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First Move with Julia Chatterley
Alibaba Shares Fall on Reports China wants to Split Up its Payment Business; Corporate America Ask for Clarity on U.S. Vaccine Mandates; Disney Unveils its New Plan for Movies. Aired 9-10a ET
Aired September 13, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:22]
ISA SOARES, CNN ANCHOR: Live from London, I am Isa Soares, in for Julia Chatterley, this is FIRST MOVE and here is your need-to-know.
Beijing breakup. Alibaba shares fall on reports China wants to split up its payment business.
COVID confusion. Corporate America ask for clarity on U.S. vaccine mandates,
And screen versus stream. Disney unveils its new plan for movies.
It is Monday, so let's make a move.
Welcome once again everyone. Happy Monday. Great to have you with us on this rather busy start to the week.
And I want to start today's show with a check as we do a quick check of the markets.
U.S. stocks are on track for a solidly higher open as we count down of course, to the opening bell on Wall Street, roughly 30 minutes or so to go.
Europe is also higher right across the board.
Let's have a look at the major U.S. averages and how they're set to open. We're expecting the stocks to bounce after five straight days of losses for
the Dow and the S&P, but look how the last weeks have gone.
Stocks fell last week on concerns of course that the delta variant will slow economic growth, even of course as inflation moves stubbornly high. We
look at that Dow 2.2 percent, S&P 1.7 percent and the NASDAQ roughly the same. That's what a pretty rough and wild ride for stocks.
The U.S. releases though it's updated look at consumer prices tomorrow. This will be a key data point for the Fed when it meets next week to
discuss easing stimulus.
Over in Asia. China's continuing crackdown on tech helped trigger a 1.5 percent drop as you can see there in the Hong Kong Hang Seng. Chinese
electric vehicle firms came under pressure after Beijing warned that consolidation is needed in that sector.
I want to show you Alibaba though because it fell on reports that Beijing wants to break up its financial Alipay unit and that is where we're going
to begin our drivers today.
Beijing reportedly wants to split the super app, Alipay into two parts. It wants one app for payments, and then another app for loans. This latest
regulatory crackdown targets one of China's largest Fintechs. Alipay has more than 700 million active users a month and its parent company, ANT
Group controls over 50 percent of the country's mobile payments market.
Clare Sebastian is on this story for us. Good morning to you, Clare. Let's talk more about this latest story, more scrutiny, it seems by Beijing on
Big Business. Explain to us what this means for the ANT Group, which is, as we set out right there is a pretty big and profitable payment app.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, this is a giant, Isa, and actually, this is one of the poster children of this ongoing sort of
increase in regulation that we're seeing from the Chinese authorities on their tech giant. Don't forget ANT Group's, what was going to be a
blockbuster IPO last year was shelved by the Chinese authorities that was set to have raised $37 billion in what was going to be the biggest share
offering in history.
So this move today really hits ANT where it hurts that the lending arm of the business, these two consumer lending products are actually more of a
revenue driver than the original function of the company, which is online payment systems. So, this really hits them where it hurts.
They're saying, apparently, according to "The Financial Times" that they had already told them to separate out the backend of those lending
products. Now, they want to split them into a separate app, which would really affect how users sort of interact with Alipay, which is one of the
most popular apps in China, a huge driver of e-commerce sales.
So, that's one thing. They've also done another move here where they're asking ANT to sort of turn over the user data that underpins their consumer
credit reporting business, to a joint venture that's partly owned by the government.
This is interesting in the context of what we've seen from the Chinese authorities with the likes of DiDi. They're very concerned about consumer
data. But this regulation is worth noting. It isn't about collecting less user data or sort of asking explicit permission, the likes of which we've
seen in Europe. This is about control. The government wants that user data not only in the hands of these private companies, and I think this is
clearly the latest sort of volley of regulations that we've seen in this ongoing crackdown.
That's why you see stocks -- Chinese tech stocks across the board down today, even the likes of Tencent who's WeChat pay actually compete with
Alipay.
[09:05:02]
SOARES: Yes. And Jack Ma, Clare, he has been pretty vocal about Chinese interference on business. Where does he stand on these latest move? Any
comments given what reports we're hearing from "The Financial Times" on this?
SEBASTIAN: Well, you know, Jack Ma, the founder of Alibaba and of course, ANT Group, which spun off from Alibaba, he has really not been seen in
public very much at all since last October, Isa, when he made a speech criticizing Chinese regulators, accusing them of stifling innovation. That
it turned out was a big mistake from him.
Then the events that followed, the shelving of ANT Group's blockbuster IPO, Alibaba itself being hit with a record fine in April. Jack Ma, in a way
that sort of visionary founder, the flamboyant performer who symbolized the rise of Chinese tech companies, the rise of prosperity in the company now,
really, again, a poster child for what's happening now.
The government trying to sort of rein in the power of these tech giants, take back control. He is a cautionary tale for many of these companies.
This is why you see them falling in line, you know, going out of their way to show that they want to comply with China's regulations. He is now a
symbol of the government trying to take back control.
SOARES: Well, as soon as you've heard anything from him, do let us know. Clare Sebastian there for us. Thanks very much, Clare. Good to see you.
Now, a new CNN poll shows growing support for vaccine mandates in the United States. More than half of Americans, 54 percent now say they agree
that vaccination should be required for office workers returning to the workplace. Similar percentages support it for other situations, such as
students attending in-person classes, and people going to sports events or concerts.
Meanwhile, the Consumer Brands Association which really represents firms including the likes of Coca-Cola and Kellogg's wrote to President Biden a
list of questions about this new vaccine mandate.
Christine Romans joins us now with more. We'll talk about those list of requirements in just a minute, Christine, I really want to get a sense from
you in terms of the mood in the United States regarding the vaccine mandates.
CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: You know, it's interesting, I think it's less divided than many people would think.
You look at those poll numbers and it is very clear that a majority of Americans want vaccines and they want people vaccinated at work. They want
to know the person sitting next to them in the office when they return to the office is vaccinated.
And I think that there is this feeling, a growing feeling, companies have been nudging in this direction for some time. First encouraging, and then
in some cases, requiring vaccinations, but that there is this feeling that we will not get back to normal without widespread adoption of these
vaccines.
There's also a very clear understanding by the public here, I think that every single infection that you see in this country and around the world is
the chance for a new variant to develop and spread with maybe even more frightening speed than the delta variant we're seeing now.
So, there is a new renewed sense of urgency, I think that people want to get back to normal and they know the vaccine is the way to do that -- Isa.
SOARES: And it seems we seem to be -- that seems to be reflected, at least Christine, when I speak to CEOs in the last week saying, you know, we stand
with President Joe Biden. In fact, this should have happened way sooner. Where does the rest of -- where does Corporate America stand on this then?
ROMANS: So they first started by encouraging, you know, vaccinations. They were very patient with people who were vaccine hesitant. As that vaccine
hesitancy is slowly starting to decline here, companies are being a little more bold, they are requiring -- more and more companies are requiring
vaccinations here.
And if you don't do the vaccine, then you have to do, you know, an expensive testing regime. In some cases, I think the next step here is
going to be companies requiring their employees to bear some of the cost of those expensive testing regimes to push them into vaccination.
We know that Delta Air Lines, for example, announced in late August that it was going to spend $200.00 extra a month. It was going to put on the
healthcare tab of its employees, and that employee would have to spend $200.00 extra a month if they're not vaccinated. And Delta reports that
4,000 people got vaccinated even before that went into effect.
So, we know that company leadership matters here, and people start to pick up the vaccine a little bit more. We also know that there are a record
number of open jobs in this country. So, there are some industries where -- especially in healthcare, frankly -- where CEOs and managers are worried
about mandates, sort of, you know, having people really dig in, you know, maybe even leave their job.
So far, we are not seeing data that support people leaving their jobs in big numbers because of a vaccine mandate. And clearly, if there's a Federal
guideline here, the President announced last week, which again, is requirements, not a true mandate for private sector workers, but
requirements with testing that sort of levels the playing field, right?
If everybody has sort of a level playing field, then, I don't think you're going to see the job hopping that some worry about.
SOARES: Yes. Christine, Romans for us there. Thanks very much, Christine. Great to see you.
ROMANS: You're welcome.
SOARES: Now, Disney is optimistic about the return of moviegoers. The company announcing the rest of its 2021 films will be released in theaters
before actually streaming on Disney+.
Frank Pallotta has the detail, and Frank, this is clearly a sign that Disney is optimistic, as well as confident that we will return to theaters
even though COVID cases, the delta variant is on the up in the United States.
[09:10:19]
FRANK PALLOTTA, CNN MEDIA WRITER: Yes, that's exactly what the sign is here because at the end of the day, Disney of all the studios can really
blow this whole thing up. And what I mean by that is that if they really wanted to go directly to streaming, then they could. Like the theaters
really don't have leverages here when it comes to Disney. Disney is the top studio in terms of box office and power when it comes to Hollywood right
now.
So, what I kind of read this as, Disney is looking at the tea leaves and saying to themselves, you know, the last couple of weeks we've had good box
office returns, "Shang-Chi and the Legend of the 10 Rings," the new Marvel movie has made a ton of money. "Free Guy," another movie from Disney's 20th
Century Fox made a lot of money. "Candyman," a horror movie made a lot of money.
So they are seeing this move on generally the right direction, despite the COVID concerns.
SOARES: And Frank, do you know how long they will play before they go to streaming? Has that shifted somewhat? Are they delaying that?
PALLOTTA: It looks to be around 30 days for some films like "Encanto," the new Lin Manuel Miranda animated film, but mostly, it's around 45 days,
which is interesting because that's seemingly becoming the industry standard now.
We have other studios, like, you know, out there who are doing 45 days, Paramount is one of them, and that seems to be the new industry standard
down from what used to be around 75 days. So a big move, but still a lot of exclusivity for theatres.
SOARES: Do you suspect then, Frank, that you know, further studios will probably follow suit with you know, big screen first and then streaming
given, of course, the box office that we have seen in some of these movies?
PALLOTTA: Well, I mean, show goes Disney, so goes the rest of Hollywood. So, I think there is something to be said about that. But I think that
studios are already kind of doing this.
I think what we're going to see moving forward is less of a theaters versus streaming, and a theaters with streaming. Instead of a combat and a
conflict, you're going to really see these guys coexist because they think the box office has shown that there still is a lot of money there. There's
still a lot of money to get out of ticket sales, and I don't think streaming is at that point yet.
Not to mention, Disney is coming off of this huge kerfuffle lawsuit with Scarlett Johansson. Box office is easier. It's not as hard to make these
deals in the old traditional sense compared to the new way which is streaming.
SOARES: Frank Pallotta there for us. Thanks very much, Frank.
And there'll be much, much more movie news later this show when I'll be speaking to the CEO of IMAX, Rich Gelfond. Stay around for that.
First though, let me bring you some of the stories making headlines right around the world.
Japan says it is concerned by reports the North Korea successfully tested new long range cruise missiles. North Korean state media report they were
fired just over the weekend and hit targets 1,500 kilometers away, long enough to reach Japan.
The U.S., South Korea, and Japan said they are monitoring the situation.
CNN's Paula Hancocks is in Seoul for us this hour with more. Paula, what more can you tell us about this missile test, and critically. How
significant it is?
PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, Isa, North Korea through its state-run media, as you said that this happened over the
weekend. They say that this is a new strategic weapon that's been in development for some two years.
Now, we have seen in previous parades, one last January, one last October, that there had been new weapon systems that were being unveiled at these
military parades. Now, we don't know for sure, experts are still looking at the limited photographic evidence of this that we have from North Korea as
to whether this is one of those weapons systems that have been unveiled.
But experts has been consistently telling us that they had to be tested. If North Korea was unveiling these kinds of weapons systems, then they had to
make sure that they work and we also heard just last month from the sister of the North Korean leader, Kim Jong-un, Kim Yo-jong. She said that she was
slamming the U.S. and South Korea for holding these joint military drills even though Pyongyang had asked them not to hold these military drills, and
she had said that they would face a more serious security threat.
So we have been expecting some kind of acting out or retaliation from North Korea. But of course, this does concern those in the region as although
it's not ballistic missile technology, which is banned under U.N. Security Council resolution, so technically it's not breaking any rules. It's still
pushing North Korea forward in its weapons development -- Isa.
SOARES: Paula Hancocks for us there in Seoul. Thanks very much, Paula.
Now, a Pakistan International Airlines jet landed at the airport in Kabul, Afghanistan today before returning to Islamabad. The special flight was the
first from neighboring Pakistan to land in Kabul since U.S. troops left the country two weeks ago.
It offers some hope to Afghans who want to leave the country.
[09:15:06]
SOARES: Protesters gathered in Sao Paulo, Brazil on Sunday calling for President Jair Bolsonaro to be impeached.
[VIDEO CLIP PLAYS]
SOARES: They are critical of Bolsonaro's handling of the COVID-19 pandemic and his political attacks on the courts. Mr. Bolsonaro apologized for
recent comments saying they came from the heat of the moment.
And still to come on FIRST MOVE, supply shocks slowing productivity and high government spending. Harvard professor Ken Rogoff says today's economy
looks a lot like it did in the 1970s. He will explain.
And yet another COVID mystery, a man tests positive after 21 days in quarantine.
Both those stories after a very short break.
(COMMERCIAL BREAK)
SOARES: Welcome back to FIRST MOVE, everyone.
Let me show you U.S. futures as we count down of course to the bell. They remain on track for a higher open as you can see there. The bulls are
really trying to regain their lost ground after last week's more than two percent drop for the Dow that I showed you beginning of the show. It was
the worst week in fact on Wall Street in June. So, there, the futures looking all green arrows right across the board, all hovering roughly
around six tenths of percent.
Investors really bracing for another hot read on consumer inflation tomorrow. A report out on Friday showed wholesale inflation jumping more
than eight percent year-over-year in August. That's the biggest monthly increase on record.
And inflation fears are also playing into the ongoing negotiations in Washington over new fiscal stimulus. Democratic Senator Joe Manchin raised
fresh concerns this weekend over $3.5 trillion in proposed new social spending. He says it will boost inflation and cause budget deficits to
soar.
Reports say House Democrats are set to propose boosting the corporate tax rate from 21 percent to over 26 percent to help pay for the new programs,
but the final stimulus price tag remains uncertain.
Meantime, uncertainty over China's regulatory crackdown on business weighed on Asian shares. Clare Sebastian brought you that story at the top of the
hour. The property firm, Soho China fell almost 35 percent after Blackstone pulled the plug on a $3 billion takeover bid.
Blackstone backed out of the deal over concerns that China might reject it.
[09:20:11]
SOARES: So plenty for us to get our teeth into this hour. Ken Rogoff joins me now. He is the Professor of Economics and Public Policy at Harvard
University and also the former chief economist at the I.M.F.
Ken, great to have you with us. Happy Monday. Let's start on the data we expect today. A pretty busy week. Retail sales, consumer price index, all
obviously paint in picture on spending and inflation. What's your reading of what this may show regarding the economic recovery here?
KEN ROGOFF, PROFESSOR OF ECONOMICS AND PUBLIC POLICY, HARVARD UNIVERSITY: Well, I think all signs are pointing to that we're in a lull in the
economic recovery. People, firms, leaders don't know how to react to the delta virus, we're adjusting.
I will say I don't think that will go on forever. I think it's not a pleasant situation, but the economy will adjust. But inflation is likely to
stay high and the central bankers are trying to convince how it is temporary. But I think it's worth more worrisome than they let on.
SOARES: That's interesting to hear. I mean, it's clear that the demand is unwinding as consumers become vaccinated and return to work, and clearly
more inclined to spend. Do you think though, it's transitory, like the Fed believes? Or do you suspect it will last for the rest of this year, at
least, Ken?
ROGOFF: So, I think the problems are more deep seated than the Fed lets on. We have a lot of parallels with the 1970s, which was the last time that
we saw really high inflation. We're nowhere near there yet. But we have the slowing productivity, we have these supply chain problems.
We had the Great Society in the United States back then. We have a big push to expand our social safety net now. And data is a lot higher, which puts
pressure on the Central Bank not to raise interest rates.
Central Banks can pull the plug on inflation. They do have the power to do that. But will they? There are a lot of pressures on the Fed, less so, but
still on the European Central Bank to sort of keep things going.
And I think -- I'm not saying they're doing anything wrong now, because I don't know how the recovery is going. But will they be able to pull things
back? They say they're alert, they say they will. But I think the political pressures look more like the 70s to me than they do like the preceding
decades.
But I think the risks are higher than the market seems to be weighing in.
SOARES: And why do you think in that case, they're downplaying it?
ROGOFF: It's their job to try to hold everyone's expectations, don't have wage increases, adjust for inflation, don't charge higher interest rates,
because you think inflation is going to be really high. They really rely on holding down people's expectations. They call it anchoring expectations.
And they've done an amazing job of that.
But this is a tough one that we're facing now, and they are trying to use all, you know, goodwill they have, all the credibility they have. But I
think the political forces are pretty powerful pushing against them and I think it's tougher than people realize.
SOARES: So when you look at the next moves there, where do you expect them to go? I mean, I read the piece you wrote about the similarities, the
parallels between the economic as well as foreign policies of today compared to the 1970s, and it was pretty unsettling as I read it, I have to
say.
ROGOFF: Well, it is unsettling. I mean, so one of the parallels I didn't mention was obviously, the U.S. had suffered the loss of the Vietnam War.
And this time, Afghanistan is very painful. There had been a leader who, you know, was pushing the limits of the Constitution in the 1970s. We had
one, you know, the last few years before President Biden.
You know, there's a long list of parallels. And, you know, people think inflation is just a technical thing. It's a temperature switch. The
policymakers can change it. It's not. It represents the pressures in our economy.
We need the growth. And I'm sure the, you know, Biden administration feels they need to win the midterms and governments all over the place, and they
haven't had that pressure in a long time and it's here.
SOARES: Would you say they, Ken, I mean, I've read some economists say that, you know, this accelerating inflation is the lesser of two evils. Are
you of that thought?
ROGOFF: Well, actually, for the moment, I am. I mean, am I more worried about having inflation be four percent? Or that our economy goes into a
tailspin? I would much rather have inflation be too high for a while.
But I think that the risk that inflation does get too high are just underestimated.
[09:25:09]
ROGOFF: So it's not what's happening right now. But you know, think about it. Jay Powell has, I think done a terrific job. But he is under a lot of
pressure to sort of not tighten monetary policy. He's due to get reappointed any month now.
There's a very good person waiting in the wings, Lael Brainard. And, you know, Powell doesn't keep things soft. Biden will certainly bring her in,
and I think, Lael, I have enormous respect for her. I think she'll be great if she is appointed. But she's probably very much pushing to a softer tone.
She's talked about raising the inflation target. And I think there are people around, you know, doing that. I'm not going to get into the details,
but the risks of having higher inflation are much more palpable over a few years, not just over the few months.
SOARES: Ken Rogoff there for us. I wish we had more time. Ken, next time, we'll talk China. Great to see you. Thanks very much.
ROGOFF: Next time, China. Thank you.
SOARES: The market open is after the break. Thank you, Ken.
(COMMERCIAL BREAK)
SOARES: Welcome back to FIRST MOVE. It's been a busy first few 29 minutes or so. We'll have the opening bell shortly on Wall Street and it is
expected to be rung today by global intelligence firm, Black Sky.
If we have a look, U.S. stocks though, they are beginning -- expected start the week with gains. All the major averages -- you can see there, them
ringing the bell -- are higher in early trading. Let's have a look at how they're faring.
Major challenges await investors for this hour, including new inflation as I was talking to Ken Rogoff there and retail sales data that is expected
this week.
Plus the ongoing negotiations in Washington over new fiscal stimulus, as well as next week's Federal Reserve policy meeting.
[09:30:10]
SOARES: We're starting to see some moves -- if we just stay on this for a minute -- moves on the markets. Dow Jones up, a fraction, same thing with
the S&P. No movers as yet with the NASDAQ.
Apple shares are higher though in early trading ahead of tomorrow's expected unveiling of the new iPhone. Apple fell three percent on Friday
after a Federal judge ruled that the company can't force firms to use its App Store payment system.
And now you can see green arrows as we promised you right across the board. Dow Jones up seven tenths of a percent, similar picture of the S&P 500, and
the NASDAQ quickly catching up, too.
Now, the delicate balancing act of opening up and keeping the public safe has led to delays at airports. One company that is trying to make travel
more seamless is Portugal's Vision-Box. Its biometric contactless tech is present at more than 100 airports.
The pandemic has only made the demand grow with plans to upgrade all of Britain's border crossings. Miguel Leitmann is the CEO of Vision-Box. He
joins me now via Skype from Lisbon, Portugal.
Miguel, great to have you on the show. Look, this is exciting. I've just come back from Lisbon a couple of months ago. And I can tell you, I would
have liked everything to move much quicker. Some of your technology already used in immigration. But now you're really going the next step and that's a
stepping up with biometric boarding. Explain to viewers how this would work, Miguel.
MIGUEL LEITMANN, CEO, VISION-BOX: Yes, well, first of all, good afternoon. And thank you for having me. So the biometric boarding is full -- is the
next step on what you consider an automated border control, where we extend the scope of checking in and identifying passengers to board the airplane,
so it's -- you can do any kind of checks at the point of a border control, but you can also do it extended throughout the whole journey of the
passenger inside the airport and the ultimate check is just before you board and you get into the airplane.
So this is called seamless flow, and it envisages that besides the control itself being done by border authorities itself, you can extend this by
involving stakeholders like airlines in like airports that operates into that seamless experience of the passenger, which agrees, of course, with
the throughput and the security in that experience.
SOARES: And we'll talk about the security in a second, but I'm interested to know, is the pitch that you're making to airlines and to airports,
Miguel, this will save you time, or is it more along the lines of you know, people want contactless given the fears of a COVID? Which one is the
stronger push here?
LEITMANN: Look, the automation or border control after 9/11 was just the first step, right? It's a means to increase security, identify passengers
against an authenticated document. But you need to involve more stakeholders to make it even more secure and more quicker.
So the pitch is security and more convenience for the passenger. And with this, the whole process being quicker. So it's a win-win situation for all
the stakeholders, the passenger, the border authorities, the airlines, and airport operator.
SOARES: So I'm guessing our viewers would probably say okay, that sounds great. But what do you do as a company with the data say, passport photos,
passports, COVID vaccinations, because the concern, of course, will be people's privacy, data sharing and the whole ethics around this, Miguel?
LEITMANN: So you need to understand that it is a very public discussion going on and sometimes it's been oriented in the wrong way. If you point
the camera towards a crowd, right, let's say inside the airport, you're not asking the system to identify that person, okay? You're just verifying if
that expected passenger is the right owner of an authentic document and if he can be associated to the document.
So we are not -- we're not bringing in anything new. We are automating existing processes, which for decades have been done very, very thoroughly
and very well, but manually. So, it's just a question of automation and biometrics. It is just the glue between all of those processes, where
finally, I think we are now at the step where the different stakeholders have identified that they can improve the whole system by working together,
so collaboration, interoperation between those stakeholders in nations brings that into a much more secure and satisfactory experience for
passengers.
So we are not storing data, we're not raising new data, we're just automating existing data that any one of us, even yourself, when you
travel, right, you need to bring your passport with you, and you're presenting it to the proper authorities, or you have interacted with a
country to which you have to apply for a visa.
[09:35:25]
LEITMANN: So all the data that you have to use in your traveling is already there. So, we are not as a solution provider, it is a platform
provider. We are not storing data, we are doing a service for different stakeholders and making sure that within the privacy recommendation, that
it's expedited, and it's much more secure than it is today.
SOARES: I'm glad you clarified that because, of course, that would be a concern for many people when we're talking about data, passports, and COVID
vaccinations and so forth.
What does this mean though, Miguel, for airport infrastructure? I mean, how much is needed in terms of investment and infrastructure to make this work?
LEITMANN: Well, first of all today, let's bring this about two years behind, 2019, starting 2020. So the airports, the airlines, different
stakeholders, they were checking and understanding that this was the only way to move forward.
Now, after the pandemic, it is actually the seamless technology companies, the technology is the only way you can bring trust back into traveling and
bring passengers back into the airport and into the airlines.
So it's not a question of how much, but it's how big and how efficiently you can bring people back into traveling, but I would say no airports,
above 25 million to 50 million passengers a year would be investing today something like -- something between 50 cents to $1.00 per passenger to
implement these kinds of technologies.
SOARES: Miguel Leitmann, the CEO of Vision-Box there for us in Lisbon. Thanks very much, Miguel. Obrigado.
And we'll be back after a very short break.
(COMMERCIAL BREAK)
SOARES: Now the United Nations is holding an aid conference for Afghanistan in the hopes of raising $600 million in desperately needed
humanitarian aid.
[09:40:04]
SOARES: Meantime, Qatar's Foreign Minister held talks with Afghanistan Taliban leaders on Sunday. It is the highest level foreign visit since the
militants took over last month, and it comes as Afghan citizens are increasingly concerned about just what the Taliban's rules are now and how
they'll run the country.
Nic Robertson reports now from Kabul for you.
(BEGIN VIDEOTAPE)
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR (voice over): Battered and bruised, Kabul journalists, Nemat Naqdi and Taqi Daryabi show the
results of a beating they say came at the hands of the Taliban. The pair were covering an anti-Taliban protest when they will hauled away to a
police station.
NEMAT NAQDI, AFGHAN JOURNALIST (through translator): They were hitting me with extreme force, and I really thought that this was the end of my life.
My left eye has been hurt so seriously that it is still red and I am worried that I can't hear anything in my left ear.
ROBERTSON (voice over): Both feel victim of crossing an invisible line of what the Taliban will permit and what they won't.
TAQI DARYABI, AFGHAN JOURNALIST (through translator): They declared to the journalist in a press conference that they will be granted permission to
continue with their activities, but only under the Islamic rules.
ROBERTSON (voice over): In Afghanistan's north, the powerful new Taliban Police Chief in Mazar-i-Sharif admits even he doesn't know the limits of
his powers.
QARI HAQMAL, TALIBAN POLICE CHIEF (through translator): Until now, we have not received any specific orders from our chiefs. We are following the
rules of the Emirate. There isn't specific ban on anything.
ROBERTSON (voice over): Across Afghanistan, people are becoming increasingly worried. The Taliban have little idea beyond religious
principles about how to run the country, and may even be divided over how to do it.
"There's no work. There's no trade, and people have lost confidence," this man says. "No solid economic plan has been presented to the people. People
have no proper understanding of the Taliban's plans."
"We can see that their Cabinet has not yet been completed. What we can deduct is, there are internal differences within the structure of the
Cabinet, and this in itself adds to the concerns people already have," he says.
A mix of fear and fatalism appears to be filling the void. Some Kabul residents are ignoring the Taliban's previously strict dress codes. No idea
if it's okay or what could happen if they're caught.
The lesson of the two journalists, while the Taliban are dithering, potentially infighting, use every last moment of freedom.
DARYABI (through translator): The journalists will not stop. They are people who convey the voice of the population.
It is possible that from now on, the Taliban threaten and torture journalists, the continuation of their activities will be deemed as a
danger to their government.
ROBERTSON (voice over): An interim government that is yet to fully find its feet. Nic Robertson, CNN, Kabul, Afghanistan.
(END VIDEOTAPE)
SOARES: Still to come, coping with COVID in the winter months. Britain is set to plan out amidst challenges not just from the pandemic, but also
Brexit. What is the plan? We'll have more after this.
(COMMERCIAL BREAK)
[09:45:43]
SOARES: Now, Disney is betting that moviegoers are ready to return to theaters. It says all new 2021 movies will be shown first in cinemas before
streaming. The box office success of Marvel blockbuster "Shang-Chi and the Legend of the 10 Rings" suggests that Disney's magic could pay off.
"Shang-Chi" raked in $5.3 million for IMAX last weekend, this after breaking box office records when it opened last week.
Joining me now is Rich Gelfond. He is the CEO of IMAX.
Rich, thank you very much for being on the show. As we just mentioned, Disney, clearly releasing the rest of their movies this year before
streaming, a sign of confidence, no doubt. How confident are you that now is the time to do this?
RICH GELFOND, CEO, IMAX: I'm very confident. I think a lot has happened in the last week, a number of things. First of all, as you mentioned, "Shang-
Chi" had a terrific worldwide global box office, opening two weeks ago and followed by a low drop the second week, then "Venom," a Sony film moved up
three weeks.
"Bond" has reconfirmed that it's opening in late September, and then a week later in the rest of the world. In the U.K., it's in late September. And
then you have the "Reception of Dune," at the Venice Film Festival. "Spider-man" coming. You have Disney changing its windowing to much more
pro-theatrical, they read the data and they understood how well the theaters were coming back and that all has come together. So, I think this
is an inflection point.
SOARES: But you know, they looked at the data and they've noticed this at the time, but at the same time, you're still seeing a rise in, at least in
the U.S., in the delta variant -- of cases. Does that worry you at all?
GELFOND: I mean, of course, you want your customers to feel safe, and that's the most important thing, obviously, on a global basis. But the
opening of "Shang-Chi," the holiday weekend was $90 million, which is the best weekend in the whole pandemic in the U.S. Internationally, it did
really well. IMAX is in 84 countries, it did very well for us. And then this was the best second weekend in the whole pandemic for us.
So you know, I think the issue with COVID overall, it's moved from a phase which involve lockdowns and, you know, is it going to be open or close to
more or less, how you deal with it? And I think vaccinated people, and especially moviegoers who tend to be younger and probably have less
underlying conditions, they're coming back.
And I think, you know, that's the question. At some point, you've got to figure out how to be a little bit more nuanced, and I think, now that's
happening.
SOARES: Is that the trend that you're seeing, Rich? You're seeing the younger crowds coming back? They're slightly more relaxed compared to what
you would have seen pre-pandemic?
GELFOND: You know, I don't have scientific data on that point, but you look at the franchises people are coming back for like "F9" did extremely
well. "Shang-Chi" this weekend, "Free Guy." I mean, these are more, you know, aimed to people in their 30s and younger, and they're turning out.
It's just a hunch.
I suspect, if it was a franchise that was aimed for older people, it wouldn't be quite as robust because of concerns, but you look into other
things. Look at concerts, you look at sporting events. At least in the U.S., people are really coming out.
I went to the U.S. Open men's final yesterday here in New York, and you couldn't find a mask, you had to be vaccinated. It just seems like people
are getting back on with their lives.
SOARES: Yes, I'm sure. I mean, I can see -- I haven't seen "Shang-Chi," I have to say. I want to see it. My makeup artist was saying is phenomenal.
I'm really looking forward to "Bond." I think, certainly, many people here and I normally see "Bond" in the theater.
So that must be something you're really looking forward to, no doubt, that kind of demand?
GELFOND: We are, and you know, there's a lot of pent up demand on a global basis and "Bond" has been one of those movies that people really want to
see it. As I said, it was a number of turning points, but I think a really key thing was when MGM and the Broccolis announced that "Bond" wasn't
moving and staying and I think that led to this domino effect where a lot of people feel confident on both ends of it.
[09:50:13]
SOARES: Rich, how does the demand compare internationally? If we, you know, focus on China, Europe, how is that moving? Is that moving at
completely different speed? Roughly in line with what you're seeing in the United States?
GELFOND: Well, Asia has moved much quicker than any area of the world, and Japan had its highest grossing movie ever, "Demon Slayer" during the
pandemic, believe it or not, as hard as that is to believe and is the highest grossing IMAX film. China as well has done very well.
The United States is, you know, just turning now in a very positive way. The U.K. has been sort of a leader, internationally, in terms of reopening.
Latin America and India are a little slower, and other places in Europe are starting to come back.
SOARES: I mean, I was reading, correct me if I'm wrong, IMAX China, I mean, done particularly well, $19 million profit in the first half compared
with the year, earlier loss. I mean, what can you learn from this success? I mean, what has worked here, Rich?
GELFOND: I mean, clearly what's worked is where people feel safe and there is good content. They want to go back to the movies. I mean, you know, I
know people like sitting on their couches, and they like eating in their kitchens, but we're a social people, globally. I mean, we like culture. We
like to congregate. We like to be with friends and family. And I think where they're safe, they want to come back.
SOARES: I think we're all tired of sitting on the couches. I can tell you that much. I speak for myself, at least anyway.
Rich Gelfond, great to see you, the CEO of IMAX. Thanks very much, Rich.
GELFOND: Thank you, Isa.
SOARES: So, now the British Prime Minister is preparing to announce how the country will deal with the coronavirus in the coming months.
New COVID-19 cases have fallen slightly, but remain relatively high as you can see there with that graph. More than 29,000 new infections were
reported on Sunday. Deaths have ticked up, but a lot lower than during previous waves. Fifty six were confirmed on Sunday.
Nina dos Santos is in London with more. So Nina, we're hearing that the government, the U.K. is set to announce a COVID plan for autumn or winter.
What can we expect this plan to entail -- Nina.
NINA DOS SANTOS, CNN CORRESPONDENT: Well, you can expect about 24 hours before they announce it, it is supposed to be announced tomorrow afternoon,
U.K. time, Isa. But you can imagine in typical Boris Johnson style, we will certainly see quite a few headlines leaking probably to the British press
overnight to try and test out some of these policies to see how much pushback they'll get.
Really, what we're expecting is for that passport -- vaccine passport scheme that was supposed to be rolled out to places like nightclubs, those
confined spaces to finally be shelved. That was what we saw in the British press overnight confirmed by the Health Secretary earlier that that will be
at least for the moment completely out of the way.
The government had done a big U-turn on the issue of vaccine passports, but we're also expecting Boris Johnson, perhaps flanked by, you'll remember the
usual characters, Chris Whitty, the chief medical officer, Sir Patrick Vallance, the Chief Scientific Officer on either side, liken the peaks
during the pandemic of last year. It's likely that he's going to be talking about lockdown legislation, perhaps removing some of the last vestiges of
the most draconian measures, but leaving enough leeway for another lockdown to be implemented over the parts of the U.K. that Westminster has
jurisdiction over because remember, other parts of the U.K. like Scotland can set their own rules on things like public health, if the case number
starts to spike later on in the year.
Now we do know in preparation for this, he said, just in the last hour or so, we've had news that the Chief Medical Officers have now overruled the
Vaccine Committee, which initially about a week and a half ago said that they weren't going to be recommending vaccines for 12 to 15 year olds on
the first week that they go back to school. Now, we know that they bounced that decision over to the Chief Medical Officers and they have decided to
recommend these vaccines for 12 to 15 year olds, just one shot of Pfizer's vaccine.
So far question is, whether or not parents will give their consent on a case by case basis to allow their children to be vaccinated -- Isa.
SOARES: That's right. Yes, absolutely. So many parents wanting to see what exactly was happening when it comes to vaccinating their children. Nina, I
want to switch gears slightly and give you a sense and ask you about what we've seen in terms of the consequences of Brexit.
We have seen many businesses really struggling over the summer. Give us a sense of how bad it is in terms of up and down the country?
DOS SANTOS: Well, this has been the sort of a creeping concern that you see with empty supermarket shelves, some of the big furniture companies
like IKEA have been complaining of shortages. We even saw some of the big restaurant chains like McDonald's, Nando's, a chicken restaurant here in
the U.K. saying they've run out supplies and are having to change the menu to deal with these supply chain issues.
[09:55:16]
DOS SANTOS: The U.K. is currently in the grips of a huge shortage of truck drivers. This is partly because of a shortage of the labor coming over from
the E.U. in a post-Brexit era where many people who might have come from say Eastern Europe to try and help with the harvest of fruits that happens
at this time of year, or also to drive those big trucks over from the European continent, they are not coming anymore. And that situation has
been exacerbated by the COVID rules as well.
So we are seeing a lot of fresh produce associations warning that they are having to throw away items. We're seeing as I said, even hardware stores
saying they are having to curtail their ranges, and this is something that is going to get more and more concerning as we head towards the end of the
year -- Isa.
SOARES: Yes. Indeed. Thanks very much, Nina. Nina dos Santos there.
That's it for me. Do stay safe.
"Connect the World" with Becky Anderson is next.
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[10:00:00]
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