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First Move with Julia Chatterley

China Reports GDP Grew 8.1 Percent In 2021; Credit Suisse Chair Goes Amid Reports Of COVID Breaches; Three Killed In Suspected Drone Strikes In Abu Dhabi; Underwater Volcanic Eruptions Cause Significant Damage In Tonga; Beijing Locks Down Office Building After One Omicron Case; Djokovic Back In Serbia After Deportation From Australia; Concern Over India's Religious Festivals As Omicron Spreads; Pays $2.5 Million For Real Estate In The Metaverse; Hong Kong Journalists Describe Being Targeted By Police. Aired 9-10a ET

Aired January 17, 2022 - 09:00   ET



ALISON KOSIK, CNN INTERNATIONAL ANCHOR: Live from New York, I'm Alison Kosik in for Julia Chatterley. This is "FIRST MOVE." And here's your need

to know.

Slowing growth. COVID restrictions and a real estate crisis hit China's GDP.

Drone deaths. At least three people killed in Abu Dhabi attack.

And Djokovic deported. Tennis star returns home to Serbia after his Australian exit.

It's Monday. Let's make a move.


A warm welcome to "FIRST MOVE." Great to have you with us this Monday. It's a market holiday here in the United States, but lots of action on other

global markets to tell you about.

In Europe, a positive start to the trading week with UK and French stocks currently in the lead. Shares of UK pharmaceutical giant GlaxoSmithKline

are rallying after rejecting Unilever's $68 billion bid for its consumer products division. Unilever could decide to up its offer. Its shares are

down sharply.

Banking giant Credit Suisse trading lower as well. Its chairman is stepping down after reported violations of COVID lockdown rules.

We'll have more on that in just a moment.

Looks like a mixed day in Asia. Chinese shares closing with gains after the Central Bank there cut its benchmark interest rate for the first time in

almost two years. China is easing monetary policy at a time when other major Central Banks are tightening as it grapples with slower growth and

widening COVID lockdowns.

And that is where we will begin today's drivers. China is reporting its economy expanded 8.1 percent last year. That's far ahead of the

government's targets. There are signs, though, of a potential slowdown ahead.

Selina Wang has the details now and she joins us live.

So, Selina, walk us through what details you saw in this latest GDP report out of China.

SELINA WANG, CNN CORRESPONDENT: Well, Alison, that annual growth number of, 8.1 percent, was in line with what economists were expecting, but growth in

the last quarter was only up 4 percent from the year before, which is the slowest pace in a year and a half. And that, Alison, is a sign of troubles

to come.

The main challenges for China's economy in 2022 are going to be these continuing COVID outbreaks throughout the country and a worsening property

sector slump as China is trying to deflate the property bubble and reign in that under strain spending from this property developers. The big bright

spot was China's exports as the world's demand for China's goods still remain strong. We saw shipments up 21 percent.

But because of China's zero-COVID strategy, retail sales have significantly slumped with retail sales only going 1.7 percent in December. This is no

surprise as China has responded to even a handful of COVID cases in cities across China with these strict lockdowns, mass quarantines and mass testing

as well. And that means that millions are locked inside their homes, you have entertainment, venues factory shut down.

The strategy of zero tolerance has worked so far, but the fears that with Omicron and given how transmissible it is, it will not be as effective. And

as the rest of the world learns to live with COVID-19, some economists say that the cost of China's zero-COVID strategy outweigh the benefits. For

instance, with Goldman Sachs cutting, slashes projection for 2022 GDP growth from 4.8 percent to 4.3 percent.

But Alison, with the Beijing Winter Olympics just weeks away and later this year the Communist Party Congress coming up, China is not expected to ease

on these restrictions any time soon.

KOSIK: OK. Selina Wang, thanks so much for walking us through all of that. And we will have deeper analysis later in the show on China's GDP.

The chairman of Credit Suisse has resigned after less than a year in office. This follows reports that Antonio Horta-Osorio broke COVID rules.

On one occasion, he's said to have attended Wimbledon last year instead of quarantining.

Anna Stewart joins us live now.

You know, I think he's kind of in good company, right, in the context of Djokovic and Boris Johnson, but let's get to what - what COVID rules he

broke and what the reaction has been over the past 24 hours.

ANNA STEWART, CNN REPORTER: Yeah. So, the bank, Alison, hasn't gone into a huge amount of detail as to what the investigation their board instigated

really brought out and what exact wrongdoing was. But what is clear is the outgoing chairman doesn't refute that he's made pretty poor decisions.

In a statement, he has said this. "I regret that a number of my personal actions have led difficulties for the bank and compromised my ability to

represent the bank internally and externally. I therefore believe that my resignation is in the interest of the bank and its stakeholders at this

crucial time."


Now, "Reuters" reported on this, said that the chairman had traveled from Switzerland to the UK back in July last year to attend Wimbledon. At the

time, he would need to quarantine. Allegedly, he didn't. That actually would have been a criminal offense at the time. In addition to that, a

"Wall Street Journal" report today says, the investigation also looked at his use of a corporate jet.

Now, either want to get any more details on all of this. I don't think the bank wants to publish this report from their board. I think they want to

draw a line under it not at least as the chairman has now resigned and replacing him as board member, Axel Lehmann. He takes over with immediate

effect. He only joined the bank last year actually but has a long history at UBS where he was an executive.

It is his job to turn around this bank or continue the work that Horta- Osorio had started. And in a statement, he says, he will carry out the bank's strategic plan in a timely and disciplined manner without


Let's hope, Alison, he lasts longer than the last, which was just nine months.

KOSIK: Yeah. I mean, and you wonder how much this resignation, what it's going to - how it's going to impact the bank's turn around. I mean it was

Antonio Horta-Osorio who was actually brought into Credit Suisse to repair the bank's reputation in the first place. So, what kind of further

reputational damage has he caused?

STEWART: I mean, this bank has had a terrible two years. They have a number of events I'm sure they wish they could forget. You can see it. We can show

you the share price over the last two years.

Since the beginning of 2020, there was the collapse of Wirecard that it got ensnared in. There was the Luckin Coffee scandal. There were the terrible

investments in Archegos. Also, Greensill, those last two investments actually ended up costing the bank $5.5 billion and led to some really

high-profile resignations as well. Prior to that even in in 2019, the former CEO, Tidjane Thiam, had to resign after two spying scandals at the


Really important to remember, all of that actually happened before Antonio Horta-Osorio was appointed as chairman which was only last year. He was

charged (INAUDIBLE), unfortunately, he's ended up somewhat muddying it with his own personal decisions. Clearly, the board have decided at this stage,

they have zero tolerance for any kind of wrongdoing.

Looking at that share price today though, look at that, down by 2 percent. I don't think investors are particularly happy, not at least with this

story but perhaps for the future for this bank. And whether that culture that allowed for so many bad decisions and scandals to take place. Whether

or not that culture is changing and will change perhaps under a new chairman. Alison?

KOSIK: Too much drama does not help the stock price at least in this case. Anna Stewart, thanks so much.

Turning now to a still developing story in the Mideast. At least three people are dead, and six others injured in suspected drone strikes against

oil targets in Abu Dhabi. Yemen's Houthi rebels appear to be claiming responsibility.

Let's bring in Sam Kiley. He's on the phone with us in Abu Dhabi with the latest.

Sam, what do you know?

SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT (via telephone): So, this is the first time that there's been lots of lives as a result of Houthi

actions inside United Arab Emirates. One Pakistani and two Indians were killed. According to the government here, when what is believed to be a

drone or some kind of flying missile hit a very large oil facility here, decimating closed on oil storage tank, setting that on fire, causing a

chain reaction which caused a fuel tanker, a truck tanker to explode, injuring six others.

There was also another attack close to the international airport, indeed in the area around the construction for the new international Abu Dhabi

airport. That was less damaging. It didn't appear to -- we haven't gotten any information yet of any casualties or any significant damage from that.

But this is a major escalation in terms of what the Houthis have been claiming is a response to what they allege has been an increased level of

activity in support of malicious fighting them coming from the United Arab Emirates.

Now, the UAE officially withdrew itself from the Yemen Civil War where they intervened in support of the government and government backing militias

alongside Saudi Arabia against the Houthis. But the Houthis until recently had been enjoying quite a lot of battlefield success.

They recently had some turnaround in that. They've recently been beaten back in at least two major locations. Part of that they were attributing to

the intervention in some form or other, not clear what form, from the United Arab Emirates.

The Houthis saying that this is in response to that and are saying that there are future attacks planned. Now they often make these sorts of

statements and threaten all kinds of things, but this is the first time that they have been able to launch a successful drone attack that we're

aware of against the United Arab Emirates.


There have been of course frequent drone and missile and long-range missile attacks against Saudi Arabia out of Yemen, out of the Houthis, who are

operating in North Yemen and have been for some years now as part of their Civil War.

KOSIK: All right. Thanks to Sam Kiley for all of that. Great reporting and context in that breaking news.

OK. And these are the stories making headlines around the world.

South Korea says the North test fired what it presumes were two short range ballistic missiles on Monday. It's the fourth time this month that

Pyongyang has been suspected of firing projectiles. Seoul's Unification Ministry says the series of tests is regrettable and does nothing to

improve inter-Korean relations.

New Zealand officials say there was significant damage to the west coast of Tonga's main island after an underwater volcano erupted several times.

Experts say Saturday's eruption was likely the biggest recorded anywhere on earth in more than 30 years.

Meteorologist Jennifer Gray joins us now.

You know, that's incredible right there that - it's historic in that way and then the pictures themselves, those satellite images are really just

jaw dropping.

JENNIFER GRAY, CNN METEOROLOGIST: It really is, Alison. Just remarkable, these satellite images that we're seeing from the South Pacific. And you

can see this incredible cloud of ash and steam that just came out of the ocean 12 miles into the sky, so really incredible. And shock waves were

literally heard around the world.

In Alaska, almost 10,000 kilometers away registered, they heard it there, even was recorded across portions of the UK. And then it made it to the

U.S. a second time. So, it just shows how powerful these volcanos are.

Of course, here's some video from it. You can see the cloud of ash that is just in the sky continuing to spew from the video and you can see right

there. So, it is going to take quite a while for that ash cloud to disperse.

It's very high in the atmosphere. It has made it over Queensland on Monday. 63,000 feet into the atmosphere. And no current threat to aviation. Of

course, that is something that will be monitored in the coming days and even weeks ahead. But it is resting over portions of Australia and it will

definitely be noticing, for the most part really just from sunrises and sunsets, makes the sky much more colorful but is very high in the

atmosphere across portions of Australia.

So, here is sort of a timeline. This picture was from middle of November. And you can see not much there at all. But it did start erupting. And so,

it grew around the volcano. You can see sort of spread out, smoking there, smoldering.

And then, after the huge eruption on Saturday, the caldera basically just fell into the ocean. And so, that's the after picture right there.

And that's one of the things that generated that tsunami threat across the Pacific, even Hawaii, the U.S. Mainland also had that tsunami threat.

And we actually saw tsunami waves up to a meter or more across portions of Vanuatu, also Australia, more than a meter. And then made it to the U.S.

West Coast as well, by local time in the morning hours. And you can see more than a meter right there in Port San Luis in California and then right

around a meter in Crescent City, California.

But this is something that's really remarkable to me as well. The lightning that was generated from that cloud of ash. Look at that. From the volcanic

eruption, all of the lightning that was generated, these images and all the things that we're learning from this volcano, Alison, absolutely stunning,

just incredible.

KOSIK: Yeah. This is a story where the pictures certainly tell the story.

Jennifer Gray, thanks so much for that update.

The FBI says Saturday's hostage crisis at a Texas synagogue was a terrorism related matter aimed at the Jewish community. Authorities identified the

hostage taker as a 44-year-old British citizen who was killed after an 11- hour standoff. The man's brother says his family is devastated and wants to apologize wholeheartedly to the victims.

Still to come on "FIRST MOVE."

Omicron threatens the Olympics. Beijing reports its first case just weeks before the games.

And a metaverse land rush. We'll meet the company investing millions in the virtual real estate market.



KOSIK: Welcome back to "FIRST MOVE." I'm Alison Kosik.

U.S. markets are closed today for the Martin Luther King Day holiday. An extra day of rest for Wall Street traders after a volatile week.

The major U.S. averages ended the week with only modest losses, but we saw wild price swings intraday as investors began pricing in a new era of less

robust economic support from the Fed.

JPMorgan, Citigroup and Wells Fargo all reported better than expected earnings Friday, but they all ended the session mixed. JPMorgan fell

sharply on fears that higher cost will pressure results going forward.

More major banks are out with results this week. Goldman Sachs reports Tuesday, Morgan Stanley earnings are out on Wednesday.

One Omicron case. That's all it took for Beijing to lockdown an entire office building with workers still inside. China is reenforcing its

commitment to stamp out COVID-19 ahead of next month's Winter Olympics.

David Culver reports from the Chinese capital on the unusual steps it's taking.


DAVID CULVER, CNN CORRESPONDENT (voice-over): Omicron breaching Beijing's borders, a single case putting the Winter Olympics host city on high alert.

China's zero-COVID policy making no exceptions.

In the capital city, targeted lockdowns immediately activated along with strict contact tracing, Chinese health officials publicized the infected

person's recent travel history starting with their home.

We drove by the Beijing community where the woman diagnosed with Omicron lives. Remember, health authorities say all of this sparked by just one

case, at least for now.

(on camera): Here we go. You can see here, this is one of the entrances and exits, it is gated off. They've put these big blue barriers to keep folks

from going in and out.

(voice-over): The woman's neighbors allowed some fresh air, but confined to the complex, their trash piling up waiting for specially designated

disposal teams to truck it out. Many nearby businesses closed.

The woman lives a 15-minute drive from the Olympic Park.

(on camera): Not only where she lives that health authorities have it locked down, but also where the woman works, which happens to be in a bank

inside this building.

So out front, you can see they've got this blue tent setup, where a lot of times they'll do testing and processing before they can finally declare it

safe enough to reopen.

(voice-over): But if you think it's just a bunch of empty offices, look closer. COVID control staff carting in big boxes. Inside them, can you read

that? Pillows, betting people have actually been locked down at work and these supplies might make their stay a bit more comfortable for what could

be days of testing.


Omicron not only in Beijing. Cases also surfacing in several other Chinese cities including Shanghai. Social media showing snap lockdowns trapping

shoppers at one store.

Outside this mall, a person posting that this woman was emotional wanting to hold the child who was staring back at her from behind the glass.

Although it is unclear when the woman and child were reunited, officials kept them all closed for two days as they tested those inside, performing a

deep clean before reopening.

Sounds extreme, but most online voicing their support for the strict containment efforts.

Less than three weeks until the Olympics and recent outbreaks had 20 million people sealed in their homes; others, bused to centralized


State media showing these makeshift encampments built within days. Mass testing is a constant.

Back in Beijing, I hopped in line for my regularly scheduled COVID test.

(on camera): That's number 97. Done.

(voice-over): But if you think the heavy measures have brought life here to a halt, most who are not traveling might say otherwise.

On Sunday, crowds flocking to this popular Beijing Lake, frozen just in time for the Winter Games, families enjoying the chill and seemingly

confident officials will keep COVID in check.

David Culver, CNN, Beijing.


KOSIK: This spread of Omicron is just one of potential obstacles for the Chinese economy, which expanded by 8.1 percent last year but showed signs

of slowing in the final quarter.

Joining us now is Patrick Chovanec, he is the economic adviser at Silvercrest Asset Management and former professor at Tsinghua University in


So great to have you on the show, especially today when we get this GDP report when it feels like China is in the middle of a transition. But we'll

get to that in just a moment. First, I want to get your reaction on the GDP report. What stands out for you?

PATRICK CHOVANEC, ECONOMIC ADVISER, SILVERCREST ASSET MANAGEMENT: Well, it beat expectations, but the reality is that China's economy has been slowing

in the second half of the year. There are a number of reasons why.

There's a shift in priorities by the government in terms of economic growth. There's the specter of Omicron and the impact that that will have.

And then we're in a political cycle in Beijing as well because there's a party Congress coming next year and there's usually a political cycle in

terms of stimulus where it's serving the off part of that sale.

KOSIK: All right. Let's break one part of it down of this report. I'm talking about China's real estate sector because of what Evergrande went

through late last year. How this impacted China's overall growth. I'm curious to hear what the ripple effect from Evergrande will be, how its

troubles can actually impact China's wider property market?

CHOVANEC: So, property market is always a big driver of the Chinese economy. Construction is a huge part of it. And it's been an issue for a

long time in terms of concerns about overbuilding and prices being too high. The government has tried to cool it off, but you know it's tried

repeatedly over the last decade or so. And each time that it does so, it flirts with the possibility of a much, much slower economy and also the

possibility of financial troubles breaking out. And so, we're walking a balancing act with Evergrande and with others trying to cool it off but not

cool it off so much that you get the kind of financial ripple effects that could really derail the rest of the economy.

KOSIK: You know when you look at this GDP number and the prospect of China's economy slowing, you know you look at how much President Xi's own

government, you know the bold economic reforms that it's put into place you know from monopolies and big tech to restrictions on overseas IPOs, you

know the reigning in the property sector. I mean, how much of China's own crackdown on its businesses contributed to this slower growth?

CHOVANEC: So, I think it's a big part of the picture and I don't think it's going to change going forward. You know optimists will say that this shift

or what they're calling common prosperity is sort of kind of a like a social democratic move to tackle inequality. And it's you know necessary.

Certainly, inequality is a big issue with China. But the pessimists, and I would count myself among them, would say that the way they're going about

it is not through the kind of economic reforms that they've talked about for many years as being long overdue and necessary, that is the market

really disciplining sectors like the property sector.

Instead, it's a reassertion of the state in a top down, in some ways, draconian way, which has the potential to really stifle the sort of

dynamism and innovation that the Chinese economy needs to truly rebalance.


And you know the heavy hand of the state is really one of the big concerns that economists, but also investors have when they're looking at the

direction that China's going.

KOSIK: I want to turn to the Olympics for a moment because we're hearing that tickets will not be sold to the public for the Winter Olympics. You

know there's so much pride for China on the line. I'm curious what you think went into this decision? How difficult of a decision do you think

this was to make?

CHOVANEC: China is facing a very difficult situation with Omicron. You know the early indications seem to be that Chinese vaccines are not very

effective or certainly not as effective as the vaccines that we have in the west towards tackling Omicron or protecting people from Omicron. That's an

early read. We don't really know and there hasn't been born out. There haven't been a lot of cases at least formally reported in China. So, we'll

find that out.

But that really casts a big shadow. And it's one of the reasons why China has relied so heavily on these lockdown restrictions, because their - their

concern is that if it spreads, you know, even small percentages add up to huge numbers in China. And that has a number of impacts on China's economy

going forward.

The first is the impact potentially on consumer spending where people are locked down in places right now like Xi'an but potentially other cities.

The second is the impact on supply chains. A lot of companies around the world are concerned about that this could be worse than even in the spring

of 2020. And it feeds into global inflation concern, because supply chains are already seriously constrained.

And you know China right now is more difficult to visit than when I first went in 1986. It was easier in 1986 to get to China than it is right now.

That has to have an impact over time on the economy. It has to take a toll, because it's one thing to continue existing business relationships.

I mean, in the latest economic numbers, China's had a boom in exports because the rest of the world is recovering, at least in terms of demand.

But it's continuing existing economic relationships is different than forging new ones. And it's very hard when you can't go to a country and you

can't get a read on the real situation there, both micro and macro, to be able to make investment commitments. And I think that's one of the things

that's weighing down over the Chinese economy and over Chinese markets. And I think it will continue to do so as long as China remains severely locked


KOSIK: All right. Patrick Chovanec of Silvercrest Asset Management. Great to get your perspective and your expertise. Enjoyed you on the show.



KOSIK: Coming up after the break.

Back in Belgrade. Tennis star Novak Djokovic returns to Serbia after Australia cancelled his visa.

A live report coming up next.



KOSIK: Welcome back to "FIRST MOVE." I'm Alison Kosik.

And you're seeing video of Novak Djokovic arriving home in Serbia after Australia deported him. Meantime, the Australian Open is getting underway

without the world men's number one.

Paula Hancocks is live in Melbourne for us.

But first, let's go to Scott McLean. He joins us live from Belgrade.

So, Scott, Djokovic arriving back in Belgrade just a few hours ago. I'm curious to hear what the reaction was when he stepped off the plane.

SCOTT MCLEAN, CNN CORRESPONDENT: Yeah. Hey, Alison. It was enthusiastic. We were waiting at the airport, we were waiting at the VIP entry and exit

where fans had come to gather, waving flags, chanting.

But of course, Djokovic didn't leave from the VIP exit. How silly of us to think that because Djokovic is not a VIP in this country. He is well beyond

that. He is a national hero. So, he went out some other exit. And those fans who showed up, they didn't even catch a glimpse of him. But moan hold

that against him surely.

Djokovic now that he's not playing in the Australian Open has a lot of time on his hands to ponder his future. Something he may well want to think

about is whether or not to get vaccinated because at the moment it is looking like he will not be able to play at Roland Garros to defend his

French Open title in May if he remains unvaccinated. That's because the sports minister in France told CNN today that there will be no exceptions

to the vaccine pass law that requires people to show proof of vaccination to get into restaurants, theaters and sporting events as well. That applies

to both spectators and the athletes themselves.

Last year he was able to get an exception because they used a bubble system. That's no longer the case. So, if that law is still in place by

May, the next major tournament he'd be able to play in is Wimbledon, but he would have to arrive early to finish the mandatory quarantine period for

unvaccinated people into the UK.

If you're wondering where Serbs hold this against him, because they just want him to get on the court and play and represent Serbia, by and large

the answer is no. I spoke to one young man who is waiting for Djokovic at the airport this morning. He is vaccinated, but like many Serbs you will

meet here, he strongly defends Djokovic's right not to be. Listen.


UNIDENTIFIED MALE: That this will happen in Orwell's books, that this will happen, that someone would lose freedom of speech, freedom of thought,

freedom of everything. He was judged and he was sentenced because he told something. He didn't even say that. We are here to support our champion.


MCLEAN: Now, Djokovic put out a statement the other day in which he said that he was uncomfortable with all of the attention on him. Perhaps by

extension, he's also uncomfortable with the way that he's being portrayed in some circles as sort of an antivaxx hero.

That is certainly not how he's portrayed here. That's not how anybody, it seems, thinks of him in this country. But of course, if he clarified his

stance of vaccination that would go a long way towards clearing up people's perceptions of him right now and also toward clarifying what lies in his

future. Alison?

KOSIK: OK. Scott McLean, so a hero in one spot. And then, let's go to Paula Hancocks where I'm curious how he's being regarded after you know, dramatic

few days. Now that the Australian Open is underway. I'm curious to hear what the sense you're getting from other players in the tournament about

how this has gone down.

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Alison, it's no secret that players were sick and tired of being asked about Novak Djokovic. So, if

players coming here to the Australian Open, some of them, it's the pinnacle of their career. They weren't being asked about their form, their chances,

their hopes. They were being asked about a very messy visa fiasco.


So, it was the first day of the Australian Open today without Novak Djokovic. But still, there was a festive atmosphere at the grounds, people

starting to look towards the tennis, focusing on something else. There was a fairly mixed reaction to what happened, although most people thought that

what should have happened did happen. Let's listen to what they said.


UNIDENTIFIED FEMALE: For me, so many families have not been able to see family members across Australia or in the world just because they've not

been allowed to travel, and borders are being closed. So, to let someone that is not vaccinated, then we all have to be -- seems silly. Sorry, I'm -

yeah, I'm kind of happy about it.

UNIDENTIFIED FEMALE: I think it was actually a good decision. We've all done the right thing. You know, in getting vaccinated. We're not allowed to

come here unless we're vaccinated. And I think it was a great decision. I'm disappointed for Djokovic because I would have loved to have seen him you

know compete for his 21st Slam event.

UNIDENTIFIED MALE: It's sad that we're not going to see the best tennis player in the world play, but rules are rules.


HANCOCKS: And when it comes to the three-year ban having your visa revoked, Scott Morrison, the prime minister was asked about it and said there may be

an opportunity to change that for an individual in the right circumstances in the future. So not shutting the door completely. Alison?

KOSIK: That's an interesting response.

Paula Hancocks, Scott McLean, thanks so much.

And here are some updates on changes to COVID-19 restrictions around the world.

In England, people can now end self-isolation after five full days if they test negative on days five and six and have no fever.

Meantime, in France, after weeks of debate and amendments, parliament has approved a controversial vaccine pass bill. The new law requires proof of

full vaccination for many everyday activities like visiting bars and restaurants as well as long distance public transport. A negative PCR test

is no longer enough. The law still needs to go to the constitutional court next week for final approval.

The Omicron variant is spreading across India and its timing couldn't be worse. Millions of devotees are expected to attend a Hindu festival that

stretches over the next few weeks. And experts fear the religious gathering could make a bad situation far worse.


MICHAEL HOLMES, CNN ANCHOR (voice-over): A holy dip to wash away sins. Hundreds of thousands of devotees in India taking the plunge in the Ganges

River to celebrate a religious festival. But health experts say what might be good for the soul is a huge public health risk.

The number of new daily confirmed COVID-19 cases on average in India is nearly 30 times higher than it was a month ago.

But while some cities and states have banned gatherings, there is no national ban, and health experts free, these large events, and the lack of

masks and social distancing, could lead to further mass outbreaks, as the Omicron variant surges in the country.

UNIDENTIFIED FEMALE (through translator): People are standing here on the banks of the river and roaming without any masks. No one is following the


HOLMES: During the festival in West Bengal, which was expected to attract millions of visitors, drones were used to try to reduce the size of the


SUDIPTA MONDAL, BLOCK DEVELOPMENT OFFICER (through translator): The holy water was brought and sprayed on devotees. We practiced social distancing,

and not more than 50 people were allowed here. And then the second batch came. Another drone was also deployed to sanitize the place.

HOLMES: But the pilgrims far outnumber security personnel, and many people are ignoring health measures by crowding on the riverbanks and not wearing


A similar gathering at the Kumbh Mela festival in April of last year contributed to the spreading of the deadly Delta variant in India. There

were more than 4,000 deaths on average a day at the peak of that wave. Hospitals ran out of beds and oxygen.

It's a scenario, healthcare workers don't want to repeat, even though hospitalization rates right now are relatively low.

But with new confirmed cases rising above 260,000 two days this week, many cities including the capital, New Delhi, are observing weekend lockdowns.

Restrictions that may get even tighter if, like after previous festivals, large numbers of people return home from their spiritual journeys with

something other than a blessing.


KOSIK: And our thanks to Michael Holmes reporting.

Up next. The real estate in the virtual world. We'll speak to the CEO of about spending millions of metaverse land.



KOSIK: invests in digital assets including NFTs and cryptocurrencies. But its newest and most cutting-edge bet is on metaverse

real estate. It has just bought a plot of land in "Decentraland" for $2.5 million. plans to develop the land and monetize it through

advertising, festivals and rentals.

Joining me now is Andrew Kiguel, he is the CEO of

I'm so excited to have you on the show today to get more details first of all about this acquisition you recently made, buying this patch of land.

Why is it important to own land in the virtual world and when do you think you're going to see a return on your $2.5 million investment?

ANDREW KIGUEL, CEO, TOKENS.COM: Yeah. So, we think of a metaverse as the next iteration of social media. And although there's only a few hundred

thousand people using it today, we anticipate that over the next few years there's going to be millions of people joining these platforms and

eventually billions of people using these platforms.

So, what we're doing today by purchasing this land is we're going assess pre-purchasing advertising and retail space to act as this demographic.

We're going to see a return on this investment very quickly. We're holding a big fashion there in conjunction with "Decentraland" in March and we

already have a long list of well-known brands and retailers that want to partner with us on that show.

KOSIK: OK. I'm going to play skeptic here because any time there's a new exciting trend like the metaverse and there's a lot of noise, many people

jump onto it. What do you say to critics who say that investments like these are risky bets and they're questioning whether people will actually

gather in these spaces? And now I know that hundreds of thousands of dollars have been paid by people like Snoop Dogg and people are clamoring

to be his neighbor in the virtual world. But is this - is this virtual playground for just the wealthy?

KIGUEL: No. This is not a fad. I mean, we can look at companies like Facebook during the largest rebranding history to Meta. We can look at

companies like Samsung, even the fashion brands like Gucci, Balenciaga, Adidas and Nike are all establishing a presence there.

And so, what I would say to people that are still skeptical, maybe these were the same kind of people that were skeptical about social media and its

impact on advertising and maybe even people who were skeptical about the Internet. My prediction is that within 24 months, every single large

corporation is going to have to need a presence in the metaverse in the same way that they need a website.


KOSIK: Or is this a situation where the promise of the metaverse is more interesting?

KIGUEL: Well, the promise of the metaverse is very interesting, but really when you see what's happening there, this is where gaming is shifting to,

education, the ability to shop and create immersive experiences. There have been concerts held in the metaverse that have attracted you know in the

millions. And so, when we think about COVID and the impact of a pandemic and people's need to want to socialize, the metaverse is really just a

great place for people to gather, regardless of where they're geographically located.

KOSIK: Talk to us more about Web3 for those of us who don't necessarily understand how this works and why it's significant.

KIGUEL: Yeah. So, if you think about Web2 as social media and communication, Web3 really introduces ownership. And so, when we can go out

into a virtual world and buy land and create things like NFTs that we can buy that can be worn or traded, that's really a big part of what Web3. It's

the alignment of content, money and ownership.

KOSIK: How do you see this playing out in the future as far as regulatory bodies, legal systems getting involved? I mean, have legislators even had

the time and the inclination to wrap their head around what you're talking about, focus on it enough, because this could be an area that's ripe for


KIGUEL: You know, Alison, you're absolutely right. It is so new that these rules haven't been established yet. I mean, we're literally making history

every day as we're doing things in the metaverse, like creating lease contracts with retailers, building virtual stores. This hasn't been done

before. And so, we're stepping through it very carefully. And obviously, regulation is a good thing when it's done properly.

KOSIK: OK. Very quickly, I want to hear about the fashion show that's happening at the end of March. Where can people access it?

KIGUEL: Yeah. So, it's going to be held in "Decentraland." We're going to be announcing in the next few weeks who's some of the various brands are

going to be attached to the show. There's going to be the same things you might see at the lending room or New York Fashion Week, after parties, DJs,

lots of different immersive experiences. And I'm going to say that this could end up being one of the most widely viewed live fashion events in

history, because we're expecting to attract several hundred thousand people to attend this event over the course of four days.

KOSIK: OK. Well, I have to say, I will do my best to attend. Great talking with you, Andrew Kiguel.

KIGUEL: We will have a VIP ticket for you, Alison.

KOSIK: Ooh. I feel so special. Thank you. I'll be looking for it.

Andrew Kiguel, CEO of Thanks very much.

And there's more "FIRST MOVE" after the break.



KOSIK: Welcome back. Unlike the rest of China, Hong Kong has enjoyed a high degree of press freedom until recently. The territory once prided itself on

a vibrant, critical and open media culture. Now, three years after violent unrest and two years into a new Beijing backed national security regime,

authorities have intensified their crackdown on the press.

As CNN's Ivan Watson reports.


IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): This is what it looks like when the Hong Kong police knocked on the door of a local

journalist carrying a search warrant.

(on camera): What time did they show up at your door?


WATSON (voice-over): Police take Ronson Chan in for questioning. That same morning, they raid his workplace, the independent online news portal "Stand

News" and arrest at least six other people tied to the outlet, accusing them of publishing seditious material.

Within hours, "Stand News" shuts down for good. And just days later, another independent news site, "Citizen News," closes preemptively, citing

the deteriorating media environment.

CHAN: Today, getting the foreign correspondent in the field is quite dangerous honestly.

WATSON (on camera): It's dangerous for you to talk to me right now?

CHAN: Yes, yes.


CHAN: I'm afraid that it will become evidence saying that we've become an agent of other foreign power. But I still think that I have to speak out

about what happened in Hong Kong.

WATSON (voice-over): The Hong Kong authorities say they're going after criminals, not silencing journalists.

CARRIE LAM, HONG KONG CHIEF EXECUTIVE: So, these actions are law enforcement actions. These actions have nothing to do with so-called

suppression of press freedom or suppression of democracy.

WATSON (on camera): The government says it is not targeting journalists.

CONNIE, "APPLE DAILY": It's a lie. This was a lie.

WATSON (voice-over): Connie, who doesn't want her full name published for safety reasons, worked as a journalist at the tabloid "Apple Daily." It

shut down last June after police raided its offices, seized its assets, and arrested at least nine executives and staffers on charges of collusion with

foreign powers. After a 16-year career as a journalist in Hong Kong, Connie is now unemployed.

CONNIE: I'm thinking of leaving Hong Kong.

WATSON (on camera): Why?

CONNIE: Because it is not safe anymore.

WATSON (voice-over): Hong Kong used to be the freest corner of modern-day China. A former British colony that was supposed to be spared the strict

government censorship in Mainland China.

The city was home to a feisty local press corp. In 2000, reporters shouted questions at then Chinese leader Jiang Zemin.

JIANG ZEMIN, FORMER PRESIDENT OF CHINA: But the questions you keep asking, too simple. Sometimes naive. Got it?

UNIDENTIFIED FEMALE: Chairman Jiang, what do you think --

STEVE VINES, FORMER PRESENTER, RTHK: Hong Kong was also a very big center for international coverage in the Asian region precisely because it was a

place where you didn't need to worry about someone knocking on your door in the early hours of the morning.

Hello, and welcome to the post.

WATSON: For 20 years, British journalist Steve Vines hosted a news show on Hong Kong's public television network, but he packed up and left for this

rain-soaked corner of England last year after he watched Hong Kong authorities arrest dozens of opposition politicians and activists.

VINES: It was just breathtaking. Every day, somebody was arrested. Some organization was forced to close down. Somebody else had been fired. I

mean, it was just relentless.

WATSON: The Hong Kong authorities insist journalists can still work here.

(on camera): Is there freedom of the press in Hong Kong today?

TOM GRUNDY, EDITOR-IN-CHIEF, HONG KONG FREE PRESS: Yes and no. It's difficult in that we feel that there is enough for us to continue, but it

certainly put the industry in crisis.

WATSON (voice-over): Tom Brundy is editor-in-chief of the Hong Kong Free Press. He hopes authorities don't muzzle his small, non-profit reader-

funded news site.

GRUNDY: We don't know where the red lines are. The goalposts keep moving. For the moment, we're staying put and pressing on.

WATSON: The last year has been a bitter lessened for the city's heartbroken, newly unemployed journalists.

CHAN: I trust them for over 27 years.

CONNIE: So, I just hope that anyone still have freedom of speech, just, you must hold it tight.

WATSON (voice-over): Ivan Watson, CNN, Hong Kong.



KOSIK: And our thanks to Ivan Watson for that great reporting.

All right. Let's leave you with a smile before we go. Just take a look at the dedication of Disney fans.

Some have been waiting more than 6 hours in this line. Why? To get a collectible popcorn bucket. You heard right.

Look at these lines at Disney World. EPCOT's International Festival of the Arts, it just kicked off over the weekend. And as part of that, Disney is

selling a limited-edition popcorn bucket shaped like a purple dragon called Figment.

Now, I know you remember what Figment looked like. I had a stuffed animal. It was my favorite. And now, I wished I had it because I'm hearing that

they're being sold for $25, the buckets are.

But now, they're reportedly going for $200 on eBay. It shows that Figment - we need to show stuffed animal Figment. Anyway, Figment has value. I wish I

knew that as a kid.

That's it for the show. Go ahead and tweet me. Follow me on Instagram at @alisonkosik.

"CONNECT THE WORLD" is next. I will see you tomorrow.