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Quest Means Business
Debt Limit Vote In U.S. Senate Could Come As Soon As Today; Ethiopia Atrocities Would Constitute Violation Of U.S. Trade Agreement; Airbus CEO Says Hydrogen-Powered Planes Offer Long Term Solutions; Ireland Joins OECD Deal To Curb Corporate Tax Avoidance; Natural Gas Prices Fall After Putin's Comments; Gold Down As Inflation Fears Recede. Aired 3-4p ET
Aired October 07, 2021 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN BUSINESS ANCHOR: We have an hour together, 60 minutes. In the last 60 trading on this Thursday. It is the third straight day of
triple digit gains for the Dow. Look at the markets and you see how they're doing.
The Dow is now off the highs of the day, over 500, but still a gain of one percent, giving back about three quarters of one percent. The triple stack
shows a different picture in terms of gains. The NASDAQ is up, the S&P is up. They're all showing robust -- particularly the NASDAQ. The tech stocks
are doing the best.
The markets and if you want to know why they are ebullient, the U.S. senators leaders have agreed to kick the can down the debt road. The
ceilings can be extended until mid-December -- delayed.
Ethiopian Airlines is facing threats of U.S. sanctions after CNN's report on how the airline transported weapons.
And in the last few hours, Ireland said it will raise taxes -- corporate taxes, and is finally joining with the O.E.C.D. on a minimum corporate tax
We are live in New York on Thursday. It's October the 7th. I'm Richard Quest and I mean business.
It may only be temporary, it will be December when we'll be back here again, but Wall Street is still delighted by a debt deal in Washington.
Now, even when the deal is done, which it isn't, it won't fully be, if you see what I mean. U.S. markets are up. A vote could happen as soon as today
on extending the borrowing limit through early December.
However, both sides are claiming victory on what is at best a temporary fix.
(BEGIN VIDEO CLIP)
SEN. CHUCK SCHUMER (D-NY): We have reached agreement to extend the debt ceiling through early December, and it is our hope that we can get this
done as soon as today.
SEN. MITCH MCCONNELL (R-KY): Republican and Democratic members and staff negotiated through the night in good faith. So, it is moving toward the
plan I laid out yesterday to spare the American people a manufactured crisis.
(END VIDEO CLIP)
QUEST: Now the Dow is on a roller coaster over the last week as the U.S. fumbled around on raising the debt limit. You'll see there, down heavily,
up, then down heavily, and then up and up and so we are today. Republicans were threatening to derail the process and the Senate Republicans have met
at a conference lunch to sort out the last remaining objections amongst their ranks. The holdouts could delay a vote until Sunday.
Manu Raju is here with us. All right, Manu Raju, come on. Why? Well, I mean, forgive me. I'm glad -- the market is grateful that they've delayed,
but they've just delayed an inevitable. We will be back here again before Christmas.
MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: You know, Richard, this whole fight is all about the fact that Members of Congress do not want to
take this vote. They all know that they have to raise the debt ceiling because of the potential economic consequences that would come from the
first ever U.S. default. Nobody wants to be blamed for that.
But virtually nobody wants to actually cast a vote to raise the debt ceiling, which is why we've been in this situation, this staring contest
for weeks. And now we're reaching to the point where they are going to -- they have come to this agreement -- the leadership has -- to extend the
national debt ceiling by $480 billion, expected to take the country up until early December, at which point that definitely could be breached
again, and then we'll be back in the same situation.
Now, Richard, at this moment, it's still uncertain exactly how this vote is going to play out today. Republicans having a hard time because they now
have to convince 10 of the Republicans to break ranks, vote with all 50 Democrats on this short debt ceiling increase after months of saying that
Democrats alone were responsible for increasing the national debt ceiling.
And we're learning and talking to senators and top Republicans that they do not have those 10 Republican votes yet. So these discussions are happening
behind the scenes. There are still some expectation, because this was a deal cut by Republican Leader Mitch McConnell that they will get those 10
Republicans to break ranks, but at the moment, they don't have it, which just goes back to my initial point. They know they have to do it, but they
don't want to own it.
QUEST: So two things here. Firstly, surely if the leader -- if Leader McConnell -- the Senate Minority Leader, if he wants this to go through, he
can find 10 moderates or those on his side who he can corral, bully, or browbeat. And secondly, what is his thinking? I mean, what does he expect
is going to happen between the 7th of October and the middle of December that's going to change the landscape for getting it to pass more long term?
RAJU: There's virtually nothing that's going to change over the next few weeks here because they are still in the same staring contest because
there's a dispute over the process of raising the debt ceiling. Not the fact that has to be done, but the process.
McConnell wants them to use -- Democrats use a budget process that will not require Republican votes. Democrats don't want to use that budget process
because it's convoluted. It opens them up to a lot of politically charged amendment votes. And they say Republicans should own this as well because
of the debt that was incurred during the Trump administration.
So because of this procedural dispute, it's still going to exist in a couple of weeks where they have to deal with this again. And on top of
this, Richard, this is going to coincide with another deadline on December 3rd, to continue to fund the U.S. government. And if they don't extend
funding for the Federal government, we are going to have a government shutdown and a debt default in December and be back right where we are.
QUEST: Manu Raju on Capitol Hill, thank you.
And so to Ethiopia. Ethiopia has, for decades been the beneficiary of a U.S. government trade agreement that grants hundreds of millions of dollars
of favorable access to U.S. market. As a result, Ethiopian Airlines in recent years has been able to build a global fleet and become one of the
world's leading carriers.
For both the U.S. and Ethiopia, this relationship matters.
For almost a year now, conflict has raged Ethiopia's Tigray region, you and I have talked about this on this program many times.
Now numerous CNN investigations have uncovered evidence of Ethiopian government atrocities. Now, we have evidence that Ethiopian Airlines cargo
airlines have been shuttling weapons between in Ethiopia and Eritrea, north the border.
Experts believe that if so, it constitutes a violation of international law and the trade agreements with the United States.
Hours ago, we learned that the Biden administration has issued a warning, it could sanction those responsible for ferrying the weapons following our
Nima Elbagir is with us from London. This superb reporting, basically, does chapter and verse to the very manifests the documents shows what was there
on the aircraft. Ethiopian Airlines say to their knowledge, they've never carried weapons in such a fashion.
NIMA ELBAGIR, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, they do. But what has been quite interesting is to parse their most recent statements.
Initially, they were saying that they absolutely categorically denied this latest statement. They say that not to their knowledge, and it feels like a
very tiny change, but it is one that could potentially have impact.
The implications are that they could argue that military actors commandeered this craft. They could also argue, and we've seen it argued by
some proxies of the Ethiopian government and the Ethiopian Prime Minister already online that this was commandeered as a statecraft which is allowed
under international law.
But as you know, you understand these laws better than most, Richard, you still have to declare it. What Ethiopian Airlines did was they switched off
their transponder. They did not declare any of their cargo. And they are at the moment not being honest about what they did and didn't know.
QUEST: And with this in mind, the idea that they could be sanctioned, what sort of sanctions would be in the realm of possibility here?
ELBAGIR: Well, what's really worrying the Ethiopian government is AGOA, the African Growth and Opportunity Act, which as you pointed out, is worth
hundreds of millions of dollars of favorable market access into the U.S. and they've built this fleet off of it just this week.
Boeing announced new plans for Addis Ababa, the Ethiopian capital to become an African aviation hub. All of that goes away, or becomes a lot more
expensive and a lot trickier for Boeing to stay in business with, if the U.S. removes the eligibility of Ethiopia from AGOA, which they say they'll
review at the beginning of the year.
But if they sanctioned leading actors in this and the U.S. were very specific that they said, because this is a state carrier, they could
sanction both those within the government and within the hierarchy of Ethiopian Airlines.
And just before we came to air, Richard, another senior Biden administration official reached out to our team to say that they were also
themselves investigating our findings. So, clearly the Biden administration wants to be seen to be taking this seriously because they have also come
under some pressure and fire from U.S. lawmakers for not acting quickly enough on the tragedy in Tigray.
QUEST: Why in your view is the U.S. taking such a stern view? There are atrocities indeed that have taken place and continue to take place. But
Nima, there are atrocities all over the world that the U.S. does not get into much involved with. So what in your view, is the reason why they're
taking this so seriously?
ELBAGIR: Well, one, it speaks to the relationship that the U.S. has with Ethiopia. Ethiopia was before the recent financial sanctions were put in
place, the largest recipient of U.S. aid in Africa.
It also has a long history of military and trade cooperation, and has been held up to a certain degree as an example of what can happen when you are
close to the United States. And there are historic ties there. But also it is because Richard, these are not just and there is no just in atrocities,
right? All atrocities, any life lost is heartbreaking.
But what we are looking at his atrocities that bear all the hallmarks of genocide, and that that is what we have reached through our investigations.
And that's what we've started to hear from others, including investigators linked to the Holocaust Memorial Museum in the U.S. People feel that the
methodology of this campaign could potentially meet to genocide and that the U.S. cannot be seen to allow to happen.
QUEST: Nima, thank you. Superb reporting. Thank you.
Allow me to reiterate what Ethiopia says. Ethiopia is responding to our findings. Ethiopian Airlines said it complies with all aviation regulations
and in their words, to the best of its knowledge and its records, it has not transported any war armaments in any of its routes by any of its
aircraft. Well, that's pretty clear.
A U.S. trade spokesperson told CNN, they would review eligibility for AGOA, the Act next year, and to be based in their words, on the compliance with
standards that include adherence to all internationally recognized workers' rights, rule of law and human rights.
After the review, the USTR could, quote, "possibly recommend that the President add or remove certain countries from AGOA beneficiary country
As to the allegations of Ethiopian Airlines and Boeing, the aircraft manufacturer said they had no comment. The Ethiopian and Eritrean
governments did not respond to requests for comment.
So to Ethiopian itself, we always cover airlines on this story in great detail, so we feel we really must get to grips with this.
Ethiopian operates a fleet of 130 aircraft. It is the largest and most successful by much measure of any African carrier. Ethiopian connects Addis
to 116 destinations, all the biggies -- New York, London, Shanghai, it is a true sixth freedom hub, as they say.
A member of Star Alliance alongside those like United, Air Canada, Lufthansa, and Singapore.
Mary Schiavo is our aviation analyst and Mary is with me now. If we look at Ethiopian, it's one of those airlines that is very successful, extremely
successful. But the threat of U.S. sanctions in some shape or form would be extremely damaging. How do you see that playing out?
MARY SCHIAVO, CNN AVIATION ANALYST: Well on several different fronts, I expect. First of all, the relationship between Ethiopian Airlines and
United States and Boeing is very tight. If anyone has flown on Ethiopian Airlines knows they have pretty much all-Boeing fleet, you know, a great
fleet, great planes. And a lot of that was due to, as you mentioned earlier, you know, counter trade, trade measures and support from the
But the airline is owned by the state and so that adds a bit of a wrinkle. And so I think what they were playing was a game of semantics of when at
first until they were literally confronted with the photographs of the cargo manifests and showing Ethiopian Airlines flight, they played a game
of semantics and said oh, no, not on our planes, not on our airlines, it is not us.
But they might have been using it just as you said in the earlier piece as a military aircraft and other nations have that. The United States has
that. It's the Civil Reserve Air Fleet, and in times of national emergency, you take civilian aircraft so it could play out on many fronts, but the
U.S. can put sanctions both on the airline and through the trade agreements.
QUEST: Would you see a possibility of Ethiopian losing its traffic rights?
SCHIAVO: Well, they could, but so many of those treaties are separately negotiated treaties with various five and six freedoms of the air, mostly
five freedoms, that what usually happens is a tit-for-tat. When the United States imposes sanctions on an airline, then that airline's country says,
well, okay, but then you can't land here either.
United States had a lengthy tiff like that with Japan, not over anything like this, over a financial lucrative rights. But it's usually a tit-for-
tat when you start taking away air and landing rights. And you know, who has more to lose? Ethiopia.
I mean, they are a huge tenant at Dulles Airport in Washington, D.C., but then it also would hinder trade between the two countries. But absolutely
you can do it, you can sanction them, and then we'd expect them to sanction our airlines.
QUEST: And would you -- I mean, is there a risk that Ethiopian just says this will blow over? Just ignore it. Don't do anything. If you don't do
anything -- I mean, you're familiar with this syndrome. If we wait long enough, everyone will have forgotten.
SCHIAVO: Absolutely. And despite the violations, you're turning off the transponder, you know, making themselves go dark when you have to have
collision avoidance capabilities, not declaring the manifest and the loads they were carrying. There are so many violations. How do you begin to
address them all?
Maybe the way they have chosen is to say, man, we're just not going to comment and it's going to blow over. I suppose that could happen. So, it
really does come down to what President Biden said, I guess, it was last month or a couple of weeks ago that he intends to sanction people who
participate countries and businesses who participate in such atrocities.
And so, I think that the real -- the real force will come down the United States whether they're going to respond.
QUEST: Mary, always good to have you. Thank you very much indeed, Mary.
SCHIAVO: Thank you.
QUEST: And I should indeed mention, of course, Mary is involved in ongoing litigation with Boeing. But that does not of course, involve Ethiopian
Airlines, just to be clear.
Airbus says it will take a team effort to bring down carbon emissions. The Chief Executive says hydrogen-powered planes will be the cornerstone of the
QUEST: The UAE is the first Middle East country to say it will aim for net zero emissions by 2050. And as we came at Expo 2020 in Dubai, the target
brings it in line with the Paris Agreement.
The E.U., U.S., and many other countries have all made the same or similar pledge. Now, if you talk to the CEO of Airbus and ask him about 2050, it
will not be long before he says hydrogen and he'll said again, hydrogen- powered planes are the long term answers as seen by Guillaume. It's a part of aviation's ability to do its bit for net zero 2050.
Remember, I.A.T.A, at the weekend voted net zero by 2050. So Airbus has a whole range of hydrogen-plane concepts, which is going to launch 14 years
from now or so, and it is under a big pressure. Airlines, air manufacturers, and engine manufacturers. Guillaume Faury told me, it would
be a multi-step process to net zero.
GUILLAUME FAURY, CEO, AIRBUS: There are different bricks that we need to get there. The first one is the modern planes are by far more fuel
efficient than the old ones. So replacing old planes buy new ones is already part of the answer, this can be done today.
The second big part is all about sustainable aviation fuels, transition from fossil fuels, kerosene, to those fuels. On the short term is going to
be bio -- biofuels. But it's not scalable to the extent we need.
So then it's going to be about synthetic fuels. And this will require hydrogen, by the way, but that's a different story. And we need SAFs anyway
for long distances. So, I'm not trying to oppose SAF and hydrogen, they have different timeframes. They have different kinds of views. But we
believe hydrogen will have a glowing place 2035 onwards.
QUEST: You're betting the house on hydrogen.
FAURY: No, we don't. No, we don't. As I told you --
QUEST: No one says -- for you, this is really important.
FAURY: It is important, but we're not betting the house because we believe in SAF as well. As I told you, the SAF would be very important as a
continuous improvement of the existing platforms, reducing the fuel burn, transitioning from kerosene and fossil fuels into sustainable aviation
But at the same time, we're preparing the more mid-term, long-term future with hydrogen.
QUEST: So to some extent, this sustainable issue rests with you, doesn't it? The ability to create a vehicle that is more user friendly for the
FAURY: Well, to a large extent, we have created those products. Very low level of fuel burn. Today, they are certified for 50 percent of sustainable
aviation fuels, each and every plane that goes out of the Airbus door is certified for 50 percent. So yes, others have to do their share as well.
Now, when we look at the medium and long-term future, there's a lot on this as well, and we don't deny and we are very happy to engage in innovation in
preparing the next generation of products. We will go from 50 percent to 100 percent sustainability aviation fuels on the existing planes, and we're
preparing hydrogen. This bit of time is demanding for everyone.
QUEST: And let's talk about the business, post-pandemic. It was interesting, airlines didn't cancel orders, did they? They postponed. They
moved, they cajoled. But they didn't cancel.
And that's interesting. What does it tell us?
FAURY: That they believe in the future, and that they like our products, and that they consider the back to normal will come one day. And so it was
all about deferring, trying to find the right way of managing the liquidity of the airlines versus the need of down payments to prepare for the
manufacturing of the planes, and we've been able to find solutions for many, many cases.
QUEST: How difficult was that for you, as the manufacturer? When all of a sudden, all these airlines say, well, you know, that plane, either you're
building or that you're about to build or that -- I don't want it just yet. I'll have it in three years' time. And you're thinking, well, I've got a
factory that's -- I've got employees that have to be paid. How difficult was it?
FAURY: You're touching the right points. Well, it was a lot of uncertainty at the beginning, and we had to build new plants without really knowing.
So, we sat down with customers. We try to define customer by customer, plane by plane, and we just rebuild the production planning one by one, and
we had very little time to do that.
So it was the work we did in the second quarter of 2020 just being hit by the pandemic. And we had defined a new reality and we had a lot of
inventory for a bit of time. But we think we have defined the right level of production to then get rid of a large share of this inventory, and here
QUEST: Guillaume Faury of Airbus and of course, the industry has agreed to go net zero by 2050.
Paul Polman, the former CEO of Unilever says it's time for chief executives to speak up and speak out if they are serious about climate action.
QUEST: He has delivered a new book titled "Net Positive." And says it is not of the governments to save the planet. Paul's with me from London, he
joins us via Skype, it is good to see you as looking well.
To a large extent, we can just take what we've heard as a good introduction for talking about "Net Positive," because you have CEOs, aircraft
manufacturers, engine manufacturers, who now have to make good on that promise. And this is something of which you are incredibly familiar. In
fact, you say in your book -- you say in your book, "We can't make token commitments on something as large as climate change." Isn't that what's
PAUL POLMAN, FORMER CEO OF UNILEVER: Indeed, Richard, we're talking here about the future of humanity, the science has spoken. We're well aware of
the enormous costs that we're incurring. COVID is just a small example of that.
And what we have seen in the last year and a half, I think, is that the world has partly woken up. In terms of countries, we now have commitments
from 131 countries to go to net zero, it used to be 20 percent. That covers about 70 percent of the global emissions. We also have 20 percent of the
companies making commitments that are science based to be net zero by 2050.
Now, here is the issue, we can't wait till 2050. We have to reduce the carbon emission by 45 percent between now and 2030. The countries
collectively go up 16 percent. This is where the problem is, and very few companies are making commitments on that timeframe. They're just too
worried about it, or there is still the bulk of companies who don't even publish or make the commitments at all.
So there is some work to do, and this is one of the things we're addressing in the book.
QUEST: The book is wider than just -- well, I just, forgive me -- than climate change. You say also in the book, "Companies are increasingly asked
to make choices about how they operate in the world, and what they stand for. Stakeholders are watching on opportunities to do the right thing."
Now, we've talked about this on QUEST MEANS BUSINESS. You and I have actually about CEOs being the moral barometer in this sense, the need to do
right. But I will question and I put it to you, how, as a CEO, do you do that?
POLMAN: Well, the first thing is good to remind ourselves that World Overshoot Day, which was the day that we used up all resources that the
world can replenish was this year, July 29th.
Frankly, Richard after that day, we are actually stealing from future generations. So, it's not good enough anymore to be CSR or Corporate Social
Responsibility or being less bad. It's simply not good anymore even to be circular. We need to be restorative, reparative, regenerative, and this is
something that we are arguing and call it net positive, and it starts with the CEOs in the company, as you rightfully say. If the top is not
convinced, we won't get there and that courage needs to come from the CEOs.
There are two reasons now why the CEO should be interested in it. The first one is make them aware of what is happening in the world and be connected,
hopefully, coming to the conclusion that companies should be there to solve the world's problems and not to create the world's problems. And the second
thing is the enormous opportunity that it gives us.
What we now see is that the cost of not acting has actually become higher regretfully than the cost of acting, which makes it such an enormous
opportunity, as we have showed with Unilever.
QUEST: But as we have also seen, as CEO, how do you determine which to go for? I mean, sustainability is one thing, but let's talk about, for
example, Black Lives Matter, homophobia, gender diversity?
And then of course, I suppose on those, one can arguably find a common ground. But then you have right to choice versus right to life? Do you
think it's appropriate for a CEO to take a corporate position on those?
POLMAN: Well, 75 percent of the population thinks so even in the United States where you are right now, Richard, and they trust business higher in
this respect than governments, may I say regretfully. And for employees, that percentage is even higher.
If the CEOs don't speak up on these issues that are relevant for their business or whether they can make a real difference related to their
constituents, then frankly, they're not doing the job according to these people.
And more importantly, they also expect companies to have values, which energize employees, which unlock productivity, which pays for its itself in
results, and the values need to be defended. So, when you have issues like equal rights for people with disabilities or people with different sexual
orientation, or different ratio, colors if you want to, they do expect CEOs to speak up if these issues are being violated, and frankly we should
because the issue of humanity is at stake there.
QUEST: Paul Polman always good -- the book is Net Positive, we will talk more on this. I'm grateful to you sir, thank you.
So tonight, on the streets of Dublin, it's almost 8:30 in the evening, they are getting ready for a quick bevvy. Maybe they won't be drinking so
heavily, or there'll be drowning their sorrows if you're a corporate leader, the low tax haven is over. Ireland says it will fall into line with
the U.S. plan for a global minimum corporate tax rate, which is higher than the existing one, rate minor double.
QUEST: Hello, I'm Richard Quest there's more Quest Means Business in just a moment. It's the end of an era for Ireland after decades as a low tax haven
for U.S. tech companies that's all about to change. Dublin is falling in line with the U.S. plan for minimum corporate taxes. And the CEO of the
world's biggest gold miner tells us how his company plans to go carbon net zero by 2050. That's all still to come only after I given you the news
headlines, but this is CNN and here are the facts and news come first.
The drugmaker, Pfizer, has asked U.S. regulators to authorize its COVID vaccine for children aged five to 11. It follows the company releasing data
showing the vaccine is safe and generates antibodies in children of that age, if endorsed it will be the youngest group in America to receive access
And magnitude 5.9 earthquake rocked Japan's Chiba Prefecture on Thursday night, east of Tokyo. There are reports of minor injuries handed to
airport, runways were briefly shut down, and some trains were halted, strongest earthquake in Tokyo since 2011.
The British based Tanzanian novelist Abdulrazak Gurnah has won this year's Nobel Prize in Literature. The Swedish Academy said the award was in
recognition of Gurnah's uncompromising and passionate portrayals of the effects of colonialism. Gurnah has written 10 novels, many of them focusing
on the refugee experience.
Ireland is set to abandon its reputation as Europe's tax haven with the lowest rate or something like that. It will join the OECD deal, setting a
minimum 15% rate on corporate profits. Many U.S. tech giants of the European headquarters in Ireland and not include those you see on the
screen, Google Apple, et cetera, et cetera.
Clare Sebastian has more. She's with me in New York. And so, Clare, why did the Irish given they had baffled and said they wouldn't and then all of a
sudden, they turn around and say, well, we'll go along with it.
CLARE SEBASTIAN, CNN INTERNATIONAL CORRESPONDENT: Yeah, Richard, the sense we're getting is that their view now having been locked in negotiations for
the past few months, since the majority of OECD countries signed on in July is that it's just better in and out, essentially. As part of the
negotiations, they have secured a few concessions. For example, in that original statement, the global minimum tax was set at least 15%, which
Ireland felt sort of left room for future rises, there was a sense perhaps that the U.S. would eventually want to bring it up higher to its own
corporate tax rates, or at least has now been taken out.
Ireland says it also secured concessions from assurances from the E.U. that countries that don't meet the threshold -- companies, rather, that don't
meet the threshold of 750 million euros in annual revenue won't be taxed at 15% that they will be able to maintain that price 12 and a half percent
rate. But ultimately, what this boils down to, Richard, is that the global minimum tax means that if they don't tax these companies at 15%, in
Ireland, that the country where these companies have their global headquarters, for example, with Apple, it would be the United States can
top up that tax, can essentially collect the difference between the corporate tax rate they're paying in Ireland and the minimum tax of 15%. So
that is why they say ultimately, we will be losing out on those revenues if we didn't join in.
QUEST: OK, and but this still leaves Hungary one or two others, doesn't it? Who are hold out if they don't go along with it, what happens?
SEBASTIAN: Well, I think, you know, ultimately, the OECD can still go ahead, but it means that for example, with the European Union, this was
critical that Ireland joined I think Estonia has also said it will join today because they can't make changes to their tax policy without unanimous
consent of their members. So, this is a very important step. But there's a meeting of the OECD tomorrow, Richard where they're set to sort of have
everyone sign up to this framework. So, we'll see at that point, how many holdouts are still left over. And after that there's still a lot of work to
be done. A lot of technical things have to be ironed out. The Congress in the U.S. is still debating this, so everyone has to pass it in their home
countries and really, the IRS say today they don't expect any change until 2023.
QUEST: Clare Sebastian, on that, thank you.
Now natural gas prices have fallen 6% following Vladimir Putin saying that Russia could soon be pumping more gas. The lights on heating high and it's
all much more expensive in Europe, especially in the U.K., relying heavily on natural gas to create electricity. Here, you see a spike in energy
prices over the summer. Just imagine what the winter will be like.
The Russian Deputy Prime Minister says the approving of the controversial Nord Stream 2 pipeline would ease Europe's energy crisis. Anna Stewart is
with me in London. Quid pro quo, you give us Nord Stream 2, we will pump up the wazoo, the gas bringing the prices down.
ANNA STEWART, CNN REPORTER: That is certainly, Richard, what it felt like in a meeting where on the one hand, you have the president saying, oh we
could export more gas to Europe, something that IEAs been asking for now for weeks. And at the same time, the deputy prime minister says hey and if
you have a quick certification of our new pipeline that would also help gas prices.
The two certainly feel like they're connected but Russia has long denied that they are withholding gas prices, sorry, withholding gas exports to
keep that price high to lend weight to its argument. They deny that but it is certainly playing into the arguments from energy experts and analysts on
QUEST: So, let's take the U.K., for example. My reading of the U.K. situation, I mean part of its Brexit, part of it is pandemic and the
drivers went home. Part of it is high prices. But -- and then if we look at other countries like Germany that we've been talking about over the course
of the week, similar sort of issues except for Brexit. So, is the situation systemic, or is it cyclical?
STEWART: I think at this stage, it's probably systemic in terms of when looking at a country transitioning to cleaner energies. And this is a
moment where it's been hit by multiple shocks. So, it has been hit by the issue of the pandemic and the fact that post lockdowns, all these energies
are roaring back into action. And supplies are still low, because of the last winter being very long and wind and solar. But on top of that, is the
fact that there isn't enough storage facilities, particularly in the U.K. That's one of the key problems here. And that isn't enough gas supplies.
There weren't enough long-term contracts.
And the one surprising element I'd say the last 24 hours was -- with last 24 hours, Richard, was the fact that I actually agreed with President
Putin. He put some of the blame on to Europe saying they didn't sign enough long-term contracts for gas. And I don't think they did.
QUEST: Anna Stewart who would have signed up for the lot if she'd had the wherewithal in the bank account. Good to see you, thank you.
So, to European -- to stocks in Europe and the US. Now gold is on down day. Inflation wages have been taking a backseat. And just around we'll talk
about gold and the mining of gold with the CEO of Newmont, gold mining.
QUEST: U.S. markets are shining today. The Dow is shot at more than 500 points at the outset, holding gains of more than 1% but off the top of the
day of 500. So given back about half to three quarters of a percent on the debt deal in Washington.
Initial jobless claims also came in lower than expected, it was down from the previous week. You see the numbers on the screen. And all that glitters
is not gold. Gold is off today too, about inflation fears coming down. Gold is the perennial hedge against inflation, is down around 6% over the past
year. I suspect that doesn't worry Tom Palmer, the CEO of Newmont, the world's largest gold mining company. 6% here 6% there, Tom, you're in it
for the long haul, aren't you?
TOM PALMER, CEO, NEWMONT: Good afternoon, Richard, we absolutely are in for the long haul. Prices might be off a little bit, but they're very good
prices compared to where they've been over the last decade or so. So, we're certainly enjoying the benefits of that as our shareholders.
QUEST: And do you think that as an inflation hedge, particularly as we saw the ECB, the U.K. and the U.S. and the Fed worries of inflation, did give a
boost to -- they're not an indirect as such, but this -- we're back to the old game of gold being relevant.
PALMER: I think we're certainly -- I think gold is certainly relevant. And I'd encourage people to have gold in their investment portfolio across the
board. But not only gold, I'd actually have gold equities, because we can also give good exposure to gold, but we deliver returns to shareholders.
So, we're paying a 4% yield at the moment, but the only gold company sitting on the S&P 500, and we're competing with the best of them on that
QUEST: And yeah, there has been tremendous consolidation within the gold equity sector. Do you think it's done? Are you now all so big that you
couldn't do more?
PALMER: No, we're not done by any means. Richard, if you look at gold mining companies, gold equity, publicly listed companies, there are about
1000 of them around the world, that's 10 times more than any other commodity that's mined, you add up the value of all of those companies, and
we're about 20% of the value of Apple. So there needs to be, I think, still considerable consolidation. And I think climate change is going to drive it
because you're going to need scale and life in your portfolio to underpin the investments for moved to a net zero operation. I think it's coming.
QUEST: So, let's read what you say. Mining is an intensive, is an energy intensive business with 88% of Newmont's energy used for mining and
milling. As the company looks to reduce emissions, it will use strategic approach. But when I read that, you're looking for 30% by 2030, and
achieving net zero 2050, you can't do it?
PALMER: We could -- we certainly have a pathway to 2030. And we have an aspiration to 2050. And I think the things we'll do to get to 2030 will
certainly put us on that pathway to 2050. Three key areas, Richard, ones, a culture of continuous improvement, every one of our operations looking to
become more efficient. Second, manage renewable energy. That's a step change as we move to renewable energy to fit our operations. And the third
one is technology and having the courage to back technology and work with the manufacturers of equipment for mining, so that we can introduce things
like battery electric vehicles into the mining game, renewable energy coming in over the grid or electrically propelled those trucks as well as
PALMER: Because of your intensity of energy concentration, do you fear you're not quite fossil fuel verboten, but you're not far -- but you could
end up with investors, shunning mining, because of the energy intensity?
PALMER: Mining is required for decarbonization. So, the world is going to need the metals that we produce. We are doing the things to reduce our
energy efficiency, to reduce our reliance on fossil fuels, and produce the metals that are going to be needed to decarbonize the world. So, we are an
essential part of that, Richard.
QUEST: A few weeks ago, I asked this on this question, I asked this question of all people, I know the answer for you. So, I'm going to ask it
anyway. I'm going to give you a chance for an asset under the bed, all right, it's an asset that you can pop under the bed for a rainy day. You
can have $1, you can have a euro, you can have a Bitcoin, or you can have a bit of gold, which you're going to take it a
PALMER: A gold. It's been a store of value for millennia. It's --
QUEST: All right, thank you --
PALMER: -- gold, but even better ever Newmont stock sitting on the --
QUEST: Oh please, punting his own stock. Tom, I didn't do that the board would have been after you.
QUEST: All right, I should merely say -- I shall merely say whatever your stocks can go up as well as down. Good to see you, Tom, as always, thank
you, sir. I appreciate it.
Final 10 minutes of trading on Wall Street. I love the closing numbers, when we return. Quest Means Business, good evening to you.
QUEST: They're nearly midnight in Dubai and so the first week of Expo 2020 is coming to an end. The fair has giant expectations that that it is living
up to. At the mobility Pavilion, they're taking that quite literally. CNN's Eleni Giokos reports.
ELENI GIOKOS, CNN CORRESPONDENT (voice-over): With big aspirations by wanting to create an unrivalled visitor experience. In 2017, the Expo 2020
team travelled 14,000 kilometers to New Zealand.
RICHARD TAYLOR, CO-FOUNDER & CEO, WETA WORKSHOP: The scale of the mobility pavilion for us was fairly significant, really not since the seven-and-a-
half-year journey on the Lord of the Rings where we looked after five different departments have, we tackled something of such similar scale, but
in half the length of time.
GIOKOS: Four months, Richard Taylor and his team set about designing a monumental tribute to the epic journey of human mobility.
TAYLOR: We created three eight times larger than life size giants, if they were to stand up, they'd be nearly 16 meters tall. The three characters are
Al-Bakri, who is a great geographer and historian. We also did Battuta who is the great scholar and explorer, and we did ibn Majid, who was a
navigator and cartographer.
GIOKOS: Creating these hyper realistic replicas was no easy task.
TAYLOR: Just in their clothing alone, there's one and a half kilometers of fabric and each piece of clothing, dressing them with forklifts and cranes
20,000 individual holes drilled into the face to insert the beard. The eyes are 3d printed.
GIOKOS: Not to be done with just creating giants, the team set out to showcase the history of mobility down through the centuries through a type
of art called Bas-relief.
Our Bas-relief is 53 meters long, it's got over 200 human figures 100 animals over 100 vehicles that tells the story of mobility from people
emerging out of the beginnings of the world, then finding mobility by forming tribes inventing footwear, and then of course on to the mobility of
vehicles and ships and airplanes.
GIOKOS: Now in their final home at Expo 2020, the displays I'll say to wow visitors by paying tribute to how mobility has been the driving force
behind mankind's development. Eleni Giokos CNN, Expo 2020 Dubai.
QUEST: Can't wait to see it all, thank you. We'll take a profitable moment you and I, after we've had a short break.
QUEST: Tonight's profitable moment, this week, we've devoted much time talking about the aviation airline industry following IATA and for good
reason an industry that was on its knees that proved its worth with government bailouts, well, now BA's bringing back it's a 380s, United says
it'll fly 90% of schedule if not capacity, and various parts of the world Australia, Qantas is bringing home, is opening up much sooner.
But on this question of net zero 2050, the airline industry knows that it can be done, but it's going to take a great deal more work. And that's
going to be from the OEMs: Boeing, Airbus, Bombardier, Embraer, the like from the manufacturers of engines, Rolls Royce, GE, Pratt & Whitney, from
the fuel manufacturing companies, Shell and the like.
The problem is the airline's themselves get the blame. And the reality is that the public to have to understand that aviation and airlines is less
than 3% of global emissions. And of all the industries that is working hard it is trying to get that number down. But realistically, it's not going to
drop overnight from magically until new technologies come along. And that means whilst everybody does their best and continuous descent and European
open skies and a European single skies, is introduced, it's still going to be some time before aviation gets it right. It's just a reality.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York, whatever you're up to in the years ahead, I hope it is profitable. We
joined President Biden's speaking in Chicago on vaccine mandate. We'll join that after the closing bell which comes now (inaudible).