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First Move with Julia Chatterley
Markets Unsettled As Fed Decision Loom; W.H.O.: Omicron Spreading At "Unprecedented Rate"; Kremlin Calls Putin-Xi Virtual Meeting "Very Positive"; Hundreds Evacuated From Hong Kong Building After Fire; Haiti In Need Of Aid After Tanker Blast Kills Dozens; England Removes All 11 African Nations From Travel Red List; Boxed Moves Into Fresh Grocery Delivery; Israeli Recycling Firm Offers A Landfill Alternative; "Smart Africa" On Getting The Continent Online. Aired 9-10a ET
Aired December 15, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:18]
JULIA CHATTERLEY, CNN ANCHOR: Live from New York, I'm Julia Chatterley. This is FIRST MOVE. And here's your need to know.
Faster Fed. Jay Powell set to speed up the stimulus withdrawal.
Super spreader. The W.H.O. warns Omicron is growing at a, quote, "unprecedented rate."
And power play. The Kremlin describes talks between President Xi and Putin as very positive.
It's Wednesday. Let's make a move.
(MUSIC PLAYING)
A warm welcome as always to our FIRST MOVErs around the globe as we deck the halls with innovative guests and holiday cheer but investors today
singing from a high stakes hem sheet, and it's a more cautious yield tide carol.
C stands for Central Bank bonanza. The Fed poised to announce its long awaited stimulus exit, aka "Stexit." And rate tech outlook today too, will
it be tinsel, or will it be torment?
A, for accelerating inflation. This week's hot read on U.S. factory level prices makes the Fed's post-transitory job tougher. UK consumer prices now
at a 10-year high, too.
R, for retail sales. Fresh data shows Americans with perhaps a bit less of an urge to splurge November numbers, a touch weaker than expected. We got
all the details coming up.
O, of course, for Omicron. As the World Health Organization warns of a unprecedented spread. And that of course remains a key risk.
L, for landmark levels. A losing week so far for stocks but the S&P 500 still less than 2 percent away from record highs. As you would expect, a
quite premarket today ahead of the Federal Reserve announcement and decision. Does the ones patron Powell involve into a peevish Powell? I was
looking for P words there. Struggling the real risks as if they decide a more forceful response is needed, action on prices, which would make him
party pooper Powell to investors if no one else.
A softer session in Asia amid fears that the U.S. will add more Chinese firms to its restricted list. Chinese retail sales growth much weaker than
expected too as COVID restrictions weigh on consumer activity where weakness lies. However, stimulus often follows.
It's a delicate dance for global policymakers and that's where we begin the drivers.
Always light on her feet, however.
Christine Romans joins us now.
You know I was going to do that.
Christine, weaker on the retail sales.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Yeah.
CHATTERLEY: Pricing pinching here. What do we make of these numbers?
ROMANS: And maybe some supply issues, as well. I mean, look, we're heading into kind of a new phase here, right? And I think this corresponds with
exactly what you're seeing in the job market and some of these other indicators.
So, you have a little bit weaker here on the retail sales front just illustrates, right? The Powell pivot, to put my alliteration on the Fed
chief for you. And the very delicate dance they have to do from being the pandemic shock absorber to now inflation fighter. Julia?
CHATTERLEY: Yes. I prefer the Powell pivot as opposed to peevish Powell, party pooper Powell. I always try.
What do we think of Jay Powell? Because as I mentioned, it is a delicate balancing act. You've got the sort of eyes on COVID, the suggestion is
perhaps it may not be as dangerous in terms of an infection, but it is a highly prolific in terms of the number of infections. But inflation is
hard, and they have to react.
ROMANS: It's time to - it's time to move on inflation.
CHATTERLEY: Yeah. COVID time.
I mean that is - that is the consensus here. Overtime, right, and maybe hopefully -
CHATTERLEY: Yeah.
ROMANS: -- they are not behind the curve or not too much behind the curve. And there will be a lot of, you know, Monday morning quarterbacking on that
word transitory and maybe they were too sane went for too long on the effects of inflation.
But I think, Julia, as you know, would we parse these statements and these meetings. Sometimes we're looking for very nuanced changes and words. I
think this time is going to be quite dramatic what the Fed is setting us up for.
This is a big deal here today. It's definitely a new territory the Fed is in. Taper, taper, taper more quickly, right? You cannot be tapering into a
red-hot economy or you cannot be still buying bonds at that this rate into a red-hot economy. They might have to taper more quickly. The Fed chief has
even hinted that.
And then rate hikes for next year. But look, I want to show you the inflation numbers. I mean these inflation numbers and factory level that
we've talked about to the consumer level. These are real. These are biding. Even when you talk about you know these adjusted for last year, you know,
when you look at the comparison from last year, some of these inflation categories are still - they still look pretty bad here.
And then the Fed chief himself has said the economy is red hot and in fact, you know, inflation looks like it's here to stay.
[09:05:00]
Let's listen to what he said just a month ago.
(BEGIN VIDEO CLIP)
JEROME POWELL, U.S. FEDERAL RESERVE CHAIRMAN: But at this point, the economy is very strong and inflation pressures are high. And it is
therefore appropriate, in my view, to consider wrapping up the taper of our asset purchases which we actually announced at the November meeting.
Perhaps a few months sooner.
(END VIDEO CLIP)
ROMANS: So, he has telegraphed, I think, exactly what we're going to hear today about how quickly the Fed is going to shift to inflation fighting
mode and when they're going to start making these changes.
CHATTERLEY: Yeah. Better that you go sooner rather than later. And then you don't have to backload it, all going incredibly quickly and perhaps
heighten the risk of some kind of recessionary environment. Yeah?
ROMANS: Like getting it do -- getting it wrong. Getting it wrong here has implications for everyone whether you're a stock market investor, whether
you own a company in the United States or around the world, whether you're borrowing money, whether you're trying to finance a home.
I mean, the Fed decision here and Central Bank decisions around the world quite frankly are really, really the most important lever right now outside
of health, right? We've already got the vaccines. We know what mitigation is for the coronavirus part of it.
Now, I mean the Fed inflation fighting is all right here and the Fed and with Central Banks.
CHATTERLEY: Yeah. And it has global spillover effects, as well. What they do and what they don't do, quite frankly.
Christine Romans, thank you.
ROMANS: Nice to see you.
CHATTERLEY: "Underestimate this virus at your peril," quote words from the World Health Organization, which warned Omicron is spreading at an
"unprecedented rate." It says the disease shouldn't be dismissed as mild and the burden on the world health resources could be overwhelming.
Elizabeth Cohen joins me now.
Clearly, stern words. Give us some context on the rate of spread that we're seeing, Elizabeth.
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: You know, Julia, I feel like it was just yesterday that you and I were talking about how quickly
what we called at the time the UK variant was spreading.
CHATTERLEY: Yes.
COHEN: And then we talked about how quickly the Delta variant was spreading and this one was like one was worse after another. I'm sorry to say, we're
continuing that trend. Omicron is even faster than Delta.
Let's take a look at something that Dr. Rochelle Walensky, the head of the CDC, said yesterday. She said that in some countries, "rates are doubling
approximately every two days." That is a very fast growth.
Dr. Anthony Fauci here in the U.S. has said you know we expect this to become the dominant variant at some point. We've seen that happen, right?
The original corona was replaced with what we call at the time the UK variant. That was replaced by Delta and it could very well be, that sooner
rather than later Omicron will replace Delta.
CHATTERLEY: Yeah. And this is the key. We -- even if and the anecdotal evidence suggests, and you and I were talking about the South African - the
latest South African study yesterday that this is a milder version of what we consider in our minds as the COVID virus. It's not a reason not to still
take all the precautions.
COHEN: That's right. And I know that it - it might be - it might be some relief to say oh, well, a not so bad version of COVID is going to take over
the world, that maybe that's a good thing. And that's really the wrong way to look at it.
And here is why. When it spreads very, very quickly to sort of you know all sorts of places and - and goes quicker than anyone could have imagined,
it's going to reach people for whom it will be a problem. It's going to reach people who have weak immune systems. It's going to reach the elderly.
You know, before we sort of did our best to protect those people but if it's that transmissible, that may not be quite as possible.
The other thing is that even a mild variant is going to put a strain on our health care systems. People are going to feel symptoms of COVID. They're
going to find out that someone they know has COVID. So, they're going to go and get tested. And at least in the United States, testing is really, you
know, has some snags to it. They're going to go see their doctor. I mean all of that put a strain on health care systems, even if people don't,
hopefully, don't end up in the hospital.
CHATTERLEY: Yeah. And when you've got virulent spread and we were hearing yesterday again from the head of the South African hospitals, it's 4.2
times more transmissible. So, that is going to put a greater magnitude of numbers out there. People going to their doctors, to your point, even if it
is a milder version, even if it is, the numbers still are here are great.
Elizabeth Cohen, and I mean great in terms of magnitude, not great as in good.
Elizabeth Cohen, thank you. Very clear. Thank you.
A show of solidarity, Russia calling Vladimir Putin's meeting Chinese President Xi Jinping, "very positive," quote, after they held a virtual
summit earlier today.
This comes as both face mounting pressure from the United States and NATO over Ukraine, Taiwan and many other issues.
Selina Wang joins us with more and on many of these issues. These two leaders and the nations are firmly aligned, Selina. What more did we hear
from this one-hour meeting?
SELINA WANG, CNN CORRESPONDENT: Well, Julia, out of this meeting you had both of the leaders publicly praising their strong relationship. Putin even
calling the China-Russia relationship a quote, "model" of cooperation for the 21st century while Xi Jinping said the two countries will continue to
firmly support each other.
[09:10:08]
So, this was really the leaders creating this unified front as their relationships with the United States, with the West, are deteriorating. It
was a show of solidarity especially towards Washington as they are facing increasing tensions.
China facing tensions over technology, trade, human rights concerns.
Russia facing tensions and pressure of course over the buildup of troops near the border with Ukraine.
And across the board, you can see the ties between China and Russia deepening. Already major trading partners, they are working together on
building a lunar space station. They are striking energy deals. They're also beefing up their military cooperation. In October, Chinese and Russian
military ships teamed up to circle around Japan.
So, this is across the board and the meeting really reflected that deepening tie, as well as how these two leaders are increasingly on the
same page on a wide variety of international issues, as well. Both countries condemning and criticizing Biden's summit for democracy on top of
that, while you have the United States and other Western countries boycotting, announcing diplomatic boycotts of the Beijing Winter Olympic
games. Putin out of this meeting saying he's excited to, looking forward to attending the Winter games and meeting Xi Jinping face-to-face.
Take a listen here to what else Putin had to say.
(BEGIN VIDEO CLIP)
VLADIMIR PUTTING, RUSSIAN PRESIDENT (through translator): This allows us to thoroughly discuss the development of Russian-Chinese relations of
comprehensive partnership and strategic interaction. I consider these relations to be a real model of interstate cooperation in the 21st century.
I would like to note that we support each other on issues of international sports cooperation including the rejection of any attempts to politicize
sports and the Olympic movement. I have no doubt that the games will be held at the highest level as China is capable of.
(END VIDEO CLIP)
WANG: This, Julia, meeting also really emphasized this close personal relationship between Xi Jinping and Putin with Xi calling Putin and quote
"old friend" adding that they've met 37 times since 2013 while Putin referred to Xi Jinping as his, quote, "dear friend."
And also, Xi Jinping told Putin he's also looking forward to that face-to- face meeting and said quote, "would like to join hands with you together for the future." Julia?
CHATTERLEY: Yes. That's what comes when you've been in power for many, many years.
Selina Wang, thank you for that.
OK. Let me bring you up to speed with some of the other stories making headlines around the world.
Authorities in Hong Kong say they have evacuated more than 700 people from a high rise building that caught fire. At least 13 people were injured and
some reported feeling sick after inhaling smoke. Firefighters have extinguished the flames and investigating the cause.
We get more details now from CNN's Kristie Lu Stout.
(BEGIN VIDEOTAPE)
KRISTIE LU STOUT, CNN CORRESPONDENT: Here in Hong Kong, emergency workers have rescued hundreds of people after a fire broke out at a high-rise
commercial building. At one point, 350 people were trapped on the roof of Hong Kong's World Trade Center before firefighters put out the blaze. 770
people were evacuated. At least 13 people are injured.
And the World Trace Center is a commercial building in the city's Wan Chai District at Causeway Bay, one of Hong Kong's busiest shopping areas. It's
an office tower and shopping mall with a number of restaurants inside.
And according to an initial government report, the fire broke out at around lunch time, 12:37 p.m. today. And then it spread from a switchboard on the
first floor.
A CNN team outside the building spoke to eyewitnesses and people who were evacuated including Hong Kong resident (INAUDIBLE).
How do you feel after getting out of the fire?
UNIDENTIFIED FEMALE: I took the lift in time, but no more no more people tell me about the fire, but now I do thank you very much for the God I am
safe.
LU STOUT: She is one of the over 700 people evacuated from the building, but the cause of the fire is under investigation.
Kristie Lu Stout, CNN, Hong Kong.
(END VIDEOTAPE)
CHATTERLEY: Officials in Haiti are pleading for blood donations and other aide after a fuel tanker exploded on Monday in the country's second largest
city. At least 62 people were killed, many of whom were trying to collect fuel directly from the truck when the blast happened.
CNN's Matt Rivers has the latest.
(BEGIN VIDEOTAPE)
MATT RIVERS, CNN CORRESPONDENT: Well, yet another tragedy that Haiti is now forced to deal with after a fuel tanker erupted in the northern city of
Cap-Haitien. Dozens of people were killed as a result of this explosion, dozens more were injured.
The mayor of Cap-Haitien telling CNN, he is urgently calling for people to donate blood because of so many people being in the hospital with such
severe injuries.
[09:15:00]
What appeared to happen here according to the mayor, is that people were coming to this fuel tanker in Cap-Haitien because there was a leak and
people were coming to collect fuel for themselves.
It's so unclear what caused this explosion, but it was massive. And it obviously had a huge impact on all the people that were around that tanker.
It also had a big impact on the buildings that were around there.
We know at least 50 buildings according to the mayor were damaged as a result of this, many of which will have to be demolished according to the
mayor because of the level of damage sustained by the flames and this explosion.
But I think it's very important here to add the context of what's happening in Haiti. There has been a crippling gasoline shortage, a fuel shortage
going on for months in Haiti.
Remember, this is a country that cannot rely on a reliable electricity grid. And as a result, many, many people use gas, use generators every day
for basic things like running refrigerators, keeping things cold. All the way up to industries will use diesel generators to keep the lights on.
This shortage has crippled the country in a lot of ways. And it's made many people desperate, desperate enough to go after a fuel tanker that was
leaking fuel simply because many people are just desperate to get any fuel they can put in their generators that they rely on for so many different
parts of their lives.
This explosion, a horrific consequence of what is a nationwide gas shortage that has affected so many people.
Matt Rivers, CNN, Mexico City.
(END VIDEOTAPE)
CHATTERLEY: The U.S. president is heading to Kentucky later today. Joe Biden will survey the damage caused by the weekend's deadly tornadoes and
meet with victims and deliver remarks. At least 88 people were killed in the storm's that hit parts of the Midwest and the south. 74 in Kentucky
alone.
U.S. Secretary of State Antony Blinken is cutting his overseas trip to Southeast Asia short after a reporter traveling with him tested positive
for coronavirus. Blinken has counseled meetings in Thailand and will head back to the U.S. He and his senior staff have tested negative.
Still to come here on FIRST MOVE.
Curb chaos. The UK lifts South Africa travel restrictions but is the damage already done? I speak to the head of the tourism counsel.
And from trash to treasure. The Israeli KingTech firm turning household waste into a better form of plastic.
That's coming up. Stay with us.
(COMMERCIAL BREAK)
[09:20:02]
CHATTERLEY: Welcome back to FIRST MOVE.
Forget about Santa Claus. Fed Chair Jay Powell is coming to town and we'll know soon if he's feeling naughty or nice.
Market action not so merry as we await the Fed's announcement on how fast it will pull back stimulus and when it might begin raising rates. All this
after a volatile session Tuesday with the Nasdaq falling more than 1 percent, interest rate sensitive tech investors increasingly worried that
the Fed might tighten aggressively to tame inflation.
The counter risk of course is COVID and that continues to complicate the policy paths for all Central Banks around the world. The Ifo Institute for
Economic Research warning this morning that Germany's economy could fall into recession early next year as supply chain issues and lockdowns put
pressure on the economy, something of course the European Central Bank will keep firmly in mind ahead of their meeting and announcements tomorrow.
And as you've heard, the Omicron spreading at an unprecedented rate. Travel restrictions appear more pointless it seems by the day. The first nation to
acknowledge that fact it seems the UK and it's now removed all 11 African countries that were on its red travel list.
That will come as a huge relief to nations like South Africa which heavily rely on tourism from nations like Britain. About 450,000 UK travelers visit
South Africa in a typical year. Tourism generates more than $16 billion and supports more than 700,000 direct jobs.
To discuss all this, I'm pleased to say we're joined by Tshifhiwa Tshivhengwa, he's the CEO of Tourism Council South Africa.
Tshifhiwa, fantastic to have you on the show. As I mentioned to you just before we came back from the break, I wish it were under better
circumstances. What's your response to the decision by the UK to remove South Africa from that red list?
TSHIFHIWA TSHIVHENGWA, CEO, TOURISM BUSINESS COUNCIL SOUTH AFRICA: Well, it is good news that the UK has removed South Africa from the red list. It is
time conduct where I'll be logging the UK government as well as the mission here in South Africa for them to reconsider their decision. So, it's good
news.
It may be a little late because most people have already made their Christmas plans but nonetheless, it gives us direction and confidence that
those that want to come to South Africa in the next few weeks are able to come through and hopefully we don't repeat the same mistake of putting
South Africa on the red list. It is welcome news. It will go a long way in restoring the recovery of tourism.
CHATTERLEY: Let's talk about that because I mentioned it's 750,000 direct jobs. 1.5 million jobs. It's critical and the UK is a huge part of the
tourism industry. What did you see in terms of booking cancellations once these measures came into place and what hopes do you have for those that
perhaps were hoping to come, now saying OK, we'll still go?
TSHIVHENGWA: Well, what we are seeing is that in the first 24 hours since the red listing of South Africa and other countries following suit, we saw
that a billion-rand worth of booking in the first 24 hours were cancelled and when you look and extrapolate, we have seen that you know almost $400
million U.S. dollars could have been lost because of this red listing. So, what we're hoping for is that we don't talk about the red listing again.
And also, more importantly that other countries that still have South Africa on the red list, including the USA, Canada and many others across
the European Union will reconsider their decisions the same way they consider their decision when the fall of the UK in terms of red listing
South Africa because we are dependent on tourism as an important part of our economic development and there are many people that I employed through
tourism.
As speak now, we have around 470,000 people that have lost their job because of COVID-19. So, we need to recover. We need to get people back at
work. Both in urban areas and rural areas and we appeal to both all the nations that have really red listed South Africa to reconsider their
decision the same way the UK has done and restore travel and relations between South Africa and many other countries in the world.
CHATTERLEY: As you said, it was vitally important that you were talking to the government, that you were trying to convince them what happened was the
wrong decision and clearly, I'm sure those discussions are being had with governments in Canada or in the United States in particular, too. How
hopeful are you and what are you hearing from them about timing potentially or how they're thinking about their decision and whether or not to remove
those restrictions in the near term?
TSHIVHENGWA: Well, we do hope that you know the removal of South Africa happens immediately because when they impose the restriction, it happened
immediately after the UK imposed a restriction. So, we are hoping that you know all these governments are going to be sitting down, reconsider their
decision as soon as possible and really restore the relations between you know ourselves and this country.
[09:25:00]
So, it's not something that needs time because it didn't need time in the first place when the imposition was done. And another thing that's positive
is that we have released a lot of information in South Africa to the international community about the Omicron variant in terms of whether
vaccines are effective and whether it's severity and many other things that are important in decision making and that information can be used to speed
up the decision-making process and get more people to travel into South Africa but way of removing South Africa from the red listing. And we hope
that's done immediately and that's why we're appealing to everyone, the lawmakers in the U.S., in Canada, in the European Union to speed up the
process so that you know to start the recovery of tourism here in South Africa and other countries within the Southern Africa region. We are
dependent on tourism, it's important to our economy.
CHATTERLEY: Yeah. And I know and you're passionately reiterating the message. And we hear you. I assure you. The challenge here is that what
we're seeing now is the virus and the spread of the virus escalating, not just in South Africa. It's all over the world now when we're seeing those
case numbers continue to rise. And I think one of the things came out of this as we were discussing the scientists that had come forward and said
look, we've identified this other variant, is the level of vaccinations and in South Africa, I believe it's less than a quarter of people that are now
vaccinated.
How prolific are vaccinations for those people that are working in the tourism industry? Because for tourists deciding to come to South Africa,
even today they want to know that when they come, they're safe. How can you convince those tourists, and you have your moment now that it is safe to
come? I don't necessarily mean the virus, I just mean the people that they're going to be interacting with, too.
TSHIVHENGWA: Absolutely. Within the tourism sector and the entire really chain, we have been encouraging our staff to be vaccinated. There were
properties that had 100 percent vaccination rate. Others are coming up at 80 percent and so forth and so on. So, you can be rest assured that the
very chain of tourism here in South Africa is vaccinated and many people are still on the queue to be vaccinated and it's safe to come through.
We have robust protocols that we've put in place over 20 months ago and we've never been the source of the spread because our protocols are clear,
they are followed, and compliance is high. So, it means that anyone who wants to come to South Africa, you're going to be meeting people in the
tourism industry that are vaccinated.
They are following protocols. We wear our mask. We social distance. We sanitize everywhere and take our temperature. We have protocols that are
robust and should be assured that coming to South Africa, you're coming to a very safe destination where you don't have to worry much and of course,
we're going to make sure that you also wear a mask, you social distance, and follow the protocols and know some standards as we have them here in
South Africa.
CHATTERLEY: Yeah. The message there I think we get it. Be safe and you're ready for business. And wow, I've been there at this time of year. South
Africa is amazing at this time of year. And we all know that. Sir, great to have you with us. We hope you have the confidence to come back and that
those jobs come back there, too. Thank you, thank you for your time.
TSHIVHENGWA: Thank you.
CHATTERLEY: We're back after this. Stay with us.
[09:31:25]
CHATTERLEY: Welcome back to FIRST MOVE.
U.S. stocks are up and running. Investors preparing for a whipsaw Wednesday. We're gearing up for whatever it is the Fed have to say, how
much support might get snatched away and when the first-rate hike will come into play or if COVID spread will force further delay. Lots more on
investor's holiday plate as well.
New numbers showing U.S. retail sales up .03 percent in November. Weaker than expected but still the fourth straight monthly rise and let's be
clear, I make that around 16 percent higher year on year. Context matters.
Retail sales giving us even more jampacked with online retailer boxed. The bulk buy e-commerce firm has been busy. It went public on Thursday last
week and moved into the New York fresh food delivery market and it has teamed up with Google and that last part is key. Boxed is not just changing
the customer face side of shopping, it's also revolutionizing the tech on the backend.
Joining us now is Chieh Huang. He's the co-founder and CEO of Boxed.
Fantastic to have you on the show. We have much to discuss. So, I'll get cracking.
Firstly, on the retail sales front because you just heard me reading there about the numbers. What are you seeing whether it's from individual
customers or from the business-to-business part of what you're operating at as well?
CHIEH HUANG, CO-FOUNDER AND CEO, BOXED: Yeah, so from the B to C component of what we're seeing, that continues to be sticky. So, the customers and
how they're behaving at least on Boxed. We're still quite confident and we see that behavior and things are going well there.
On the B-to-B side, of course, we got our eye first on Delta and Omicron. About 25 percent of our business traditionally was b to be servicing.
Coffee rooms, pantries. And so, that business is still rather muted or generated. And on the last part of our business the software sales
component retailers around the world now need the e-commerce. It's not a nice to have. It's a need to have. So, the pipeline there is very cool. So,
that's kind of what we're seeing from our point of view, Julia.
CHATTERLEY: Yeah, fantastic. On the 25 percent business to business, that simply is because people aren't in the offices. They're not eating snacks.
They are not ordering supplies and things so that's what you're saying about that remaining muted which makes sense to me, I'm assuming. How
sensitive overall is the business to waves of the virus and how much people spend online?
HUANG: So, on the B to C side kind of what we've seen in the data is that people - you know -- I would say overall, the kind of tops and the bottoms
are probably a little more according to a statistical kind of top or the bottom, because, you know, folks are starting to get used to the virus at
least here in the United States. It's been with us for almost two years now. And so, people are getting about their lives even though there is a
second wave, at least what we're seeing. On the B-to-B side as you can imagine, you know if there is, no people in the office.
CHATTERLEY: Yeah. And that's not changed much.
HUANG: Yeah, exactly.
CHATTERLEY: Yeah. Fingers crossed that changes in the early part of next year and we're in a position to be able to do it. It's not just about
selling to businesses or selling to individual customers. And I mentioned this in the introduction, what we've discussed many times on the show is
what is also I think unique to your business and bought by others is the technology behind the scenes.
Just explain what differentiates you and the technology that you provide and why this new partnership with Google, Google Cloud is going to be so
interesting.
HUANG: Yeah, you know, we've been on the show so many times, Julia, and everytime, you know I always talk about our basket night. So, when you sell
a consumer package goods, it's really important to be able to you know ship a lot to someone's home.
[09:35:03]
Because you can't make money just shipping a single thing of seltzer water. So, the technology we built also versus that, so from the front-end
systems, the warehouse systems, all the way to the physical robots we've built. And CNN has been in our fulfillment center, kind of filming the
robot before.
And so, now retailers all around the world want that enterprise e-commerce in a box and that's what we're selling. And you know on the backs of that
we signed this great partnership with Google. We're not only of course, we're going to continue to be on Google Cloud. But we're going to co-market
our services.
So, telling our customers or our software projects that hey, JCP is a great, great platform they should consider. And then on the flip side,
their e-commerce customers hopefully will be able to migrate over to Boxed, as well.
CHATTERLEY: What percent of the revenues of the business does this represent today and how big do you anticipate this coming -- becoming?
HUANG: It could be pretty big. I mean, if you just look around the world, it's no longer a nice to have, it's a need to have. Last year, it was zero
percent of the business. This is the first year that we began selling software and already we're guiding Wall Street to about $17 million in
software sales alone this year. So, we're pretty excited about where it could go because that's just year one.
CHATTERLEY: Watch this space. What about seasonal hiring?
HUANG: So, for us, we've always kind of done right by our consumers and our frontline employees so if you go out there and search for Boxed, half of
what comes up is how we treat our votes on the frontline. So, we actually haven't had a lot of turnover there. And so, we don't see the huge kind of
spikes in need of hiring seasonal employees, but our frontline employees are sticking with us. The average hourly tenured employee at Boxed is
around two to three years.
CHATTERLEY: Yeah. And we've talked about this in the past and I think what differentiates you as a leader as well is how you've helped your people
along, paying for schooling, there have been all sorts of things along the way. And people can read that too online.
That I think is critically important for of course what happened in the past week which that you finally listing and you're now a public company.
Talk to me about how that feels, Chieh. How does that feel for your workers, too?
HUANG: It's -- it was you know a dream come true and kind of what I told them when here was the only word that I had was gratitude. You know
gratitude to our investors, our team, gratitude to you, Julia, for having us on the show for now years. You know, is just a really dream come true
but it's really just the beginning.
Now we have this space in order to build off of. And so, I told everyone it was, you know, a great day that we could take off and celebrate but now the
hard work begins, and we earned a starting line. I guess beginning in this new world as a public company.
CHATTERLEY: I know how hard you fought for this as well. And that you know at times you barely slept. So, the idea that you have the day off, kind of
the day off, I'm sure it was like 24/7 and the runup to it.
(LAUGHTER)
Yes. The smile - the smile says everything.
Now, speaking of ambitions and you can tell me what -- how you're going to utilize some of the money. But I think it's well documented that the
grocery business is tough. Even a giant like Amazon with whole foods has found this particularly tough.
What is it about your business and your capabilities that makes you think that immediate online grocery delivery is something that you can
revolutionize?
HUANG: Yeah, it's just how we specialize. So, everything does something well. Everyone does something well and for us it's online groceries. So,
we've done this since the beginning in the shadows of all those big companies you just mentioned.
CHATTERLEY: Yeah.
HUANG: So, from day one, we specialize not in selling everything but just in this category and the technologies, the basket values, everything else
has been geared towards it. I think that's what will make us successful. And just like they have ancillary businesses now, we have B-to-B. We have
software sales. And so, overall, you're starting to see us diversify a bit, but at the same time, we're still core in online grocery.
CHATTERLEY: Great to chat to you. As always, keep in touch. We'll continue to track your progress and wow. What a journey. Congratulations again.
HUANG: Thanks.
CHATTERLEY: Yeah. A lot of work. Chieh Huang, co-founder and CEO of Boxed there. Thank you.
OK. Coming up after the break, the Israeli company which might uncover the Holy Grail of recycling diverting waste from landfill and into new
products. We'll explain, next.
(COMMERCIAL BREAK)
[09:42:12]
CHATTERLEY: Welcome back to FIRST MOVE.
It's a depressing reality that while many of us diligently sort out our recycling, the amount of waste that ends up in landfill is still shockingly
high. It's estimated the world generates 2 billion tons of rubbish every year.
And my next guest says 80 percent of that is dumped in open landfills and only 4 percent ends up recycled. The Israeli recycling firm, UBQ, has found
a way to convert household waste into plastic pellets or powder, which can be recycled into new products like plastic trays, hangers or waste bins.
Its company says it raised $200 million in a new funding round to grow its operations and scalability here is critical. Tato Bigio is co-founder and
co-CEO of UBQ materials. And he joins us now.
Sir, fantastic to have you on the show. Those statistics say everything to me. I often think about that as I'm furiously sorting through everything,
actually how much good I'm doing. You're basically saying this can be turned into treasure and it can be monetized, too.
TATO BIGIO, CO-FOUNDER AND CO-CEO, UBQ MATERIALS: That is correct. Good morning, Julia. Thank you for having me this morning on your program.
UBQ has developed a groundbreaking technology that enables us to take household waste, 100 percent of all materials that you throw into your
garbage bin and convert all of them together without the need of separation into a plastic replacement that is both sustainable and cost competitive.
So yes, we can handle 100 percent of their receivables that will go to landfill and save landfills for our future generations.
CHATTERLEY: And just to be clear, it's everything. It's food waste. It's paper. It's every kind of waste, glass for example that the paper
packaging. What's the process that takes all of that and creates these pellets that then can be used in other products?
Well, if you see the composition of waste typically, you're talking about 85 percent organic which would be the food residues that you're talking
about. Dirty cardboard paper, diapers and mixed plastics. Those that are recyclable and non-recyclable.
We will take all those materials together and through an advance a chemical reaction process, which is clean water less and energy efficient, convert
them into one room with genius, composite material that behaves exactly like plastics, like common plastics that they are made out of oil. Just at
ours is completely made out of waste.
CHATTERLEY: Oh my goodness. Wait, wait, so the science of this is really exciting me. What kind of chemical reaction that is waterless, clean as you
said and energy efficient?
[09:45:08]
Does that mean it has zero carbon footprint because surely some form of energies required to catalyze this chemical process? You're being quite
coy. I want more information.
(LAUGHTER)
BIGIO: OK.
Well, here we also have very good news because yes, we don't need to use any water because as you know waste comes very humid.
CHATTERLEY: Right.
BIGIO: So, we have enough humidity in the waste to process the way we do it. The chemical reaction goes at the particle level, so we don't need to
go molecular therefore we don't use high temperatures. And the beauty of it is that we're saving landfills and when you throw organic materials into
landfills, they tend to decompose to methane. Methane is a very powerful dust, like 85 times more toxic than CO2. So, our total score is extremely
positive. So, we're greenest plastic material available today on the planet.
CHATTERLEY: Is anyone else doing this. And I'm assuming it's a paid process. So, if you told me you have to do something terrible to me to keep
it a secret. Is anyone else doing this or would you consider licensing the technology because I mean, when I go back to the statistics that we
introduced in the beginning, what you're doing if it works and I know you can address some of the skepticism is great, but we need to be able to
scale it up. We have to do this on a mass production level in order to really be in the amount of waste creating. Would you consider licensing
this technology?
BIGIO: Julia, yeah, what you're seeing is exactly what we are trying to do with this. This capital funding will help us you know extend our capita or
our footprint in other countries. We're starting with expanding in the Netherlands. We're expanding in - in Europe, and in the United States then
in Asia and other countries. Definitely, we have to be aggressive who want to have a - create a circular economy where human consumption leaves in
harmony with the planet.
We do have a great solution. And for us, it is very important to deploy this technology as fast as possible to end with landfills as soon as
possible and leave our very planet into our kids.
CHATTERLEY: Talk to me about those expansion plans as you mentioned because I was looking just at the list of what parts the world generates most waste
based on some of the data that we have. And actually, East Asia or in the Pacific Region comes incredibly high. And I know you have a partnership
with Motherson which is an Indian Japanese partnership. Talk to me about what is going on now and the impact that you're having because this is also
part of the way that you scale up not just creating factories and certain locations but also with big businesses surely.
BIGIO: That's exactly the name of the companies to work with really with the biggest global brands. Today, were actually already a supply and
material to Mercedes Benz, to McDonald's, Motherson, Mainetti and many other big players, big names. Not only brands but also manufacturers,
distributors and resin producers. So, our material can be integrated all along the product line and the carbon footprint of UBQ or the footprint of
UBQ will be as impactful as it can be. The more we deploy factories around world which is exactly what we're trying to do.
We want to have an immediate effect. We do have the technology and now we need to deploy a lot of financial resources and of course human capital to
be able to achieve these. We expect to have factories in most countries of the world in order to be able to convert the local waste into local UBQs to
supply local industries with their own waste. So that is the plan. And we are heading through there.
CHATTERLEY: It sounds like a plan. It sounds like a mission. We can call it that.
Cost. Let's talk about cost. For one of these companies that's buying these pellets in order to be able to utilize those in addition to the plastics
that are being created for whatever it is their packaging, what is the added cost as a result of being cleaner?
BIGIO: So, UBQ is coming with an alternative plastic material that can be used by current plastic industries in their machines with their current
process, making the same process they did before with a very strong proposition, and we're price competitive.
So basically, there is almost no question why not to use it. We're coming with a sustainable circular material that is carbon negative and that can
be basically used in any durable product at the same price but with a very strong sustainable value proposition. So that is what makes UBQ so
attractive today and that is what we're expanding so fast.
CHATTERLEY: Yeah. I mean, if it's comparable to other plastics, why wouldn't you? If you can clean up your carbon footprint. I think this is
crucial. What about path to profitability, Tato? How long is it going to take you to be profitable?
BIGIO: Oh, well, a company that is expanding very fast typically puts a lot of its resources in that expansion.
[09:50:00]
And of course, in the R&D, we want to come with new generations of sustainable biowaste materials like UBQ, but definitely after our first
landscape plan in the Netherlands, we will already become a profitable company and that will help us also deploy a new plant in other places and
be able to reach other corners of planet, of course.
CHATTERLEY: So, we're talking a couple of years just as a signpost.
BIGIO: Well, we're talking hopefully for many years to come where - where our technology will be able to have an impact to the world. The waste
problem is huge. It's bigger than us. We'll do everything to others, whatever we can. And we will always welcome other technologies because
definitely as population grows and economic conditions improve, the problem is getting bigger.
So yes, UBQ is coming with an amazing revolutionary one of a kind technology but we need to do more and now that Glasgow came to life and
there is this pledge of reducing it in many countries, well we're actually one of those important solutions and would love to see others coming out
with other solutions because definitely we need to have a circular economy here to support life in the future for future generations.
CHATTERLEY: Yeah. We need more projects like this. And we'll come back. You come back and talk to me again because there has been some skepticism and
there had been many failed projects that are heading in this direction, so fingers crossed. This is one that fundamentally is a game changer.
Great to have you on the show, sir. Thank you.
BIGIO: Thank you, Julia. Thank you very much.
CHATTERLEY: Co-founder and co-CEO of UBQ Materials. Thank you.
More FIRST MOVE after this.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to this week's connecting Africa. A Rwanda based organization that's doing literally that. Smart Africa aims to develop the
continent's digital infrastructure and it hopes it will open up opportunities in Africa's booming fintech sector to more people. Take a
listen.
(BEGIN VIDEOTAPE)
LACINA KONE, DIRECTOR GENERAL, SMART AFRICA: I'm Lacina Kone, the director general of Smart Africa. I'm helping Africa to be transformed into a single
digital market by 2030.
Today, Africa stand for 39.8 percent of population connected. The average around the world and planet is about 53 percent. That is one of the biggest
challenges.
Number two key objective is to promote and facilitate doing business in Africa. The regulatory environment has to be adaptive. Smart Africa today
being a 32 country, every country has a flagship project.
[09:55:02]
So, basically, we've taken the use of transformation. We've broken them down into pieces. Every country would be championing one specific project.
So, this approach in harmonized way, it ensures that no nation is left behind. And we learn from each other.
If you combine together in the planet, all the suppliers of the fiber optic connectivity, it covers 95 percent of the world populations. So, why
connectivity today is still an issue. It goes back to regulation for development.
The regulation is very important. Ease up the regulations to be able to attract a private sector to come and invest in the infrastructure.
Particularly in Africa where we have close to 60 percent of our populations living in rural area.
However, affordability is an issue. And again, it takes me back to the second challenges which is access to smart devices which is very important.
Once we have affordable in those regions, of course, it would be a boom.
(END VIDEOTAPE)
CHATTERLEY: And that just wraps up the show. Stay safe. "CONNECT THE WORLD" with Max Foster is up next. And I will see you tomorrow.
(COMMERCIAL BREAK)
[10:00:00]
END
