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Connect the World
EU Members Vote on Retaliatory Tariffs Against U.S.; South Korea Announces $1.3 Billion Emergency Support for Auto Industry; Germany's Far- Right Party the AFD is Excluded from the Coalition; Global Markets Extremely Volatile Amid Tariff Hikes; Israeli Soldiers Reveal Plan Behind Gaza Buffer Zone; Trump Imposes Sweeping Tariffs on Trading Partners. Aired 9-10a ET
Aired April 09, 2025 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
(COMMERCIAL BREAK)
CHRISTINA MACFARLANE, CNN HOST, CONNECT THE WORLD: This is the scene in Washington, D.C., as President Trump's trade representative is set to
testify before U.S. House Committee on Tariffs and Trade Policy. It's 09:00 a.m. on Capitol Hill and at the New York Stock Exchange, where we're
keeping our eye on futures ahead of the opening bell, it's 02:00 p.m. in London. I'm Christina Macfarlane, and this is "Connect the World". Welcome
to the show.
Global Markets facing another wild day ahead after the U.S. President slams a 104 percent levy on Chinese goods, but Beijing hits back putting its
tariffs on the U.S. up to 84 percent. European stocks sink as investors look on in horror. And there's more to come. We could soon learn the EU's
response to Washington.
Well, the stock market in New York opens in about 30 minutes from now. Let's take a look at where futures stand right now. As you can see,
obviously down almost by just over 1 percent there in the DOW. A reaction, of course, was swift in U.S. futures, reflecting our breaking news today,
and that is a global trading order that has been, frankly, completely up ended.
In the last few hours, China announcing it will raise tariffs on the United States to 84 percent and when U.S. President Donald Trump, sweeping import
levies went into place overnight. Beijing was, of course, the hardest hit. The tariff on Chinese goods is up now to 104 percent. The U.S. Treasury
Secretary spoke on Fox News a short time ago, holding the line on the White House's position.
(BEGIN VIDEO CLIP)
SCOTT BESSENT, U.S. TREASURY SECRETARY: They have the most imbalanced economy in the history of the modern world. And I can tell you that this
escalation is a loser for them, that they have some very smart economists, academicians, technocrats within their bureaucracy, and they would be
telling the leadership that we do not have the edge here. They are the surplus country that their exports to the U.S. are five times our exports
to China, so they can raise their terrors but so what?
(END VIDEO CLIP)
MACFARLANE: Well, the sharp declines we saw there in futures markets, perhaps unsurprising given all of this. However, we are still seeing
unusual volatility moves in U.S. bond markets. Now we often see investors turning to bonds in times of uncertainty, but yields on U.S. treasury bonds
are jumping as investors sell off U.S. government debt. Remember, bond yields go higher as bond prices fall. So, all the green you're seeing on
your screen here is not a good sign. In fact, it means higher borrowing rates.
Well, oil prices are tanking on the news. You can see them here, global and U.S. benchmarks both down steeply right now. And we will have more on the
reaction out of Beijing shortly. Meanwhile, keeping a close eye on Brussels, where the European Union is expected to vote very soon on
retaliatory measures against President Trump's tariffs.
After consulting with industry leaders, Reuters says the EU is expected to slap 25 percent counter tariffs on a number of U.S. imports that could
include motorcycles, poultry and other food products. And it comes as European stock markets suffer another day of heavy losses, the FTSE, DAX
and the IBEX there all down over 2 percent almost 3 percent.
And the Bank of England is warning on intense uncertainty as these tariffs fall into place. Well CNN's Melissa Bell is joining us now from Paris. And
as we said, Melissa EU voting today on how to respond after having taken their time, and who can blame them in responding to Trump's reciprocal
tariffs? Talk to us more about what we might expect.
MELISSA BELL, CNN SENIOR INTERNATIONAL CORRESPONDENT: That's right. And the first thing they're going to be voting on are, is their response to the
first round of tariffs that were on steel and aluminum. That is the first vote that we're going to get today.
But of course, remember that the European Union has been hit also, the second series of tariffs on cars. The third, of course, the so-called
reciprocal that the Europeans are now calling horizontal because they don't believe they're reciprocal at all.
Europeans very much concentrating for now on focusing on goods, as the United States House, but keeping up their sleeve, and they've made this
very clear, looking at services as well, which could hit some of the big American tech.
But for the time being, there's just a great deal of consternation here in Europe at the sort of apparent home own consumers, things like Ferraris,
European cars already hit a -- steel and aluminium tariffs and the car tariffs, but are simply now going to be to American consumers that much
more expensive to buy in the United States.
[09:05:00]
Not just Ferraris, of course, the European Union famous for its luxury goods, and I'm thinking here of champagne, by definition, of French
product. 27 million bottles were exported to the United States in 2023. They will now be that much more expensive for Americans to buy Heineken
Beer, European Beers that Americans are pretty fond of.
Already sealed -- by hit by aluminum tariffs, now more expensive to American consumers because of the 20 percent so called reciprocals. And
then there's the question of wine. It is 2.5 billion euros worth of European wine that is sent to the United States each year now subject to
that 20 percent import tariff.
And the argument could be Christina, you know OK, Americans are going to turn to American wine. But the point about the wine industry, like every
other industry, is that it is built around the idea of a tariff free world. American wines use French barrels that they import from France now
themselves subject to that 20 percent import tax.
So, there is a great deal of puzzlement, consternation, surprise here in Europe that the United States should have done that to its own businesses
and consumers first and foremost. And that is even before you consider what the response will be, both this initial response, as I said, to do with
goods, and we're likely to hear a lot more about that later on today.
But maybe later, also some of those measures that might just target services, and that could mean a whole other layer of pain for American
companies, not just big tech, but American banks for instance, there is a so called nuclear option of the anti-coercion instrument that the European
Union has threatened to wield out at some point if it needs it, that would simply target the revenue of American banks in the European Union.
I think when you think about all that, you get a better idea of all these warnings we've heard over the course of the weekend from the big American
banks and hedge funds, Christina.
MACFARLANE: Well, some pretty impressive goods you've assembled there on the banks of the of -- Melissa. I appreciate you breaking that down for us.
Thank you.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: I'm telling you; these countries are calling us up, kissing my ass. They are. They are dying
to make a deal. Please, please, sir, make a deal. I'll do anything. I'll do anything, sir.
(END VIDEO CLIP)
MACFARLANE: President Trump again reiterating how desperate he contends foreign leaders are to hammer out a trade deal. Now that his global tariff
policy is in effect, most economists still scratching their heads on the formula used to come up with them. China, now facing a whopping 104 percent
tariff on goods coming into the U.S.
Chinese quickly retaliating by increasing tariffs to 84 percent vowing to quote fight to the end of the trade war. CNN's Alayna Treene joining me now
from Washington. Alayna, China quickly retaliating against the U.S. and these increasing tariffs as we digest this information, has there been any
response from the White House to this latest move?
ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Well, we have heard from some of the president's top economic advisers this morning, Christina, including
Treasury Secretary Scott Bessent, who's really been one of the key messengers as it relates to this tariff plan.
He essentially said in an interview with Fox News that he believes in an escalating trade war between the United States and China, that the United
States will win. However, he also acknowledged, he said, it was, quote, unfortunate that the Chinese do not want to come to the table and negotiate
with the United States.
Now, of course, we know several countries they have said somewhere around 70 countries have already reached out to this administration to try and
work out deals. But China is one that we've heard really push back on that, to argue that they do not have plans to try to -- you know -- to some of
these tariffs, and that they believe that they are unjustified.
And so, I think a key question, of course, is particularly as it relates to China and Beijing, is, what is the end game here? How does the Trump
Administration believe that they will move forward? Will these tariffs be, quote, unquote permanent, as the president has referred to in the past, and
how long would that actually definition of permanent be? And what kind of negotiations could potentially arise from this, if this continues to be a
sticking point for both sides.
Now, I do want to get back to some of that sound you played earlier as well Christina, because I think it's very telling about how the president and
his team are viewing these tariffs more broadly. He is clearly revelling in the amounts of countries and foreign leaders who are knocking on his door
trying to make deals with him.
And we have some reporting that actually people from U.S. diplomats, officials, people close to President Donald Trump, have all been kind of
indicating to these different countries that they really need to think creatively about how they are going to deal with the United States.
If they can offer anything to sweep in some sort of these negotiations, anything unique that they can come up with, they should play that card.
According to our reporting, actually, some of these have nothing to do. These ideas have nothing to do with trade at all.
[09:10:00]
One of the deals that have been discussed is securing the freedom of Americans wrongfully detained abroad, committing to working with U.S. AI
companies buying more U.S. energy. The list goes on. And so, we could actually be seeing broader -- you know tailor made deals, as the White
House has referred to them, deals to try and get out of some of these tariffs, all of that, of course, going on behind the scenes here today.
MACFARLANE: Yeah, a lot going on I'm sure behind the scenes. Alayna Treene there at the White House. Thank you. Of course, one of those countries not
going cap in hand to Donald Trump is China. Quite the opposite in fact.
Let's bring in Marc Stewart, who's standing by. Marc, interesting to note, I think, as you said a couple of hours ago, that this announcement came
just two hours ahead of Wall Street opening China, raising the stakes again. Walk us through what Beijing have been saying?
MARC STEWART, CNN CORRESPONDENT: Right, Christina. Let's first talk about the timing. This happened just after seven o'clock in the evening here in
Beijing, just after seven o'clock in the morning in New York, about 2.5 hours before the markets open. This could be coincidence. This could be
something deliberate.
Will never know, but if this is a war about money, an announcement prior to the stock market opening is certainly something that could move and impact
the very volatile market in the United States. Now, China has made it very clear that it was going to fight back, fight to the end, was among the
phrases that we've heard.
And now we are seeing these additional tariffs, which will add up to 84 percent tariffs that will really hurt the heartland of America, American
farmers, the agriculture industry. China being very blunt today, saying that the U.S. escalation is a mistake upon mistake, and it is seriously
damaging the global trade environment, if you will.
China is in this fort, the long haul. That's the message that we are surmising from Beijing. Let's listen to what a government spokesperson had
to say just a few hours ago. Let's listen.
(BEGIN VIDEO CLIP)
LIN JIAN, CHINESE FOREIGN MINISTRY SPOKESPERSON: External shocks cannot alter the fundamental strength of China's economy, its stability, abundant
advantages, resilience and great potential.
(END VIDEO CLIP)
STEWART: Here's what's interesting. We're not just hearing from the government. We're not just hearing from state media. We're also seeing a
lot of response on social media. In fact, as our producer here pointed out, it's a topic that's been exploding this action by China.
I mean, among the phrases that we are hearing on social media, fight, never compromise. Some people are even cheering about the fact that this
announcement was made before the U.S. markets open.
Christina, I think the question that we have both been asking each other and talking about over the air over the last few days is, what will be the
breaking point? What will cause one side to perhaps cave in or fold? I really don't know, because, as China's defiance is so strong.
In fact, the wording that we're hearing from the government is that the United States is not being genuine to even begin talks about such a serious
matter as these trade disputes. So, the road map Christina, cloudy, murky. I'm running out of ways to describe it, but I think that the picture is
very clear.
MACFARLANE: Yeah, everything you're saying, Marc, clearly China, sensing this is a trade war that they can win. What is the end game? We just don't
know. Marc, appreciate you as always. And in the next hour, we're expecting a hearing on the Trump Administration's trade policy agenda with U.S. Trade
Representative Jamieson Greer.
Meanwhile, Democrats in the Senate are unhappy with the Trump Administration's global tariffs and want to pressure Republicans to choose
between backing the president or preventing price hikes for their constituents. CNN's Manu Raju has more on the concerns of some of those
lawmakers.
MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Donald Trump's top trade official Jamieson Greer, was answering questions from Republicans and
Democrats on the Senate Finance Committee about Trump's tariff policies. He urged patience.
He said these issues, these trade deals, would not be resolved overnight. He contended that a number of these countries, roughly 50 or so, have come
to the negotiating table seeking to lower their tariffs. But the question is, how much patience will Republicans in particular give, given that they
control both the House in the Senate?
Some of them express some skepticism over the Trump policies, and others were flat worried that if the tariff policies go into effect, particularly
in the long term, that some industries and companies could go bankrupt.
(BEGIN VIDEO CLIP)
RAJU: You seem to have concerns about some of these companies could go into bankruptcy because of this policy. Explain your concern?
SEN. RON JOHNSON (R-MN): I have those concerns. I've been expressing, of course, some time.
RAJU: Do you think that this could lead to bankruptcy?
JOHNSON: In certain businesses. That's real possibility.
SEN. THOM TILLIS (R-NC): Of course. It concerns me. I mean, my God, it's a stability issue. Businesses hate uncertainty. We got a lot of uncertainty
in business. You always come up with decisions you create one throat to choke.
[09:15:00]
I'm just trying to figure out who I should complement or who I should hold accountable?
SEN. TODD YOUNG (R-IN): Congress should play a meaningful role when it comes to developing revenue measures, whether it's taxes or tariffs. I
think the president needs broad discretion to be able to enforce whatever Congress develops and implements, and so I actually have been working with
the administration to give them more tools to implement existing tariff laws.
(END VIDEO CLIP)
RAJU: But there is a bipartisan effort in the Senate to give Congress a check on the president's tariff powers. However, that is not coming for a
vote because it's opposed by the Speaker of the House, Mike Johnson, who wants to give Trump latitude to enact these tariff policies.
And also John Thune, the Senate Majority Leader, someone who is actually skeptical of tariffs himself, a long-time supporter of free trade
agreements, but he does not want to be on the opposite of Trump on this issue, says he wants to give Trump space, and also is contending that if
they were to move forward, he doesn't see a path for it to become law, especially given the fact that Trump has threatened to veto that
legislation.
But if lawmakers begin to raise more concerns, particularly Republicans, they hear from voters who are paying more for a wide range of items,
perhaps the calculus could change. But at the moment, Trump's policy is moving ahead. Republicans are watching nervously as Democrats are out
rightly opposed. Manu Raju, CNN, Capitol Hill.
MACFARLANE: Well, South Korea is taking a different approach, from China to the tariff maelstrom. The acting president says it is a pity what is
happening, but there is hope. Our exclusive interview next.
(COMMERCIAL BREAK)
MACFARLANE: South Korea's government is throwing its auto industry a lifeline to help weather, quote, serious threats from the U.S. tariffs.
It's allotting $1.3 billion in emergency support for manufacturers to absorb the shock. South Korean stocks entering bear market territory today.
The benchmark KOSPI, closed down 1.7 percent you can see there the country's acting President Han Duck-Soo says he is hopeful a deal can be
struck with the U.S. to lower the tariffs. Explain South Korea strategy in an exclusive interview with CNN's Mike Valerie.
MIKE VALERIA, CNN CORRESPONDENT: Well, the headline here is that we now have a dramatic illustration the differences between two approaches. We
have China leading the resistance, retaliating with tariffs of its own. And now in this new interview with South Korea's Acting President, Han Duck-
Soo, we have an idea of South Korea's playbook, which is to come to the negotiating table cool collected, putting value in the strength of its
long-term alliance with the United States with the mentality that a deal can be made.
In this new interview. South Korea, side of state, we asked him, what is Seoul's strategy in Washington, D.C. listen to what he told us.
[09:20:00]
(BEGIN VIDEOTAPE)
VALERIO: So Acting President Han, what is your message to President Trump?
HAN DUCK-SOO, SOUTH KOREAN ACTING PRESIDENT: First of all, we will cooperate with the United States and President Trump to make sure that we
can find some of the solutions to arrive at the win-win situations.
VALERIO: You do anticipate that this 25 percent tariff level will not stay? That's your anticipation.
DUCK-SOO: Yeah, depending on the negotiations.
VALERIO: That's certainly your hope.
DUCK-SOO: Yes.
VALERIO: Are you optimistic? How do you feel on a gut level, these negotiations are going to go?
DUCK-SOO: About 57 countries are actually subject to that kind of tariff. So --
VALERIO: 25 percent though, that's pretty steep for friends for generations.
DUCK-SOO: Well, it's a pity, because we are evaluated in that way.
VALERIO: Yeah.
DUCK-SOO: But I think that that kind of different assessment can always happen in these kinds of situations.
VALERIO: Should friends really be treating friends like this?
DUCK-SOO: Well, friendship should be compensated by sometimes the mutual economic, financial and other dimensional aspects. You can never say that
relations between United States and Korea, because we are friends, so everything should be condoned, and we don't care what happens.
VALERIO: Yeah.
(END VIDEOTAPE)
VALERIO: Now, just a few hours after Acting President Han Duck-Soo sat down with CNN. The acting president had his first phone call, his first
communication ever with U.S. President, Donald Trump. And the president posted on Truth Social that things seem to be looking good for a deal
writing quote, we have the confines and probability of a great deal, things are looking good.
So, the real test here will be if a country like South Korea comes to the negotiating table, putting the full faith in the value of its long-standing
alliance with the U.S. How far can its tariff come down, for what it's worth, Han Duck-Soo had served as ambassador to the United States from
South Korea before the Trump years.
And also, before the Trump years, he was instrumental in getting the U.S., South Korea free trade deal over the finish line. Mike Valerio, CNN, Seoul.
MACFARLANE: Turning now to a developing story out of Germany, where the country's major centrist parties have reached a coalition deal. Pressure
has been mounting to former government as Europe's largest economy has been teetering on the brink of recession amid a global trade war.
The agreement comes after weeks of negotiations following the February federal election. The Christian Democratic Union Party led by incoming
Chancellor Friedrich Merz, won the election but failed to secure a majority. The far-right part of the AFD finished second in that election
and is excluded from the proposed coalition.
Our Fred Pleitgen has been following this from Berlin. So, details of this have been revealed in a press conference. Fred, what more are you learning?
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: They are actually being revealed right now as we speak in a press conference, we
already heard from Friedrich mouth, as you've noted, the head of the Christian Democratic Union. And also, the Designated Chancellor of Germany,
many here believe that he is going to be sworn in to office on May 7th.
And he sorts of laid out the main priorities of the new government that he is set to lead. And they essentially boil down to three things, if you
will. First and foremost, it is the economy, where the new government says that they want to lower taxes. They want to cut taxes. They in general,
want to make investment in Germany a lot easier than it has been in the past.
Also increased tax breaks, for instance, not just for larger corporations, of which, of course, Germany has the strongest economic power in Europe has
many, but also for smaller and medium sized businesses, which many people here in Germany consider to be the real backbone of Germany's economic
motor.
By the way, right now, the man that you're seeing on your screen right now is Lars Klingbeil he's the head of the Social Democratic Party of Germany,
the other coalition party that, of course, is the party of Olaf Scholz, which lost the election and has now negotiated this coalition agreement to
stay in a government.
So, the economy is definitely the first thing. And you're absolutely right, Christina, to say the country is not only actually teetering on the brink
of a recession, it has been in recession for considerable amount of time already, the past two years, and will probably be in one, again this year
as well, especially with what's going on in the United States.
The second thing, and this is a huge topic, and was a huge topic in the German elections, is migration, where the new government, or the incoming
government, has decided that it will make it tougher to come to Germany. It will make seeking asylum in Germany a lot tougher.
[09:25:00]
It wants to implement border checks on Germany's outside borders, which is a novel thing, because, of course, Germany is in the Schengen area, and
therefore there shouldn't be any border checks on those borders. But they have said that the migration crisis is such in Germany right now that that
is something that they are going to do.
And then, of course, the big thing also is German defense and security. And therefore, the first time, Germany is going to get a National Security
Council, which will be inside the German Chancellor. But the most important thing is that the German military is going to receive a considerable amount
of funding.
One of the things that those who are in power now in Germany have already done before the government even came into power, is they've changed the
German constitution to make sure that Germany can take on more debt in order to be able to pay more for defense. That, of course, in direct
reaction to the war in Ukraine, to Russia's military buildup as well.
And Russian military becoming bigger, but of course, also in reaction to the Trump Administration and its threats not to be there for European
defense in the way that it has been before. In total, the Social Democrats and the Christian Democratic Union, the Conservative Party led by Friedrich
Merz, say that they believe that they can bring Germany back on the right economic track.
As you've also stated very correctly, more radical political forces have been taking root here in Germany, with a major poll that actually came out
today for the first time showing the far-right Alternative for Germany to be the strongest political force if elections were to be held on this day,
which, of course, they are not. A new government right now is forming that could then be sworn in at the beginning of May, Christina.
MACFARLANE: Yeah, a lot for this new coalition to balance there. Fred Pleitgen, live from Berlin. Thanks, Fred. Well, let's get you up to speed
on some of the other stories that are on our radar right now. Rescue workers are frantically searching the rubble for survivors after the roof
of an iconic nightclub in the Dominican Republic collapsed early Tuesday.
At least 113 people, including two former major league baseball players were killed. CNN has learned Merengue Singer Rubby Perez who was performing
when the roof caved in is among the dead. Well Ukrainian President Volodymyr Zelenskyy says two Chinese nationals fighting in the Russian army
have been captured.
He said it happened in the Donetsk region in Eastern Ukraine. China says it's verifying the situation with Ukraine. Beijing has consistently denied
having any involvement in the war. And a federal judge has ruled a White House ban on the Associated Press is unconstitutional.
The AP was denied access to presidential events as a punishment for refusing to change the Gulf of Mexico to the Gulf of America in its
reporting. Trump Administration has a week to appeal. All right, still to come, stock markets are looking for direction after China announced huge
tariffs on U.S. goods and we are minutes away from the opening bell on Wall Street. Stay with us.
(COMMERCIAL BREAK)
[09:30:00]
MACFARLANE: U.S. markets are open, and you can see the U.S. shares, the DOW and the S&P 500 currently down the NASDAQ up in the green for now. This
after a very volatile day after we mentioned China stepped up its response to U.S. tariffs, pushing its tariffs on U.S. goods now up to 84 percent
overnight.
The U.S. tariff of 104 percent on Chinese imports went into effect, even as markets shake and confidence crumbles. The president claims his plan is
working and drawing trade concessions from other countries. Just look at the Asian stock markets, which closed and China revealed its latest
response.
The picture is pretty mixed. Many businesses people have reacted with dismay to the trade war. We heard from billionaire Bill Ackman, a vocal
support of President Trump posting on X, our stock market is down. Bond yields are up and the dollar is declining. These are not the markers of
successful policy.
I'm receiving an increasing number of emails and texts from small businesses, people I do business with or have invested in, expressing fear
that they will not be able to pass on their increased cost to their customers and will suffer severely negative consequences. Well, joining me
now from Bern at Switzerland is Cornelia Meyer.
She's Chairman and Chief Economist at LBV Asset Management. Thank you so much for your time. As we -- you know have just seen there the opening on
Wall Street, a very mixed picture. In fact, it's kind of been a mixed picture all day after that massive shock of retaliation from China
announced just a couple of hours ago.
Tactically announced, actually, two hours ahead of opening on Wall Street. I just first of all want to get your reaction to this escalating trade war
we are seeing between the United States and China, where it's all going to lead.
CORNELIA MEYER, CHAIRMAN AND CHIEF ECONOMIST AT LBV ASSET MANAGEMENT: Well, it's not going to lead to a happy place, because, as you see, stock markets
are reacting. And what really concerns me is the absolute volatility that we're seeing the VIX is you -- that is out of bounds, the Volatility Index
is out of bounds.
And that is no good, investors and participants in the economy need stability. What we see is, I think, goes well -- beyond just some trade
war. It is also a realignment of the global architecture, trading architecture, which you know, has served as well over the -- ever since the
Second World War.
MACFARLANE: Yeah, and I want to talk about sort of reorientation, as it's being called. But first, we just heard a comment there from Bill Ackman, a
close ally of Trump, breaking ranks once again, to raise the alarm that there are red flags happening here in the market. Bond yields are up.
There's been a drop in the dollar.
MEYER: Yeah.
MACFARLANE: There's a drop in commodities. How much of a concern, for those of us who don't quite understand the intricacies of that? How much of a
concern is that, particularly as it relates to the bond market?
MEYER: Well, it certainly, it is a big concern, and let's not forget how the U.S. has a huge twin deficit. So, what's happened in the -- what's
happening in the bond market, what's happening with treasury and treasury yields is very important. So, yes, that should be a concern.
And, you know, Bill Ackman is not alone. Ray Dalio has said yesterday, I think. Another, you know, big investor has said yesterday, iconic investor,
don't this is not just about a tariff. This is about a geo political, geo economic realignment of the world as we know it.
And let's not forget, you know, globalization took something like 40 years in incremental steps to get where we are now. And you can't that, it's not
a light switch. If you try to undo it overnight, there will be people suffering. There will be economy suffering.
MACFARLANE: I know, Cornelia, you're a bit of an oil expert.
[09:35:00]
I don't know if we have oil stocks that we can show on our screens, but we know that the price of oil has continued to fall today, the lowest point
actually we're reaching now since 2021.
MEYER: Yeah.
MACFARLANE: How concerning is that as we weigh the likelihood of a global recession? Because I'm seeing some economists predict that we could see it
as soon as this quarter.
MEYER: Well, absolutely. And you know, oil will move with the macroeconomics, oil will go up when we think, you know, the economics go --
the economies of the world go gangbusters. It will go down, if we look at the recession. On top of that we had, and this was long overdue --
unwinding some of its 2.2 million barrels a day of voluntary cuts that they had because the oil price was always teetering very low.
So, I think this is very bad. You look at OPEC's monthly oil market report last month in March, where they said they think the oil demand is going to
grow 1.4 million barrels a day this year. I don't think it will grow that much if we really go into a global recession.
MACFARLANE: And you're talking about, you know, how all of this is going to contribute to the complete realignment of markets globally, of industries
globally, how much reorientation are you seeing already in supply chains from the likes of automakers, computer makers and how quickly really do you
expect industries can rejig their global supplies in this climate, in real chain, in real time?
MEYER: Well, the problem is it's not a light switch, you know, especially when you look at tech companies. This is not the -- these are very highly
specialized factories. This is not -- you're not talking about diaper factories that you can just put up. These are highly specialized factories.
So, this will take time, but what we'll see in the meantime is a redirection of trade flows. You know, a lot of the Chinese trade flows that
were going to the U.S., flooding the Walmarts and, you know, putting bringing iPhones to the U.S. They will probably now go to Europe or other
sort of affluent, semi affluent markets.
So, what you always see when you have these realignments, trade flows will realign, or will rebalance and then over the longer term, we will see a
realignment of supply chains. But again, it took 30 to 40 years to get the integrated supply chains where they are. They're not going to -- we can't
change them overnight.
MACFARLANE: I mean, that is a fascinating point, isn't it? I mean, it's taking decades really in the making, for that type of -- those type of
moves to happen.
MEYER: Yeah.
MACFARLANE: Cornelia Meyer, we really appreciate you being on with us just as we see this opening bell, and we'll be back in touch again, I'm sure, in
no time at all. Thank you. Now a new volley or in the global trade war from Europe. A short time ago, European Union members states voting in favor of
their first counter measures against President Trump's tariffs.
In a statement, the EU have said the new duties will start on April 15. Now although it did not provide details on the new rates. It also noted the
counter measures could be suspended at any time, should the U.S. come to a fair agreement through negotiations. We'll get to the details from Anna
Stewart live here in London in just a few minutes.
Now, it's a policy, Israel has never officially acknowledged. Its military has transformed every bit of territory in Gaza within a kilometer of the
Israeli border into a wasteland. IDF soldiers who were deployed to the enclave are revealing how the military systematically carried out the
destruction of civilian infrastructure to create the buffer zone.
The IDF says these actions are essential in order to prevent Hamas and other terrorist organizations from operating in the area. CNN's Jeremy
Diamond has this report.
(BEGIN VIDEOTAPE)
JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT (voice-over): Inside Gaza swathe of land closest to the Israeli border have been turned into a
wasteland. Nearly every building within about a half a mile of the border fence has been destroyed. We filmed this footage a year ago while
demolitions were still ongoing.
Over time, the Israeli military has raised about 22 square miles of Palestinian land, creating a buffer zone on about 16 percent of Gaza's
territory. It is a no-go zone for Palestinians, some of whom have been killed after setting foot inside the unmarked perimeter. Now for the first
time, an Israeli soldier sat down with us to describe how the military systematically destroyed civilian infrastructure to create this buffer
zone.
"SOLDIER A", ISREAL DEFENSE FORCES: Some of them, the buildings were destroyed completely, and some were still standing and our job was to make
more of the first kind.
[09:40:00]
DIAMOND: But the fact that there were still building standing meant that the mission wasn't done.
"SOLDIER A": Yeah, and we destroyed them one by one in a very methodical fashion, area by area.
DIAMOND (voice-over): A Sergeant First Class in the 5th Infantry Brigade. He was called up to reserve duty on October 7th, and was later deployed
here in the industrial zone of Gaza City's Shejaiya neighborhood, protecting combat engineers as they bulldoze buildings and rigged others to
explode.
We've blurred his face and changed his voice because he risks reprisals for speaking out about a policy the Israeli military has never officially
acknowledged.
DIAMOND: Was it clear to you that this was not the actions of one commander or one unit. "SOLDIER A": Oh definitely, definitely. I know other units
were doing the same up north and then down south. I knew it came from Harper High.
DIAMOND: What did they tell you about the mission to raise these buildings and establish this security zone?
"SOLDIER A": One was that, as a lesson from October 7th. We're going to have a larger buffer zone larger than before, and the other was that on
October 7th, this industrial zone was used as a launching --
DIAMOND (voice-over): Over the course of the war, this one-time, economic hub was flattened. This video, which CNN geo located, shows the destruction
of Gaza's only Coca Cola factory. But it's not just factories in the town of Khuza'a, hundreds of homes were leveled with a clear zone of destruction
spanning about one kilometer from the border.
Residential buildings, green houses, sheds, factories, you name it, it needs to be flat. That's the order. A sergeant major who served in Khuza'a
said, except for the UNRWA school and that small water facility, the directive was nothing left. He is one of a dozen Israeli soldiers who
describe the demolitions and enforcement of the buffer zone to breaking the silence.
An Israeli Watchdog group that verifies and publishes soldiers' testimonials. Some also described how the buffer zone has been turned into
a kill zone for Palestinians. A Sergeant First Class in the armored corps described the rules of engagement, adult, male kill. Shoot to kill.
For women and children, shoot to drive away. People were incriminated for having bags in their hands. A warrant officer in the IDF said, guy showed
up with a bag? Incriminated terrorists. I believe they came to pick Hubeiza, an edible plant, but the army says no, they're hiding. Boom.
JANINA DILL, CO-DIRECTOR OF OXFORD INSTITUTE FOR ETHICS AT LAW AND ARMED CONFLICT: A kill zone is in essence, the announcement of a party to the war
that they won't take physical precautions, that they won't verify the status of an individual before attacking them, and that definitely violates
international law.
DIAMOND: Is this kind of widespread destruction of civilian property to create a buffer zone, legal under international law?
DILL: Needs to be a legitimate military objective and operational objective, and the only way to achieve it would be to destroy the civilian
property. And at that scale, that's simply not quite plausible. If there is no military necessity, then that fulfills the criteria for a war crime.
DIAMOND (voice-over): The Israeli military did not respond to CNN's requests for comment. More than 6200 Palestinian buildings have been
damaged or destroyed within one kilometer of the Gaza border, according to satellite analysis, including here in Al Bureij, where homes and acres of
farmland were destroyed.
For 40 years, Abdul Aziz al-Nabahin grew olives, oranges and guavas on that land, but that has all been ripped away from him.
ABDUL AZIZ AL-NABAHIN, HOME DESTROYED IN OPERATION: When they announced the 40-day truce, we went back. We found the house destroyed. The trees were
bulldozed.
DIAMOND (voice-over): But he has lost so much more. Abdul Aziz says his son Mahmoud (ph) went to collect fire wood near their home when he was shelled
by an Israeli tank and killed. The Israeli military did not respond to CNN's requests for comment.
AL-NABAHIN: They knew they were only collecting wood, not resisting or fighting, just a cart with wood clearly visible. Still, they were targeted.
The Israelis did this intentionally.
DIAMOND (voice-over): Even now he says they will kill anyone who goes there. Jeremy Diamond, CNN, Jerusalem.
(END VIDEOTAPE)
MACFARLANE: Important report there from Jeremy. And you are watching "Connect the World". There's more news ahead. Stay with us after this quick
break.
(COMMERCIAL BREAK)
[09:45:00]
MACFARLANE: "Visionaries" is a CNN's series, highlighting trail blazers and leaders in sport, tech, business and the arts and in the world of women's
sports. Few have enjoyed the last year quite like Ilona Maher, but the message she puts out resonates, beyond sport, and I was very lucky to spend
a bit of time with Ilona in her hometown of Vermont.
(BEGIN VIDEOTAPE)
MACFARLANE (voice-over): In our hyper opinionated social media age, it takes confidence to block out the noise and share your whole self.
ILONA MAHER, OLYMPIC RUGBY MEDALIST: So, I was talking to an older woman yesterday, and I was like, oh, you should watch our games. I'm number two.
I'm the really big girl out there. And she was like, no, no, you shouldn't call yourself big. You're not big. You're beautiful. And I was like, no,
no, I am big.
And what I think is cool is that I've now taken control of that word, and I love being called big, and I call myself big, and I call -- my teammates
call me big, and I don't mind it.
MACFARLANE (voice-over): It's exactly the kind of message millions of fans have come to count on from Ilona Maher, an Olympic medalist, professional
rugby athlete, social media super star, brand ambassador, SI swimsuit cover model, Dancing with the Stars, runner up. All of that within the last year
alone, as Ilona, has become the face of her sport, and so much more.
MAHER: As the Olympics officials are today, I want you to take a look at all the different body types on display. All body types matter. All body
tapes are worthy.
MACFARLANE (voice-over): While her popularity sky rocketed since the Paris Games last summer, becoming the most followed rugby player in the world.
The work started long before then. It began here in Burlington, Vermont.
MACFARLANE: Obviously, you grew up here. What was your childhood like? What was that experience like?
MAHER: Well, Burlington is an amazing place. I went to a very small Catholic school right by here called St. Joe's. We were just talking about
it on the drive here. I graduated in a class of nine from eighth grade. And so, I think there's a great sense of community here because of my Catholic
school, because of the sports that I played.
I went to college outside of the state. But still, I always feel like when I come back here, I have you know, whether it's family, some friends, but
still that sense here.
MACFARLANE: And you return now, not just as an Olympic bronze medalist, but as a social media sensation, the face of women's rugby. I would actually
argue all of rugby. What does it feel like to have become America's sweetheart?
MAHER: I love when people call me that, because I feel like I'm maybe not the image people would have of a sweetheart in some senses of the word of
the phrase, but I'm honored that I am that way. It's been so cool to get all these under my belt, whether it's, you know, Sports Illustrated,
Dancing with the Stars.
I think something that I really stress is that this isn't doesn't feel new or different for me. I mean, since Tokyo Olympics, I've been posting
consistently. This was kind of the trajectory I wanted it to take. I knew that in my sport, I wouldn't just get to play my sport and be happy with
it.
I knew that I had to do more to may have a comfortable life for myself, to spread my game, to spread rugby in general. So, for years now, I've been
leading up to this point hoping to do what I have done. And so, I'm so happy that this worked out like it did.
(END VIDEOTAPE)
MACFARLANE: And you can watch the full interview with the amazing Ilona Maher on "Visionaries" later this month on CNN. We're back after this quick
break. Stay with us.
(COMMERCIAL BREAK)
[09:50:00]
MACFARLANE: In the last hour, we have just had plans from the European Union to impose tariffs on the U.S. They are in response to President
Donald Trump's tariffs on EU steel and aluminum exports. Anna Stewart is here to tell us more about it. The you have chosen to take their time in
responding. Now we have it. What more do we know.
ANNA STEWART, CNN CORRESPONDENT: The EU always take their time, Christina, and this is exactly what we were expecting. So, a retaliation, but only
actually to the very first tranche of tariff, which lost in the mist of time, sometime in March, aluminum and steel tariffs as such, and we're
still waiting for the full list and exactly how much this will total.
It will only be a fraction of the overall tariffs that have been implemented by the U.S., which in total, right now is that $420 billion, so
that's around 70 percent of all EU exports. It's vast. So, we're expecting more retaliation. The first round will be implemented from the EU on U.S.
goods on April 15. The second set kicks in on May 15.
MACFARLANE: So, this is kind of the opening salvo, and essentially puts the ball slightly back in America's court, right? What they're saying here is
that these counter measures can be suspended at any time. Should the U.S. agree to a fair and balanced, negotiated outcome?
STEWART: The EU has been banging the drum for some time now that they would like to negotiate.
MACFARLANE: Yes.
STEWART: They will retaliate if they have to, but obviously the first option for them is to negotiate, and they have tried. They have offered
zero for zero tariffs on industrial goods and on cars. It's gone absolutely nowhere at this stage.
MACFARLANE: Oh well, and we're just seeing that the European markets down again, that after that bombshell announcement from China on retaliation
this morning. And we're also seeing oil prices down quite significantly, and I believe the lowest since 2021 why is that significant?
STEWART: Yeah, let's have a look at oil prices. We are seeing them incredibly low levels. Brent at $60 WTI below $60 mark at this stage. Now
this is feeding into the broader story of risks of a global recession, and whether there will be as much demand for oil, will there be as much
manufacturing and so on, looking ahead longer term.
And we're having so many warnings now, not just about a U.S. recession, but about a global recession, and that all feeds into the oil price. Of course,
many people will be quite happy with cheaper oil, not least someone United States, President Donald Trump, who owns this as something of a victory,
but the sort of reasons and causes feeding into it are not really good.
MACFARLANE: Now, I hate to pivot to this if you're not prepared, but I'm going to ask every analyst I have on today about bond yields which are up,
which is not a good sign, and that is directly, as I understand it could impact the likes of mortgages, credit ratings, ability to borrow. Just give
us the broad picture on what that means for the consumer.
STEWART: Well, and also, what is so interesting is we're seeing 10-year bond yields in the U.S. being sold off, which means yields are going up.
This is interesting because this is usually a safe haven asset.
[09:55:00]
MACFARLANE: Yeah.
STEWART: This is the sort of asset you might see actually doing better than other assets, because you think, well, we're having, we're in a storm right
now in the markets, but longer term, looking at a longer-term trajectory, things will be OK. We're not seeing that. It's questioning for investors
whether or not America is sort of the safe haven, whether it is the backstop.
So, this is why it is so interesting. And yes, for the consumer, of course, no one wants to see this. This is raising costs for borrowing for the U.S.
This is absolutely not what this Trump Administration wants.
MACFARLANE: Yeah, and other industries, other trading blocks, looking for those safe havens as they clearly not being felt in the U.S. right now.
Anna, thank you. We will have more on the market's madness in the next hour of "Connect the World". I'll be back with more at the top of the hour.
(COMMERCIAL BREAK)
END
