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First Move with Julia Chatterley
EU Commission Pitches Plan to Move away from Russian Gas; Survey: Many U.S. CEOs are Expecting Recession; Bitcoin Losses Cost El Salvador Tens of Millions of Dollars; Ukraine's Postal Service Continues Deliveries Amid War; Irish Leader: UK is not Engaging Seriously in EU talks; Twitter Board Tries to Hold Elon Musk to Deal. Aired 09-10a ET
Aired May 18, 2022 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
(COMMERCIAL BREAK)
ALISON KOSIK, CNN HOST, FIRST MOVE: You're watching CNN. I'm Alison Kosik in New York. Let's start with the main news from Ukraine and Russia says
nearly thousand Ukrainian soldiers have surrendered at the Azovstal Steel Plant in Mariupol since Monday. CNN can't confirm the Russian tally.
Most of the soldiers appear to have been taken to Russian controlled territory. A new report from Human Rights Watch details numerous alleged
crimes by Russian forces against civilians in Kyiv and Chernihiv regions of Northern Ukraine.
Among them 22 apparent summary executions, nine other unlawful killings, six possible enforced disappearances and seven cases of torture. It's
believed the crimes were carried out from late February through March when Russian troops controlled much of the area.
Some Ukrainian civilians interviewed by the group also described being held in inhumane and degrading conditions with little or no food or water.
Meantime, in Kyiv the first Russian war crimes trial since Moscow's invasion of Ukraine has begun. A 21 year old Russian soldier is accused of
killing a 62 year old man in Ukraine's Sumy region. That's according to Ukraine's Prosecutor General's Office. He has pleaded guilty.
CNN Correspondent Melissa Bell is outside the courthouse in Kyiv. And she joins us live now. Melissa, great to see you! I understand that court has
adjourned early. Why did that happen and what happened before the session ended?
MELISSA BELL, CNN CORRESPONDENT: Well, extraordinary scenes here today at this Kyiv courthouses. Of course, as you reminded our viewers this scene of
the first war crimes trial being held in Ukraine since the war began.
On trial 21 year old Vadim Shysimarin who's accused of having killed an unarmed civilian on the fourth day of the war, after his convoy got hit, he
and other Russian soldiers got into a car to try and escape and kill the civilian for fear that he might denounce them to Ukrainian authorities.
Now, that is what he's accused of, as you say the proceedings just adjourned I don't know if you can see behind me that considerable media
presence here and that is because there were simply too many journalists packed into what is a very small courtroom.
So things will pick up again tomorrow, the hearing is postponed to tomorrow. But we did find out one extremely interesting thing in the
proceedings that have taken place so far. And that is that we're not only going to be hearing as we did begin to from Vadim Shysimarin this morning,
we're not only going to hear from him, but we're also going to be hearing from another Russian prisoner that is being put - that we're going to be
hearing testimony from being called by the prosecution who was traveling in the car with Vadim Shysimarin at the time.
So we should learn by tomorrow a lot more about exactly what went on. But we're going to be hearing from not one, but two Russian prisoners of war
and I think that is significant. It's something that we've only learned this morning.
KOSIK: OK, Melissa Bell live for us Kyiv, thanks so much. Finland and Sweden have officially handed in their applications to join the NATO
alliance. Their leaders were received by Secretary General Jens Stoltenberg in Brussels earlier today. The decision was spurred by Russia's war on
Ukraine and it marks a major shift for two countries that have remained neutral for decades.
(BEGIN VIDEO CLIP)
JENS STOLTENBERG, NATO SECRETARY GENERAL: Every nation has the right to choose its own path. You both made your choice of the thorough democratic
processes. And I warmly welcome the requests by Finland and Sweden to join NATO. You are our closest partners, and your membership in NATO would
increase our shared security.
(END VIDEO CLIP)
KOSIK: The European Commission is proposing to speed up the EU's transition to renewable energy to help end reliance on fossil fuels from Russia. It's
planning to invest an extra $220 billion to increase renewable power capacity, saying green energy sources should account for 45 percent of EU
output by 2030.
Anna Stewart joins us now with more. So what is the EU's plan here to kind of wean off - wean itself off of Russian energy from being so dependent on
Russia's oil and gas?
ANNA STEWART, CNN CORRESPONDENT: Well, this was a really comprehensive package and that is a big acceleration that figure for renewable energy by
2030 from what it had before. It comes as you said there with a big price tag $22 billion.
[09:05:00]
STEWART: Ultimately, though it believes this plan would save the block longer term around $100 billion a year because that's roughly how much it
spends on fossil fuels and largely, of course from Russia.
Now the plan is very comprehensive part of this was particularly short term will be just replacing some of the natural gas from Russia with liquefied
gas from elsewhere. That'll help it reduce its reliance certainly this year, by two thirds when we're talking about Russia.
Longer term, though it is all about green energies and it's got a lot of different plans in this package. For instance, it wants to speed up the
process of green lighting new energy projects, making it easier and quicker. EU wants to ensure that any new public building built in the EU
has solar roof panels by 2025.
Important to note though, that while this is a really ambitious plan, with great ideas on infrastructure to help wean itself off Russian energy, it
will require the approval of all 27 member states. And not just the approval, Alison, but also implementation because it's not just money
coming from the EU this will take action from all member states.
KOSIK: And some strength because it's certainly not easy to wean off of being so dependent on Russian energy sources. You know, for now, the EU is
reliant on Russian gas and it risks being cut off from that if it doesn't bend to President Putin's demands for payments to be made in rubles. What
more are you learning about that?
STEWART: Well, if anything, this situation on that front is getting more confusing. Now yesterday, we had guidance that lasts from the EU. And it
seems to contradict actually some of the guidance they gave last week.
Now at the heart of this issue is can EU energy suppliers pay for their gas using both a Euro account with Gazprombank and a Euro account? So can they
pay in Euros to Gazprombank have that money in Russia by a Russian entity converted into Rubles? And for that to pay for the energy would that be a
breach of sanctions?
At the end of last week, it appeared that EU was leaning towards the idea that it wouldn't be and that just by sending Euros to Russia would fulfill
the contract that payment would be done. As of last night the suggestion is that setting up any kind of Ruble account with Gazprombank would be a
breach of sanctions.
This leaves these energy importers in quite a pickle as to what to do now. We believe quite a few of them have set up both Euro accounts and Ruble
accounts with Gazprombank at this stage. We know for instance, any in Italy has done that.
They said they did that yesterday as a precautionary measure. But it's coming down to the worst some of these contracts are due to be paid. Some
countries like Finland their big gas importer there has said they will not play ball with us. They simply refuse to pay in euros and have it converted
to rubles.
They refused to bow to President Putin's decree they expect or warn that it could be cut off from Russian gas this weekend. That has already happened
from Poland, for Bulgaria but for a country like Sweden, natural gas accounts just 6 percent of the overall energy mix.
For other member states in the EU - so really, we're looking for more guidance, perhaps some compromise and definitely more clarity from the EU
on whether the suppliers can pay for the gas using euros that gets converted into rubles Alison.
KOSIK: OK. Anna Stewart, great for all and thanks for all of that great reporting. Here in the U.S. Business Chiefs are increasingly bracing for a
recession. A survey by the Conference Board Think Tank finds that nearly 70 percent of CEOs expect the Federal Reserve's efforts to tame inflation will
eventually trigger a recession.
Matt Egan joins us now with the details, Matt good to see you. So I'm wondering what did the CEOs detail in this survey - what were they pointing
to say a recession is definitely coming?
MATT EGAN, CNN REPORTER: Well Alison, this survey revealed a surprising amount of gloom and doom from the C suite. CEO confidence is at the lowest
level since the start of the pandemic 60 percent of CEOs anticipates that economic conditions are going to get worse. That's up from just 23 percent
who said that last quarter, and 68 percent expect that the Federal Reserve's war on inflation is going to eventually tip the economy into
recession.
Now, I think two important caveats there one, just 11 percent of CEOs expect a so called hard landing, which would be marked by a deep recession,
the rest are actually expecting a mild and short recession. And they're not necessarily anticipating an imminent recession.
This survey did not really specify when the downturn would begin merely describing it as something over the next few years. Now, this is really all
about concerns about the worker shortage, rising input costs and just how high inflation is right now? And what the Federal Reserve is going to have
to do to get it back under control?
You know, it is striking to hear this level of pessimism from business leaders, especially because this economic expansion is barely two years old
and there are a lot of bright spots. I mean unemployment. Is that a COVID low?
Headcount U.S. payrolls they're almost back to pre-crisis levels retail sales are growing really fast but all of that is being overshadowed by high
inflation.
[09:10:00]
EGAN: And, you know, I sort of wonder if this survey raises the specter of a self-fulfilling prophecy where business leaders, they start to hunker
down, they spend less because they're worried about inflation, and worried about a recession. And that actually brings about the recession.
I just want to read you a key quote from Dana Peterson, the Chief Economist over at the Conference Board, and she told me, you can always talk yourself
into a recession if businesses start shedding jobs in anticipation of a recession that is going to spook consumers, and that can get us into a
recession.
So Alison, it feels like everyone is very negative right now. Clearly, CEOs are negative consumer sentiment is at the lowest level in more than a
decade. Investors are negative whether or not this is overdone? I don't know. I guess what we'll find out pretty soon.
KOSIK: You know what I've talked with analysts and I've talked with economists like Mohamed El Erian, who think there won't be a recession. So
then there is that side of it as well. Matt Egan thanks so much.
EGAN: Thank you.
KOSIK: These are the stories making headlines around the world. Blackbox data recovered from a China Eastern flight that crashed in March suggest
someone in the cockpit intentionally down the plane. That's according to a Wall Street Journal report setting a preliminary assessment by U.S.
officials.
All 132 passengers and crew died after the plane nosedived from 29,000 feet. CNN Beijing Bureau Chief Steven Jiang has more.
STEVEN JIANG, CNN BEIJING BUREAU CHIEF: Even before the Wall Street Journal story was published, there had been a lot of speculations on Chinese
Internet about this crash being caused by pilot suicide. Because as many experts have pointed out, a mature aircraft type like the Boeing 737/800
simply doesn't fall out of the sky.
Now Chinese officials had previously strongly denied those so called rumors, but after the journal article was published, we have seen the
airline industry regulator here CAAC issue a statement to state media basically saying they have reached out to their American counterparts at
the U.S. National Transportation Safety Board.
And what the Americans have told the Chinese according to CAAC was that they have not released information about the investigation to any media
outlets. So notice how carefully worded both sides have been. Neither the Americans nor the Chinese have directly deny the crux of the journal
report, which was this deadly crash was caused by human inputs from the cockpit.
Now analysts and the observers have also pointed out to some hints and suggestions that the Chinese authorities may be concerned about if not
aware of the human factors involved in this crash because on April 6th, just a few weeks after this crash, the CAAC authorities held a nationwide
conference on air safety with the Minister of Civil Aviation actually urging officials across country to pay particular attention to pilots state
of mind saying all frontline employees, but especially pilots need to be physically and mentally fit to fly to ensure the safety of the entire
industry.
And other observers have also pointed out to the fact that the 737/800 series continues to be operated by Chinese airlines after the crash as
another sign that this crash was not caused by mechanical or technical failures. Even China Eastern itself after suspending commercial services of
the aircraft type for a brief period of time has resumed flying this very popular aircraft across China. Steven Jiang, CNN, Beijing.
KOSIK: U.S. Soccer has just reached a landmark agreement for the first time ever men and women playing for U.S. national teams will get equal pay and
prize money for international matches. The deal comes after years of bitter legal battles and contract disputes. It runs through 2028 covering the next
two World Cups each for men and women too. Still ahead our "Market in Meltdown" investors who say they face ruin will ask if Crypto can ever
fully recover. And not so free as a bird with Elon Musk's Twitter deal still on hold hear what the company's board is now saying.
(COMMERCIAL BREAK)
[09:15:00]
KOSIK: Welcome back! I'm Alison Kosik. New losses for Bitcoin this morning after a turbulent two weeks for crypto investors as we have been reporting
the values of TERRA and LUNA, which were promoted as so called Stablecoin dropped as much as 99 percent in just days. Some investors say it's ruined
them financially and even have spoken about suicide.
Let's talk with Juthica Chow she is the head of OTC Options Trading at the Crypto Exchange, Kraken. Thanks so much for your time today.
JUTHICA CHOU, HEAD OF OTC OPTIONS TRADING, KRAKEN: Thanks for having me.
KOSIK: So Juthica, it has been a really scary ride for a lot of crypto investors recently, you know, we saw a lot of fear in the crypto markets.
I'm curious what you're seeing at Kraken are our customers panic selling?
CHOU: Well, I think we definitely saw selling over the last couple of weeks, which is what has contributed to the price action, partly due to the
broader market and the growth concerns with the Fed stemming inflation and then obviously, partly due to crypto specific factors.
But I would say among our client base, there's not really panic per se. A lot of customers have been in crypto for a while and have been through
multiple cycles have seen multiple crashes, even dating back to just recently in March 2020 and then May 2021.
So this isn't the first time we've seen a volatile environment and I think many of our customers have braced for it and prepared for it from a risk
point of view.
KOSIK: For Bitcoin, though, you know, volatility it's expected. But are you sensing that there's anything different about this kind of moment or cycle
of volatility? And what do you see in the short term for bid for Bitcoin? Is there any recovery for it? I mean gone are the days it seems of $100,000
Bitcoin by the end of the year?
CHOU: Well, I think what's different this time around; it's how much it's tied to the broader market. So I've been in Bitcoin for a while. And if I
look at prior cycles, the volatility was usually specific to Bitcoin factors, for example, China banning Bitcoin or when we had the - in 2014.
But this is the first time that a lot of the volatility is actually driven by what's happening in the broader market, with the NASDAQ with tech
stocks.
And I think part of that is due to the institutionalization of Bitcoin where you have more funds in institutions that are investing both in
traditional assets as well as Bitcoin. And so I think it goes both ways in terms of that's obviously very good for Bitcoin and adoption, but it does
contribute when you get broader market volatility that contributes to Bitcoin volatility.
I think as we move from being more risk off right now, which is the current nature of the environment to being more risk on, we will see investors
disproportionately invest back into Bitcoin, particularly as they start thinking about what assets to own as an inflation hedge.
KOSIK: One of your competitors Coinbase recently said if it went bankrupt, its users could lose all the crypto in their accounts. What do you make of
that and can the same thing happen at Kraken?
[09:20:00]
CHOU: Well, I can't really speak to Coinbase's comments. And I think a lot of times they're just legal restrictions that you have to put in
disclaimers that you have to put. But ultimately, they're just questions around custody and holding crypto and, and custody as an exchange.
And a lot of the fiduciary obligations that we have, as custodians, we obviously take those very seriously. And I'm sure Coinbase does, too. I
think folks within space, there wasn't really much surprising. It was just kind of nit picking some legal language out of the 10K or 10Q.
KOSIK: Maybe it wasn't so surprising to you; you live and breathe this stuff. But oftentimes, a lot of these investors who get into crypto, they
don't read the finer points. So does that - what's your suggestion, then for people who, let's say, have crypto?
You know, let's say they're invested with you? Is it better to put it in a wallet? Is it safer there? And is it tradable as well?
CHOU: So I think there are tradeoffs when it comes to custody. And so the two main questions are do you want to hold your own private keys your own
passwords? Or do you want to entrust the third party custodian with it?
And I think both answers are equally valid, depending on people's risk appetites and there, where they kind of fall in this spectrum. So a lot of
times a custodian might be safer and more efficient for you to manage.
You don't have to worry about the headaches. But obviously you are entrusting a third party with custody risk. Some folks prefer to have the
control of having their own private keys, but ultimately, and then the responsibility lies with them.
And if they forget their passwords or their seeds, or if they lose it, then there's really no help coming and they would have lost their Bitcoin.
And so it really varies depending on individual appetite, but I think both are equally valid approaches for individuals.
KOSIK: Well, Juthica, thank you so much for all that great information. I'm sure those who are playing with Bitcoin these days will appreciate that.
Juthica Chou thanks so much for your time.
El Salvador is facing tens of millions of dollars in losses on crypto. Last year, it became the first country in the world to adopt Bitcoin as legal
tender, but the president also invested $100 million in Bitcoin before the price plunged.
Rafael Romo has more on that and the wider economic concerns. Raphael, what are you seeing?
RAFAEL ROMO, CNN CORRESPONDENT: Hi, Alison. Well, since early November, when Bitcoin was at its peak, the Cryptocurrency has gone down by a
whopping 56 percent. This morning, it's worth less than $30,000 when it reached nearly 68,000.
Back then for El Salvador, the problem is not only the reported loss of tens of millions of dollars, but also the fact that credit rating agencies
have downgraded the country which will make it difficult to get any loans for government projects.
(BEGIN VIDEOTAPE)
ROMO (voice over): It was flashy, loud and colorful. The special effects rival those of a rock concert that's how El President then made his grand
entrance, greeting everybody in English, no old fashioned suit or tie needed.
NAYIB BUKELE, SALVADORAN PRESIDENT: We're demonstrated that Bitcoin could do a lot of good things.
ROMO (voice over): Nayib Bukele, the 40 year old millennial President of El Salvador told the crowd, he's making his Central American nation of 6.5
million, a Bitcoin nation. That was back in November, when the market cap for Cryptocurrency hit 3 trillion. Bukele started promoting Bitcoin during
the summer.
BUKELE: This will generate jobs and help provide financial inclusion to thousands outside the formal economy.
ROMO (voice over): And in September, El Salvador became the first country to make Bitcoin legal tender alongside the U.S. dollar. Two months later,
the president announced plans to build a city where Bitcoin would reign supreme. But not everyone has jumped on the Bitcoin bandwagon.
JULIO SEVILLA, PROFESSOR, UNIVERSITY OF GEORGIA: It's supposed to be the currency right now Bitcoin, but people are not using it. It's mostly, you
know, businesses, international businesses like Starbucks, like McDonald's that are accepting Bitcoin because, you know, they don't want to be at the
fault with the policies of the government.
ROMO (voice over): And the government has gone all in buying up more than 2300 bitcoins since September, to the tune of more than $103 million. The
problem is that in the same period that Cryptocurrency has lost more than 35 percent of its value, meaning the Salvador and taxpayers are tens of
millions of dollars in the red thanks to their president's investment strategy. The president's answer buys the dip words he has posted multiple
times on Twitter.
SEVILLA: For an investor, for an individual investor, it may make sense right to say buys the dip, but the problem for our country, the risk is way
bigger. And we don't know if this is the deep.
ROMO (voice over): Georgia university business professor Julio Sevilla says the risk goes beyond losing money.
SEVILLA: Their own bond market has also suffered a lot. You know, it's out there with Ukraine on the riskier bonds perceived as countries on Ukraine.
You know, it's in a word that they did it induce El Salvador is getting into this risk voluntarily.
[09:25:00]
ROMO (on camera): On the one hand, El Salvador is making a risky investment. On the other, the small Central American country is counting on
help from the International Monetary Fund to repay government bonds worth $800 million.
The bonds are due in January and this burden, it's in addition to other financial obligations. How big is the risk of default?
SEVILLA: If the president keeps on buying as Bitcoin goes down, I think the risk of default may be larger because at some point, the IMF is going to
say no, we cannot loan your money. You're not doing things the right way.
ROMO (voice over): Sevilla says he still expects El Salvador to get financing. But if its president continues to double down on risky
investments, he says the fault is a very real possibility.
And Bukele's dream of making his country a Bitcoin nation could become a mirage.
(END VIDEOTAPE)
ROMO: Two credit rating agencies Fitch and Moody's have downgraded El Salvador so far this year, in part because of the risk associated with
Bitcoin purchases. And according to an analysis by Bloomberg, El Salvador's Bitcoin losses are roughly equal to its next bond payment of $38 million
due in mid-June, Alison, back to you.
KOSIK: All right, Rafael Romo thanks so much. Still to come, Ukraine's only national postal service is still making deliveries amid the war. I'll be
talking with the services director about its new stamp and how their work has changed during the war. That's after the break.
(COMMERCIAL BREAK)
[09:30:00]
KOSIK: Welcome back. I'm Alison Kosik. That was the opening bell and U.S. markets are up and running. And it looks like stocks are lower to start the
day a day after we saw some strong gains in the market.
In an interview yesterday, Fed Chair J. Powell said the central bank will not hesitate to raise interest rates to tame inflation. This has rising
costs are weighing on some company earnings. Shares of target are falling sharply after its first quarter profit and missed expectations.
The company blamed high costs and supply chain problems. Meantime shares of Lowe's are also down after its sales missed its estimates. The company says
cooler spring weather hurt demand for seasonal goods.
A failed river crossing turned into a graveyard of Russian tanks. CNN's Sam Kiley reports from the scene of one of Russia's worst defeats in Ukraine.
(BEGIN VIDEOTAPE)
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): The first signs of a Russian disaster - the Russian tank being salvaged by Ukrainian
troops. A few days ago this was the scene on the edge of these woods, Russian pontoon bridges and the ferocious Ukrainian artillery attack.
The Ukrainian commander with us cast an eye to the sky looking for Russian drones. This is no place for complacency. Ukraine and NATO have claimed
that Russia suffered badly here.
They estimate 70 to 80 vehicles destroyed and a whole Russian battle group of 1000 men mauled.
KILEY (on camera): So we're at the edge now of the area where the Russian armor was caught after it had crossed the pontoon river you can see down
here, there's a destroyed tank next to it. And I'm a personnel carrier and if we look down the road here, got another armored personnel carrier and
another and another.
The Ukrainians were able, they say due to their superior reconnaissance and intelligence to work out where the Russians were going to cross and then
bring in devastating levels of artillery. And this is the result this is only the edge of it.
KILEY (voice over): Russia has now shifted its attacks elsewhere, at least for now.
KILEY (on camera): When you see this, how do you feel?
UNIDENTIFIED MALE: Great. I understand that our artillery is working and our troops are working too because there was both artillery and ground
fighting. The units in cooperation with other troops were pushing the enemy across the river on foot.
KILEY (voice over): Shattered Russian armor is scattered along this path through the woodland. On the ground, we can't move forward. The track is
mind.
KILEY (on camera): A real disaster for the Russians but something that the Ukrainians now are saying here. That means that the pressure is off this
particular front for now, and that they believe that the Russians are focusing more of their efforts elsewhere.
KILEY (voice over): Ukrainian soldiers pick over the debris of this victory. But the chilling truth is that many of their comrades have ended
up like this. And while this is a success in the grinding war for Ukraine, Russia remains an immediate threat.
KILEY (on camera): And they've asked us to get out of here with their military commander because they're worried that our cars are going to
attract attention and therefore attracting coming. This is still clearly an extremely active area.
KILEY (voice over): And one as it was for the Russians that a considerable relief to leave. Sam Kiley, CNN Bilohorivka.
(END VIDEOTAPE)
KOSIK: Ukrposhta is Ukraine's national postal service and it has been operating throughout the war. Despite the dangers of working in a war zone
and massive damage to roads and rail tracks, it is still delivering pensions, parcels mail and aid supplies.
Last month it issued a stamp celebrating Ukraine's strong resistance. It picture one of the defenders of Snake Island shouting defiance at a Russian
warship. Igor Smelyansky is the Director of --is the Director General of Ukraine's national logistic and postal service. And he joins us live now,
so great to have you on the show today.
You know, it's remarkable how Ukraine has been able to keep many of its central functions running throughout the war. And this includes your
service, which is vital.
I'm curious to hear how you and your employees continue making deliveries and stay safe. You know, I would imagine there are so many obstacles to
overcome every day just so you can get those deliveries done.
IGOR SMELYANSKY, CEO & DIRECTOR GENERAL, UKRPOSHTA: Sure. I mean, I think safety is a relative term right now, but obviously we're trying our best to
deceive. We start every day at five and 6 a.m. reassessing the military situation assessing which roads we can and cannot take where can or cannot
go.
[09:35:00]
SMELYANSKY: And we plan our routes. And that's how we keep our employees and the clients safe. We work with military to demand, to demand the
places, to demand our branches, which have been occupied sometimes by Russian forces. So it's now become part of the daily work.
KOSIK: Is it true that you on Vladimir Putin's kill and capture list of key Ukrainian leaders? If so, do you know why?
SMELYANSKY: You know you never know for sure what's in his head. But I think every chairman or every executive of the top companies, the strategic
company on his list; I always post reports, et cetera.
But I don't think we should take it in our head. We just have to keep operating and do the job that we do. And hopefully, we'll win and he no
longer matters in the world politics.
KOSIK: You know millions of people have fled Ukraine. How hard is it to keep employees at this point? Are you finding that as well that you're
knocking on doors to make deliveries and no one answers or worse, you get to their homes, and they're destroyed?
SMELYANSKY: We have both. Obviously, we have local employees that know exactly what's happening. By the way, they're helping our citizens that
left, we established a new service called suitcase from home, so all the refugees that left Ukraine, their relatives can send their stuff to them,
wherever they are, Italy, Poland, and U.S.
And just last month, I think we tripled our volumes, so they can have something from home, clothing, toys, everything. And in the places which
have been destroyed, we're finding people, we're finding them in bomb shelters, sometimes they'll be in bomb shelters.
They're finding them in the new places. Or let's say if they change the place where they live, they can obtain their pensions in the new location.
So we are adapting to the situation on a daily basis, and trying to make sure that people are receiving what they are receiving.
I personally went to Donetsk and Luhansk region last week, and we delivered over 70 pensions to several - mobile connection, or even without
electricity, but we still deliver it.
KOSIK: I understand your company issued a stamp. Tell us about it. How did you come up with it? And what's been the response to it?
SMELYANSKY: I think response been great. It's now the symbol of our fight. On the stamp, yes, as you correctly described, there is a soldier that
sends the Russian ship to go where it needs to go.
And so we issued the stamp on April 12. And April 14, the ship was sinking. So I think we got the message. You know what's important during the post
service that when you send the message or send the letter, it's been received and delivered.
So I think this time has been delivered. And the reason this stamp is so popular, because it sends the sentiment that the thing all the people in
the world feel toward Russian forces, they need to go where they need to go.
And by the way, on Monday we will issue the newsletter called Russian worship done just to celebrate the fact that it's now in the status of the
submarine. And hopefully that's where the Russian military will be.
KOSIK: What's the biggest challenge that you face in your business?
SMELYANSKY: I think it's containing emotions and making your decisions with the cold head. You see millions of people in this place, you see your
employees killed, but nevertheless a thing every day they need to assess the situation and focus on the goal on making sure that we deliver food.
We deliver parcels; we deliver pensions to millions and millions of people. I think that's been the hardest part that I've learned how to do and
hopefully we go have to keep doing it not for a long time.
KOSIK: Well, you are certainly an example of a business that is literally just moving forward right in the middle of a war. Igor Smelyansky, Director
General of the Postal Service of Ukraine. Thanks so much for your time.
SMELYANSKY: Thank you very much.
KOSIK: The UK is introducing new legislation that could break the rules of its deal with the EU. Some say it also threatens to put peace at risk on
the island of Ireland. We'll explain after this.
(COMMERCIAL BREAK)
[09:40:00]
KOSIK: Tensions are rising over Brexit again. The EU officials are bristling after Britain said it would propose new legislation to let it
ignores some of the terms of its Brexit agreement.
The law would mean the government could set aside parts of the Northern Ireland protocol, a crucial part of the 2019 Brexit accord. The EU says
that would be unacceptable and would trigger retaliation.
British officials insist they do want to reach a solution by talking. Ireland's leader tells a different story though claiming the UK is not
sincerely engaging in talks with the European Union, he voiced his concern to CNN's Richard Quest.
(BEGIN VIDEOTAPE)
MICHEAL MARTIN, IRISH TAOISEACH: It's time you started negotiating seriously and in a substantial way with the European Union. I mean, this is
the treaty that you signed up, that the British government signed up to this ratified it in Parliament.
And now have misgivings in terms of the potential operation of this protocol, because let's not forget some aspects of this haven't been
implemented yet. Grace periods, exemptions and so forth.
But nothing can replace substantive professional negotiations within the European Union and United Kingdom to deal with issues that have
legitimately arisen in respect of the operation of the protocol, particularly raised by unionists within Northern Ireland, which we believe
can be resolved through sensible negotiations
RICHARD QUEST, CNN'S INTERNATIONAL BUSINESS CORRESPONDENT: Right. But they would say that there been negotiation for the last six months to a year,
there has been negotiation, the EU proposals are not acceptable to the British and vice versa. And therefore this is the way forward. They're not
of course, at the moment activating article 16.
MARTIN: There hasn't been a negotiation for the last six months. But they know that there hasn't de facto because there are elections happening in
Northern Ireland. Now the war engagement prior to Christmas and to be fair to - Vice President of the European Commission, he brought forward very
significant advances.
And he listened and he met Unionist politicians, and also industry in business in Northern Ireland. By the way, the protocol is advantageous now;
it's working in favor of industry, business jobs, agriculture, Northern Ireland. And most people in Northern Ireland want to retain access to the
European single market.
QUEST: Would you support a change in the protocol?
MARTIN: Now we weren't prepared as members of the European Union, through negotiations between the European Union Commission Vice President and his
team and the UK Government to minimize the impact in terms of checks and so on, of the operation of the protocol, which can be done with sensible
engagement that can be done.
But this kind of on off start, you know, the British - can't just keep talking to itself about this. It needs really to get into proper
negotiations with the European Union.
(END VIDEOTAPE)
KOSIK: The Northern Ireland protocol was an attempt to uphold a delegate power balance it ensures borders remain open between the Northern Ireland
and the Republic of Ireland key to maintaining peace in the region.
[09:45:00]
KOSIK: Aside from risking a trade war, some born scrapping the protocol could lead to rising tension on the ground. Bianca Nobilo explains why.
BIANCA NOBILO, CNN CORRESPONDENT: All of the disruption of Brexit, arguably, the thorniest challenge and least debated beforehand was its
effect on the island of Ireland. The Northern Ireland protocol came into effect in 2020 to try and address some of these difficulties.
It had two key objectives, number one, protecting the EU's single market which allows the free movement of people goods, services and capital,
because Northern Ireland is part of the UK separated by the Irish Sea.
And Republic of Ireland is part of the EU. So this is now the only land border between the UK and the EU. The second thing was avoiding a hard
border on the island of Ireland.
The removal of border checks was an important part of the peace process in recent decades. And there are fears that the restoration of a hard border
here would have an incendiary effect on tensions between the Unionists who want Northern Ireland to remain part of the UK, and the Republicans who
want unity with the Republic of Ireland.
Plus, they had to find a way to mitigate the economic and social impact on people and businesses which move across this border frequently. So the way
to square this circle ended up being customs and regulatory checks on the movement of goods between Great Britain and Northern Ireland, effectively
creating a border in the Irish Sea, which has infuriated Unionists. So why does this matter?
The Northern Ireland executive is in deadlock because of it. Unionist parties are refusing to reenter government until major changes are made to
this protocol.
Because this assembly is based on power sharing, there must be both a nationalist representative and the unionists and one cannot be empowered
without the other. So, UK Prime Minister Boris Johnson there he is says that he wants to get the government there back up and running. He's also
arguing that circumstances have changed dramatically since the protocol was agreed.
They meet the pandemic and a European war worsening a cost of living crisis. So he's threatening to override the protocol to make changes that
are palatable to his government and Unionist parties in Northern Ireland.
And he says he'll do that unilaterally, saying that the UK would have a necessity to act if a compromise can't be found with the EU. But the EU has
made it clear that unilateral action would be a breach of international law, which is generally not a good look for a head of state.
And the EU has warned that taking that step could spell a trade war and or legal challenges. And Sinn Fein now the largest party in the Northern
Ireland Assembly has warned that the Prime Minister tearing up the protocol will destabilize Ireland. KOSIK: Coming up after the break, the Twitter
board is on Elon Musk's back saying it'll hold him to his $44 billion deal. That's next.
(COMMERCIAL BREAK)
[09:50:00]
KOSIK: Welcome back, I'm Alison Kosik. Africa is making strides toward a more inclusive financial future from FinTech to free trade. The continent
is seeing transformation with the unbanked getting accounts and trade barriers falling. Makhtar Diop the International Finance Corporation sits
down with our Connecting Africa Host Eleni Giokos.
(BEGIN VIDEOTAPE)
ELENI GIOKOS, CNN CORRESPONDENT: The pandemic has seen an incredible acceleration in the FinTech space. And I guess when you look at the African
example, you know, in many ways so many African economies have been at the forefront of pioneering solutions to bank the unbanked to FinTech. Give me
a sense of where we are right now.
MAKHTAR DIOP, MANAGING DIRECTOR, INTERNATIONAL FINANCE CORPORATION: This is just fantastic. What's happening in Africa for a decade ago when we're
talking about FinTech about M-PESA? The IFC invested in Safaricom and people were saying, what are you doing, what is the thing?
GIOKOS: That was a good call, yes.
DIOP: That was a good call. And people were saying what these things called a FinTech? Fast forward today we have of the nine unicorn, we are in
Africa. Six of them are coming from FinTech. So FinTech is doing great.
In Nigeria, we have now three big unicorns in FinTech. So it's a business is moving well, was more importantly, he has an impact on people lives and
people development.
We have, as you know, financial inclusion, which is very low in Africa, only 58 percent of people have accounts. And now we've FinTech, we have
enough people who can do transaction by.
GIOKOS: You had foresight when it came to M-PESA. And in fact, it's been something that's been said that we haven't really seen anything riveting in
terms of true disruptive technologies since M-PESA. So what's the next M- PESA?
DIOP: Interesting things. So number of women in startups is much larger than people would have expected. You see great ideas of young entrepreneur.
And it's interesting, you see a mix, people who were in Europe or the U.S. coming back home and developing their business.
People would never left Africa while developing the business. And we are pairing also with MIT lab, and we're trying to do some innovation for
development, and try to see some of this innovation moving forward.
So I think that it will help developing into Africa trade. But we need to make sure that everything's which has been assigned and said is the Africa
free trade agreement becomes a reality.
GIOKOS: It's a financing institution, and it's the businesses that are going to ensure that the continental free trade area is actually you know,
becomes reality. Are you excited about what you're seeing right now, since it went live?
DIOP: I see a lot of political will to do that. But I think would be the next step is to make sure that the private sector and businessmen are the
center of the Africa Free Trade Agreement, encouraging to have a continental wide a dialogue between the private sector and the public
sector. So they can really exchange ideas on what are the challenges they're facing.
(END VIDEOTAPE)
KOSIK: The Twitter board is pushing Elon Musk to complete his $44 billion deal for Twitter. As we mentioned, the billionaire says it's on hold,
pending his concerns about spambots.
And a statement that Twitter board said this, we believe this agreement is in the best interest of all shareholders. We intend to close the
transaction and enforce the merger agreement.
Notice the word enforce there could legal action beyond the way. Paul R. La Monica has the latest now on this Twitter twist. So what do you think could
legal action be on the way here?
PAUL R. LA MONICA, CNN CORRESPONDENT: I mean, it's possible but obviously, Alison, it really all depends on what Elon Musk decides to do. There is
that binding agreement to buy Twitter at $54.20 a share. Look at Twitter's stock price, and it's clear that Wall Street does not expect the deal to go
through at that price at last check Twitter shares were trading below $38 a share.
So I think Musk either is looking for a way out because of these concerns that should have come up if he had done real due diligence instead of
impulsively trying to buy Twitter.
But I think that there's also the distinct possibility that Twitter recognizes that Musk may be their only hope, if you will, and they might
need to do a deal at a lower price.
So instead of litigation, maybe Musk and the Twitter board, go back to the negotiating table realize that a lot of things have changed in just the
past month. And maybe the takeover price is something below 54, 20 but hopefully above 38.
KOSIK: You know it seems as if the board is trying to get a hold of this runaway train a.k.a. you know this possible takeover of Twitter.
[09:55:00]
KOSIK: Is there even a certain date in the SEC filing about Elon Musk's interest in the company to buy it? Is there a date that this he either
needs to buy it or get out of it?
LA MONICA: Yes, I mean, he has a binding deal. So if he does not want to go through with this offer at the current price and decides to walk away
entirely, there is a $1 billion breakup fee, which is admittedly couch change couch cushion change for Elon Musk, so not something that he
probably would be too concerned about.
I think the bigger question though Alison remains will Musk really want to buy Twitter but just at a lower price? Or could he possibly look to start
his own social media network if he's so inclined?
He's got the cash to do it if he wants to start yet another company to go along with Tesla, Spacex, Boeing Company and everything else that he runs.
KOSIK: Well, Paul we'll have to watch Twitter to find out right. And Paul R. LA Monica thanks so much. And that's it for the show. I'm Alison Kosik;
follow me on Instagram and Twitter @alisonkosik. Thanks for joining us, "Connect the World" with Eleni Giokos is next.
(COMMERCIAL BREAK)
END
