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First Move with Julia Chatterley
Alphabet Announces Layoffs, Netflix Numbers Excite; Western Defense Chiefs Debate Sending Tanks to Ukraine; Greek PM: Europe will Continue to Support Ukraine; U.N. Chief: We're not United against the Climate Crisis; Spanish PM: Inequality is our Major Challenge. Aired 9-10a ET
Aired January 20, 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. Great to have you with us
again, just ahead on today's show defense debate Western officials are meeting today they're discussing sending much needed battle tanks to
Ukraine, and it comes ahead of a feared new Russian offensive.
Germany still a key holdout but talks are ongoing. We'll have a live report and streaming gleaming Wall Street applauding strong results from Netflix.
It is cheaper ad supported subscription tier really helping Lauren, millions of new customers also a surprise management move. We've the
details just ahead.
But first the action on global markets, mostly higher open currently on tap for Wall Street say for the DOW, the DOW is currently down fractionally.
The bulls are hoping for a bounce after three straight days of losses driven by concerns about slowing economic growth and continued hawkish fed
speaks. Europe meantime continues its strong 2023 advance, but new pain and tech Alphabet now the latest firm to announce a major round of layoffs,
thousands of workers being cut globally. We will discuss in just a moment.
And it's also the last day of the World Economic Forum in Davos, Switzerland. "First Move" closing out the week in style with an array of
important guests from the conference we'll hear from Spanish Prime Minister Pedro Sanchez on the fight to alleviate inequality. U.N. Secretary General
Antonio Guterres on the immediate steps needed to combat climate change. Plus, the Prime Minister of Greece on the importance of standing united
with Ukraine.
And the conflict in Ukraine is where we begin today's program. We begin on the sidelines of a high stakes defense meeting, where the German Defense
Minister has just told reporters, no decision has been made yet on whether to send Leopard 2 tanks to Ukraine. Right now Ministers from dozens of
countries are debating how to boost Ukrainian Military capabilities? Ukraine's President Zelenskyy opened the meeting calling for more
assistance without delay.
(BEGIN VIDEO CLIP)
VOLODYMYR ZELENSKYY, PRESIDENT OF UKRAINE: The war started by Russia does not allow delays and I can thank you, hundreds of times and it will be
absolutely just in fear given all that we have already done but hundreds of thank you are not hundreds of tanks.
(END VIDEO CLIP)
SOLOMON: And CNN's Oren Liebermann joins me from the Pentagon. Oren, good to have you so what is the path forward here, right? Because we know that
there are certain European nations Poland, Finland, for example, who would like to send tanks but can't do so without Germany's OK. So what's the path
forward look like?
OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT: As of right now, the plan is for the U.S. and other countries to put pressure on Germany to make a
decision. But as you pointed out, we just heard from Germany's very new Defense Minister Boris Pistorius that no decision has yet been made. This
is Ukrainian President Volodymyr Zelenskyy says, look, Time is not on our side.
It's on Russia side pushing the U.S. and other countries to move faster. The question is what will cause Germany to make a decision and that's what
the U.S. and others are trying to figure out. As you point out Poland has been very vocal about this, they've been frustrated and that, as we've just
seen, has boiled over there.
Now threatening just to send tanks normally, because these are German made Leopard tanks, you would need Germany's approval before exporting them to
another country. Finland has also expressed its willingness to send Leopard tanks, and about a dozen other countries in Europe have these. So these are
not in short supply.
But Germany is just too timid right now and has not yet made a decision. Up until now, it appeared to be - for that, Germany was waiting for the U.S.
to announce its own sending of tanks. But the U.S. has made clear that the main U.S. tech known as the Abrams is simply too complex and too much of a
maintenance nightmare too heavy to send to Ukraine and saying, look, that's not the issue here.
The issue is Germany needs to approve this and we're held that's what we're watching. Now, does Germany shift on this one? Or for example, does Poland
just do what it's threatening to do send its tanks and wait to see what the consequences are from Germany?
SOLOMON: Well, that's an interesting point Oren, I mean, if we if we do see that type of action from Poland, you have to wonder what type of division
that would create between Poland and Germany lots to watch here, Oren Liebermann thank you. Now to global economic uncertainties which are being
blamed for a punishing new round of job losses.
And tech, Google parent company Alphabet, announcing today those 12,000 workers will lose their jobs worldwide. That's amid a post lockdown
spending pullback by clients, but in the streaming space signs of resilience Netflix saying that it is getting stronger than expected
subscriber growth more than 7.5 million new quarters' customers in the last quarter alone.
[09:05:00]
SOLOMON: And that's thanks to popular new shows like Addams Family spinoff Wednesday. Netflix assuring Investors that it's also keeping costs in
check. Paul R LA Monica joins me now, Paul, we'll get to Netflix in just a moment but I want to start with Alphabet.
So help me put this in context 12,000 workers, I mean, how much of a cut is that percentage wise Alphabet as a huge company, obviously? But also how
much of this is a correction perhaps if you can call it that from the massive expansion the company saw during the pandemic?
PAUL R. LA MONICA, CNN REPORTER: Yes, that's a great point. Well, it's about 6 percent of the global headcount at Alphabet. So that is pretty
significant, I think that what you have going on here is that Alphabet, which owns Google, YouTube, of course, really ramped up aggressively and
now realizes like many other tech companies, Microsoft, Meta, Amazon, that they have to scale back.
And Alphabet CEO Sundar Pichai even admitted saying, over the past two years, we've seen periods of dramatic growth. To match and fuel that
growth, we hired for a different economic reality than the one we face today.
And, you know, if you didn't know who that was saying that you could have thought that it was Mark Zuckerberg, that it was Satya Nadella, that it was
someone you know, at pretty much any tech company right now. They all ramped up aggressively and unfortunately, demand is not going to be there.
As we have all these worries about a recession.
SOLOMON: Paul, your point it's sort of like fill in the blank, right because we continue to hear it sort of day after day, week after week. It
seems like the last few weeks at least, I want to now turn to Netflix. Paul, as you know, 2022 was a brutal year for the company, the stock
finished lower about 38 percent. The company reported that it was losing subscribers; it was brutal to say the least. And now that seems to have
changed what happened?
MONICA: Yes, I think there are a couple of things at play even though Netflix did not break down specifically, how much of the growth came from
the new ad supported cheaper subscription. It is interesting to see that Netflix had this level of growth.
And the company did admit on the conference call, which I think is reassuring some investors today that the growth they saw is new customers,
they didn't have as many paying premium subscribers going down to the ad tier even though it cost less money.
So I think that's reassuring that people at Netflix that already had more expensive plans, didn't look to cut costs. But you know, Netflix and
streaming, what we've really quickly learned, Rahel, is it's all about hits. Remember this time a year ago, it was all about squid game and how
that was saving Netflix.
Now it's Wednesday, it was such a phenomenal hit for the company. And it really just goes to show that when you're in streaming media, if you have a
property like Wednesday at Netflix like the Mandalorian at Disney. You can rely on those big fans coming back at least for whenever a new season is
they're going to be subscribing.
SOLOMON: Oh, and by the way, to your point, Paul, if you can also manage to spend a bit less on content and bring in more people. That you might just
be able to turn it around especially and even in the midst of a very crowded field and streaming Paul R LA Monica, good to have you have a good
weekend.
Well into deep trouble for Genesis the Cryptocurrency broker it's filing for Chapter 11, after suffering major losses following the collapse of FTX
and the hedge fund three arrows Capitol. Anna Stewart is on the story. Anna, good to have you! So what happened here? I mean, how much of this do
you think is directly tied to FTX or something else entirely?
ANNA STEWART, CNN REPORTER: I mean, that is a good question, because certainly this is one of the dominoes that has fallen since the collapse of
FTX. But actually, this lending platform of Genesis was actually in trouble even before then, because its two biggest borrowers were three arrows and
Alameda research. The latter was linked FTX but also three arrows which went bust even before.
So the writing was on the wall, I'd say from around November, when Genesis actually stopped withdrawals from their customers on the lending platform.
That was when you, kind of really knew that, you know, stuff was going to hit the fan, let's say. Added to that, I would say there are some other
lines around this particular company there are interesting.
Genesis was already in a dispute with Gemini, which is the company founded by the Winklevoss brothers that is regarding a joint crypto platform, I
would say could earn. We could get into that as a product, but I won't because we do not have the time, but essentially Gemini says that Genesis
owes the investors have earned some $900 million.
Add to that the fact that Genesis and Gemini both were charged by the SEC just over a week ago for illegally selling securities to Investors. I would
be amazed if anyone could follow all of that but it doesn't really surprise me that Genesis is lending platform has filed for bankruptcy. Listen, I
know we say it a lot but with these lending platforms in crypto, they are not regulated.
[09:10:00]
STEWART: They do not need to have you know a capital cushion as you would with a traditional fit bank. We see this time and time again many of our
customers are also in crypto are also unregulated, also don't have good cash, capital cushions. And also, of course, there are many scams in there
as well. So the news this morning, you're, kind of like --.
SOLOMON: It's a lot to keep track of, but one thing that I would bet that viewers can keep track of is that 2022 was a tough year for crypto was
called a crypto winter, which essentially just means a pretty significant fall in value. Anna, we don't have much time but are we starting to see
signs of a potential --?
STEWART: Well, I mean, like after the litany of crypto disasters last year in the fact that the fallout continues, you would be amazed to think that
perhaps the crypto winter is throwing. But looking at prices perhaps Bitcoin is up 25 percent over the last month if theory which is the leading
alternative Cryptocurrency also up by around more than 30 percent. I'm sure plenty of people will roll their eyes and say yes, until the next big
crypto bankruptcy or scam they may well be right.
But listen, if you love crypto, if you hate crypto, if you just want to learn a little bit more about it. The next episode of decoded is for you.
We spent the last couple of months with a team trying to decode Cryptocurrency hugely challenging, great fun as well. We have a cool
episode coming out next weekend, January the 28th. I hope you get to see it.
SOLOMON: Who better to tackle it hugely challenging, but I have no doubt, Anna, that you handled it well. Anna, it's interesting and I'll just say
before I let you go a friend to me last night talked about crypto thawing and said crypto was back. I don't know about that. We'll have to wait and
see but good to have you nonetheless. Thank you Anna Stewart!
Well, after a three year COVID ban, China says that it will allow tour operators to resume overseas package holidays for Chinese vacationers to
certain countries. Right now, China is also facing one of the busiest travel days of the year for travel with millions heading home to celebrate
the Lunar New Year holiday this weekend.
Let's bring in Marc Stewart in Hong Kong. Marc, so help me understand put this in context for me. How large of crowds are we expecting because I
would imagine that there is also a fair bit of trepidation about COVID right now? So how large of crowds are we talking about here?
MARC STEWART, CNN CORRESPONDENT: Right Rahel, well, let me just start by saying that Chinese government officials have emphasized the point that
they feel that the number of COVID cases has peaked in many parts of the country. So the stage is set for what is described as the largest human
migration on Earth, or at least that's what past history as shown. If you look at the broader picture, 1.4 billion people living in China, but there
may be as many as 2 billion individual trips.
And today, if we look across China, people are traveling by air, by sea, they are driving they are flying a very busy scene at travel hubs all
across the country. With that said, of course, there is some concern about the spread of COVID. While health officials do again, feel there has been
this peak, the question is whether or not rural areas are perhaps in as strong shape as city centers, if anything because of health resources that
are available.
But this is a much cherished time of the year; this is a time of year that people across Asia really look forward to. And historically speaking, this
has been something that's been on hold for about two to three years in many parts of the world, because of COVID. So people are trying to make that
effort to see their loved ones to see their family and friends.
You did mention that some of the tour operators in China will be able to resume travel again. And that is significant because it will open up China
to places such as Singapore. I'm looking at the list here South Africa, Russia, Switzerland, Argentina, all different directions where travel has
been put on hold.
With that said in some parts of the world, Chinese travelers are being met with restrictions, whether it be testing or some kind of a waiting period.
So that's also in play here, but as far as here in Hong Kong, Rahel, where I am, there are rabbits everywhere it is the year the rabbit people are
very excited even in conversations with colleagues and with sources. They're just looking forward to slowing down and spending time with family
and friends.
SOLOMON: Understandably, Marc Stewart thank you and happy New Year.
STEWART: Thank you.
SOLOMON: And we'll have more "First Move", after this.
(COMMERCIAL BREAK)
[09:15:00]
SOLOMON: And as we've been reporting discussions continue at this hour about sending more military equipment to Ukraine. The talks taking place at
a meeting of Defense Ministers at the Ramstein Air Base in Germany. The Kremlin says that even if NATO sends more weapons, it will not prevent
Russia from achieving its goals.
Let's bring in CNN's Chief International Correspondent Clarissa Ward from Kyiv. Clarissa helped me understand it appears that urgency is the headline
of these meetings we heard from Zelenskyy saying essentially time is not on our side. Help us understand why some believe that this could be a defining
moment in the war?
CLARISSA WARD, CHIEF INTERNATIONAL CORRESPONDENT: Well, Rahel, we know now that the Head of the CIA Bill Burns actually visited President Volodymyr
Zelenskyy here in Kyiv at the end of last week, and was essentially sharing with him the CIA's outlook, in terms of what they expect from Russia in the
coming weeks and months. But the fear here has been for some time now that Russia is planning a major spring offensive. The logic behind that is that
300,000 troops were mobilized.
150,000 of them were sent onto the battlefield; the remaining 150,000 have been in training and will basically be finishing their training in the
coming weeks. And so the idea is that they will then be part of some kind of a spring offensive. What you heard also from Lloyd Austin, the U.S.
Secretary of Defense was, this is a key moment, because right now Russia is running out of ammunition, but they are trying to regroup they are trying
to recruit.
And they are trying to basically build up production internally in terms of their military industrial production. And so the fear is that the longer
you leave it, the law, the greater the chances that Russia will be sort of successful in some kind of an offensive. So that's why you're seeing that
note of urgency coming from Ukraine supporters in terms of trying to get them the types of weapons that they need to act now to act fast and to act
decisively, Rahel.
SOLOMON: The NATO Secretary General said in Davos earlier this week, Clarissa that the war has reached a pivotal moment. We'll wait to see
Clarissa Ward in Kyiv there thank you. And the war Ukraine continues to be at the heart of the debate on the final day of the World Economic Forum in
Davos. Julia Chatterley spoke with the Prime Minister of Greece and asked him whether Europe's unified stance against Russia's aggression would be
sustained?
(BEGIN VIDEOTAPE)
KYRIAKOS MITSOTAKIS, GREEK PRIME MINISTER: We'll continue because that is the right thing to do. And because our approach is yielding results, I
think a lot of people were surprised by how unified the Western world was, and in particular the European Union. But we will stay the course we will
continue to support Ukraine and of course, we will move away as quickly as possible to reduce our dependence on Russian gas.
JULIA CHATTERLEY, CNN HOST: We'll talk about that, but we are almost one year on now from the start of this war.
[09:20:00]
CHATTERLEY: And I spoke to the NATO Secretary General this week in particular and it was all about the weaponry and providing greater support.
And a question I asked him and I'll ask you the same is, are you confident that continue in this manner with support with weaponry is the only path to
peace?
MITSOTAKIS: Is there an alternative, because certainly the alternative is not to allow the Ukrainians to be defeated in the battlefield. They need
weapons, and we will supply them with weapons, in order for them to reach a point where they can negotiate a peace on their own terms. This was always
the goal. Obviously, we're all looking for an end to the conflict.
But we need to give the Ukrainians the means that they require in order to defend themselves, this is what this is all about, this is a war of
aggression. This is a provocative attempt by a great power to sort of impose it sort of revisionist fantasies in terms of its foreign policy. And
we will continue to support Ukraine, as we've done so far.
CHATTERLEY: The Spanish Prime Minister said to me, the lines of diplomacy have to remain open too with Russia.
MITSOTAKIS: I think there's no doubt, there's no doubt about that.
CHATTERLEY: Can you - and you've talked about the sort of people to people connections --.
MITSOTAKIS: But at the end of the day, of course, channels of communication need to be kept open. But this negotiation is going to take place
eventually, between the two parties involved, and the other ones that you create is the one that will determine the terms of peace, and hopefully we
will reach that point, sooner rather than later. But the more successful they are in the battlefield, I think, the more likely we are to reach that
end game.
CHATTERLEY: You mentioned it energy security and that's been the talk and also that clean energy is the best form of energy security for Europe, in
light of what we've seen, particularly over the last 12 months. But also that if you're going to invest in oil and gas, it has to be infrastructure
that can adapt and transition to cleaner fuels like hydrogen in the future. And I think specifically that in what you're doing in the Northeast.
MITSOTAKIS: Well, first of all, it may be, you know, snowy and cold in Davos. But I can assure you that today, in Greece, all our wind turbines
are spinning, it's a sunny day, and we're producing a significant amount of electricity, even during the winter from renewables versus the future. We
learn something from the Ukrainian crisis is that we need to double down on renewables, they are cheaper, and they are geopolitically safer.
And this is exactly what we're doing in Greece. In the meantime, we need gas but we need to be careful that all the gas infrastructure needs to be
ready for a future after gas, for example, we're building a new electricity factory in Northeastern Greece, it will be hydrogen ready, in the short
term, we will provide electricity not just for Greece, but also for the Balkans.
We want to be an exporter of energy and a provider of energy security for our Balkan friends. But in the long term, it can burn a combination of
hydrogen and gas and eventually, it could move to green hydrogen.
CHATTERLEY: You know, what surprises me when I look across Europe is particularly the growth in 2022, significantly outperforming most of the
other countries. Yet you still managed to bring the deficit down, which goes to your point about that 90 percent profit tax as well, even to the
point where some economists out there saying, you know, are you pushing too hard in order to bring that deficit down? I know getting investment grade
rating in 2023 is something that you are fundamentally focused on.
MITSOTAKIS: And it has to happen and it will happen.
CHATTERLEY: Will it.
MITSOTAKIS: It will happen, once we resolve you know the political sort of uncertainties because as you know, we will have an election in the spring
and I'm confident that we will win again.
CHATTERLEY: Are you sacrificing popularity, though by pushing so hard to get that --?
MITSOTAKIS: But I don't think we're pushing that hard because the economy has been over performing, which means that we've generated actually more
fiscal space to support businesses and households. If anything, we did the opposite during COVID; we spent more than 40 billion. We pushed up our debt
again, but the markets were tolerated because they understood that this was a one sort of policy response.
But at that same time, when they look at our overall debt to GDP, we bring it down by almost 40 percentage points, in three years, the fastest
reduction of all European countries. But we still have enough money to support vulnerable businesses and households. So that's why I think our
policy has been successful because it was both and it is both liberal in terms of generating growth but also progressive in terms of supporting the
weaker households and the weaker members of our society.
CHATTERLEY: It's a delicate balance. It's been an incredibly tough three years for all nations. I think that for all leaders reforming at the same
time, tough too, and I know you've tackled that particularly in the tech sector as well, which goes back to the finances as well. Why should the
people give you more time?
[09:25:00]
MITSOTAKIS: Because we've delivered on our promises, because we're rebuilding relationships of trust with the Greek people, because we've
lowered taxes, we've reduced unemployment we have supported people during difficult periods. And I know this is a difficult period that we're going
through. And because at the end of the day, I think experience and crisis management cuts, as you said, poly crisis, we don't know what crisis will
be around the corner.
We're hoping for calmer waters, but we never know what the future will throw at us. So I think the question of reliability, stability,
predictability is important these days for Greeks for the first time, they sense that the country has turned the corner. I don't think they would want
to derail this path.
CHATTERLEY: Can you avoid recession this year?
MITSOTAKIS: Oh, most definitely, we will not have a recession this year, if anything were likely to close to grow closer to 2 percent and 1 percent.
This is my estimate.
(END VIDEOTAPE)
SOLOMON: And coming up on "First Move".
(BEGIN VIDEO CLIP)
ANTONIO GUTERRES, UNITED NATIONS SECRETARY GENERAL: We are close to a devastating tipping point and we are not united to face it.
(END VIDEO CLIP)
SOLOMON: Strong message there from the Head of the United Nations about the climate crisis coming up next.
(COMMERCIAL BREAK)
SOLOMON: Welcome back to "First Move", another key theme at the World Economic Forum in Davos, climate change. Julia spoke to the UN Secretary
General Antonio Guterres about global efforts to tackle the crisis.
(BEGIN VIDEOTAPE)
GUTERRES: Science tells us that if the temperature grows above 1.5 degrees, we will be facing a very dramatic I would say catastrophic situation in
many parts of the world.
CHATTERLEY: We are already there.
GUTERRES: We are heading to 2.8 if nothing new happens based on the policies that are presently being implemented.
[09:30:00]
GUTERRES: And we are on the verge of the moment in which because emissions are growing, they aren't reducing. The science tells us that should be
reduced by 45 percent until 2030. The present projections give an increase of 14 percent. So, we are still destroying deliberately the planet. And we
are very close to the moment in which it will be irreversibly impossible to limit temperature grows to 1.5 degrees, which means we are close to a
devastating tipping point.
And we are not united to face it. And there is not enough political will to do it because the sense of urgency that will be required apparently is not
shown by most of the leaders in the world.
CHATTERLEY: Why? Why is changed so hard? Why isn't this personal for everyone?
GUTERRES: Because these are tough choices, you need to change the way our economies work, we are using 1.6 plans, we cannot use 1.6 plans, and we
just win. So, there are tough choices that need to be made. And it's easier to go on thinking about the next elections or the polls that are being
published the next week. And this is linked to the daily things in which we need the understanding that we are facing the existential threat of our
time.
And that there is no way we can sacrifice this priority to the daily priorities of political power struggles or other forms of political
activities that are still dominant in the majority of countries, including democratic countries.
CHATTERLEY: Do you see any country that's living up to its promises that has the policies to back up promises?
GUTERRES: We see lots of good examples; we see lots of good examples, especially in small countries. You have several Finland, for instance, is
prepared to get to net zero in 35. You have Small Island developing states, even if they are in a very difficult depth situation, even if they lack
resources, even if they are the main victims of climate change.
They're not emitters, big emitters, but they are doing investments to reduce their emissions. The problem is with the big emitters, the problem
is concentrated in the g20. The g20 represents 80 percent of the emissions and the g20 needs to come together. It doesn't work to blame each other.
CHATTERLEY: What about the fossil fuel industry? Because they have to be part of the solution to and I think that's fury, the significant theory
about the inertia, the resistance, the recognition in that industry, that an existential crisis for the planet perhaps means more to them, because
it's an existential crisis for them personally. And so, they're not cleaning up fast enough.
GUTERRES: Well, everywhere in the world, we are transitions. No, we are not moving with cars moved by horses here in Davos. So, everything is changing.
Technology is changing. We are not making phone calls as we were 20 years ago, economies are in transition. And one of the transitions that is
absolutely essential is the transition from dominance of fossil fuels to a dominance of renewable energy.
Without that transition, we are doomed. Now the fossil fuel industry has reacted to these by denial for decades. There was recently published, as
you know, was study that showed that one of the big fossil fuel companies knew that climate change was coming. But just it reminds me of the tobacco
industry and their campaigns to say, well, tobacco is not so bad for the household. This is a bit of a like it's the same kind of thing.
So, there was a state of denial. There is a lot of green washing. I mean, there is practically no fossil fuel company that when they advertise don't
put lots of green things they are doing. But the truth is that we are still evicted to fossil fuels. And government policies are still oriented in
order to make fossil fuel to a certain extent predominate in their economies. We give much more subsidies to the fossil fuel industry, then to
renewable energy.
CHATTERLEY: At the core of this and I think what's really jeered up the conversation. And the movement to some extent of courses is the war in
Ukraine. And I think you've been very sort of brutally honest that you two are struggling to see a resolution and end in sight to this war.
GUTERRES: I think for the time being at the present moment, I do not see a chance to have any meaningful peace negotiation between the two sides.
That's why as U.N. we have been involved in the evacuation of civilians from Azovstal. If you remember, in the black sea grain initiative in trying
to also to facilitate exports of the badly needed Russian fertilizers and food.
But at the same time in trying to support the efforts of the international agency, atomic energy innovation to Zaporizhzhia doing our best advocating
for speeding the process of exchange of - war and we are very much committed to all these things that are vital especially for the Ukrainian
people that is suffering so much.
[09:35:00]
GUTERRES: But for the moment, I do not see a chance and a very effective mediation. And, and the impact in the suffering of Ukrainian people is
terrible. And the impact in regional security and in the global economy is becoming a very dramatic impact because it adds to many other things. I
mean, inflation was already growing, and then it exploded.
Food security problems already existed, and then it exploded energy questions already exist. So it is it is something that adds to situation
that was already almost perfect storm in many parts of the world.
(END VIDEOTAPE)
SOLOMON: And staying in Davos, the Spanish prime minister telling the crowds there that inequality remains his country's major challenge, whether
it's inequality on gender, generational or geographical lines, but the clock is ticking for Pedro Sanchez, Spain is in a general election year.
And he's trying to achieve a delicate balance between retaining power and reforming the economy. Julia asked him, can he do both?
(BEGIN VIDEOTAPE)
CHATTERLEY: You come with a message from Spain to that your growth is set to outperform average of other EU nations, your inflation is lower, and
your spending is high. It is an election year, as we've mentioned, is that sustainable? How are you approaching the combination of spending civil
servants' wages going up pensions, keeping in line with inflation I saw as well?
And I guess fiscal responsibility on the one hand in keeping in mind, the longer term and the investment potential for the longer term; it's a lot to
judge.
PEDRO SANCHEZ, SPANISH PRIME MINISTER: Actually, we're reducing.
CHATTERLEY: I saw that too.
SANCHEZ: Republic deficit and - score of course, a public debt and our forecast, look to less than 3 percent of our public deficit for 2025. What
we are doing is to use these next generation European Union funds, which means over 160 billion euros for the next years to modernize our economy.
And that also means structural reforms.
So, over the past three years, we have approved over 190 structural reforms in Spain, not only the labor market, the pension reform, but also
vocational training, education, - green sensation, digital skills. So, you know, there's a kind of momentum in Spain, for the modernization of our
economy and to earn competitiveness in this, this, this twin revolutions, which are, of course, the green sensation and the digital transformation.
So, we have, we have the finance resources coming from Brussels, we have the reforms. And we have also the political will to do so. And this is I
think, a very important message to the Spaniards, but also to the foreign investors, because last year, we increased by close to 24 percent our FDI.
So, there's also a commitment and the confidence among foreign investors in the possibilities of the Spanish economy.
CHATTERLEY: You know, in the midst of the debt crisis, quite senior European leader said to me, Julia, we all know how to reform. We just don't
know how to reform a get re-elected doing it. And I think you're saying you're sort of trying to find the balance there and succeeding, why should
the Spanish people vote for you? Why should they give you longer? And I guess, tied to that question, where do you feel like you've let them down?
And you'd like to course correct in another term?
SANCHEZ: So, the main beauty in Spain and I see, I think it's worldwide, especially in Spain is inequality, gender inequality, generational
inequality, territorial inequality, this is our major challenge. So, this is my main duty.
And I think that elections also are a debate of, of the future, or are you proposing for the future? And what I propose to my citizens is to
consolidate all these transformations, and to win the future and not to return to a path that doesn't understand the world that we're living in.
So, you know, I have a good expectation for the Spanish presidency of the European Union. And of course, for the general elections that will be next
December.
CHATTERLEY: So, you think you can win?
SANCHEZ: Well, I work for that.
SOLOMON: And also in Davos, one of the world's most famous football clubs, what is it doing there. It's a question people have been asking after
Manchester United set up a shop in Davos with a luxury lounge.
[09:40:00]
SOLOMON: The club insists that it's designed to entertain clients and partners rather than to whoop new buyers after the club went on sale. Larry
Madowo went to investigate.
LARRY MADOWO, CNN CORRESPONDENT: Now, that is something you don't see here every day at the Davos promenade, or the world economic forum, one of the
world's biggest sports teams Manchester United, currently fighting for the premiership title. They have their own space here. It's very slick looking.
They're taking meetings; people are having a coffee, maybe discussing the game.
If I was looking for a buyer or a sports team, this is where it would come because all the wealthy people are here. If I was looking for a shirt
sponsor, this is also the place to come. Because again, the entire world's wealthiest people are here. And here's the thing. Manchester United's
presence at the world economic forum has actually gotten bigger.
They were first year in 2019, smart space 2020, and slightly bigger now. All this so if they ever make an announcement, maybe it was hatched right
here. You just never know right? Larry Madowo, CNN, Davos.
SOLOMON: Meantime, long time soccer rivals Cristiano Ronaldo and Lionel Messi faced off in an exhibition match in Saudi Arabia. The match was
Ronaldo Saudi debut after signing a reported $200 million contract with the - football club. Messi and Paris Saint-Germain ultimately won the friendly
fight for.
After match, Messi shared video on his Instagram of the two rivals hugging there. Good to see the good sportsmanship. Meantime U.S. stocks are up and
running. Let's take a look. It looks like a mixed and to the week at least start to the session the DOW was up about two tenths of 1 percent, the
NASDAQ and the S&P both up, at the NASDAQ the biggest winner there, about half a percent.
Lots of challenges though for the bulls including mixed Q4 results from the major banks and weak December retail sales numbers investors also eyeing
the upcoming debate in Washington over raising the debt ceiling that has the potential to really rattle the markets in the spring and early summer.
But strong start to tech earnings season Netflix shares are rallying about 8 percent, that is a nice rally after reporting better than expected
subscription growth. Co-CEO Reed Hastings also announcing that he is stepping down from that role to become the company's executive chairman.
It's a better start to the year than last year for Netflix. We'll see how the year shakes out. And that is it for the show. I'm Rahel Solomon great
to be with you. Marketplace Asia is next.
(COMMERCIAL BREAK)
[09:45:00]
STEWART: A car that changes color, virtual reality you can feel and a machine sketch artist, a kaleidoscope of a fantastic and the weird at the
2023 Consumer Electronics Show or CES, which took place in early January in Las Vegas, Nevada. The annual trade show is a space for tech giants to
present their latest innovations on a global stage.
From mobility to smart homes, health care and the metaverse I'm Mark Stewart and this is Marketplace Asia. On this month's program meet the
Asian companies on the cutting edge of automotive technology and gaming. They're taking center stage at CES and setting the trends for the year to
come.
(BEGIN VIDEOTAPE)
STEWART (voice over): With some 300 vehicle tech exhibitors CES 2023 was one of the largest auto shows in the world event organizers say, while
cutting edge cars are nothing new at CES. This year many exhibitors put the spotlight on the software that powers then.
The rapidly growing sector is the foundation of other key advancements for instance, autonomous driving. In the automotive space, major players from
across Asia attracted attention at this year's event, including tech companies making new inroads into the sector. In the mobility hall at CES,
one topic was hard to mix.
UNIDENTIFIED MALE: Let's talk software first, a move towards a software component.
UNIDENTIFIED MALE: The transition to the software defined vehicle.
STEWART (voice over): That's where onboard software takes care of the major operations of the car from safety to communication and infotainment. But
it's more than a buzzword experts say.
ALEX KOSTER, MANAGING DIRECTOR AND PARTNER, BOSTON CONSULTING GROUP: If you imagine in the smartphone area, what happened was you replaced the physical
keyboard by a touchscreen.
And suddenly you could do much more innovation on it because it was constantly changing somebody could swipe suddenly you could have predictive
capabilities. So that's what software does. It allows you to do constant updates over lifetime it's not any more a fixed product.
STEWART (voice over): So, making a car more like a smartphone or like a game console. Sony Honda Mobility announced its electric car brand of Phila
and its first prototype car. The joint venture brings together the best, the two Japanese behemoths have to offer says Chairman and CEO Yasuhide
Mizuno like Honda's driver assistance systems and Sony's entertainment offerings.
YASUHIDE MIZUNO, REPRESENTATIVE DIRECTOR, CHAIRMAN AND CEO, SONY HONDA MOBILITY INC: They have music and - movies as well as the games.
STEWART (voice over): The Company did not reveal car specs like range or battery capacity, but vehicles will be on the road in early 2026 first in
North America and then Japan according to Mizuno.
MIZUNO: You might want to read like, if we get on a ride, ride on the car, no drive, no steering, just reaping, go back to my house or office.
STEWART (voice over): But it will be several more years before a driver can sleep or watch TV on their commute, Mizuno says, because for that to
happen, the company first needs to master fully autonomous driving. This challenge has long plagued the auto industry in part because there's a near
endless combination of things that can go wrong on the road and our autonomous system must learn to handle them all.
It's why in 2022, Ford and Volkswagen pulled the plug on their self-driving effort, Argo AI. Well, General Motors Robo Taxi unit crews face $1.4
billion in losses by the end of Q3. Despite roadblocks in the industry, LG displays already banking on a fully autonomous future on show at CES, this
concept car.
In place of a steering wheel, a dashboard display and windows overlaid with augmented reality.
SARAH KIM, ASSISTANT MANAGER OF AUTO SALES, LG DISPLAY: So, what this does is this act as a window, but also provides you with additional information
that you want to see overlapping with the outside view. So, you're able to get more information on the products --buildings whatever you see.
STEWART (voice over): For now, LG Display says it is focusing on integrating its solutions into none or partially autonomous vehicles.
KIM: Honestly full autonomous driving vehicle is a bit far away. We expect another five to 10 years at least.
[09:50:00]
STEWART (voice over): Across town CES took over the Las Vegas motor speedway in an attempt to speed up the software transition. In this race
competing university teams program AI drivers that can pilot a fully autonomous IndyCar and 170 miles an hour plus.
Engineers from South Korea's Advanced Institute of Science and Technology, the only team to compete from Asia this year, say successes here could open
the way for self-driving passenger cars, particularly in more dangerous situations.
DAVID SHIM, PROFESSOR, KOREA ADVANCED INSTITUTE OF SCIENCE AND TECHNOLOGY: And one of those extreme cases will be the fast driving. So, you know the
cars will drive on the regular street but we also drive in freeway highway. And in those areas, we need to have a very, very reliable, high speed
autonomous driving system; our car can drive up to 20 kilometers per hour. So, if the car can survive in this extreme condition, then the technology
will be mature.
STEWART (voice over): For Shim and the companies at CES putting software in the driving seat, there's still a long road ahead.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
STEWART: Welcome back to Marketplace Asia. Innovation from Asian companies is driving demand in the automotive industry. But it's not the only sector
where Asia is having an influence at the CES.
(BEGIN VIDEOTAPE)
STEWART (voice over): The Asia pacific region is the biggest market for gaming internationally, home to over half the world's gamers according to
Google's 2021 global insight report.
It's also home to some of the most influential companies in the space, including Sony. The Japanese tech giant took to the stage at the 2023
consumer electronics show to announce a host of new devices, including the PlayStation VR2 console set to hit the market in February 2023.
The number of active users of VR headsets is predicted to reach 22 million in 2023, up by almost 50 percent from mid-2022 according to global
consulting firm Deloitte. As VR gaming gets closer to the mainstream, some companies are honing in on the mechanics of making simulated experiences
more lifelike. We took a look at a few of them here at CES.
Like this one Razor, a tech company headquartered in Singapore and California that says it is for gamers by gamers. Razer is developing more
of what it thinks consumers want.
BOB OHLWEILER, HEAD OF GLOBAL SALES & MARKET, RAZER: These are some of the accessories that we're starting to, to commercialize and roll out on VR.
STEWART (voice over): Lightweight adjustable straps and facial interfaces for VR headsets the goal to make the experience of VR gaming more
comfortable. So, users can fully escape into their virtual worlds.
OHLWEILER: It's immersion, so you want them to be deeply immersed in the game, so that they can feel the whole game.
STEWART (voice over): Then there's this one, South Korean company - took a different approach to feeling in VR. These tactile gloves give users a
sense of touch in the simulated environment and a haptic vest replicates sensations of actions.
And finally, Libest, another exhibitor from South Korea the start-up took on the challenge of life span, so gamers can stay in VR for longer. Founded
in 2016 Libest developed this thin bendy lithium-ion battery.
[09:55:00]
STEWART (voice over): It's designed to fit into the unused space inside a VR headset or fingers of a haptic glove, for instance, powering the device
without adding any extra book.
ALLEN CHUNG, SENIOR MANAGER OF SALES AND MARKETING, LIBEST: So, device manufacturers require a lot of battery capacity. So, by applying our
battery, it will extend the running time of the device.
STEWART (voice over): But as simulated environments become more advanced battery life is only part of the problem. You also need higher bandwidth
experts say.
GARY SHAPIRO, PRESIDENT AND CEO, CONSUMER TECHNOLOGY ASSOCIATION: We know where we're going with the web. And the internet as broadband speeds
increase as of processing speeds get better and that is a more realistic, involved experience, whether it's AR, VR, so we know where we're going to
end up, how we get there will depend upon the cleverness of entrepreneurs and the desire of consumers to actually spend their money on these types of
applications.
STEWART (voice over): Its clear many gamers want to spend their money here and invest in the very real future of virtual reality.
(END VIDEOTAPE)
STEWART: And before we go, a segment on the show we call in the market this month Japan and its growing fascination with frozen food.
(BEGIN VIDEO TAPE)
STEWART (voice over): This is the winner of Japan's 2022 dish of the year. Frozen food including meats, sushi and pizza's some items still in their
airtight bags. Japan is world famous for fine dining with over 400 Michelin starred restaurants, but it seems convenience is now king. Remote work
during the pandemic spiked the demand for ready to eat food.
The average amount of money spent on frozen foods per family went up 20 percent from 2019 to 2021 according to Japan's Ministry of Internal
Affairs. Some items are even breaching cult status, a box of frozen Kobe beef croquettes from a Takasago City butcher shop has a 30-year waitlist
and restaurants too are hoping to cash in on Japan's growing appetite for frozen food.
(END VIDEOTAPE)
STEWART: And that's it for today's show. For more on these stories and others just go to our website cnn.com/marketplace Asia. I'm Marc Stewart,
thanks for joining me.
(COMMERCIAL BREAK)
END
