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Quest Means Business
Wife of British Scholar Jailed in UAE Speaks to CNN; France Sanctions 18 Saudis Over Khashoggi's Murder; U.S. Republicans Subpoena Former FBI Director Comey and Attorney General Lynch; Cyril Ramaphosa Promises a "New Dawn" for South Africa; Microfinance Revolution Boosts African Entrepreneurs; Artificial Intelligence Robot Works as a Fashion Model; EU Lawmakers Want Amazon to Ban Soviet-Themed Goods. Aired 4-5p ET
Aired November 22, 2018 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA NEWTON, CORRESPONDENT, CNN: All right, we might all be thankful because there is no trading on Wall Street today for the Thanksgiving
Holiday, but here's what's driving today on Thursday, November 22nd. The pound is surging after Theresa May gets the draft deal on Brexit.
There is a political battle brewing between France and Japan, now that Carlos Ghosn is out at Nissan and Facebook's outgoing head of comms takes
one for the team as he takes the blame for recent scandals. I'm Paula Newton and this is "Quest Means Business."
Good evening. A deal that delivers, that's the latest message from the British Prime Minister on Brexit. Theresa may has agreed on a draft
declaration on the UK's post Brexit relationship with EU powers. She also says she is confident she'll be able to deliver on agreement at a summit in
Brussels this weekend.
(BEGIN VIDEO CLIP)
THERESA MAY, BRITISH PRIME MINISTER: The deal that will enable us to do this is now within our grasp. In these crucial 72 hours ahead, I will do
everything possible to deliver it for the British people and I commend this statement to the House.
(BEGIN VIDEO CLIP)
NEWTON: So here is a quick look at the major points in the draft post Brexit deal. Aren't you glad we did this for you. Trade is the top
priority, of course. Mrs. May's political declaration calls for quote, "No tariffs, fees, charges or restrictions across all sectors." That is very
significant. Then there is freedom of movement, a key issue with referendum voters in 2016. The blueprint aims to provide visa free travel,
very important here, for short-term visits to the UK. This deal also kicks the can down the road, way down the road, on certain issues, including
Gibraltar, Ireland and a new agreement on fisheries quotas.
These topics could dominate what is sure to be a high stakes summit in Brussels this weekend. Our Nina dos Santos has been following all of this
from London and she joins us now. You know, Nina, still a lot of confusion as to whether or not this is a deal that at the end of the day Theresa May
can get actually get through her own parliament.
NINA DOS SANTOS, CORRESPONDENT, CNN: Yes, you're right. And then after her Parliament, if she manages to get through that, then of course she
would have to go back to the European Parliament, too. And then we have potentially the House of Lords having a say on things, too.
So this is by no means a deal that has been agreed to by all the parties that need to agree to it before, of course March 29th. And in the
meantime, it is looking increasingly likely that many people on the opposition side of the aisle, but also within her own party are opposed to
elements. The real problem that they have with it, Paula, is this is part of a two-stage process.
The first stage having been last week's very detailed 585-page withdrawal agreement that is legally binding. This one being the political
declaration of the future relationship that the UK would have with the EU that is nonbinding. But the problem that some people have with it is that
it is also rather vague as you pointed out.
NEWTON: Yes, it is that vagueness that a lot of people are talking about today. Nina, thanks so much. Good to see you. We'll continue to follow
the outcome of this deal really in just the hours to come. Appreciate it.
Carl Bildt is the former Prime Minister of Sweden, he is also the co-chair of the European Council on Foreign Relations and he joins me now from
Stockholm via Skype. Thank you for joining us. When we get to the spectrum of this, we talked about hard Brexit, we talked about blind
Brexit, we talked about soft Brexit, we've talked about so many things. You argue this is the best deal that Britain could ever expect no matter
how you categorize it.
CARL BILDT, FORMER PRIME MINISTER OF SWEDEN: In the worst possible situation. I think they withdraw the agreement, which is really a
controversial one, it is probably the best possible deal in the worst possible situation. Clearly bad for the UK, bad for Europe, but in a bad
situation probably the best that can be done now. Whether that be that empowers the UK Parliament, but that remains to be seen, but if that
happens, then we have the prolonged debate of negotiating all of the issues of the final relationship.
NEWTON: You know, at least one EU Commissioner told me quite a few weeks ago that he always expected that the UK would not be able to pass this. Do
you think that that's changed now? Do you think that the UK will find a way to make this work and also it has come up as an issue that all 27 EU
members will also accept it?
BILDT: I think that is a problem of the EU side at least so far.
[15:05:04]
BILDT: I think the withdrawal agreement - the withdrawal agreement I think is set in stone by now, whether it will be accepted to the UK, it remains
to be seen. On the political declaration, I understand the 36 pages, I understand there are some outstanding minor issues. But that's not
necessarily that significant because that shows the political declaration. And all of those issues, really long list, is what needs to be sorted out
in the negotiations over the course of X numbers of years ahead.
So if hard Brexit can be avoided, let's hope, by no means it should, there is going to be a prolonged exit, prolonged Brexit, so that's was a
difficult one.
NEWTON: You say a difficult one, you know, you often sought that Theresa May has one of the toughest jobs on the planet right now. At the end of
the day, no matter how much they have been really debating her future, do you still think she is the person for the job here, that if anyone is going
to get a deal now, it will be Theresa May?
BILDT: That is not for me to watch, but any Prime Minister of the United Kingdom in this particular situation will be in a bad situation because the
referendum result is a very difficult one. And if there is not a way to get out of it, which I doubt, but anyhow, it will be the task of any Prime
Minister of the United Kingdom to deal with a distinct and comfortable and difficult situation.
And that is the immediate talk in the House of Commons in the next few weeks, but the years in which it would be bound by the European Union in
which it will have to negotiate all of the issues that I indicated in the 36 pages of this political declaration. It is not easy.
NEWTON: Definitely not easy. The people who would prefer a hard Brexit that say this is what they voted for say that this deal actually - that it
in fact amounts to the UK remaining a vassal state of the EU. Do you, as obviously a proponent of the EU, have any counterpoint there? Because at
the end of the day, they're still saying this deal does not go far enough.
BILDT: Well, the choice of the world is by them. But, of course during the period of the next few years, when the UK was in fact to be bound by sort
of the customs union and all of the regulatory alignment, it loses control to a very large extent. It will be dependent upon the decisions taken in
Brussels by many of them taking the view of being a part of it, but without having any say.
There will not be any UK representative around the table in Brussels where the other European countries are deciding the rules of the game.
NEWTON: And the more the Brexiteers here people like you speak, the more they say they're going to fight harder to make sure Theresa May never gets
this deal through Parliament. We will continue to watch and learn, Carl Bildt. Thanks so much for your time. Really appreciate it.
BILDT: Thank you.
NEWTON: Now one of the biggest alliances in the auto industry is now facing uncertain future after Nissan ousted the man behind it. The company
has removed Carlos Ghosn as its Chairman. He spent nearly two decades at the Japanese carmaker, turning its fortunes around. The Board has
unanimously now voted him out after his arrest for an alleged financial misconduct.
Now, Nissan is in the alliance with another Japanese carmaker of course and that would be Mitsubishi and France's Renault and it say remains committed
to that partnership. French and Japanese economy ministers have now met in Paris to try and work out where out where these companies actually go from
here.
There are fears that Ghosn's removal could see the power shift between France and Japan clearly going from France to Japan at the moment, it is
not a relationship of equals as Renault owns almost half of Nissan. Nissan only owns 15% of Renault and key here, it has no voting rights.
Our Melissa Bell has been watching all of this from Paris. You know, Melissa, we're talking about this as an economic story, but I'm sure what
you have been covering today is very much a political story at this point.
MELISSA BELL, CORRESPONDENT, CNN: That's right and that was bound to happen, Paula, because of the size of this giant as a result of that
alliance. But also because France is a 15% stakeholder in Renault. So of course what happens to Renault is of huge interest and importance
strategically, economically to the French government.
And hence this meeting today with the two economy ministers, without going to the detail of how this is going to work out because we're really at the
beginning of a process. I mean, after all, as France's economic minister has pointed out, Carlos Ghosn has not yet been charged and the French
authorities are very much wanting to know more about the kind of proof that has been amassed to back these charges that hang over his head as a result
of this several months long investigation within Nissan, now, handed over to the Japanese authorities.
So we're at the beginning of a process, many unanswered questions. But I think all the economy ministers could do today after their meeting was
repeat what they had done in a joint statement on Tuesday, which is reaffirm ...
[15:10:08]
BELL: ... their commitment to the - commitment to this alliance. The big question is really whether that stands? Can it continue after Carlos
Ghosn, the man who is not only after all, Paula, its architect but it was believed the man who wanted to see that alliance go even further. Now, how
worrying was that on the Japanese side as you say with that imbalance between Nissan and Renault? That's one of the great unknowns as well.
I think something that will be the subject of a lot of speculation going forward. But clearly, clear calls from French authorities for the time
being for Japanese authorities to provide great clarity around what the proof is that might allow Carlos Ghosn to be charged.
NEWTON: Yes, and it is so interesting about that, because many have wondered, look, if the Japanese have come up with this kind of evidence,
what did French authorities know? What did they know at Renault? Is that making waves there in France or really has it all been overlooked
considering the kind of jobs and investment that is at stake right now?
BELL: Well, I think for the time being, it is a bunch of questions really on the side of the French. It has been such an extraordinary story over
the course of the last few days on a human level. This mighty giant and how he appears to have fallen, how his fate has been transformed really so
publicly and in the course of a matter of days with all these questions hanging over precisely what the wrongdoing was and how extensive it was.
So questions really for the time being. And, of course, as you say, more broadly on the question of this alliance, can it survive and how can the
French who are very keen that it should, given their stake in Renault ensure that it does. But that balance of power, of course, we come back to
that, between French authorities and now the Japanese who rather hold more of the power perhaps over this than they did when this all began.
NEWTON: Melissa, something I'm wondering about very curious about, we've seen many pictures of Emmanuel Macron with Mr. Ghosn and obviously, he was
held up as really one of the titans of French industry, specifically manufacturing and the jobs that go with it. Is there going to be any
political collateral damage here for Macron and his government?
BELL: I think it will depend very much on whether those charges are brought on the nature of the charges, on how they stand up to international
scrutiny and to whether if this can be shown to have taken place, how the Renault took it or takes it or failed to spot what it might have spotted,
how endemic if there was corruption, that corruption was and how widely shared the responsibility of not spotting it should have been and perhaps
was not.
So, again, these are all unknowns around the immediate fate of Carlos Ghosn himself, around the broader fate of this alliance and then, of course, for
countries like France, as implicated as they are in the fortunes of Renault with 15% stake, how they then react to what went on at Renault, what they
should have known and what they might have done to prevent it from taking place.
But for the time being, I can't stress enough the extent to which we are at the very early stages and really until the charges are brought, this is all
the subject of speculation. Of course, so many questions around such a marked leader, such a giant of the automobile industry are bound to mean
unsettling times for the industry itself.
NEWTON: Yes, absolutely. But as you point out, these are allegations at this time and there's still a lot more questions than answers. Melissa
Bell in Paris, appreciate it.
Up next, Facebook's outgoing comms chief takes the blame for hiring a PR firm targeting its critics. Among them, George Soros. We'll have more
next.
[15:15:00]
NEWTON: All right we call this strategic, right? It was a good old fashioned news dump from Facebook. Yes, on the night before Thanksgiving
holiday here in the United States. The social media giant's outgoing communications chief says he and he alone was responsible for hiring a PR
firm which the "New York Times" says targeted Facebook critics, including billionaire inventor and philanthropist George Soros.
Now, a man who has been vilified by the far right, he has faced explicitly anti-Semitic criticism. In a statement released by Facebook, Elliot
Schrage seemed to vindicate Mark Zuckerberg and the firm's COO, Cheryl Sandberg saying, "Responsibility for these decisions rests with leadership
of the communications team, that's me, Mark and Cheryl relied on me to manage this without controversy."
Our business correspondent, Clare Sebastian joins me now. I mean, look, obviously the whole release and the timing was suspicious. Also is the
fact that he's absolving at the end of the day Mark Zuckerberg leads Facebook, not the communications team.
CLARE SEBASTIAN, BUSINESS CORRESPONDENT, CNN: Right, I mean, this is management 101. What we've heard from Mark Zuckerberg and Cheryl Sandberg
throughout is that they didn't know anything about definers, that they were looking into it. Now, whether or not they knew, I don't know which is
worse. Frankly, it's new work that they didn't know. I think it creates the impression that they're not completely in control of this platform.
And I think we're still going to see leadership questions despite the fact that this does smack of an attempt to inoculate them from this, A, because
of the way it was done on the night before Thanksgiving; B, because Elliot Schrage was outgoing anyway. He was already planning to leave.
So this doesn't really count, someone falling on their sword for this whole affair. Secondly, he's really only taken responsibility for one section of
that explosive "New York Times" report, the fact that they hired this Washington PR firm called Definers to dig up dirt on critics and then
competitors frankly. There are other parts of it as well that Facebook tried to downplay Russia's involvement in the 2016 election.
And that, you know, they ramped up and tried to deflect controversy on to competitors after Cambridge Analytica. So there was more to that report
and this only really tackles one part of it.
NEWTON: And they seem so incredibly ill prepared to answer any of these questions even when they finally apparently finally figured out what was
actually going on within their own company. Our Laurie Segall as you know, did an exclusive interview with Mark Zuckerberg. Let's listen Clare to
what he told Laurie when Laurie asked him specifically about what he would say to George Soros.
(BEGIN VIDEO CLIP)
MARK ZUCKERBERG, CEO AND CHAIRMAN, FACEBOOK: Well, I know that George Soros has been the target of a lot of really horrendous attacks. And I
think that is terrible. And I certainly wouldn't want anyone who is associated with our company to be a part of that.
(END VIDEO CLIP)
NEWTON: You know, that is an incredibly weak response to a man that they know has been vilified and perhaps in some way the company they hired has
now contributed to that.
SEBASTIAN: Yes, to be fair, Sheryl Sandberg did go a little further. She published a memo alongside that memo from Elliot Schrage and she said - she
found the whole idea that their work could have contributed to any kind of anti-Semitic content deeply abhorrent and deeply personal because of
course, she is Jewish as is Mark Zuckerberg.
But, you know, this is still Facebook trying to do damage control after the fact. They still are being criticized for the fact that they seem
unwilling to be completely transparent with the public.
NEWTON: And I think people perhaps will say, okay, these are two people who are Jewish, clearly, they would never support anything this anti-
Semitic. But at the end of the day, it seems to be a win at all costs, you know, within Facebook.
[15:20:08]
NEWTON: Which basically validates the "New York Times" story. That they'll do anything at this point to survive and win in their apparent
structure the way it is without regulation, that the critics are getting the better of them.
SEBASTIAN: I think there is still a lot of debate around the company as to how willing they step up with who they are, willing to countenance more
regulation, clearly that is something that is coming, but I think there is some debate around that and certainly, the way this whole announcement came
out on the eve of Thanksgiving, as we said someone who is outgoing does raise those questions.
Again, I will say that to Facebook's credit they are saying that they need outside help, they talk about their new hire of Nick Clegg who is going to
conduct an audit of all of their relationships with outside consultants. They are talking about setting up a board that will handle some of the
appeals process full of independent members. All of that is positive, but I think there is still a lot of suspicion around how far it will go and how
committed they are.
NEWTON: Yes, and Clegg the former Deputy Prime Minister in the UK, they're thinking perhaps will have the authority, the gravitas not just within
Facebook, but outside as well to try to get some of this done. Thanks for following the story. Really appreciate it and Happy Thanksgiving to you.
SEBASTIAN: Happy Thanksgiving. The trade war strikes again. This time it is Tesla, the car company is slashing prices in China for the second time
this year. The announcement came out Thursday in an effort to make its cars more affordable. It is also about market share, obviously, all this
week we're looking at the fierce competition between the Chinese and American tech sectors. Today, Matt Rivers shows us the Chinese electric
carmaker hoping to take over Tesla's place at the top.
(BEGIN VIDEO TAPE)
MATT RIVERS, CORRESPONDENT, CNN: In the race to dominate the global electric vehicle market, you might think that American carmaker Tesla is
leading the pack, but several Chinese competitors are catching up, if not already ahead.
And if you believe the snazzy car ads, one of them might just win.
(BEGIN VIDEO CLIP)
RIVERS: This is a high quality video.
MIA GU, BRAND MANAGER, BYD: Yes.
(END VIDEO CLIP)
RIVERS: This is one of the hopefuls - BYD or Build Your Dreams. The company launched here in Shenzhen 23 years ago. While you might not have
heard of it, investors have.
(BEGIN VIDEO CLIP)
RIVERS: It's a big milestone when Warren Buffet invests in a company.
GU: It is, it is.
(END VIDEO CLIP)
RIVERS: Mia Gu is one of the brand managers here.
(BEGIN VIDEO CLIP)
MIA GU, BRAND MANAGER, BYD: This BYD's car showroom.
(END VIDEO CLIP)
RIVERS: And she shows us their latest models, most aren't that flashy, cheaper designed with the average consumer in mind. But some are slicker
than others. Mia called them sexy.
Only one way to find out, we take their so-called new generation Tang out for a spin. So quiet. This sells for about half the price of Tesla's
popular Model S and that's their big pitch. It's just like a Tesla, but for less.
(BEGIN VIDEO CLIP)
GU: Tesla's price now is still a little bit expensive for many people.
(END VIDEO CLIP)
RIVERS: China is the world's largest automobile market and it's also the world's biggest polluter. No wonder perhaps that authorities want two
million electric vehicles sold here by 2020 and they offer subsidies to car buyers to help.
(BEGIN VIDEO CLIP)
GU: One of the biggest I think, the killer of people's health is the exhaust.
(END VIDEO CLIP)
RIVERS: They produced over 100,000 electric vehicles per year. Sold in China, California, and everywhere in between with a global work force
that's 220,000 strong. Clearly, China is going all in on new energy. Now, Tesla wants in here, too.
Elon Musk's company recently announced, it would open up a plant in Shanghai, not that BYD is worried.
(BEGIN VIDEO CLIP)
GU: We're quite open to competition. We welcome more and more industry players.
(END VIDEO CLIP)
RIVERS: Of course, the ride could be bumpy. After years of explosive growth, BYD's profits dropped 20% in 2017. Some now wonder if the dream of
electric vehicles here is too dependent on those government subsidies and what happens if they go away? But for now, the company is confident the
future is electric. Matt Rivers, CNN, Shenzhen.
(END VIDEO TAPE)
NEWTON: Okay. Anything Trump can do, Trudeau can do better. We'll be very careful there, that might get the Prime Minister in trouble again.
But Canada has unveiled a raft of new tax breaks to try and stay competitive with the United States. The move will allow businesses to
write off capital investments for tax purposes in response to aggressive tax cuts as we have all heard about from the Trump administration.
Richard Carleton, CEO of the Canadian Securities Exchange, joins me now from Toronto and you are working, sir, because to define once and for all
for everyone Canada has Thanksgiving, but it is in October. So that's why --
RICHARD CARLETON, CEO, CANADIAN SECURITIES EXCHANGE: That's right. We enjoyed our turkey, some weeks ago.
NEWTON: Oh, god, and did we ever. Okay. So let's move on to what the Canadian government did here. This has been a call from CEOs as you and I
both know for months and months in Canada. Is it going to do the trick? Because I know that a lot of Canadian companies have been very concerned
that innovation and productivity can't keep pace with US.
[15:25:03]
CARLETON: Well, it is very much a start, but I think that, you know, it is not clear that this is going to address two I think of the big issues that
Canadian business leaders are concerned about. The first one, and I think this is front page news, not just in Canada, but in several other markets
around the world, is the fact that we have Alberta Oil stranded, and as a result is basically selling at a gigantic discount to the world price.
That's costing not just the energy companies significant to revenues and profits, but obviously because of the royalty programs and so on, it is
costing governments and frankly Canadians from coast to coast a tremendous amount of money.
So making progress and seeing leadership from not just the Federal government, but the provincial governments involved on the pipeline issues
and other transportation issues is something I think that businesses are clearly looking for.
The other component of this is, again, addressing taxes at the business level is fine. But we still have a considerable difference in tax rates at
the personal level. When you combine provincial and Federal income tax in Canada, we're at a considerable disadvantage to our peers in the United
States.
And so, again, business I think is looking for leadership from both levels of government on this issue to begin to really address the concerns that we
face vis-a-vis the United States.
NEWTON: Yes, and it will take several quarters to figure out if anything the Canadian government is doing is actually working. I want to move on to
- I don't know, did you know you have this labeled the king of cannabis listings? Did you know that, Richard?
CARLETON: Yes, I think that's first thing that pops up in my Google search.
NEWTON: It likely it does. I think everybody is talking about the fact that Canada is the exchange. Your exchange is where you go, not just if
you're a Canadian cannabis company, but even if you're an American cannabis company trying to raise capital and list.
Do you worry, because some critics have said that look, it is leading to a reputation of Canada of being in some way, shape or form contributing to
this cannabis bubble and although that is not a very good analogy. But most people have been putting the cannabis stocks in the category of
Bitcoin, really. And saying is this really prudent to be going down this road, especially when you see, you know, how much cannabis stocks, the
volatility in them and how far they have fallen in the last few weeks.
CARLETON: Well, anytime you have a new industry, there is bound to be a lot of speculation that takes place. And I think it is fair to say that
investors that are active in this space should be regard it as risk capital that they putting up. But I think again, everybody understands that this
is go to be a considerable business, not just in Canada and the United States, but globally in the coming five to ten to 15 years.
And so what we're seeing really is the birth of an entire new industry, and the names that will come to dominate this space in fact are being born
literally as we speak. So, yes, there is - and you would expect to see considerable volatility, and as you mentioned, we have become a home for US
companies which have sought to raise growth capital in the Canadian public markets, which is I think a testament not just to what we do, but to the
ability of the Canadian public equity markets to raise money for early stage businesses.
But as I say, we're - you will see a lot of volatility, but at the end of the day, there is real business here. There are going to be substantial
revenues associated with not just the recreational use of cannabis, but my own view is that we're going to see medical applications that probably
outstrip the recreational market in terms of absent revenue and profitability potential for the industry.
NEWTON: Well, I'm glad you're trying to set the record straight, because I do believe that everyone in Canada is just going off on a tangent here.
Blockchain cannabis, it's just the wild north. Richard, thank you so much. And next time we'll have you in here, we'll talk about the blockchain as
well. Appreciate it.
CARLETON: Okay, thank you very kindly.
NEWTON: Up next, in an exclusive interview with CNN, South Africa's President Cyril Ramaphosa slams US President Trump and promises a new dawn
on land reform. Can his words woo back investors?
[15:30:00]
(COMMERCIAL BREAK)
[15:30:00] PAULA NEWTON, HOST, QUEST MEANS BUSINESS: Hello, I'm Paula Newton, coming up in the next half hour of QUEST MEANS BUSINESS, an
exclusive interview with South African President Cyril Ramaphosa who says he can't convince foreign investors to return.
And we'll head northeast to Kenya where Richard is trying out mobile moneys in Nairobi's market. Before that though, these are the headlines on Cnn.
The wife of the British man jailed in the UAE has told Cnn, there's been a big misunderstanding and is calling on the UAE to show sensibility and
humanity.
PHD student Matthew Hedges was sentenced to life in prison for spying, charges both he and the British government strongly deny. His wife told
Paul LaGrone that the trial lasted only five minutes, and that Hedges did not have access to medical and psychiatric care.
France is banning and sanctioning 18 Saudi citizens over the murder of Saudi journalist Jamal Khashoggi. The French Foreign Ministry calls his
brutal killing a crime of extreme gravity and runs counter to freedom of the press. It's unclear whether the 18 individuals are the same ones
sanctioned by Germany earlier this week.
U.S. House Republicans issued subpoenas for former FBI Director James Comey and former Attorney General Loretta Lynch. Comey's attorney says they will
fight the order in court, only maintains he wants to testify publicly and does not want to give private deposition about FBI actions during the 2016
presidential election.
A festering sore, that is how South Africa's president Cyril Ramaphosa described the country's land reform issue. In an exclusive interview with
Cnn, he's renewed his promises to address it and address it properly. The president has previously admitted that earlier efforts to redistribute land
stolen under apartheid were plagued by fraud and corruption.
Cnn's David McKenzie asked him how this time would be different.
(BEGIN VIDEO CLIP)
CYRIL RAMAPHOSA, PRESIDENT, SOUTH AFRICA: We're now in a new dawn. We're now in a new phase, we have repositioned quite a number of things that we
are doing in government to do things more effectively, free of corruption with greater determination and greater commitment.
DAVID MCKENZIE, CNN CORRESPONDENT: The investor community seems to be holding back a little bit, worried about primarily -- I've heard from them,
the land issue. Is that a fair assessment?
[15:35:00] RAMAPHOSA: Well, that seemed to be the case until I convened an investment summit. I was able to give the investing community a clear
message on the question of land. I said, one, we've got to deal with this. This is a festering sore. I want you to join me in working together to
address this problem.
We are going to make sure that we address it in a way where we will not, one, destroy our economy, we will instead want to improve the lives our
people, taking into account -- when I say, our people, I'm talking about both black people and white people. Just as Nelson Mandela did.
(END VIDEO CLIP)
NEWTON: David McKenzie joins me now from Johannesburg. You know, he has a very difficult job here because he really desperately needs to attract
those investors. Despite the fact that obviously they remain very uncomfortable and skeptical about any land reform plan.
MCKENZIE: Well, that's right, and like any investment, the uncertainty of the land reform policy is a cooling factor when it comes to foreign
investment. And that's what Cyril Ramaphosa needs now more than anything. Is a kick-start in this economy that is being struggling as of late.
Very high unemployment here, Paula, and the technical recession that South Africa seems to be creeping out of still is meaning that the investors are
kind of holding their money back a little bit despite what the president is saying. And at the same time, he has this extremely challenging political
equation to deal with here in South Africa.
The president insisted several times that land appropriation without compensation and the policy they are trying to pursue could actually unlock
economic potential, Paula, by he says first giving a government land and unused land to people who he says need it the most. Paula.
NEWTON: All right, and certainly, one would think that at this point in time, the whole land reform issue has to resolved in some way. How much
does the economy really need this to happen and happen properly?
MCKENZIE: Well, one way to look at it is that, he says if it's not dealt with, then it will lead to an unstable South Africa. At the same time, you
have the U.S. government because I put the question to them and they are a major trading partner of South Africa.
They say appropriation without compensation risks sending South Africa down the wrong path. So they have both their public relations battle to fight,
and just a political one here in South Africa. It's been -- land reform has been on some level a failure up until this point from Nelson Mandela's
time because of the corruption that has beset it.
But Cyril Ramaphosa says he is the man to do the job as a former union boss and the chief negotiator for the ANC out of apartheid. Perhaps, if anyone
can manage those complicated matter, he can. But there's a very long way to go and a lot of policy and political uncertainty before South Africa
gets there. Paula?
NEWTON: You know, there's a lot to do politically and economically on both scores. Can he do it politically because we all know, you know, the very
volatile times that have just happened there in South Africa in recent months politically, but also economically.
They don't have a lot of time to waste in terms of what's been going on with the economy.
MCKENZIE: They don't, but politics and the power and the economy are so eccentrically linked here right now. Ramaphosa only squeaked through as
the new ANC president. Of course, his predecessor Jacob Zuma was effectively ousted, meaning he became president.
Now, just a few hours ago, Ramaphosa put what was kind of a mini-shuffle in the cabinet. People had hoped for more in South Africa. Some key
ministers who have been accused of corruption stay in their posts. So it shows that Ramaphosa doesn't necessarily have the power to put through
controversial moves right now that may be after next year's election.
NEWTON: And when is this full circle to the beginning of the conversation which is, he needs to get that confidence from investors to get back in the
economy. David McKenzie, thanks so much for staying up late for us, appreciate it and great interview.
Now, with South Africa's economy struggling, Kenya is looking to overtake. One of the economies biggest strengths is a huge uptick in micro-financing.
Small loans that can make a big difference to small businesses. Today, much of it can be done at the touch of a button as Richard found out on his
visit to Nairobi.
(BEGIN VIDEOTAPE)
RICHARD QUEST, CNN (on camera): If you want to know what's happening in an economy, visit the high street, and this is the high street at Ikemi(ph)
where I can find fast-food, Kenyan style in the maize, I can also find lots of raw meat ready to be sold and cooked and an abundance of fresh fruits
and vegetables.
[15:40:00] There's plenty here to buy. And this high street is also a good case of a digital revolution in micro credit. For instance, the
appropriately named vision 2030 shop with Nelson, good to see you sir.
UNIDENTIFIED MALE: Thank you --
QUEST: Who is learning all about credit.
UNIDENTIFIED MALE: Actually, I started the shop because I had a job, then while I was starting, the company collapsed. We tried to fill it out in
what we can do, then we come up with an idea -- let's open a shop.
QUEST: Wow, a true "let's start a business". It's an important business selling absolutely vital staples like maize. Why do you need that line of
credit?
UNIDENTIFIED MALE: Their credit is digital after all, because we have financial constraints. Because we don't have cash at times already to pay
(INAUDIBLE) --
QUEST: Credit is a great idea, but credit can also get you into debt.
UNIDENTIFIED MALE: The way we opt for the credit was we head towards to sit down with the Mayeela Prallar(ph) and agreed because credit normally as
you have said can put ourselves as well into trouble if we don't pay it on time.
QUEST: How is it working?
UNIDENTIFIED MALE: It is working very well with us, it is friendly, it is digital.
UNIDENTIFIED MALE: One piece each.
UNIDENTIFIED MALE: One piece each. The moment we place an order, it is digital, making payments, it's also digital because there's no cash, using
on a digital cash, you just pay by M-Pesa to the bank direct, then I enter my pin --
QUEST: M-Pesa --
UNIDENTIFIED MALE: Yes, M-Pesa, yes, there we go? And then I check my balance.
QUEST: I imagine most people here pay on M-Pesa, do they?
UNIDENTIFIED MALE: Yes, they do, almost 90 percent of my suppliers, I pay them through M-Pesa.
QUEST: When are you going to open another shop?
UNIDENTIFIED MALE: We are planning to open it next year --
QUEST: I knew you were --
UNIDENTIFIED MALE: We are working on it --
QUEST: I knew --
UNIDENTIFIED MALE: We are working on it very seriously. We need to open a sister company exactly looking like this, that's the objective we are
working for come next year.
QUEST (voice-over): And so starts the retailing empire.
SALAH GOSS, HEAD OF MASTERCARD LABS FOR MONETARY INCLUSION: What this is, is an attempt to give merchants like Nelson tools that they need to build
their business. We're starting with partners, Unilever is an important one, we're starting small.
But from the lessons we've learned, we're going to expand this partnership to include different FMCG companies and different banks.
QUEST: You're dealing with customers, Nelson in this case who are to say inexperience in the handling of credit would be an understatement. The
only times they've taken loans because they have bank accounts is from local friends and then they paid usually rates of interest.
GOSS: Yes --
QUEST: How much do you have to teach these people about the mechanisms and workings of effectively a credit card.
GOSS: Right, and we do that a couple of ways. So the first thing we do is offer them training, and so I mentioned that our Center for Inclusive
Growth offers training, to teach them how to handle loans responsibly. We also worked with merchants that have relationships with Unilever.
So these are people that even though they don't have a lot of exponential credit, they know what their customers want, they know how to handle their
stock.
QUEST: And how do you prevent or what measures are you putting in place to prevent these merchants from getting into a debt trap even with you?
GOSS: Yes, I think it goes back to the training I talked about. And if you look at the results, only less than 3 percent of merchants even make it
to a place where they have to pay the interest. So we talked to Nelson today, he talks about how he decided with his brother to pay the credit
back responsibly.
So it's really understanding that the more they use credit and the better they use it, the more they can buy more -- the more they can buy, the more
they can sell. No, I think what's important here is we're tying it to an economic activity, it's not a loan in itself, it's really to help them
build up their business.
QUEST: The chief executive of the Gates Foundation says micro-financing has changed the Kenyan economy. She told me it was helping create a new
generation of African leaders.
SUSAN DESMOND-HELLMANN, CHIEF EXECUTIVE, BILL & MELINDA GATES FOUNDATION: First of all, I think it's tremendously exciting to see the kind of
leadership coming from Kenya in the mobile money space.
But we also strongly believe that if the policy conditions are right to allow for things like mobile money, and I'm sure you're seeing it in this
visit. Let's say that you're a small businesswoman, and that you have access to cellphone and that you can trade and you can save and you can
interact using mobile money.
That changes her life, it changes her agency, her ability to drive, paying school fees, paying for her family's health. So for us, everything we care
about on equity and human capital is enabled by focusing and investing in the kinds of things that Kenyans want for themselves, and enabling from
small business people to small-holder farmers --
QUEST: Right --
[15:45:00] DESMOND-HELLMANN: To have access to credit, cash, loans, a lot of things that really change those economic conditions for the people who
need equality.
(END VIDEOTAPE)
NEWTON: OK, stay with us, because next, this fashion model has secret and we let you in on what it is.
(COMMERCIAL BREAK)
NEWTON: All right, the stuffs of science fiction, but as artificial intelligence continues to advance, some robots are looking and acting more
like humans. We're going to meet Sophia, a robot that actually works as a fashion model.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: There's something strange about a machine that looks human, slightly dream-like and unreal, while at the same time, invoking
this idea of a future that might be transformative and really positive sense. Like what if these robots can walk into our world and through this
kind of humanization of the technology really care about us.
Sophia is an extremely human-like robot.
ARTIFICIAL INTELLIGENCE ROBOT: I'd like to protect the planet we have because we don't have another one. That's where I see myself contributing
to society.
UNIDENTIFIED MALE: It took years to develop the kinds of material technology that are now in Sophia robots. But we're able to with those
technologies generate more WiFi expression on much world power. We stand and watch and replicate the full set of facial muscles.
So in some of the work that we're doing, you will see your expressions and sort of match a little bit, and also try to understand in her own way what
it is you might be feeling. Technology is beautiful and mysterious and I'm struck -- and I think that we intuitively process a technology the way that
we process good design.
He is the one robot, the dozens of robots that I have designed who's become really internationally famous.
[15:50:00] UNIDENTIFIED FEMALE: I think it's inspiring artists because artists are about communicating an idea, and if you're able to do that
through this object, this model, this robot that's been, you know, formed, who is actually now a system of the world, which is again, it's still quite
mind-blowing, that is super inspiring.
UNIDENTIFIED MALE: I wanted her form to speak to people, something like a universal way. And so, I don't know what it is about Sophia that speaks to
people, but I hope that we can develop our AI and robot in a way that make a deep emotional connection.
(END VIDEO CLIP)
NEWTON: OK, EU lawmakers want the hammer and sickle off Amazon. Is it right to ban the Soviet symbols? Get your phones ready, we're asking you on
Cnn.com-slash-join, that will be next.
(COMMERCIAL BREAK)
NEWTON: All right, time to get that phone ready, we're about to open our question of the day, and it's all about Amazon with Black Friday sales,
many people will be looking to grab a bargain on Amazon of course. For some buyers though, it could more of a red Friday.
Take a look at some of these items that we found on the platform, symbols of the Soviet Union. Now, members of the European Parliament are calling
on Amazon to ban Soviet-themed goods from the websites. So our question for you today, should U.S. companies like Amazon stop selling Soviet-themed
merchandize?
I want you to go to cnn.com-slash-join, that's cnn.com-slash-join and you will see the votes as they come in here on our screens. And right now, I
am joined by MEP who started the call for this plan, he's called Antanas Guana(ph), I don't think --
ANTANAS GUOGA, MEMBER OF THE EUROPEAN PARLIAMENT: Guoga --
NEWTON: Guoga, OK --
GUOGA: Excellent.
NEWTON: I should be from the Baltic state, there you go. Listen, why is it so important to you and those who support you that these items really
are banned from all digital platforms.
GUOGA: Especially for Lithuanians because Lithuanians led the revolution, the fight for freedom. We're the first country to stand up and win freedom
for everybody I guess with the support of everyone. So those symbols, the symbols of oppression, symbols of deportation.
Millions of people got affected in the region, 60 million people got affected, and really like people got killed, deported to Gulags in Siberia.
[15:55:00] So this -- it's very emotional for people, very moving and very hurtful when these sort of symbols, the sickle and hammer are being sold,
put on teddy bears on Amazon and sold to kids.
NEWTON: And how does it make you feel when some of the items that we're seeing now on the screen, there are really cultural catch. I mean, you
know that they're very popular items especially if you try and buy them in Russia and you come home from Russia with one of those souvenirs.
GUOGA: I think it's lack of education, if it was a swastika we would react differently. But for people in Lithuania and the Baltics, Latvians and
Estonians and everyone else affected by Stalinism by the sort of rule that took place. It was in place for 50 years, I'm personally affected, my
family is affected, people around us are affected.
So we're very hurtful and for us, it's not a nice reminder -- actually European culture justice spoke and these items for commercial reasons are
banned. European parliament spoke, as we have a campaign now, we also -- Thanksgiving today, we're very thankful that Wal-Mart have removed these
sort of items.
And a personal call to Bezos to take a look at it and see whether it's appropriate --
NEWTON: Now --
GUOGA: To sell the design.
NEWTON: Wal-Mart has done it, is that true that Wal-Mart has already stopped --
GUOGA: Wal-Mart has done it yet, we're very grateful and thankful.
NEWTON: And what do you think the reluctances with the other retailers?
GUOGA: I think Bezos just hasn't been told about it.
NEWTON: He's one in detention.
GUOGA: You know, the company is so big, they're so huge, so they probably don't pay attention to little people sometimes. So we're here, I flew
especially today to New York to really just ask him can you consider, can you consider -- are these items appropriate for the public to buy when it's
so hurtful to so many people in our region.
When it's so important for us to stop this sort of campaign.
NEWTON: And look, there's such deep history here, it's impossible to get into it in the few seconds that we have left. But you know that in Russia,
you and your idea to get this off website will be incredibly unpopular. Some people say it is basically wiping clean the history of decades, and
that you have to have the knowledge of that history.
So it's not to repeat it, you know, this is very political for Vladimir Putin in particular.
GUOGA: I know, and it's a mistake. Because it's not against Russia, it's against -- it's against those ideas, the hammer and sickle was communism,
was authoritarian on the rule. Actually they -- Russians actually broke it down as well, so the Russian people were fighting against it.
So trying to remind that it was great, that what Stalin did was great, what the regime did was great, it's not -- it's not true. No one wants it, no,
we don't want to go back to that. I already have a ban from Russia by the way, so I'm not -- that concern, but you know, it's Thanksgiving, so the
Russian people, we send a great --
NEWTON: I thank you for being here. As you can see, people wait in there and a majority of us, more majority do think these items should be off the
website. And that is QUEST MEANS BUSINESS for tonight, I am Paula Newton, anyone who is celebrating Thanksgiving, have a great one and I'll be back
in a moment to check the headlines.
(COMMERCIAL BREAK)
END
