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First Move with Julia Chatterley
The Olympics Opening Ceremony is Underway in Tokyo; The F.B.I. is Warning that Hackers could be Targeting the Games; Snap Stocks Surges after Revenue more than Doubles. Aired 9-10a ET
Aired July 23, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN BUSINESS ANCHOR: Live from New York, I'm Richard Quest. This is FIRST MOVE and here is your need to know.
The Olympics are underway. The opening ceremony is underway in Tokyo.
The cyber threat. The F.B.I. is warning that hackers could be targeting the Games.
And snapping up shares -- literally. Snap stocks surges after revenue more than doubles.
It's Friday. For the last time this week, let's make a move.
As we prepare for the New York trading day, we begin on Wall Street and the markets in the U.S. are set to open firmly in the green. You see the
numbers there, across the board, all of the triple stack. On the final trading day of the week, stocks made small gains on Thursday despite a
worse week than expected and a reading on jobless claims.
An up day today would make four in a row, and that puts Monday's fears over the spread of the delta variant truly in the rearview mirror.
The main European indices are also enjoying some gains, the best of the day seems to be in Paris. In the Eurozone, business activity grew at its
fastest pace in more than two decades in July. The Purchasing Managers Index rose to 60.6 head of expectations. Any number as you know, above 50
And back in Asia Pacific, no trading in Tokyo. There's a holiday there, understandably, for the opening of the Olympic Games. The Hang Seng was the
And now straight right to the drivers.
In Tokyo, where the opening ceremony of the Olympic Games is underway in the National Stadium, the parade of athletes is taking place set to music
from famous Japanese video games. Selina Wang is in Tokyo, joins me now.
The opening is underway, and there are still some protests, I believe.
SELINA WANG, CNN CORRESPONDENT: There are. It is just starting to quiet down, but I think it's going to pick up any moment now. They have been
chanting for hours outside of the National Stadium to cancel The Olympics. There is still a strong feeling among many people in Japan that these Games
are putting their health and lives at risk, and that this shouldn't be held during a COVID-19 pandemic, when around just 20 percent of the Japanese
population is fully vaccinated and Tokyo is in a state of emergency.
But Richard, I talked to some bystanders and some of them just wanted to get as close to the Olympic action as they could. One woman told me she
bought dozens of tickets and she is devastated that she can't get into any of them. Another couple told me that they hope that these Games are
successful, even though they have been riddled with problems.
QUEST: The way in which they are taking place, the empty stadia, the great fear, of course over catching COVID and having to sit out your
lifetime ambition of attending an Olympic Games, has that destroyed essentially what atmosphere there might have been?
WANG: I think at the beginning, it was quite somber. There was the Japanese National Anthem, and then the announcer asked everyone to take a
moment of silence to remember those who have died during the COVID-19 pandemic, also to remember, as you say, the athletes who could not
participate because of COVID-19, a growing list of athletes whose dreams are getting derailed because of the pandemic and who are losing that one
shot, this big moment because of a positive COVID-19 test.
But as you see those athletes march in, it's just incredible to remember that during this pandemic, they are able to bring together all of these
athletes from more than 200 countries around the world and you could see the excitement and cheering on people's faces even through their masks, but
of course, subdued by the fact that there are no spectators, hardly any, just 950 VIPs allowed in a 68,000 capacity venue.
And Richard, I was messaging our producer who is in the stadium right now and she said it doesn't really feel like an Olympic opening ceremony. It
doesn't have that excitement and energy you would expect.
QUEST: Now, hopefully the sport will be good. Selina, you'll be there of course for the next two weeks helping us understand what's happening. We
QUEST: Tokyo is also on high alert over cybersecurity. In the United States, the F.B.I. has issued a warning about potential hacking against the
Summer Games. Alex Marquardt is with me from Washington.
Alex, good grief. If COVID wasn't enough, empty stadia, athletes catching COVID. Now, cybersecurity worries, what's it about?
ALEX MARQUARDT, CNN SENIOR NATIONAL SECURITY CORRESPONDENT: Yes, Richard. I mean, there are always security concerns around every single
Olympics. But as one expert put it to me, in the past, we might have been worried about terror attacks at the Games. Now, it really is cyberattacks.
It's a sign of the times.
There are plenty of reasons why there is this concern, cyberattacks are on the rise, both from criminals and those backed by nation states to either
spy or cause chaos. And yet again, Richard, the primary suspect here is going to be Russia, which carried out attacks during the last two Games and
because of a doping scandal, this year, will not be allowed to fly their flag.
MARQUARDT (voice over): It's a global spectacle unlike any other. For a few weeks, every two years, billions around the world tune in to watch
their countries compete for medals and national glory. That's what makes it such a ripe target for hackers.
SETH JONES, SENIOR VICE PRESIDENT, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: I am very confident that there will be some kind of cyberattack
against these games. It may not be publicly visible, but you can bet that it is going to happen. That's the world we live in today.
MARQUARDT (voice over): The F.B.I. warned this week that malicious activity could disrupt multiple functions, including media broadcasting
environments, hospitality, transit, ticketing, or security. There is currently no known threat, but with no fans in the stands because of COVID,
the most obvious target is how we watch.
BENJAMIN READ, SENIOR MANAGER FOR CYBER ESPIONAGE ANALYSIS, FIREEYE: With everything being remote and there being so few people in person, the
place where a disruption would be most noticed would be in the broadcast.
MARQUARDT (voice over): And when it comes to potential attackers, right at the top of the list is the country that has been banned -- Russia, after
a doping scandal got them barred from flying their flag and singing their anthem for the next two Olympics.
JONES: Russian leaders including Vladimir Putin are still extremely angry about the way they've been treated. They've called it unfair.
MARQUARDT (voice over): Russia has taken out their anger on the Games before. Three years ago, Russian military hackers carried out an attack
before the opening ceremony, targeting athletes, officials, and citizens in the host country, South Korea.
They took down the Games' website and deleted data from thousands of computers. They also tried to pretend they were North Koreans.
JOHN DEMERS, ASSISTANT ATTORNEY GENERAL, NATIONAL SECURITY DIVISION: Their cyberattack combined the emotional maturity of a petulant child with
the resources of a nation state.
MARQUARDT (voice over): In 2016, after Russia was accused of a systematic doping program, Russian hackers breached the World Anti-Doping
Agency, the medical records of Serena Williams and Simone Biles were hacked and released, along with those of around 250 other athletes from almost 30
After the Tokyo Games were postponed last year, the U.K. accused Russia of spying on Tokyo Olympics officials and organizations. Experts say, there is
no reason they won't do something again.
MARQUARDT (on camera): What have you seen in the way of indications that something may happen?
READ: We've seen sort of Russian espionage groups be interested in Japan over the last few years, they definitely still have the people that work
for them. And if they've made the decision that this is something they want to do, they're able to do it.
QUEST: And I guess, Alex, what we now do is watch and wait for that sort of evidence because if it's a publicity type of look what we can do versus
we're going to steal information that we can use.
MARQUARDT: It really is a wait and see situation, Richard. In 2018 in Pyeongchang, these attacks happened fairly early on. So, of course now with
the opening ceremony happening, we are watching very closely.
And it is important as you say that there are two types of attacks, those that can be stealthy, those that are espionage, often nation states
carrying out that kind of attack to spy and gather information, then, there are the ones that are more disruptive. It could be carried out by a
country, it could also be carried out by criminal groups looking simply for attention.
But experts say, we should not underestimate the extent to which Russia has been scorned because of the restrictions being put on them in this Games,
they are not allowed to use their flag. They are not allowed to use their National Anthem if their athletes win any gold medals.
As you know, Richard, hell hath no fury like Vladimir Putin scorned.
QUEST: Nicely put. Alex Marquardt. Thank you, sir.
Shares of the social media companies are surging in the premarket. Investors are rewarding Twitter and Snap for beating expectations for
earnings in the last quarter. Twitter and Snap, Snap particularly, good news for me.
Now, you will remember I bought Snap shares. We wanted to see how it did and I bought it at the IPO in 2017. I bought at what was then the peak
before it fell back and languished $28.16. I nursed massive losses and you laughed at me.
QUEST: Who is laughing now? $74.00 a share, Paul La Monica. Guru La Monica is with me. You were one of those Mr. La Monica that -- you didn't
openly laugh, you just sniggered, didn't you?
PAUL LA MONICA, CNN BUSINESS REPORTER: I was skeptical, dubious. But Richard, Snapchat is proving with this stellar user growth and huge jump in
revenue, obviously ad revenue, that this is a company that can go toe to toe with Facebook or Instagram and TikTok.
There is a ton of competition in social media for all those eyeballs of millennials and Gen Z users and Snapchat, to give them credit, they have
really turned things around and have increased engagement on the platform as well, which is what advertisers want obviously.
QUEST: Is this Facebook's own goal in the sense of all the bad publicity about Facebook, Instagram, and everything that's going on, or is this the
others doing well? You know what I'm saying. Is it one bad, one good?
LA MONICA: No, I think this is kind of the proverbial rising tide lifting all boats, because you look at Twitter as well. Twitter is another
company that, you know, I have often, you know, criticized for being really nothing more than, you know, a news wire on steroids. That it is really
something for hardcore, political, and sports news junkies and doesn't really capture, you know or have any -- you know, doesn't resonate with the
average social media user. But Twitter has found a way in the post-Trump world to continue to attract more users. The user growth is slower than
that of Snapchat's, but it is still growing pretty dramatically and they are getting nice jumps in ad revenue as well.
So, I think the Twitter and Snapchat results combined with all of the success that TikTok has had and Facebook, remember, the stock has soared
this year. This is a company that I think, the average person loves to hate because it always seems that Zuckerberg is saying something silly and
putting a foot in his mouth, but the stock continues to rise because the revenue and earnings are spectacular for not just Facebook, but WhatsApp
and Instagram and all the other properties they have.
QUEST: You make the valid point. Ignore the man and concentrate on the numbers. Thank you, Paul La Monica, Guru La Monica, I appreciate it.
Britain has added thousands of food industry workers to the list of those people who are exempt from self-isolation rules to try to prevent critical
shortages. It is the so-called pingdemic in the U.K. The delta variant, now it is causing a surge in cases, COVID, and as more people get positive
results, others are being pinged by the government's test and trace app.
In the last week, more than a half a million people were told to self- isolate by the app after coming into close contact. That includes lorry drivers, shop workers, and those in food plants. Also caught up at the
moment, the Prime Minister, the Finance Minister, Chancellor, and the leader of the opposition party.
Scott McLean is with me. A couple of quick points here Scott. The app is working as it is supposed to do, isn't it? This isn't a case of technology
gone haywire. This is about the number of new cases.
SCOTT MCLEAN, CNN CORRESPONDENT: Yes, you're absolutely right. The app essentially works on a Bluetooth signal, Richard. And so if you're within
two meters of someone for 15 minutes about, the app will ping you and tell you that you'll have to self-isolate if that person went on to test
positive for the virus.
Now, there is a distinction to be made that caused some controversy in this country a few days ago, which is the fact that one Minister pointed out the
legalities of all this, and that is that if you get pinged on your phone by the app telling you to self-isolate, of course, the government wants you to
self-isolate. Downing Street says you should self-isolate.
But the reality is, you are not legally required to actually self-regulate. And so that Minister said, look, you should use your best judgment in that
You are however required to legally self-isolate if you were actually contacted by the government by phone, the contact tracers, if they tell you
that you have to self-isolate because you were an official listed contact of somebody who tested positive.
So, there's a lot of confusion around this policy. But the bottom line to answer your question, Richard, is the app works fine.
QUEST: Okay, so it's more cases creating more pings. But the reason that the shop store shelves are empty is what?
MCLEAN: Well, first, a little bit of context. I went to the grocery store last night, the shelves there were well stocked. And so this is not a
universal issue across England, across the U.K. by any stretch of the imagination, but it is happening in some places.
The estimate from the government is that about 15 maybe 20 percent of people who work in the retail manufacturing or the food retail sector may
be affected by this. And obviously, those numbers are not evenly distributed.
So, you're going to have some areas with higher numbers, and that's maybe where you're starting to see these shortages. And so the government had to
do something, they had to respond because obviously, you can't have food shortages in any parts of the country. But they were careful not to make
this a blanket exemption because obviously, that would involve a lot of people and kind of make the whole pingdemic, the whole test and trace or
the test and trace system a bit of a sham.
And so they carefully tailored it now that they say about 10,000 people will be eligible for this exemption in about 500 or so key sites, but it's
only in certain circumstances and it certainly is not everyone.
QUEST: Scott, thank you.
These are the other stories making headlines around the world today. Indonesia has reported more than 1,500 COVID deaths in a single day. It is
the first time that that number has been -- horrific number -- has been reached. The number of new infections is up to almost 50,000, pushing
hospitals beyond their capacity. Indonesia's neighbors, including Malaysia, Thailand, and Myanmar are also seeing record case numbers.
Heavy rain and floods have now killed at least 51 people in a central Chinese city. Nearly 400,000 residents have been forced to leave their
homes and rescue efforts are still underway. Workers have been using inflatable boats, makeshift rafts, even construction trucks to get people
After threatening to put Australia's Great Barrier Reef on the endangered list, the UNESCO now says it won't; instead, it is asking for report on
efforts to conserve the reef after Australia protested against the proposal.
Anna Coren is with us for more on this. Is this a case of Australia managed to scupper the act of doing it? Did they put so much political pressure on
lobbying that the UNESCO decided, oh, it's not worth the bother?
ANNA COREN, CNN INTERNATIONAL CORRESPONDENT Richard, it was a fierce lobbying campaign, which is downright disgraceful. I mean, the Australian
Federal Minister used a government playing on an eight-day lobbying trip virtually around the world, press the flesh, and to make her case to these
Apparently Bahrain and Saudi Arabia, you know, huge oil producers, some of the first to sign on and agree with Australia's stance. Look, it's not
exactly UNESCO that ruled against the listing. UNESCO wanted the listing. They were the ones that were saying the reef is under threat from climate
change. It was the World Heritage Committee made up of these 21 countries that Australia managed to win over.
As you say, UNESCO will now have to travel out to the reef, conduct a mission, and the Australian government is going to have to come up with a
report, a plan, you know, show what they are doing to conserve and preserve this natural wonder.
This is the largest coral reef in the world. This is the largest living infrastructure on the planet. You can see it from space. But this decision
not to list it as endangered, which really was a global call for action to save this incredibly delicate, fragile ecosystem, really, it's like the
Amazon of the ocean. Now, that that is not in play, you know, I've spoken to scientists throughout the day who are beyond devastated, Richard.
They say that this is catastrophic for the reef. One scientist said to me that the reef has been in decline for years and will continue to decline,
that this should be a destination that if you can get there now, you should go because it will not be there for much longer, which is just tragic when
you think about it.
And the reason Australia, Richard, has fought so hard against this being listed as endangered is because it is one of, you know, it's a large
producer of coal and gas. It is the third largest exporter of fossil fuels.
Australia is one of the largest carbon emitters per capita in the world.
As far as its climate change policies go, they are virtually nonexistent. This government, the conservative government in power now, Richard, you
know, it didn't believe in climate change until the Australian bushfires of last year.
So, really, this is a win for Australia and an absolute tragedy for the Great Barrier Reef.
QUEST: Anna Coren, thank you.
Still to come on FIRST MOVE, the company that wants to transform Africa's response to COVID. The CEO of Africa's Biovac will be with us, and crunch
time in more ways than one, we hear from the head of Crunch Fitness who says the market is now booming.
QUEST: A breakthrough deal for Africa is how it is being described. Pfizer and the South African firm, Biovac are partnering to produce up to a
hundred million doses of Pfizer's vaccine. This will be per year. It is the first time that Pfizer shots to be made in Africa. The deal is critical to
ramping up the continent's vaccination drive. Only one and a half percent of Africa's population is fully vaccinated.
Dr. Morena Makhoana is the CEO of The Biovac Institute, and joins me now. Doctor, thank you. We'll get to the nitty-gritty of it all in a moment. And
the policy points, firstly, when realistically, when do you expect to be up and running?
DR. MORENA MAKHOANA, CEO, THE BIOVAC INSTITUTE: Thank you, Richard, and thank you for having me. After all the tech transfer processes would be
completed by the second half of 2022, we will be commencing production for the market.
QUEST: And I mean, to those of us fully vaccinated in other countries, that sounds like a long way off. But I assume that the nature of Africa, as
current vaccination status suggests that the vaccine you will be producing will be most welcome, even though it does seem late.
MAKHOANA: Absolutely, Richard, I think, as you said in your opening remarks, I mean, Africa still lags the rest of the world in terms of
vaccination. We must also keep in mind that, I mean, there is a possibility that there may be boosters. We're not sure how variants are going to shape,
you know, the whole vaccine world in the next coming years.
And so, I think there will still be a need for COVID-19 vaccines for a few more years.
QUEST: Why has it taken so long for this deal to be done? I realize maybe in legal terms, and in technical terms, it might be fast, but one
would have thought that even late last year, plans were being made or agreements were being put in place for this sort of arrangement, but we are
seven months into vaccinations being underway?
MAKHOANA: Well, so I think, Richard, we should we should look at it in the context of when the mRNA technology actually was shown to work
clinically, and it was only in December. And yes, it has been seven months and in a pandemic, seven months is a lot of time. However, when you look at
also when did Pfizer really get in to a lot of external tech transfers? It was, they have their own internal manufacturing network, but a lot of the
transactions that they entered with others like Sanofi or Novartis, were actually in 2021.
MAKHOANA: So, you know, in the context of a seven-month lead time from the time that vaccine has been shown to be successful, you know, in that
context, it is probably, you know, not a better timeline, particularly as a first for Africa.
QUEST: You talk about it as an external tech transfer, and the big issue has been one of course, of propriety protection for the vaccine's
underlying sources. What has been put in place, because the waiver as such hasn't necessarily been done, so what have you had to put in place that
will protect Pfizer's intellectual property?
MAKHOANA: Yes, so Richard, this is the second tech transfer arrangement that we've entered with Pfizer. So, we have been in an existing
relationship with Pfizer on a vaccine against childhood pneumonia. So, it's not a new relationship.
And so we're talking to a party that we know well. And so, that essentially means that the trust has been there in terms of the knowledge that they are
sharing with us on the vaccine. So, going into this transaction, you know, we didn't have to have too many fights about intellectual property or
anything like that, because the trust is there and all they needed to do and will be doing is to share in the knowhow, and pass it on to Biovac.
So, we didn't get into any intellectual property debates.
QUEST: Right. But I guess, to an extent, will you be involved if you like, in the intellectual property of and the further development of it? Or
are you de facto going to be, I suppose a bit like, you know, the distributors of soft drinks, not to minimize it, but you receive the source
goods, you manufacture, and you deliver?
MAKHOANA: Yes, absolutely. This is Pfizer's product -- Pfizer and BioNTech's product, so it won't be Biovac's. We will be contracted to
manufacture Pfizer's products. So, we won't be dealing with anything that has to tamper with any intellectual property that Pfizer has.
QUEST: And the first plant I believe is going to be in South Africa. Is it at all realistic bearing in mind, particularly this vaccine, which is
more difficult to make, it's more difficult to store, is it likely that there would be other production facilities? Or is it simply not realistic
to do that?
MAKHOANA: Well, you know, so, to date, I mean, Pfizer has only entered the transaction with Biovac. We're not sure if they have any intentions of
But let me just put into context, I mean, that you know, you have to have at least existing facilities that are of modern standards and of high
quality for one to be able to absorb such a technology and you need to have the infrastructure and the skills that can really absorb such a technology.
MAKHOANA: So, I think in the selection process, and wherever they go globally, I think they look at all of that. If one or more of those things
don't exist, then it becomes a problem.
QUEST: We'll talk more. We look forward to covering the opening of your plant and seeing the first vaccines coming from it, sir. Good to talk to
you. Have a good weekend.
The markets will open in New York, expect it to be higher. A bit of a turn at the moment, let's see if it is going to be four in a row erasing
completely the worries of inflation.
It is FIRST MOVE and this is CNN.
QUEST: And a warm welcome back. It's FIRST MOVE.
The bell has rung, and the final trading day of the week on Wall Street is underway. There is optimism. Look at that. Optimism on all the major
averages kicking Friday higher.
Tech stocks leading the way. There were gains for Twitter, Snap, Facebook, and Alphabet -- go all. The consumer spending also appears to be recovering
strongly. American Express has reported an increase in revenue after five consecutive quarters of decline. Shares are up nearly three and a half
And to our top story, after postponement, controversy, and despite ongoing calls to cancel the whole thing, Tokyo's Olympics are underway.
The opening ceremony is taking place right now. Will Ripley has more on exactly what it took to get these Games underway.
WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT (voice over): Taking off, it really hits you. Hosting the Tokyo 2020 Summer Games is a massive
RIPLEY (on camera): This is one of the biggest cities in the world. Every single direction you look in, the skyline is never-ending.
RIPLEY (voice over): One building really stands out, Tokyo's $1.5 billion Olympic Stadium.
RIPLEY (on camera): Right now, we're flying over the centerpiece of Tokyo 2020, almost 70,000 seats in that stadium. Nearly all of them empty.
RIPLEY (voice over): The Olympics first ever spectator ban, a dramatically scaled down opening ceremony. Organizers say only about 950
VIPs attending, including U.S. First Lady Jill Biden.
We get a closer look on the ground.
RIPLEY (on camera): This is as close as most Japanese are able to get to their Olympic Stadium. Police have shut down surrounding roads and even
fenced off the perimeter.
RIPLEY (voice over): For everyday folks, this is their only shot at seeing the Olympics up close.
RIPLEY (on camera): Public opinion polls show Japanese overwhelmingly don't want the Games to go forward, but wouldn't know it looking at these
long lines of people who are waiting to take selfies in front of the Olympic rings.
UNIDENTIFIED FEMALE (through translator): I am worried about the Olympic bubble, it's not perfect, but I want to cheer on the athletes.
RIPLEY (voice over): That bubble to protect athletes from COVID-19. A small, but growing number of athletes are testing positive even inside the
POPPY STARR OLSEN, AUSTRALIAN SKATEBOARDER: I am so excited to go to Tokyo, but I'm also like terrified the fact that you fly all the way there
and then test positive.
RIPLEY (voice over): Athletes are tested for COVID daily, asked to arrive five days before competing and leave two days after.
From above, you can see how packed it is.
RIPLEY (on camera): Some 80,000 athletes and officials will be staying in those buildings out there. You can see a lot of their national flags on
RIPLEY (voice over): Most of the Olympic venues are here in Tokyo. Japan invested billions only to have fake crowd noise echoing through all those
RIPLEY (on camera): This is going to be in Olympics like none other and the world is watching. They want to see if Japan can pull this off in the
middle of a pandemic, in a middle of a state of emergency without the Olympics turning into a super spreader event.
Will Ripley, CNN, flying above Tokyo.
QUEST: Our next guest is a CEO in Tokyo and knows all too well the challenges these Games have caught with.
Casey Wahl is the CEO of Attuned, which creates -- which works to create motivational software, something we can probably all identify with right
now. Good to have you, sir. What's your mood? What is the mood?
CASEY WAHL, CEO, ATTUNED. AI: Thank you for having me.
QUEST: How do you see what is taking place in Tokyo? And I mean, if we talk about motivational, how can you motivate in an environment that seems
to be so dour?
WAHL: It's interesting, I think like right now as we're speaking like the Japan national team is coming into the stadium, right, for the opening
ceremony. So, with these opening ceremonies right now, I think we're going to have a psychological shift, and it's going to be a fresh start.
So up to the Games, there is a lot of anxiety, there's mixed emotions for many people. You know, Japan wanted to show the kimono, hey, we're
beautiful, have the world welcome us, but it couldn't happen.
So now, you're seeing the other side of Japan, that Salaryman Samurai type of thing and up until the Games, we just dutifully have to make them
happen. But now that it's here, I think every Japanese person is going to be glued to their TV for the next 16 days.
QUEST: I can get that and I can understand the sport. I worry, though, the lack of an audience there, the lack of spectators. Isn't that going to
denude what would otherwise be a great experience?
WAHL: I think so. I mean, the athletes for sure, right? You want them to experience, want them to have their family, want the cheer of the crowd
when the ball shifts back and forth. You want to feel that for the event. But I think we're all going to get used to it.
You know, we are doing the first pandemic, sorry, the first Olympics in a pandemic, right? There is no playbook for this. So, Japan with its
innovation, you know, its focus on security for this, is trying to figure out as we go and make sure it comes out safe, that the athletes have a good
experience, everything that they've worked for, for the last few years can come out right.
QUEST: And the preparations obviously are there, God forbid in case it all goes wrong and there is some major outbreak. Do you believe that by the
close -- and this is just pure speculation -- do you believe by the close, people in Japan will say, well, we have a right to do it.
WAHL: I think absolutely with no doubt, like Japan has a responsibility, as a country, it isn't a country that goes away from its responsibility.
So, if you have a contract with Japan, they're going to follow through it. And I think it's going to be about what the athletes do and the stories
that we tell and the emotions that get played on the field.
But 16 days from now, when the Paralympics start and after the Paralympics finish, I think Japan will have a very quiet pride for many, many years,
and culturally these Olympics are already starting to change Japan.
QUEST: Good to talk with you. We will talk. I'm aware you have tantalizingly put that on the table about what that change is on the
cultural trend. The thing I have noticed, we are out of time, which means we'll have to have you back so we can explore that further.
Thank you, sir. I appreciate it.
It is FIRST MOVE on Friday. Shares of Chinese tech giant DiDi down again. The door may be closing on Chinese IPOs on Wall Street. We will talk about
that in a moment. It is FIRST MOVE.
QUEST: Shares of the Chinese ride-hailing giant DiDi are tanking, literally. I mean, look at it, down 17.5 percent on top of the other 10,
12, and 15 percent over the last few weeks. Down now more than 30 percent. This is following reports that Beijing is planning to hand the company
tough penalties and maybe requiring a suspension of some operations, as well as large fines. Regulators have launched investigations in the two
days after DiDi's big stock market debut in New York.
Before that IPO, 2021 was shaping up to be a huge year for Chinese listings here, but expectations are now changing. CNN's Clare Sebastian with that.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT (voice over): In the spring of 2019, China's answer to Starbucks opened trading in New York. Luckin
Coffee promising to convert millions of Chinese tea lovers of low prices and high tech convenience.
RYAN CULLEN, CEO, CULLEN INVESTMENT GROUP: It was just so attractive because on a per store basis, its market cap was very low.
SEBASTIAN (voice over): Then 23-year-old Ryan Cullen, a finance professional in Ohio was sold.
CULLEN: I saw it as an opportunity to get in early on a very fast growing company in China for me has always been sort of like an untapped
SEBASTIAN (on camera): For years, American investors have flocked to Chinese companies listing in the U.S. an easy way to own a piece of China's
fast growing consumer market. And for years, China has resisted complying with the requirement for public companies here, that the U.S. be allowed to
inspect the accounting firms that audit these companies.
SEN. JOHN KENNEDY (R-LA): Everybody has to comply with that rule, American companies, British companies, Malaysian companies, Turkmenistan
companies, except one -- Chinese companies.
They just say no.
SEBASTIAN (voice over): Compliance with that rule may not have prevented what happened next with Luckin Coffee.
SEBASTIAN (on camera): It turned out that the company had fabricated sales to the tune of about $310 million.
SEBASTIAN (voice over): An accounting scandal that eventually led to its delisting, a bankruptcy filing, and big losses for U.S. investors like Ryan
CULLEN: Luckin really came to the market, got a bunch of capital from its IPO, and then just sort of left and it left a lot of American investors
like holding the bag.
KENNEDY: Now I have a bill. It's very simple.
SEBASTIAN (voice over): It did though help spur action in Congress.
Last December, then President Trump signed the Holding Foreign Companies Accountable Act, forcing companies from countries which weren't allowed
audit inspections for three consecutive years to be delisted. Right now, China is the only one.
The S.E.C. is still figuring out how to enforce the law.
DANIEL GOELZER, FOUNDING MEMBER, PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD: It's always been clear that the situation of un-inspectable auditors in one
country just couldn't go on.
SEBASTIAN (voice over): And if you ask regulators don't deter Chinese listings, Chinese regulators might. Two days after China's ride hailing
giant, DiDi, went public, it was hit with a cybersecurity review in China, then it was kicked off App Stores.
PAUL TRIOLO, HEAD OF GLOBAL TECH POLICY, EURASIA GROUP: They are handling huge amounts of data that is increasingly being considered
sensitive by the Chinese government.
SEBASTIAN (voice over): China has now proposed requiring all large tech companies that want to list overseas to undergo a cybersecurity review, and
all this complicated by tensions between the U.S. and China.
TRIOLO: DiDi, the recent events here have sort of given ammunition to those really, in Congress, for example, the China hawks in Congress, who
really want to accelerate this process and are saying, you know, this is not good for U.S. investors, but it looks like the relationship is sort of
going further south, then I would say that the Chinese government may decide that, you know, hey, why should it be agree to auditing of our
SEBASTIAN (voice over): It's clear after years of fragile, but mutually beneficial status quo, something has to give, and investors could be caught
in the middle.
Clare Sebastian, CNN, New York.
QUEST: The COVID-19 delta variant is driving uncertainty around Europe's reopening and it is very difficult for any business to make a plan, but
especially if you're in the hospitality industry, and amongst those affected is the hotel chain Rocco Forte Hotels.
Whilst all locations are now open in Europe, the Chairman told me the uncertainty is a disaster for his company, and others like it.
ROCCO FORTE, CHAIRMAN, ROCCO FORTE HOTELS: On my last financial year, my turnover was 20 percent of a normal year. It's not just my industry, it's
the airlines, it's the entertainment industry. Children can't go to school. Parents can't get to work because their children are not in school.
It's a complete and utter disaster, and governments have been single-minded in looking at it in one way and they ignored everything else. They ignored
the economy. They ignored the other health aspects and outcomes that have occurred as a result.
They only worry about is this disease, which is not the worst diseases that has ever hit the world. It's nothing like the bubonic plague, and your
chances of dying from it even if you catch it is very small indeed.
QUEST: The view of the governments have been time and again, you know, lives versus livelihoods, which is the argument that they put forward, that
we have to deal with the disease first. And whether one agrees with that or not, we are where we are. But so, rather what can you do now? What can you
FORTE: What is the point of vaccines? Why have we all been vaccinated and been encouraged to be vaccinated if it makes no difference? If we can't
carry on and go back to normal life? And that's what's happening at the moment.
The fact that a majority of the population and certainly all the vulnerable people have been vaccinated, and yet, we're continuing exactly as before.
It's absolutely unbelievable. And it's not just -- it's the British government, of course, and Britain is one of the country's with the most
advanced with vaccinations as is the United States and they can't produce a protocol between them to allow Americans to come to the U.K. and U.K.
citizens to get to the United States.
Italy, where I am at the moment, I'm in Rome, actually in my Hotel de la Ville in Rome, a new hotel there. In Italy, they've opened up the borders
to the American market, and Americans are beginning to come here again.
QUEST: You've got your hotels reopened and one imagines that business, well, it will be better this year than last. But whether one ever makes any
money is -- I'm guessing you've had to put expansion, that sort of a dream that's not going to happen anytime soon. So, how will you come out of the
pandemic and what will you do next in terms of growth?
FORTE: We just opened a hotel in Palermo, Villa Igiea, which is the most iconic hotel in Europe, built in the early 20th Century. And actually it's
very full. There's huge demand for it and it is starting to work well already.
I'll end up to this more heavily indebted than I was before, and obviously that will affect the pace of expansion programs unless I am able to
refinance in a different way.
QUEST: So Rocco Forte. In a moment on FIRST MOVE, traffic at the gym is now rebounding as COVID restrictions ease in many countries. The CEO of
Crunch Fitness talks us through his more than reopening, his expansion part really, as we go back to the gym.
QUEST: During the pandemic, we learned all about bodyweight exercises and we pressed packets of sugar and bags of potatoes as makeshift weights.
And now of course, where things are reopening, we are going back to the gym in larger numbers than perhaps we are expected.
Crunch Fitness has more than 350 locations in five countries. It says its member check-ins last month were up 80 percent compared to January. The
Crunch Fitness CEO, Jim Rowley is with me.
Jim, we've talked during the pandemic. It is good to see you sir. These are interesting. I guess, I'm not surprised, people wanting to get back and I
guess, the art is to do it safely.
JIM ROWLEY, CEO, CRUNCH FITNESS: Yes, thank you, Richard, I appreciate you having me back. And I think you're exactly right. And that's the
expectation from the members is that we're clean, we're safe, and I think they're ready to get back to socializing. That's a big part of it, not just
exercising, but socializing as well.
QUEST: If we look at how you've tailored your offering, if you like, what changes besides the obvious health changes, screens or different rules
in changing rooms and things like that, moving machines around a bit. How have you altered in a corporate mindset for returning and trading in a
ROWLEY: Yes. It's been interesting. I don't know that we've altered much. I think Crunch has had a legacy for over 30 years, and we are trying
to establish that same expectation that the members had before.
What we've seen is substantial growth, both in our franchise operations and our owned operations. We actually grew our franchise member base during the
pandemic. During the shutdown, our members increased by more than five percent. So, I think it's really about meeting the members' expectations
with our group fitness classes, our high intensity workouts and so forth.
QUEST: Do you think your clients, the people who go there to work out, do you think they're going with a different vision and different view? Has
the pandemic from what you can tell, and I can tell, a lot of it is anecdotal, of course. It is how each of us feels, but are people working
out in a different way, do you think?
ROWLEY: They are. It's interesting. We've seen pre-pandemic there was a higher use of cardiovascular equipment, treadmills and bicycles and such.
And we believe that the trend has really shifted now towards more of an independent workout, bodyweight workout, more isolated, and some examples
where they'll take weights and they'll take a mat and maybe bands and go into a section of the gym and workout in a small area, maybe similar to
what they were doing at home in a confined area, but now doing it in a population of a gym.
QUEST: I also look at things like the mirror and the Peloton and all these things where there is a subscriber base. It's the Gillette principle,
buy the item and then pay a subscription thereafter. How do you cash in on that?
ROWLEY: Well, we've got a product called Crunch Live, which has choreographed classes. We've had that for years. And during the COVID
shutdown, we improved our lighting, our sound. We improved our studio that we film, we called it the Crunch Lab. And so, we've been putting out more
product both for members and non-members alike to join on a subscription.
QUEST: It's fascinating, isn't it? At the end of the day, it's how we all have learned something. I mean, look, I'm a gym-a-holic. I love going
to the gym. The problem -- unfortunately, and now the pandemic is over in a sense and I've actually got to go do it. I can't make any excuse.
ROWLEY: That's exactly right, and look, working out is not easy. I think that's why they call it a work out, right? So there is work involved. You
just have to have the right goals. You have to have the right discipline.
Once you get to the gym, it is significantly easier. It is making that move from the apartment or the home or the office to get there.
QUEST: Good to see you, Jim. Thank you. I appreciate it. I appreciate it.
ROWLEY: Good to see you. Really appreciate it. Thank you very much.
QUEST: One rule of joining gyms, it has to be within five minutes of your home or your work. This idea of some magnificent place that you're
going to drive to, and it is a long way off, you'll never use it.
Home or work within five minutes. That's the rule of going to the gym.
That is it for FIRST MOVE. I should go myself this weekend. I'll let you know next week if I do.
I'll be back with you on "Quest Means Business" later today. Maybe I should go between now and then. No, I won't.
"Connect the World" with Becky Anderson is next.
Whatever you're up to between now and then, I hope it's profitable.