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First Move with Julia Chatterley
Hopes Fading to Find Survivors of Dnipro Apartment Attack; Sicilian Mafia Boss arrested after 30 Years on the Run; Fortescue Drives $25B Ukraine Reconstruction Investment Fund; South African President Cancels Davos trip over Energy Crisis; Oil Industry Faces Highly Uncertain 2023; Indonesia to Relocate Capital as Jakarta is Sinking. Aired 9-10a ET
Aired January 16, 2023 - 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)
RAHEL SOLOMON, CNN HOST, FIRST MOVE: A warm welcome to "First Move", I'm Rahel Solomon in today for Julia Chatterley. Coming up this hour, the
rescue workers are desperately searching for survivors at a Ukrainian apartment complex hit by a Russian missile strike. 40 fatalities reported
so far and dozens more are feared dead.
We have a live report from the scene just ahead. Plus, a massive blow to the mafia Italy's most wanted man is under arrest after decades on the run.
We'll have the latest from Rome. But first a check of global markets and Wall Street is closed for the Martin Luther King Day holiday, but solid
gains this hour for European stocks.
The U.K.'s FTSE 100 moving closer to record highs there, green arrows also for Chinese equities. It's also a busy week ahead for Investors, the U.S.
is out with its latest look at wholesale inflation and retail sales. More U.S. firms reported Q4 results including Netflix and Goldman Sachs and the
U.S. is also set to hit its politically charged debt ceiling later this week setting off a month long congressional fight that's likely to rattle
global Investors.
The debt ceiling drama is sure to be a big topic of discussion at the World Economic Forum which kicks off today in Davos, Switzerland fears over a
slowing globalization, the threat of a global recession and the war in Ukraine just some of the other major topics this year more on the action in
Davos later in the show.
But first, we want to get to the war in Ukraine and days after Russia's deadly strike on an apartment building in South Eastern Ukraine. The search
for survivors continues. Kyiv says at least 40 people were killed in the attack; dozens of others may still be trapped under the rubble. Fred
Pleitgen joins me now live into Dnipro where the scene there is being described as apocalyptic, Fred?
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Rahel, I would say apocalyptic is certainly the word that many people who have seen this
new have been here with us as well.
And you know, one of the things that the Ukrainian President Volodymyr Zelenskyy said as he said he wants to save what he wants a cruiser to save
as many lives as possible. And of course, the chances of doing that are really dwindling by the second I'm going to get out of your way for a
second.
So you can see what's going on here, you can see that the crews here are still working. They're obviously still trying to save people, but they are
already using some pretty heavy equipment. And that really shows that they understand that the chances of finding anybody here now, so much time after
this explosion took place.
They are really minimal at this point in time; they're already starting to take as you can see some of the plates of that building down trying to
clear some of the debris that of course has accumulated here after that gargantuan explosion took place.
You can see behind me that building is just gone. That building was simply annihilated by a gigantic missile that struck you're obviously killing
scores of people, as you mentioned and I want you to have a look at some of the things that we've been witnessing since we've come here when you get on
the ground.
(BEGIN VIDEOTAPE)
PLEITGEN (voice over): The morning brings to light the full extent of the destruction. The residential building home to dozens of families
annihilated down to the foundation. Even though rescue crews still work, the chances of finding survivors now virtually zero.
All night residents watched in fear, anger and grief. All her Nevin Shanaya says she passed by the building only about half an hour before this--.
There are many friends and people close to me here many, many she said. Elena Loya, stunned by the scale of the destruction curses the Russians. I
simply hate those children, people die here, and we can't speak anymore.
Throughout the night, the death toll continued to jump. On top of the many killed Ukrainian authorities say dozens were injured, many of them
children. In just this location Dnipro, one of many sites in Ukraine, Russia targeted with barrages of missiles this weekend.
PLEITGEN (on camera): The Ukrainian says the reason why the damage here is so extensive is that this building was hit with a cruise missile called the
Kh-22. That's designed to destroy aircraft carrier strike groups. And obviously, when it hits the building, it completely annihilated it burying
dozens of people underneath.
PLEITGEN (voice over): The Ukrainians call the attack state terrorism. And the President says rescuers will continue to try and save anyone trapped
here. Let's fight for every person, President Zelenskyy says the rescue operation will last as long as there is even the slightest chance to save a
life. But even the slightest hope has now all but died and this is essentially a recovery operation.
[09:05:00]
PLEITGEN (voice over): The crews searching for bodies where so many lives were violently ended in an instant.
(END VIDEOTAPE)
PLEITGEN: And Rahel, I do have a bit of an update for you as well, because we have since then heard from the Russians now as well. This comes in the
form of the spokesman of the Kremlin Dmitry Peskov and he denied that the Russians were behind this, he said that Russia does not target civilian
infrastructure. The Russians are saying that they believe that this was a straight missile defense rocket that might have hit this building.
Obviously, the Ukrainians not having any of that they say they are certain that it was a Kh-22 missile, as we just described in our report that hit
this building. They also say, Rahel, that they currently do not have any defense systems that would be capable of shooting such missiles down.
And as you can see, behind me, the damage is certainly very much extensive. One of the things that we've heard from the local administration here is
that they're going to probably have to tear down about 250 apartments in this block, just because the building itself has been damaged so much,
Rahel.
SOLOMON: You know, it's hard to reconcile, Fred those comments from the Kremlin that they don't target civilians, and yet you see 40 people dying,
including children. Fred, if I might, I want to turn to the eastern part of Ukraine, where fierce battles continue in Russia claiming over the weekend
that its forces have taken the City of Soledar, while Ukraine says that it is still fighting. I mean, what do we know who has control of the city?
PLEITGEN: Well, right now, it's very difficult to say certainly, you're absolutely right. The Russians say that they have control of Soledar. The
Ukrainians are saying that they are still active in that area, at least and also said they still have a toehold in that city as well.
One of the things that we thought was interesting earlier today is we heard from the Ukrainians and they said that they had now launched some counter
attacks against the Russians in the Soledar area, as well and obviously are still trying to put up a fight.
One of the things that we can see is that this place is obviously very important for the Russians. Very important, specifically for that group
called the Wagner private military company to simply get some sort of win for Vladimir Putin because it certainly has been a long time since the
Russians have made any headway on the battlefields in Ukraine.
So it's certainly something where we can already see the Kremlin really talking about this a lot, Vladimir Putin talking about a certain dynamic on
the battlefield, whereas the Ukrainians are saying they are still holding on.
And certainly, if you speak to the Ukrainians, you look at what the Ukrainian leadership is saying. The morale here still is very, very high
and they understand that right now, in most of the fronts here in this country. They do believe that they have the upper hand and they they're
doing formidable job defending their country and obviously trying to expel the Russians from this country as well, Rahel.
SOLOMON: Fred has an interesting point, the symbolism of a win right now for Russia, perhaps not necessarily a huge military victory, but symbolic
nonetheless. Fred Pleitgen thank you. And of how now authorities now say at least 69 people have died after a passenger plane crash on Sunday, three
others are still missing. Please say that they have recovered the black box flight recorder from the plane as authorities work to find out what went
wrong.
This video shared on social media shows the plane rolling to one side, this is just moments before it went down. Vedika Sud joins us now with the
latest. Vedika, wonderful to have you I mean, as I said that there are still three people missing. What can you tell us about that? I mean, is
there hope that these people might actually still be alive or at this point is it just a recovery mission to locate the bodies?
VEDIKA SUD, CNN REPORTER: It's looking bleak, Rahel, that's what I would say and that's what officials are saying that the chance of survivors is
very little at this point. Today was day two of the search and rescue operation. 69 bodies that we pulled out of the gorge using cranes because
of the depth of that gorge, and those bodies have been taken to the hospital where post mortems will be conducted.
Remember 15 of those 69 bodies are of foreign nationals, at least 15 of them from outside Nepal who are on that ill-fated flight. And we've been
told that their bodies once identified will be airlifted to Kathmandu, the capital of Nepal, where the post mortems will take place and then those
bodies will be handed over to family members. Similarly, with the bodies of the Nepali nationals, they will be handed over to the family members after
the post mortem is conducted.
It's very important here to understand how big not an achievement rather than finding that black box has been a huge, huge victory of sorts. It's
going to fill up the investigations further for these people, the rescue persons on the spot on the site, because that black box may hold the
answers to all the questions that the investigators have, the family members have, of what really went wrong in the cockpit, after which that
flight actually the plane plunged into the gorge.
It's really sad to see those family members who have been waiting outside the hospital, Rahel. They want answers, they want the bodies back but as of
now the post mortems have to be conducted.
[09:10:00]
SUD: Now we do know that this is the deadliest air crash to take place in Nepal in more than three decades. In fact, also according to data that we
have obtained, this is the worst air accident have taken place in the history of Nepal. All eyes will be on that black box. We do know that a
five-member team has been formed by the Nepal Government to looking to the investigations. And we're expecting a report from them within 45 days,
Rahel.
SOLOMON: Vedika Sud thank you. To China now where China is revising the COVID deaths poll from 37 to nearly 60,000 that it's after dropping zero
COVID restrictions. And as the country's mass migration begins for the upcoming Lunar New Year holiday, concerns are rising over the spread of
COVID.
Marc Stewart joins us from Hong Kong. Marc, great to have you, so help me understand. So this is a pretty significant revision 37 to 60,000, but this
is also a nation of more than 1.4 billion people. Is the expectation or is the feeling that 60,000 is really accurate, or is there some skepticism
about whether there is still a concern about transparency?
MARC STEWART, CNN CORRESPONDENT: So much skepticism, Rahel, I mean, as you mentioned, 1.4 billion people 60,000. I mean, the math is just hard to
reconcile that aside, based on of what we are seeing on the ground, we are seeing lines to crematoriums and to funeral homes, hospitals are
overwhelmed. That is why there is a lot of doubt about this data point.
Now, just in the last few days, the government has said that they feel that the number of cases has peaked. Yet there are more and more calls for
transparency, especially by the World Health Organization. So this number, it is being met with skepticism, and then some, Rahel.
SOLOMON: And then Marc, of course, Chinese New Year quickly approaching, could that pose even more of a risk? I mean, even just anecdotally here in
the U.S. in the west, we know when we have holidays, we also start to see a spike in COVID cases. What's the expectation there?
STEWART: Well, let's again, look at the numbers according to China's Transportation Ministry, that is there will be about 2 billion individual
trips within that population of 1.4 billion. So people will clearly be on the move. And the concerns are very much similar to what we heard in the
United States about the spread of COVID.
Consider this we are going to see people leaving from some of China's biggest cities Shanghai, Beijing, Guangzhou, Shenzhen. And then they will
move to see family members often in rural areas or in country areas, if you will, for lack of better words. But the healthcare there may not
necessarily be as sophisticated and may not be as strong.
So for those reasons, there is concern that this will spread and outside of China for people traveling outside of Mainland, China, there are a lot of
restrictions about a dozen nations have restrictions we've heard in particular here in Asia from Japan and South Korea. So this spring holiday
around the New Year at last about a month. And that is why so many organizations including the World Health Organization are watching China
was such a critical --, Rahel.
SOLOMON: And as you point out, I mean so many trips expected as many people presumably haven't seen their family and years after the zero COVID
policies. Marc Stewart thank you. One of Europe's most wanted men is in custody after 30 years on the run.
Police arrested Sicilian Mafia Boss Matteo Messina Denaro, while he was being treated in a private clinic. Barbie Nadeau joins us live from Rome
with more. So Barbie after decades of being on the run, I mean, how did authorities ultimately catch up to one?
BARBIE NADEAU, CNN CONTRIBUTOR: Well, you know, it's a spectacular arrest the fact that this man who doesn't look that different from the age
progression images that the Police have been putting out and seen him for 30 years, is arrested at a private clinic in central Palermo largest city
in Sicily. You know, obviously, there was some sort of tip off but now they're going to be looking very much at the complicity aspect of this, who
knew he was there? You know, how what else has he done?
Well, he's been basically hiding in plain sight. But this is a man who has been convicted and sentenced to several life sentences in absentia for
murder, including the death of two very beloved anti-mafia prosecutors for the ordering the murder of an 11-year-old boy who was dissolved in acid
horrific crimes.
Now of course, the fact that he's behind bars means that there'll be another one right probably already in place right now. But this is being
hailed as a victory in Sicily and in Italy for the rest of this this mafia Cosa Nostra boss. But there going to be a lot of questions to ask about why
it took quite so long?
SOLOMON: As you say complicity, Barbie Nadeau thank you.
[09:15:00]
SOLOMON: Well, straight ahead, we are diving into Davos Oxfam raises the issue of wealth and equality but it's anyone out there really listening and
Fortescue Metals promises and investment lifeline for Ukraine. The Chairman of the Australian Mining Giant tells me about his reconstruction fund, and
his company's transition to green energy. We'll be right back.
(COMMERCIAL BREAK)
SOLOMON: It's time to dust off the snow boots. The global gathering of political leaders, CEOs and influencers is getting underway at the Swiss
Ski resort of Davos. And as usual Oxfam inequality report has stolen the show at the World Economic Forum, saying that the world's wealthiest people
are getting richer, pretty much faster than everyone else.
Anna Stewart is with me now. So Anna, it sorts of reminds me of that old expression, the rich keep getting richer, the poor keep getting poorer. I
mean, tell us a bit about the report. What's widening this gap? What's fueling the widening gap?
ANNA STEWART, CNN REPORTER: Well, that's just it. I mean, the top line is over the last few years, the wealthiest 1 percent have pocketed nearly
twice the amount of new wealth created than the rest of the world.
This isn't a surprise, as you say the most depressing part I find about this report is it comes out every year at the beginning of the World
Economic Forum in Davos, and every year, it's a similar story. But the focus in terms of why the wealthy are getting wealthier still, is really
two fold.
One looking at what's happened in terms of policy, for instance, over the pandemic, governments injecting trillions of dollars into economies to
protect them and a lot of that has led to the acceleration of valuations for stocks and other assets. So those invested in financial markets have
done very well out of that.
And then you can actually look more sector based, why have certain sectors performed particularly well, whether it's food companies, or most recently,
energy companies, as a result of the war in Ukraine, energy prices being high, who benefits from those huge skyrocketing profits, while some of the
biggest shareholders who are also often some of the wealthiest people in the world.
This report says for the first time, though, and a quarter of a century, it's not just that you're seeing a rise in extreme wealth. But that is
being accompanied at the same time in an increase in extreme poverty.
Right now looking around the world with inflation so high with energy prices high that feeds through to food and other kinds of bills, we are
seeing a big increase in terms of poverty. And actually today, according to the World Economic Forum, their community of Chief economists expects a
global recession in 2023. So that's the latest line from them and that suggests this situation could get a lot worse for those in poverty.
[09:20:00]
SOLOMON: Well, it's a great point Anna, because you think about for people who live in poor countries, I mean a greater percentage of their disposable
income is spent on food and energy, right? And so when you think about inflation, you can really start to understand the outsize impact for those
people. Anna so what to do about it what does the report say about what to actually do about the widening gap?
STEWART: Well, ultimately, they say, you know, every billionaire is a policy failure; they want to see a big redistribution of wealth that is
nothing new. But they do have ideas about how governments could go about that they certainly want to see increased taxation for the wealthy; they
want to see for the top 1 percent, a base rate of 60 percent. Ideally, income tax would be even higher, and would include things like your shares.
You know, that you might not sell, that's an unrealized gain at the moment, and they would like to see that tax. So people like Elon Musk would pay a
lot more. They also want to see a windfall tax for companies like energy companies who are profiting from the war in Ukraine and the increase in
energy prices.
They want a one off wealth tax. They want a lot and it's a great moment to put this report out with the elite gathering in Davos, does it actually
move the needle? Possibly not, but it does put pressure on policymakers and certainly lots of pressure on the top 1 percent, many of whom are
endeavors, right now.
SOLOMON: Well, as you point out, it's one thing to want something it's another thing to actually see it come to pass, Anna Stewart thank you. And
you can expect plenty of talk about Ukraine and reconstruction at Davos this year and on Tuesday, Ukraine's First Lady is expected to speak at the
event also there one mining magnate who was already digging deep to help.
Australian Metals Giant Fortescue is behind a $25 billion investment fund for reconstruction. The company is transitioning into green energy and
resources, investing massively in giant electric and hydrogen powered vehicles to help make its mining operations carbon neutral. Andrew Forrest
is the group's Founder and Chairman and joins me now. Andrew, welcome to the program.
ANDREW FORREST, FOUNDER AND CHAIRMAN, FORTESCUE METALS GROUP: Rahel, thanks for having me.
SOLOMON: So I want to start there with this Ukraine green growth initiative. Help me understand a bit more the scope of the fund and some of
the support you've been able to shore up thus far.
FORREST: Basically, this is an idea whose time has come. We all want to live in the era where violence, bullying one sovereign nation against
another might, is Rahel, all of that horrible part of the history of humanity could actually be put behind humanity by this one tremendous
example of Ukraine, defeating Russia. And so I want to do everything which I can, like, I'm sure every free citizen in the world does to help Ukraine,
defeat Russia.
And Russia, changed from a region to actually a country safe and peaceful within its own borders, and every other nation around it safe and peaceful
within their borders. And let it just be a message that the era of violence to for political aims, one country against another should be left behind by
humanity. And that $25 billion fund, which I hope will grow to $100 billion fund is there to really say to every Ukrainian, the instant the war
finishes to the satisfaction of your government.
We'll have a hair trigger investment to start rebuilding, but the right way that horrible old Soviet equipment that horrible old Soviet power stations,
which the horrible old Soviet right now trying to destroy. That's rebuild that rebuilt green, let's rebuild it digital, let's make it the best
infrastructure in the world. Let's commence that golden era for Ukraine, which those people more than deserve, to standing up for what is
effectively freedom for humanity.
SOLOMON: I see, so essentially, you would have to wait for the war to officially be declared over, you'd have to wait till you're welcomed into
the country by the Ukrainian government before you can actually deploy any of this capital.
FORREST: Well, you know, you just can't put together even 500 billion U.S. dollars in my case, or 25 billion as a minimum to 100 billion, which is our
target overnight. So we've started work on this months and months ago, and we've got months of work yet to be done.
But I think once people understand that, say, like the Marshall Plan Rahel, after World War Two, was a tremendously brave, wonderful investment which
American Government, American citizens did to invest in Germany, the end of World War Two.
It turned out to be fantastic for Germany, fantastic for the Investors. It's where you can put capital to work and know that it's doing very
serious good. And I certainly am out there speaking to other Investors like me to say, let's deploy our capital, where can do the most benefit? Let's
give as much encouragement as we possibly can to the people of Ukraine to know that when they win this war, they will enter into a golden era of
Ukraine.
[09:25:00]
SOLOMON: I want to turn now to China, what are your thoughts as we watch China reopen quite quickly, in fact, but cases also surged. I mean, what
are your thoughts as you watch that, and what type of impact has that had in terms of demand for metals?
FORREST: You're saying a nation which is educated, ambitious, and hungry for a better future for their own children than what they as adults have
had themselves. That pent up energy, that pent up demand held back like a dam wall for two and a half years.
You'll see that released, you'll see, as I hear constantly, my child has been saying, Hey, we're going to travel here, we're going to look at this
power of this house, or look at building this or expanding that, all of that is going to need commodities, all of that's going to need steel, of
course, iron ore.
I think that rather than being a bear on the global economy, from the Chinese perspective. I'm actually acknowledging that there will be
inflation, there will be hardship, but the world will get through it.
And the big economies like China and North America, let's think also about the inflation Reduction Act and championed by Joe Manchin, how wonderful
that is, and it's going to be for the U.S. economy. And you're saying that in North America, you're seeing heat up demand, pent up energy about to be
released in China, I think you'll see these be two economies really grow the global economy.
SOLOMON: I want to hopscotch a bit geographically, I want to go down to Davos, Switzerland, where you are, the mood has been described in Davos as
downbeat Davos, that's at least according to the Financial Times. I mean, how concerned are you looking ahead to 2023? As we said, on the one hand,
you have China reopening. On the other hand, you have calls potentially for a global recession? What are you looking at for 2023?
FORREST: I'm saying the factors which caused the hardship, inflation, the interest rates, the rising cost of living, actually artificial, though
brought on us, certainly by COVID, where the world was struggling to get back into production and but then hit with this unjust, cruel invasion of
Ukraine, which led to immediate shortages in particularly of energy.
Now, that's a device that is not a natural Nexus, that is what I hope will come to an end in human history. But that war will end and what I am
confident of is that the world must learn its lesson now.
And we must stop the rhetoric here in Davos or anywhere in the world, any parliamentary code or any Chairman's boardroom, stop the talk, and stop the
torque. And get on with it, let's acknowledge the simple truth, the more green energy you produce, and the more green energy you consume. The law,
the cost comes, the higher the standard of living of the citizen that country comes.
Now, you cannot say that for fossil fuel, the more you use fossil fuel, more expensive, it becomes more it's used as a weapon by dictators. The
more it pushes down standard of living of innocent community members, which has to stop. We have to stop using the band aid subsidizing fossil fuel
because we just want to get a quick kick in our political pawns.
But actually take the medium long term measure to deliver clean, pollution free, no harm energy, which the more you produce and use, the cheaper it
becomes. It's the only energy like that in the world. There's economic proof, there's no debate about this. We've got to get on and do it.
SOLOMON: Well, to that end, look, I mean, you had a pretty ambitious bet here with Sun Cables, a clean energy venture, which you hope to create the
world's largest solar farm here and get your back over the project, as was fellow billionaire Mike Cannon-Brooks. Can tell us more about what led to
some of the differences or disputes that ultimately led you to part ways?
FORREST: Yes, look, I haven't been involved in the management of that company. But I've seen that it's been hyper ambitious, very extravagant.
And the capital cost of that, cables goes to Singapore just kept rising by 10 percent, 50 percent, 100 percent. Now, that isn't sustainable, that's
what I would expect with inexperienced management and a board of directors who have never done large projects.
That concern me, but not as much as the single service information, particularly Singapore, that they actually weren't that interested in a
4000 plus kilometer long cable going through Indonesian waters to get to them in the first place. And what they wanted was great molecules they
wanted great ammonia, synthetic green methane, they want green hydrogen, they need those fuels. So instead of building a massively expensive cable,
simply put in the solar farm, put in the electrolyzes.
Create the hydrogen, putting the nitrogen if you want to ammonia, carbon dioxide. If you were once in synthetic green methane, or just straight
hydrogen and ship that to Singapore because that's what they're telling me they want.
[09:30:00]
FORREST: They don't want the electrons. They want the hydrogen. And so the customer is always right. And while the company is on a particular course
not to give the customer what I believe it wants, then we're happy to see that company be completely restructured, and change course.
SOLOMON: Well, Andrew Forrest will leave it here. Thank you for the time today. He is the Founder and Chairman of the Fortescue Metals Group.
FORREST: Thank you.
SOLOMON: And coming up, a crisis in South Africa why the country's leader is forced to cancel his trip to Davos coming up next.
(COMMERCIAL BREAK)
SOLOMON: Welcome back the "First Move"! South African President Cyril Ramaphosa skipping the World Economic Forum in Davos to deal with the
country's energy crisis; South Africa is experiencing record blackouts as troubles worsen at a state owned power utility company.
David McKenzie is live for us in Johannesburg with the latest. So David, help us understand this is a bit of a setback for Ramaphosa why is he
staying home? What does he expect to accomplish staying home?
DAVID MCKENZIE, CNN CORRESPONDENT: Well, what he wanted to do as the newly reelected president Rahel of the ruling ANC was to go and tout South Africa
as an investment destination. This was an important moment for Ramaphosa seen as a business friendly president.
But he's staying home because of well, look at this headline as I grabbed this paper, the blackouts in South Africa. This is just a list from the
sweat in the local paper of all the businesses they've called in recent days, small businesses, funeral parlors, you know, chicken shops, all kinds
of businesses.
And we were reporting on this late last year that has been just eviscerated by the ongoing power blackout. Some 10 hours or so of blackouts in my
neighborhood today, Rahel, and that's why the President staying. He wants to show that he somehow is on top of this despite the evidence that there
isn't a quick fix to this real crisis in Africa's most advanced economy.
[09:35:00]
MCKENZIE: And while people ask for change and protests are being organized, it seems there isn't really any way they can turn the corner on this
anytime soon Rahel.
SOLOMON: David, it's funny, I was just thinking actually about your reporting at the end of last year where you documented some of these
blackouts. So help me understand I mean, it appears that the blackouts have grown more extreme as of late how to fix this mess? I mean, what do you do
here?
MCKENZIE: Well, they have to really do a number of things. One is the aging fleet of power stations, largely coal power station of Eskom the major
power utility, which produces some 90 percent of the power, they are largely a monopoly. It's a maintenance issue. It's a long, ongoing
corruption issue.
It's an issue of a lack of planning, you know, you could list this for the next hour in your show, of what needs to be done and what hasn't been done
according to all the experts at this point. What they're really trying to scramble is independent power producers now are authorized to build up both
the renewable energies and other energy sources to get into the grid, but the grid itself in this country is crumbling.
So that's why you getting the opposition figures, ordinary citizens baying for blood. And you had this bizarre instance, late last year when the
outgoing CEO of Eskom under - who we've interviewed before for stories on this issue, claimed through the power utility that he survived a poisoning
attempt in the days around when he announced his resignation.
So there's a lot of intrigue behind the scenes. The basic issue is though, the small businesses, individual citizens of this country are reeling from
a lack of power. One thing that the ruling ANC promised they would provide for the people when they came into power more than 20 years ago. So it's a
tough situation, and no short term answers, I think, but they are scrambling to try and fix it.
SOLOMON: David McKenzie, thank you. And staying in African now, Sportswear and Athleisure Brand AFA poised to expand its footprint on local and
international markets. Eleni Giokos has the details on today's "Connecting Africa".
(BEGIN VIDEOTAPE)
ELENI GIOKOS, CNN CORRESPONDENT (voice over): Merchandise and Apparel Company AFA Sport was born with a global mindset to capitalize on the
profitable Athleisure and sports markets.
UGO UDEZUE, CO-FOUNDER, AFA SPORTS: We came into the space where there was really no ecosystem at all to support the kind of industry we're trying to
push.
GIOKOS (voice over): According to Market Research Firm Data Bridge, the global sports apparel sector will be worth almost $280 billion by 2030. AFA
Sport is the brainchild of Former Agent, Ugo Udezue who returned to Nigeria in 2015 after living 20 years in the United States.
UDEZUE: AFA Sports means Africa for Africa before we used to import all our products from China. So I went in front of my board and said, I think we
should go into manufacturing. They took a risk chance at it. Six months later, COVID hit. And we were the only people manufacturing and bringing in
sports products in Nigeria. So that's how AFA became very popular.
GIOKOS (voice over): AFA Sports is hoping to tap further into the Athleisure market estimated to hit more than $20 billion in Africa and the
Middle East by 2029.
WILL MBIAKOP, EXECUTIVE CHAIRMAN, AMERICAN SPORTS AND CREATIVE INSTITUTE: We have a booming middle class coming up. And obviously it's a massive
domestic market that we have, right? So when you look at the sports industry, we definitely need to porn additional investment.
UDEZUE: Kenya is actually one of our biggest opportunities. But every time we ship products there, they have to pay duties that sometimes even more
than the products they are buying. So if this opens up you're talking about the billions of people - opportunity, these are up--
GIOKOS (voice over): With a grain production footprint and a distribution partnership across Nigeria AFA Sport says they hope to build a legacy that
will impact generations in and outside of Africa.
UDEZUE: You know, in the next three, four years I see us as the Nikes of Africa. Africa is the next frontier.
(END VIDEOTAPE)
SOLOMON: And coming up, global oil demand and the search for a greener energy future are main topics at the World Economic Forum this year ahead
of the American Petroleum Institute joins us with his take on what's next for oil and the role of renewables coming up next.
(COMMERCIAL BREAK)
[09:40:00]
SOLOMON: Welcome back! Climate change and the role that big oil can play in a cleaner energy future turning to be hot topics at the World Economic
Forum in Davos, Switzerland this year. Climate activists marched in downtown Davos over the weekend to demand stronger climate action from
attendees.
A number of CEOs from major oil firms will be at the Economic Forum. And all this as oil investors face a highly uncertain 2023 rising demand from
China, the war in Ukraine and the threat of a global recession will surely affect the price of energy in the months ahead.
Also OPEX production response will be crucial here as well as the ability of U.S. producers to ramp up supply if needed. The President and CEO of the
American Petroleum Institute, Mike Sommers join me with his take on the oil industry outlook this year. Mike, welcome to the program.
MIKE SOMMERS, PRESIDENT AND CEO, AMERCIAN PETROLEUM INSTITUTE: Great to be with you Rahel.
SOLOMON: So we've heard a lot already this program just about the need for clean energy and the transition. And yet you argue that oil production also
needs to be ramped up and the administration needs to do more to prioritize the oil industry. And I wonder can you do both at the same time?
SOMMERS: You absolutely can do both. In fact what we've found over the course the last decade is that one of the reasons why we've been able to
reduce greenhouse gas emissions in the United States, from 2005 to 2020 wasn't necessarily because we invested a lot in so called green
technologies.
But actually because we were able to pursue a fuel switch from coal being the number one source of power in the United States in 2005, to natural gas
now, that's led to increased levels of our reductions in greenhouse gas emissions in the United States. We've cut greenhouse gas emissions here in
the United States, at levels not seen anywhere else in the world.
In fact, the United States has actually cut our greenhouse gas emissions almost as much as the European Union has combined in that time period. We
want to continue to do that. And the way to do it is we need to continue to invest in oil and gas here in the United States because natural gas is the
reason we've been able to cut greenhouse gas emissions here in the United States and we want to export that kind of greenhouse gas cutting throughout
the world.
SOLOMON: So what type of policies are you looking to see from the White House and the administration heading into 2023 and beyond?
SOMMERS: Well, there are a couple of different things that they can do. First of all, we need to open up the outer continental shelf in the Gulf of
Mexico for more production those are the lowest carbon barrels of oil in the world.
[09:45:00]
SOMMERS: We need to continue production in the United States. This administration has actually sat on the so called five year plan in the Gulf
of Mexico, meaning that no leasing can occur, the only leasing that's occurring under this administration has been mandated by federal law by the
inflation Reduction Act.
We also need to pursue more onshore production. We need to have least sales in the onshore particularly in the Permian Basin in New Mexico and other
federal lands. So those are two things that we can do to produce more here in the United States. Because we know the world is going to continue to
need lots of oil and gas into the future, particularly with the ongoing terrible war that's going on in Ukraine.
The other thing that this administration can do is they can cite new pipelines to so that we can get this oil and gas from where it is to where
it needs to be.
SOLOMON: Mike, I want you to respond to a comment earlier, we spoke to Andrew Forrest. He is the Chairman of Fortescue Metals, one of the largest
mining companies in the world. They are sort of moving transitioning to green energy as well. And what he said to me was, the more you use fossil
fuel, the more expensive it becomes, the more it's weaponized. How would you react to that?
SOMMERS: Well, that's one of the reasons why we need to produce more here in the United States. You know, unfortunately, we've become reliant too
much on regimes that are hostile to America's interest. We have the product right here. The solution is right here in the United States. We just need
to pursue it.
You know, in Pennsylvania alone, for example, there's over 400 years of natural gas under Pennsylvania, that we even know of Ohio is another great
example of where we can get more natural gas and more production. We can produce these products here and the most stable regime in the world here in
the United States.
If we just unleash this power that we have, we can do it. But it's going to require politicians to work with the oil and gas industry to pursue these
policies that we've outlined in our make move and improved plan, which you can find @api.org.
SOLOMON: And Mike, speaking of politicians, I mean, it's certainly no secret that relations between the industry and the White House were quite
tense more tense than others at certain points of the year. What is the state of relations now?
SOMMERS: We have a great ongoing dialogue with this administration. We talk with them almost every single week about policies that they can pursue.
We've solved a lot of problems that, you know regular citizens don't even know about because of some of that ongoing dialogue.
We want to work with them. We want to work with both sides of the aisle to pursue these policies, is one of the reasons why we put out this new plan
here just last week, because we believe that if politicians work together with the industry to develop these solutions, we're going to be able to get
some stuff done this year, even in divided government.
I'll remind you that in 2015, one of the most important policy changes that we were able to get done in the last two decades was lifting of the crude
oil export ban that was in place since the 1970s. That was done when Republicans controlled Congress and Barack Obama was President of the
United States.
And our studies show that we're producing 2.5 million barrels more a day, as a consequence of that policy change that was done under divided
government. We can get stuff done under divided government, if both sides of the aisle work together with industry. And that's what our make move and
improved plan is all about.
SOLOMON: Mike, what do you see as the biggest risk to oil prices for consumers into 2023?
SOMMERS: Well, I think there are a lot of uncertainties out there. We don't predict prices. But you know, there's a lot of uncertainty, particularly
with the unlocking of China right now that could lead to increased demand in China for American products and world products so that is one
uncertainty that we're seeing right now.
But you know, a lot of the downward pressure on oil prices is a result of economists predicting a potential recession, which of course, would lead to
less demand for these products. We're very bullish on the prospects for American energy going forward.
We have the best resources in the world in the Gulf of Mexico and the prolific Permian Basin the - and North Dakota. We have a lot of opportunity
here in the United States. That's not even to mention Alaska which has been one of our most prolific regions in the United States, or Pennsylvania,
where this industry started? So we have a lot of opportunity to invest more and unlock these resources for world consumers.
SOLOMON: Interesting, Mike, we'll have to leave it here. But it's so interesting, the global recession fears, you know, I wonder sometimes if
investors are perhaps reacting a bit too strongly, because when I talk to energy experts about what we actually see in terms of global consumption
demand during times of recession.
The impact is pretty marginal, I think less than 10 percent if you look at the last six recessions or so. So sometimes I think the reaction might be a
bit knee jerk, but we'll have to wait and see Mike Sommers thank you.
SOMMERS: Thanks Rahel.
SOLOMON: Yep, he is the President and CEO of the American Petroleum Institute. And you are watching "First Move". Coming up, Indonesia solution
to its sinking, yes sinking capital full details next.
[09:50:00]
(COMMERCIAL BREAK)
SOLOMON: Welcome back! The Government of Indonesia is planning to relocate its capital city as Jakarta rapidly sinks into the Java Sea. The proposed
new location is a jungle covered area on the East of Borneo. However, some environmentalists are warning that the move could endanger the wildlife and
rainforest there. CNN's Kristie Lu Stout has the details.
(BEGIN VIDEO TAPE)
KRISTIE LU STOUT, CNN CORRESPONDENT (voice over): Jakarta is sinking city scientists say the sprawling capital of Indonesia, home to more than 10
million people is dropping below sea level at alarming rates, mainly due to excessive groundwater extraction.
The government of Indonesia has a plan to carve a new capital city called Nusantara out of the dense jungles of Eastern Borneo. At an estimated cost
of more than $30 billion it's being designed as a futuristic smart city and touted by government officials as the world's most sustainable.
JOKO WIDODO, INDONESIAN PRESIDENT: The development of the new capital has to become a move towards building cities that are healthy, efficient and
productive, that are designed to be a place where the people are close from any destination where they can bike and walk everywhere because there are
zero emissions.
STOUT (voice over): Officials described the new capital as a sort of Garden of Eden built along the contours of the natural landscape. Nusantara is
expected to be completed in 2045 and the government says it will be more than three and a half times the size of Singapore and home to nearly 2
million people. Officials and developers claim it will have minimal impact on surrounding rainforests that are some of the oldest in the world.
SOFIAN SIBARANI, NUSANTARA ARCHITECTURAL DESIGNER: We have in our guidelines are all the building especially key buildings or government
building needs to be green, green building. It needs to be sensitive to the environment is also futuristic is a future smart city smart government
smart society smart infrastructure.
STOUT (voice over): But some environmentalists disagree warning of potential habitat destruction.
AGUS BEI, MANGROVE ACTIVIST: The area's unique with its natural habitats and native species. And if its mangrove forests are destroyed, all the
native species will be gone too. And the next generations can only hear the stories about the species because they don't exist anymore.
STOUT (voice over): There is another concern about the project the potential displacement of indigenous tribes
SIBUKDIN, BALIK TRIBE LEADER: The land and the farms are inherited from our ancestors. The land is the biggest asset of our tribe. For us, the farm is
the source of life if our land is taken away how could we farm? How could we live?
STOUT (voice over): Due to that the government has said it will compensate landowners.
[09:55:00]
STOUT (voice over): And there are also some critics who say Indonesia should concentrate on fixing the problems in Jakarta, arguing millions of
residents will remain in the current capital, struggling to cope with pollution, traffic and worsening floods.
DORINA POJANI, UNIVERSITY OF QUEENSLAND URBAN PLANNING EXPERT: Will lead to relieve congestion in Jakarta. Will it make whatever is left behind in
Jakarta get to live a bit better way? I don't think so.
STOUT (voice over): As construction ramps up this year, many questions remain. But one thing is clear the road to creating Nusantara Indonesia's
shining city on a hill will likely be an uphill climb. Kristie Lu Stout, CNN.
(END VIDEO TAPE)
SOLOMON: And finally the 1990s are calling Gen Z's newest obsession is the old fashion flip phone. The devices are on sale for as little as 20 bucks
at retailers like Wal-Mart and Amazon and TikTok is awash with videos of young people unboxing both modern and vintage versions.
It's part of a growing trend of young people trying to unplug. Psychologists say smartphones and social media grow while so does the
depression rate among teens. Now it seems they're choosing to use a flip phone over a smartphone instead. And that is it for the show. I'm Rahel
Solomon. "Connect the World" with Becky Anderson is next.
(COMMERCIAL BREAK)
END
