started in Australia. A veterinarian and a cattle expert are on board the ship to make sure the animals are healthy and safe. And Australian authorities are organizing a quarantine for the animals if they return to shore.
The U.S. Federal Reserve is leaving interest rates right where they are for the time being. Analysts did not expect the central bank to announce a cut at Wednesday's meeting with rates at a 23-year high. Inflation in the U.S. continues to ease and many were hoping for a signal that a cut would come in March. But Fed Chair Jerome Powell says the economy has yet to achieve a soft landing.
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JEROME POWELL, U.S. FEDERAL RESERVE CHAIR: I'm encouraged and we're encouraged by the progress but you know, we're not declaring victory at all at this point. We think we have a ways to go.
(END VIDEO CLIP)
CHURCH: Stocks tumbled after the Fed announcement with the Dow losing more than 300 points. The S&P 500 was off more than 1.5 percent. The NASDAQ lost more than two percent.
Cuban officials say they're delaying their plan to increase the cost of fuel after a virus infected government computers. That 500 percent price hike had been scheduled to take effect on Thursday. Officials say it will happen in the future.
Cuba's government is justifying the astronomical price jump by saying they no longer receive enough donated oil from allies and can no longer afford to subsidize fuel. The Cuban state owns all gas stations and the fuel price increase threatens the country's already failing economy.
Well, rising prices are a concern in Hong Kong as well. Residents have found it's actually cheaper to cross the border into mainland China to get better deals and the Chinese economy will take any help it can get right now.
CNN's Marc Stewart reports.
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MARC STEWART, CNN CORRESPONDENT (voice-over): A shopping spree in a place once known as the world's factory floor, the city of Shenzhen.
From Hermes bags and giant bears from Toy Story at the local Costco to deals at name brand stores and local markets, Shenzhen is drawing shoppers not just from mainland China but from across the border in Hong Kong. UNKNOWN: I guess it's about half price and maybe one third very
competitive.
[03:40:00]
STEWART (voice-over): In recent months, more than 400,000 Hong Kongers have made the trip every weekend, some for the sole purpose of shopping.
This includes YouTuber Andy Tsui, who's trying to create a following based on this craze. After taking a train, clearing customs and crossing into mainland China, we caught up with him and his friends in the heart of Shenzhen.
First stop, a toy store. Next, he can duck at a popular local restaurant. He makes this trip once or twice a month.
ANDY TSUI, HONG KONG SHOPPER: Many things about food, shopping, such as buy toys, the price is very cheap and compared to Hong Kong.
UNKNOWN: See something beautiful and you just buy it.
STEWART (voice-over): The reasons behind the consumer craze are clear. The Hong Kong dollar is strong, not to mention the eagerness to explore post-pandemic. The retail rush extends beyond the mall as other shoppers savor an American brand.
STEWART: One of the biggest drivers these days is this new Costco store in Shenzhen. You can certainly get paper towels in bulk. But there's also market-specific merchandise, like these snacks for Chinese New Year.
STEWART (voice-over): What's happening here, the result of a sluggish Chinese economy, meaning fewer mainland consumers flocking to Hong Kong's luxury stores, with Hong Kong residents like Andy bringing back the tradition of cross-border bargain hunting in the opposite direction.
Marc Stewart, CNN, Shenzhen, China.
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CHURCH: Bearing witness atrocities in Darfur, Sudan, as well as widespread hunger detailed in a new report. I'll speak with the author after the break.
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CHURCH: Welcome back everyone. A new report from Refugees International is sounding the alarm about mass atrocities and starvation in Darfur, Sudan. Bearing witness is based on the accounts of refugees from the war-torn region who have fled to eastern Chad.
The humanitarian organization warns that more than 10 million people in Darfur are displaced and nearly half of them are on the brink of famine, making Sudan home to the largest displacement crisis in the world.
The report says at least 13,000 people have been killed since April in the battle between the Sudanese army and the paramilitary rapid support forces. Meanwhile, another half a million refugees have fled to already overwhelmed refugee camps in eastern Chad, and there's not enough humanitarian aid to go around.
Daniel Sullivan joins me now. He is the Director for Africa, Asia, and the Middle East at Refugees International. Thank you so much for being with us.
DANIEL SULLIVAN, DIRECTOR FOR ASIA, AFRICA, AND THE MIDDLE EAST, REFUGEES INTERNATIONAL: Thank you, a pleasure to be with you.
[03:45:00]
CHURCH: So as the war continues in Sudan, mass atrocities are again occurring in Darfur. And now your organization has released this report bearing witness atrocities and looming hunger in Darfur. What are the main findings in this report?
SULLIVAN: Yeah, that's right. This is based on a trip I did to Eastern Chad, interviewing dozens of refugees from Darfur, including some who were at the time, fleeing and just arriving on the border from a town called Ardamata, the latest massacres that were happening.
And, you know, the stories that I heard were just horrific and, you know, people being house-to-house searches, people being summarily executed, sexual assaults happening, and people being targeted because of their ethnicity being called black Africans. And it was really, for me, for somebody who worked on, at Save Darfur some 20 years ago, it was eerily reminiscent of what I heard at that time in the genocide that was happening.
So the main finding is that atrocities, mass atrocities are happening again and they're ongoing in Darfur and in other parts of Sudan and that there really is an urgent need for the international community to step in and step up pressure to stop those atrocities and to get aid in.
CHURCH: And as you said, part of this report was made up of these interviews you conducted with people just arriving from the massacre in Ardamata. What were those people telling you about war crimes, crimes against humanity and potentially genocide here?
SULLIVAN: Yeah, as I mentioned, there's, you know, echoes of the genocide from 20 years ago. You know, at that time, the infamous John Dewey, the devil on horseback, the Rapid Support Forces that have descended from them are the ones who and them and allied militias are attacking.
And they're attacking based on the ethnicity, the tribes of the people. They're -- they're asking about that identity, going house to house, burning places, you know, people telling me about people being thrown into fires. You know, men being targeted or women targeted for sexual violence,
spoke to, for example, one woman who arrived with a five-year-old and said that was the only thing that she was able to bring with her. And just countless stories like that just made clear the level of atrocities that were happening. And I should mention that, you know, 85 percent or more of the people who are arriving into Eastern Chad are women and children. So there's a clear targeting of men and huge needs in Eastern Chad.
CHURCH: And you mentioned that you want to see the world step up. So what recommendations have you suggested in this report to address the ongoing atrocities and of course the hunger crisis?
SULLIVAN: Yes, and you're right, absolutely, with the hunger crisis, you know, people telling us that, you know, we have famine on the horizon. And so much like almost 20 years ago where initially most of the deaths were happening because of violence. Eventually more of the deaths were happening because of hunger and disease and we're heading on that trajectory.
So to stop that, what we want to see is first of all, a diplomatic surge in trying to get at the root causes of this fighting. And that needs to happen in ways, for example, with the U.S. government, we're calling for the appointment of a presidential special envoy, somebody who has knowledge and relationships in the region with the key players who can really bring the attention that we need to see the level that this gravity of abuses deserves.
The second thing is to support accountability and evidence collection. There's been a fact-finding mission set up by the U.N. or authorized by the U.N., but it isn't functioning yet.
And then finally, for all those people who are suffering now, the 10 million people who have been displaced in the largest displacement crisis now in the world and the 500,000 who came across the border to Eastern Chad and hundreds of thousands of others to other countries to find ways to get aid in and to surge that aid because that's one thing, getting aid into Sudan is very difficult, but getting aid into Eastern Chad and other places where people have fled doesn't have the same barriers, yet what you found there, what we found there was a really overwhelmed and under-resourced response. So there really needs to be a surge in resources to save lives now.
CHURCH: Dan Sullivan, thank you so much for joining us. I Appreciate it.
SULLIVAN: Thank you.
CHURCH: South Africa's foreign minister says five more countries are joining the BRICS bloc. The current economic alliance includes Brazil, Russia, India, China, and South Africa. And now Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates will become members.
[03:50:09]
Argentina declined an invitation to join. The group of emerging market economies will bring together the world's biggest oil exporter, Saudi Arabia, and the biggest importer, China. Some are expecting the expanded block to gradually shift to currencies other than the U.S. dollar to conduct trade. The BRICS countries have also discussed a possible common currency.
Well coming up, the legendary pilot Amelia Earhart disappeared nearly 87 years ago. Now some explorers believe they might have figured out what happened to her plane. That's next.
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CHURCH: Welcome back everyone. Investigators are finalizing a preliminary report on the door plug that blew off a Boeing 737 MAX 9 jet while in flight almost four weeks ago. The head of the U.S. National Transportation Safety Board says the report could include what they observed after taking apart the Alaska Airlines plane's door plug in the lab. The chairperson says investigators want to make sure the report is right.
(BEGIN VIDEO CLIP)
JENNIFER HOMENDY, NATIONAL TRANSPORTATION SAFETY BOARD: It's critical in any investigation that throughout the investigation that we build that timeline so we understand what happened at certain points leading up to the event, prior to the event, during the event, afterwards to help us do our analysis and develop our recommendations.
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CHURCH: Airlines have resumed flying the MAX 9s after they were grounded shortly after the incident. Alaska Airlines says it will complete inspections of all 65 of its 737 MAX-9s by the end of this week.
A team of deep sea explorers say they may be close to answering one of the 20th century's most puzzling questions, what happened to Amelia Earhart? They believe they may have found the aviator's plane at the bottom of the Pacific Ocean. Lynda Kinkade has the story.
(BEGIN VIDEOTAPE)
UNKNOWN (voice-over): Amelia Earhart, on a globe-girdling flight with navigator Fred Noonan, took off for a hop over trackless ocean wastes and was never heard from again.
LYNDA KINKADE, CNN ANCHOR AND CORRESPONDENT (voice-over): It's one of the world's greatest mysteries. Nearly 87 years ago, American aviation pioneer Amelia Earhart was attempting to become the first female pilot to circumnavigate the globe. Her plane along with her and her navigator vanished.
On July 2nd, 1937, they departed Lae, Papua New Guinea bound for Howland Island, about 4,000 kilometers away, when their plane was lost over the Central Pacific Ocean.
The pair were nearing the end of their journey. Earheart's twin-engine Lockheed Electra was never recovered. Their remains never found.
Now, this new image may be the key to bringing some closure to Earheart's story. Pilot and real estate investor Tony Romeo of South Carolina-based company, Deep Sea Vision, led a team on a 90-day expedition to look for the lost plane in an extensive search.
The group of underwater archaeologists and marine robotics experts scanned more than 13,000 square kilometers of the ocean floor when they spotted an anomaly roughly 161 kilometers from Howland Island where Earhart was planning to refuel.
[03:33:03]
TONY ROMEO, CEO, DEEP SEA VISION: The twin vertical stabilizers in the back are very clear on the sonar image and those were very distinctive of Amelia Earhart's aircraft.
KINKADE (voice-over): They used an underwater drone with sonar mapping capability.
ROMEO: The technology that we used was a Hugen 6000. There's only a handful of them in the world. And the 6000 means 6000 meters so it can go all the way down to full ocean depth with the 6000 meters to the bottom of the ocean and then basically flies like a drone back and forth scanning the seafloor for anything interesting.
KINKADE (voice-over): Romeo and his team plan to return to the area soon to confirm that the object is in fact Earhart's plane, while also looking into the possibility of bringing it to the surface.
ROMEO: We need to go and take a look and put a camera basically on the target. We need different equipment, probably an ROV, to go down there with some arms and some pincers that can take a look at the target, take a look at how it's sitting in the soil, in the mud, on the sandy bottom of the seafloor.
KINKADE (voice-over): The fate of the legendary aviator has inspired many explorers to undertake similar pursuits without success. Now this group hopes to finally put to rest the mystery that has captivated generations what happened to Amelia Earhart and her plane.
Lynda Kinkade, CNN.
(END VIDEOTAPE)
CHURCH: If you're in the market for a new car and money is no object, we may have the deal for you. A Range Rover that once belonged to Queen Elizabeth II is up for sale. It was part of the Royal Households fleet about eight years ago. It's dark blue with ivory interior.
It comes with covert lighting and specially adapted fixed steps. And it's listed for about $285,000. The car was famously used during a state visit by former U.S. President Barack Obama and First Lady Michelle back in 2016.
A painting by Denmark's former monarch, Queen Margrethe II, will go up for auction next month. Works by the 83-year-old royal have been featured in various exhibitions, but the chance to buy one is considered rare.
The auction house in Copenhagen says the abstract artwork, inspired by the natural world, was done in 1988 and given to the head of the royal household. It's estimated to fetch 11 to $15,000 at sale. Queen Margrethe abdicated in January after a 52-year reign, handing the crown to her eldest son, Frederick.
I'm Rosemary Church. Have yourselves a wonderful day. "CNN Newsroom" continues next with Bianca Nobilo.
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