Return to Transcripts main page

Quest Means Business

U.S. Consumer Prices Climb 8.5 Percent In March; Suspect At Large After 16 Hurt In New York Subway Attack; U.K. Prime Minister Apologizes For Breaking COVID Laws After Fine; U.S. And U.K. Authorities Investigating Unverified Report Of Chemical Attack In Mariupol; Putin Speaks Of Russia's Military Goals As "Noble"; Estonia To End Reliance On Russian Energy; Atlanta Airport Regains Title As World's Busiest. Aired 3-4p ET

Aired April 12, 2022 - 15:00   ET



RICHARD QUEST, CNN BUSINESS ANCHOR: We've got an hour to go to the close of trade this Tuesday and stocks have reversed their gains.

You can see, there were some solid gains in the morning. Now, they've reversed. We need to understand why. It's due to the bond market and the

latest bond issuance, giving pause for thought but small losses, the markets and the main events that we will bring to your attention tonight.

The U.S. inflation rate now over eight percent -- 8.5 percent. Look behind the numbers, and we could be near a peak of U.S. inflation, that's one


Vladimir Putin is claiming the West's economic blitzkrieg on Russia has failed.

And Boris Johnson, the British Prime Minister, has been fined for breaking his own lockdown rules.

We're live in New York tonight, as always. Today is Tuesday, it is April the 12th. I'm Richard Quest, I mean business.

Good evening, U.S. inflation climbed last month to its highest level in more than 40 years. The CPI, the Consumer Price Index, rose to an eight and

a half percent in March compared to a year ago, the highest rates since '81. Obviously, at that number well above the Fed's two percent target.

The war in Ukraine has added to existing supply chain problems and growing demand, and that has taken its toll on inflation along with energy costs,

of course. And it was fears over Russian supplies that sent energy prices 32 percent up. Food prices have also risen almost nine percent in the U.S.,

and things will get worse as the war continues.

Matt Egan is here. Right? So eight and a half percent. Pretty awful when your target is two percent. It justifies the rate going up, the last

interest rate, and it does suggest what for the next Fed meeting?

MATT EGAN, CNN REPORTER: Well, it suggests that the Federal Reserve has got to move pretty quickly here to get interest rates anywhere near a

reasonable place given how high inflation is. I mean, it is kind of incredible to think that we still have near zero interest rates. The Fed

has only just stopped buying bonds in quantitative easing, and yet inflation is so far away from that two percent target.

Now, you know, we really are living through history here, not only in the fact that we haven't seen price gains like this in 40 years, but it has

been a very long time since we saw the Federal Reserve with policies that seem so out of whack with where inflation is.

You know, there were record price gains year-over-year for a whole range of categories, everything from men's apparel, baby food, new cars, and trucks,

salad dressing, so you know, this inflation situation continues to get worse.

I think, if there is a silver lining, it's the fact that core inflation month over month was only up by 0.3 percent. That's actually an improvement

from the prior month, and we saw that used cars and trucks, those prices fell by 3.8 percent month-over-month, so that is giving some confidence to

economists who think that maybe we're finally at that long elusive peak for inflation -- Richard.

QUEST: The market started higher, and then turned turtle. It said because of a bond auction, the 10-year bond note -- the 10-year note, I should say,

which didn't go well, or at least wasn't as covered as previously as auctions have been, and we're off over 104 now.

EGAN: Yes, really interesting to see the market really took off this morning, when those inflation numbers came up, because it was seen as a

sign of peak inflation, but as you mentioned, that has -- the markets rolled over. The bond auction is interesting, because the fact that there

was tepid demand for U.S. debt is very important because the number one buyer of U.S. debt has been the Federal Reserve and as we just talked

about, the Fed is going away as the buyer.

So if there is less demand for Treasuries, then you could see yields go higher, and of course, that's very important when you think about how

stocks are valued, when you think about the cost of borrowing in the United States. So, I think that that is why you've seen that concern there.

One other interesting point, though, on the market is that again, the market was up on hopes that maybe this is peak inflation, and all of this

enthusiasm actually helped to drive oil prices higher among other things, but the fact that oil prices went higher today, up about six or seven

percent at last check is actually a negative for inflation -- Richard.


QUEST: The Fed has an exceptionally difficult, bordering on impossible task.

EGAN: Yes. It is really, really hard to do what the Fed is trying to pull off here. They're trying to cool off the economy to get inflation under

control, but not cool off the economy so much that it tips the economy into a recession.

And, you know, we've heard all of these warnings from major banks, Deutsche Bank last week calling for a recession in the United States, Bank of

America coming out in the last few days saying they think that a recession shock is coming towards the U.S., and all of it is based on this concern

that the Fed is going to, you know, hit the brakes so hard on the economy that it ends up short circuiting this recovery before it's fully complete -

- Richard.

QUEST: Matt Egan. Matt, thank you.

Let me remind you of how the day went. The market started higher despite the inflation number and the Dow was up about 200 points, and then it's

given up the gains. Now, the reason is whether or not inflation peaked.

Headline, so-called headline inflation was eight and a half percent, but then subtract the food and energy prices, you get CPI core -- I'm sorry,

you get core inflation, not consumer price inflation. That number was only up six and a half percent core inflation and has been slowing.

David Hunt is with me. He is the CEO of PGIM, which is the PGIM, Prudential's Asset Management arm. Good to have you, sir. And can you hear

me sir?

DAVID HUNT, CEO, PGIM: Richard, it's a pleasure to be with you.

QUEST: Right. Excellent. Okay. First of all, do you believe inflation has peaked?

HUNT: You know, what's fascinating to me, Richard, is just how differently the different markets are answering that specific question. You know, when

I spend time with our guys on the equities desks, it's amazing. They're looking at strong demand. They're looking at an employment picture, which

is very robust, and they're looking at corporate earnings, which are actually very strong and expected to stay that way.

Then I go down to the bond floor. And there I see a group of fairly dejected people, I mean, rates have risen, spreads have gapped out, and it

is quite clear that the expectation there is that the risks of a recession and the Fed tightening us into one has actually gone up quite a lot.

And then I go up, and I visit the real estate team. We have the third largest real estate firm in the world, and they of course, have the top

floor with a nice view, and they actually take a very much of a through cycle view of this. They would say, actually, we have been under building

in this country for a decade, and prices are rising and we expect that absolutely to continue. And by the way, real estate is a good asset through

an inflationary cycle. And so they've seen robust transaction levels, prices rising, and very strong ability to raise money.

So overall, you're actually seeing the answer to your question of peak inflation being answered in very different ways in three different markets.

QUEST: A lot of it -- a lot of the answers, though, and you alluded to it, depends on the Fed's ability to affect the soft landing. And there's a view

now that they won't be able to affect a soft landing, and some are already forecasting.

I agree, sir. It's a long way off the end of next year, but some are forecasting recessions, mid to late '23.

HUNT: Yes, I think you're absolutely right, and of course, this is the great debate between the heart and the mind. I mean, I think the market

would like to believe -- they would like to believe that the Fed can engineer this so that they raise rates just enough to dampen demand,

without fundamentally stalling the economy. But I would say the history is unfortunately not on that side.

So of all of the rate tightening cycles that we've had since 1945, three of them have resulted in a soft landing, but none of those have actually been

during a time when inflation was rising as dramatically as this.

So history would say that those who say in two years, we have a chance of a significant recession, are probably backed up by some pretty good theory.

QUEST: If this is true, and let's take that as our model case that there will be a slowdown, which does tip the economy into the U.S. economy, into

a shallow recession sometime in '23. What does that do for investments and equities, do you think?

HUNT: You know, I think that it has pretty wide ranging implications for a whole set of asset classes. As we spend time with our clients now, there

are really, I would say three dominant themes on the institutional side. One of them is a real look at what the higher inflation rates are going to

do across their entire risk assets, and whether or not they should actually be moving into real assets or real estate in a more meaningful way.


They've already been doing that a bit, but should they tilt it even further. I would say the second big theme has been with our emerging

markets, I mean, do we really believe in the emerging markets index anymore after what's happened? I mean, these indices had in it, China, South Korea,

and Argentina all mixed together. And I think a lot of our clients are saying no more. These are very different countries, and we're going to

begin to split those pieces, absolutely up.

And then to your question on equities, I would say most of them are holding the line. Their strategic asset allocation to equities is not at the moment

anyway changing, but of course, the recession will bring a good time and a good entry point, for those that want to top up on that.

And as a final point, I would say, Richard that that most defined benefit plans are actually seeing this as a time to de risk. And so you know, most

of them have a glide path; with rates rising, they are looking either for a pension risk transfer to you, or they are looking to actually continue to

do liability matching and get risk off their books.

QUEST: Now, this is interesting. You talk about the strategic possibility of a recession, in that sense, which, you know, you talk about

institutions, but the individual investor has to decide, firstly, how to rebalance a pension fund, and I don't care whether it's a 401 (k), or a TSA

or whatever it is in the U.K., whatever country you're in, you have to decide if you're going to rebalance your pension fund, and any individual

portfolio you've got. What do you do?

HUNT: So this is a real conundrum. And of course, at the moment, these are times where we see rapid changes in expectations when retail investors

react so differently from institutions.

So on the retail side, we've actually seen a lot of money moving out of bond funds. We've seen money move out of emerging market funds, and we've

seen money really move out of growth equity funds.

On the institutional side, as I mentioned, we haven't seen that kind of movement, most strategic asset allocation has remained pretty secure, with

institutions looking for a way of getting in at a better price. And retail investors unfortunately, tend to move at the wrong time.

And so I really, really would encourage the careful movement around a diversified mix of assets at this time for retail investors.

QUEST: Oh, never a truer word said, David Hunt, retail investors move at the wrong time. I count myself as one of those. I mean, if I'm going left,

you should go right. Good to see you, David. Very kind of you to take the time.

HUNT: Thanks so much, Richard.

QUEST: We will talk again. Thank you, sir.

And now more Breaking News: To the manhunt underway after a shooting inside of Brooklyn subway. Ten people were shot and six more people have been

injured. Authorities say the suspect put on a gas mask, deployed some kind of smoke canister and then opened fire. He is still at large.

Officials say it's not being investigated as a terror attack right now. New York Governor says gun violence in the city has to stop.


GOV. KATHY HOCHUL (D-NY): The people of the entire State of New York stand with the people of this city, this community, and we say no more. No more

mass shootings. No more disrupting lives. No more creating heartbreak for people just trying to live their lives as normal New Yorkers.

It has to end, and it ends now.


QUEST: The Governor there. CNN's Brynn Gingras is outside the station in Brooklyn. Terrifying, absolutely terrifying. A miracle that no one was

killed, although there are some who are critically injured. Tell me more.

BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: Yes, Richard, if that wasn't terrifying enough, we're actually learning more details about how bad this

could have actually been.

We are learning from sources, in addition to what you just described for your viewers about what went down that that suspect also had multiple

magazines, that they had fireworks, that they had gunpowder all found by a lot of -- according sources there at the scene.

So you can just imagine how intense and what they hoped would happen on that subway system, and it wasn't fully carried out according to our

sources, because we're also learning that a firearm likely jammed in the middle of this suspect trying to actually carry out this crime.

So it's just unbelievable, the information that is getting circulated right now about what could have been; still, it was horrible. As you've heard

from eyewitnesses talking about what they experienced, we know that 16 people were treated with wounds, anything from gunshot wounds to being

trampled, to the smoke inhalation from the canister of smoke that was set off.


Ten of those people have gunshot wounds and five of them are in critical, but stable condition. So a wide scale amount of victims here and as you

said, it's still -- it's a manhunt right now, Richard, for this person.

We're learning also from a source, Richard, that one person -- I'm sorry, an eyewitness video, police are able to hopefully get the name -- or sorry,

identify the suspect through an eyewitness video. So hopefully they get a name soon and then find this person.

QUEST: Listening to the Governor, the New York Governor, this has got to stop. Something must be done. Isn't she the one who is supposed to do it?

GINGRAS: Yes. I mean, listen, there's been a lot of back and forth with this Governor and the legislature because, right, it starts with them as

well about bail reform, about getting gun -- you know, ghost guns off the street. All of these different types of firearms that are flooding into the

city, how crime has surged with the pandemic had -- you know, trying to sort of apprehend these people and keep them behind bars.

So there's just been so much debate around this issue, but certainly, it has caused a lot of fear. You know, I'm sure hearing from people, I know

I've had a few friends text me today, "Is it okay to go on the subway?" People were already on edge because of the crime that they have been

experiencing since this pandemic as they try to return back to normal, try to come back into the city.

There has been a lot of crime and this certainly did not help as this was, again, a major incident. It's not something that the police have

experienced very often by any means, but the good news right now is they don't believe it was terrorist-related, but still major, major violent

incident that happened on the subway system.

QUEST: Thank you very much, Brynn Gingras there.

In a moment, Boris Johnson, the British Prime Minister, he has apologized for breaking his own lockdown laws. He says he won't resign.


QUEST: Boris Johnson, the British Prime Minister says he has paid a fine for breaking England's lockdown rules, but he will not resign over it. Mr.

Johnson apologized for his behavior and the police issued more than 50 fines for pandemic-era parties that took place at Downing Street, the Prime

Minister's office and home.


The Prime Minister says he didn't know he was breaking the rules.


BORIS JOHNSON, BRITISH PRIME MINISTER: I have to say, in all frankness, at that time, it did not occur to me that this might have been a breach of the

rules. But of course, the police have found otherwise and I fully respect the outcome of their investigation.


QUEST: Now, the Finance Minister, Rishi Sunak, and Boris Johnson's wife, Carrie, have also been fined. Bianca Nobilo is with me, covers these


The Prime Minister said, well, first of all, how much trouble is he in over this? A YouGov poll says 57 percent say you should go, but he is not going

to. How much trouble?

BIANCA NOBILO, CNN ANCHOR, "THE GLOBAL BRIEF": Probably less than he was about two months ago, when we were first hearing about the volume of these

allegations. I think, outrage of the British public was largely maxed out. Once they've heard about five, six, ten parties, and the emotional

wrenching that that induced, there came a point where there was really nothing else that could be done or that could be heard that would make

people feel any angrier, and that was obvious from polling.

I think the reason why today we haven't seen a real push for him to go, speaking out from his Ministers or from his MPs is because people recognize

that the public is pretty much in the same place now as they were then.

QUEST: So we're on this. He says it was a busy day. It was his birthday. It was a busy day, I had eight meetings, I chaired Cabinet, I did this, and

we all got together around two o'clock for 10 minutes to wish me Happy Birthday.

NOBILO: That's what he says. He says it was just under 10 minutes. That number has been revised down slightly, and he has been choosing his words

carefully throughout this, you know, when he's approached Parliament and laid out what may have happened, which now in hindsight, many people think

could have been misleading Parliament. He has assured people today that he spoke in good faith when he told Parliament they hadn't broken any of his

own rules.

I don't know how many people really believe the Prime Minister's story when I speak to people on the street or people in Westminster. It really is the

circumstances of the fact that his possible successor, Rishi Sunak, is now embroiled in all this; Ukraine, putting this story into relative

unimportance and Downing Street will be working very hard to make that the case as well.

QUEST: Is it likely that what this ends up is look, he probably should resign, but the national requirement or the national policy, he needs to

stay because of Ukraine, essentially, the country is at economic war with Russia, it is supplying military hardware to Ukraine. The last thing you

want to do is change Prime Ministers. Now, particularly when the replacement is also up to his eyes in all sorts of scandal.

NOBILO: Well, that's how the Conservative Party members who don't see a better way out of this and don't see a good successor and good electoral

fortunes by changing Johnson, that's how they'll be presenting this. And I did check though, and there have been about 10 or 11 changes of Prime

Minister during war times. So that doesn't really hold up as an excuse and Labour have already been beginning to dismantle that argument.

I think it is a case of so much behavioral disappointment is priced in with Boris Johnson as a politician. This is well known. There was still shock at

this Party-gate and the hypocrisy and it's been difficult to hear people's anger. Today, there have been a statement from the COVID-19 Bereavement

Group in the U.K. saying that you paid a fine, our loved ones paid with their lives. You've trampled on the sacrifices the British public has made.

There is a lot of anger, but I think because of the politician that he is, because of the circumstances now that allow him to try and put himself in

the light of the statesman and say there are bigger fish to fry, the lack of a successor, he seems pretty safe for the time being.

QUEST: Bianca, thank you. Bianca Nobilo, who of course will be with us in just over 90 minutes from now with 'The Global Brief." Thank you. We await

you with interest. Thank you.

The U.S. is telling its nonemergency consular staff to leave Shanghai. The State Department is warning employees about both the city's COVID outbreak

and China's strict response.

Shanghai, of course, 25 million people and subjected to China's Zero COVID strategy involving lockdowns and mass testing. Some people there have not

been allowed to leave their homes for weeks, even to get food and there are now serious food shortages.

So the economic impact is widening. The Apple supplier Pegatron is the latest to suspend production in Shanghai and China is the world's biggest

car market and it has been thrown into disarray.

CNN's David Culver in lockdown is in Shanghai.

DAVID CULVER, CNN INTERNATIONAL CORRESPONDENT: Richard, these severe and long lasting COVID lockdowns causing chaos in the world's biggest car



We're seeing factories shut down, new model launches delayed, sales plunging -- not that you need a car when you when you're sealed inside your

home, but still, China's massive car market has been thrown into disarray by this country's latest surge in COVID cases.

Strict lockdown measures in places like right here in Shanghai or in Jilin Province, forcing automakers to hit the brakes on production, risking

delayed shipments at a time when global demand for vehicles is strong.

Volkswagens factories here in Shanghai and then Changchun have been shut for weeks. Nio, a Chinese electric vehicle maker also said on Saturday that

it had suspended production.

The Beijing Auto Show, one of the industry's largest global gatherings now postponed until further notice. That mean several new car launches will

also be delayed.

New data released showing auto sales in China plunged 12 percent in March from a year ago. That's reversing a 19 percent increase in February, and it

ends two straight months of growth.

There was one bright spot however, and that is China's demand for electric vehicles remained strong. Data showing March sales were up 122 percent from

a year ago.

But the biggest frustration for businesses is that they simply don't know when they can resume their operations. Especially given that China's

national health officials warned on Tuesday, that number of new COVID cases will continue to rise, and that the outbreak here in Shanghai has already

spread to other provinces -- Richard.

QUEST: That's David Culver, who incidentally is in lockdown at the moment and has been for some time.

In a moment, after the news headlines, to Ukraine, where there is growing concerns that a new phase of the war will require new forms of weaponry.

The country is currently investigating unconfirmed reports of a chemical attack in Mariupol.




QUEST: I'm Richard Quest, we have so much more on QUEST MEANS BUSINESS tonight. I'm joined by Estonia's economy minister on how Ukraine has

accelerated his country's plan to ditch Russia energy.

And U.S. airports dominating this year's list of the world's busiest airports. It's U.S. domestic travel to international destinations. The head

of Atlanta airports is with us. It's all after the news because this is CNN and, here, the news always comes first.


(voice-over): At least 45 people are dead in flooding and mudslides in South Africa's KwaZulu-Natal province. Heavy rain washed away houses Monday

and turned roads into rivers. Authorities are working to evacuate people and restore power. The downpours are expected to continue through late


Rescue teams in the Philippines are racing to find survivors after a powerful tropical storm struck the country this weekend. Megi has left at

least 30 people dead and dozens injured. It flooded towns, caused landslides and destroyed buildings in the southern and eastern parts of the


President Biden is in Iowa to unveil plans to lift a summertime ban on what's called E15 gasoline, a mix of regular gas and 15 percent of plant-

based ethanol, specifically, typically made from corn. The aim is to help ease the nation's high gas prices. There are concerns it could hurt air



Ukraine and its Western allies say they're investigating an unverified claim that people in Mariupol were the victims of a chemical attack.

The Asov battalion, one of the Ukrainian units defending the city, reported the incident on Monday. The U.S. and the British say they are aware of that

report but haven't been able to confirm it. Neither has CNN.

Ukraine now bracing what could be a massive Russian attack in the east where concern is, Moscow could resort to chemical weapons. Such a move

would likely force the West to reconsider its response, as admitted to, indeed, by President Biden a few weeks ago. Matt Rivers is with me from

Lviv in Ukraine.

Let's take this point by point, Matt. We just don't know, on the Mariupol situation, do we, whether there were chemicals at all, whether it was a

chemical used nefariously or whether it was a chemical from a chemical plant that exploded. We don't know.

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: Yes, that's exactly right and that's why I think, right now, this attack or alleged attack, can best

be described as murky at best, given we're still trying to figure out more details.

What we're hearing from the Ukrainian side, though, is they suspect this was some sort of chemical attack while leaving open the possibility that it

wasn't. So the deputy minister of defense, you know, said in part, we are trying to understand what was used, based on the preliminary data.

There is an assumption that there could have been phosphorus munitions but the official information will follow later, so basically saying we don't

know yet.

But if phosphorus munitions were used against civilians and/or soldiers, that is clearly a use of chemical weapons, it would clearly be against

international law. And then it would be up to see how the United States, the U.K., Germany, et cetera, would respond here, because they have drawn a

line in the sand previously, Richard, about the use of chemical weapons in this war.

QUEST: So look, we always knew this idea of refocusing was not withdrawal. We talked about it on this program. But the size and scale of what could be

about to hit the Donbas region, even if Ukraine is preparing for this, I mean, the ferocity will be just awful.

RIVERS: Absolutely. And you already have seen awful things take place in the cities that still have not been captured. So Mariupol, for example, you

know, 90 percent of the infrastructure destroyed; tens of thousands of citizens that Ukraine still say need to be evacuated there.

And yet the United States made the assessment today that that city is still being fought for. Then you've got a city like Kharkiv, which Russia also

has shelled since the beginning days of this war. They want to take that city.

And only after that will they consider, according to the Ukrainian officials, going after Kyiv once again. So you're going to see things shift

to the east. But the destruction that we have seen so far in these cities, as staggering as it is, could only be increased.

And when you throw in the possibility, even if it's just a possibility, that chemical weapons could be used here.


Richard, it is really just horrific to think about what we could be seeing in the days and weeks to come.

QUEST: Now Matt, on the diplomatic front, two depressing aspects: Russia says, Putin said today, during a visit, that essentially diplomacy is at an

end, because Ukraine is saying they committed war crimes.

And Ukraine is basically saying no chance of diplomacy as long -- as a result of Bucha and Mariupol.

Does that fairly sum up the stalemate on diplomacy?

RIVERS: Yes, 100 percent, because, let's take Putin first.

Every time you think, maybe he'll give an inch, he just doubles down.

What did he say today?

He says there's Nazis in Mariupol, he says any thoughts about chemical attacks, going back to Syria, it's all fake. What happened in Bucha is

fake. He believes this is a moral and just mission the Russians are on in Ukraine. And he sees no space where he's going to back down.

And on the Ukrainian side, not only do they have to take into account the atrocities that we have seen in places like Bucha and the -- imagine going

to the negotiating table and giving up concessions, even in the face of atrocities like that.

But also I think you have to consider that the Ukrainians really think they have a fighting chance and they might not want to just give up and give up

a lot of concessions before battling the Russians in the eastern part of the country, where they do believe they can fight and maybe even win.

So where the off-ramp here is, Richard, I don't see one, at least at this moment.

QUEST: Matt Rivers in Lviv, Ukraine, for us tonight, thank you sir.

QUEST MEANS BUSINESS continuing this. Vladimir Putin says attempts to hurt Russia's economies are failing and only the Western economies will fall





QUEST: Vladimir Putin is applauding what he's calling Russia's "noble" objectives in Ukraine. The Russian president appeared on television and

said he has no doubt his military goals will be achieved.

Putin also appeared alongside the Belarusian president Alexander Lukashenko, where he addressed the wave of sanctions being slapped on

Russia, an effort, he says, is failing and only instead will hurt Western economies.


VLADIMIR PUTIN, PRESIDENT OF RUSSIA (through translator): If our partners will complicate the situation in the financial area, in the insurance area,

in transportation, including sea transport --


Well, the situation will become more complicated for them as well. The lack of food or prohibitively high prices on global markets will cause hunger in

the whole regions of the world. And the inevitable next stage is the new waves of migration.


QUEST: Estonia announced last week it will stop buying Russian gas altogether. It's a major step for the former Soviet republic, which relied

on Russia for the entirety of its gas supply until 2014, with the invasion and annexation of Crimea.

When Estonia first began efforts to reduce its reliance, the Estonian PM said she plans to stop imports within the year, largely owing to a

partnership with Finland to build an LNG pipe line by the autumn.

Joining me now, Taavi Aas is the -- Estonia's minister of economic affairs and infrastructure and joins me now.

So essentially, you are now de facto independent of Russian oil and gas. Well, particularly Russian gas, as I understand it.

Is that right?

TAAVI AAS, ESTONIAN MINISTER OF ECONOMIC AFFAIRS AND INFRASTRUCTURE: Yes that's right. Hello, Quest. That's right. As you said about oil, we can say

that we are almost independent of Russia's oil already.

But about the gas, we had the major big changes already in the last decade. We decreased our gas use and energy sector about 50 percent.

So we changed, in the heating, central heating, to local biomass. We have (INAUDIBLE). So it's quite easy for us. And now, of course, -- yes, we

still have (INAUDIBLE) need of gas during the year and --


QUEST: Sir, what would you say, sir, what would you say to other finance and energy ministers of other E.U. countries, like Germany, for example,

the Netherlands, Hungary, for example, that are -- they're not dragging their heels.

But they do not seem to wish to get to that energy independence -- or at least continue to take from Russia for the foreseeable future.

AAS: Yes, of course, that's a problem, that we depends for Russians' energy sources. And I know that every country wants to get independent from

Russians' energy sources. But it's taking time. It's impossible to do it just in a moment.

And every country looks for the possibilities to change the thing. And for us, as you said, there is possibility to start to use LNG gas. And like I

said, our gas production is quite small. And for us it's better to do it with some other countries. As we said, we will do it with Finland.

QUEST: And if we look at, I mean, obviously, the events with Russia bring home enormous historical significance to a country like yourself and, to

like yourself and of your own age.

When you look at what's now happening in Ukraine, what do you fear could happen next, as far as your country is concerned, bearing in mind, you're a

member of NATO?

AAS: Yes. You see, we see what happened in Ukraine from -- it started in 2014. So it's -- we see it already a long time. We make our own

preparations to defend ourselves. And as you said, we are member of the NATO.

So -- and at the moment, with the possibilities that are in Estonia or other parts, dictates there would be more NATO groups. So the - avert

things, for our side, we must do everything to have a good protections.

QUEST: And what about Ukraine joining the E.U.?

The president of the commission was in Kyiv. It's very much on the agenda to somehow fast-track Ukraine into the E.U.


But is this something you would support?

AAS: Yes, we support Ukraine in every fields. And of course, if we talk about trying to European Union, we also support. We support also in

approximately some weeks ago Ukraine was to (INAUDIBLE) --


AAS: -- European Union. We also support this. So Ukraine can trust to our -- to hope to our support.

QUEST: Minister, I'm grateful. Thank you, sir, I appreciate it.

Now it's one of the sort of -- I wouldn't say trivial pursuits but it's one of the great questions.

So Two questions for you.

Which is the busiest airport in the world?

And which is the busiest international airport in the world?

The answers this year are very different because of the pandemic -- in a moment.




QUEST: So this year's list of the world's busiest airports shows the slump in the global hubs and the rise in different areas, regional travel, for

example. The rankings in 2018 before the pandemic, the busiest airports, international airports, well, (INAUDIBLE) Atlanta, Beijing, Dubai, LAX,

(INAUDIBLE) Chicago, Heathrow, et cetera, et cetera.

Atlanta was number one and just two other U.S. airports were on the list. You can see there.

Atlanta stays at the top spot last year, while the global hubs have just about evaporated. Regional airports, like Denver, Dallas, Orlando have

moved up and U.S. airports are now in seven of the top spots, for one simple reason. All the others are closed.

Balram Bheodan is the head of Atlanta Hartsfield-Jackson International Airport and joins me now from Georgia.

Sir, good to see you. You always maintain the top slot because you have huge, huge network interconnectivity through Delta, et cetera. But it is

interesting, isn't it, the way in which the international or the other global hubs have fallen away.


And the U.S. have come back because the resurgence?

Hello, sir, can you hear me?

BALRAM BHEODAN, GENERAL MANAGER, HARTSFIELD-JACKSON INTERNATIONAL AIRPORT: Richard, I can barely hear you. The volume is a little bit low.

Could you turn your volume up a little, please.

QUEST: Right, well you're on air, so can you hear me now, sir?

BHEODAN: Yes, I can hear you very well, Richard, thank you very much.

QUEST: Great. Well my question is, Atlanta is number one. But it's interesting that all the other U.S. airports have come in, because the

global hubs are still locked down.

BHEODAN: Atlanta is number one but it shows the resiliency and the strength of our domestic travel requirements and needs here in the United

States. And we have opened up the country because of the availability of vaccines. And I think it lends to itself a sense of comfort for the general

population to open up and start traveling again.

QUEST: The way in which domestic travel in the U.S. has come back, has it surprised you?

BHEODAN: For the most part, we were caught a little bit surprised with the quick growth of the domestic travel here in the United States. But of

course, we were nimble and agile and able to react to it very quickly, not only airports but also our airline partners and our federal partners.

QUEST: And what plans are you making for this summer?

Because, from what I can see, Europe is going to come back quite strongly. Delta is your dominant carrier and has large capacity to Europe, which it's


BHEODAN: So, Richard, what we have done, mid-2021, we started to put together our operations plan. And just to give an example, in the first 59

days of 2021, there were about 6.5 million people who came through Atlanta.

This year, the first 59 days, January and February, 12.2 million passenger came through Atlanta. Of that, 1.1 million were international travelers.

So we have put a plan in place. We look at all elements of our operation plan to include staffing, both at the local level and at the national

level. And so we have that plan and we are nimbling up to implement that plan, to handle what we expect is an onrush of both domestic and

international passenger coming through not only through Atlanta but into the -- throughout the United States.

QUEST: When we -- the -- President Biden's infrastructure plan, which was widely accepted.

But are we seeing the results of that yet, particularly, on aviation, airport infrastructure and new runway capacity, all the things that have,

putting it bluntly, seems to put America or the United States very much on a back foot?

BHEODAN: So for airports as a whole, we don't -- our infrastructure planning is long-term. We look at our infrastructure need over multiple

years. So we have already had started building this airport and modernize our airport in several areas for capacity, safety and security, for

resiliency and for what the customers are asking for prior to the pandemic.

During the pandemic, Atlanta, in 2020 and 2021, completed over $800 million worth of construction work. So although we slowed up a little bit, the

pandemic did not have much of an impact on our preparedness into the next 20 years.

The infusion of additional money from the federal government into infrastructure is a welcome infusion, is a welcome resource for airport

across the nation to help us, to continue with that building.

And even at some of those, even after the element we have deferred to bring those elements and those projects back in closer, to continue modernizing

airports across the United States.

Again, what the president and our elected officials have done is commendable. It's much needed and we welcome that infusion of additional

resource into our infrastructure needs and future growth of aviation in the United States --



QUEST: All right.

BHEODAN: -- and on a global scale.

QUEST: Sir, I'm grateful for your time today. Thank you, I appreciate it.

To the markets in the last few moments of trade on Wall Street, with the markets. Well, it's a rough 90 points. We were up 200 points. Initially, it

was about inflation. Then it's a bond market. The gist is the markets are uncertain. The volatility is all over.

Look at the Dow 30 and you'll see it's all over the place. There's no real theme to it at the moment. But that's where the markets are. We'll have our

"Profitable Moment" after the break.




QUEST: Tonight's "Profitable Moment": It is not for me to say whether the prime minister Boris Johnson should resign, having received a fixed penalty

notice for breaking his own lockdown rules. There are many of other people who make exactly the point that he should go.

However, let's just think about it. Here you have a prime minister, that sets out very strict COVID rules and regulations of who can meet -- it was

complicated beyond the extreme, two people from one household but not three people from one household but only if you're in the garden and not the --

you get the idea.

And now he broke his own rules and the Metropolitan Police have issued a fixed penalty notice.

If this was an isolated incident I guess one would say, well, there you go but there were many parties, many get-togethers. There were loads of

questionable events during that period, which clearly showed that, at Number 10 Downing Street, they were not following their own rules.

The birthday party was perhaps the most egregious; arguably, the one before the -- Prince Philip's funeral was also pretty bad, the leaving parties. As

I say, it's not for me to say he should resign or he shouldn't.

But it does beg the question, legitimately, if you don't resign, at what point do you?

What is the offense for which you finally say, I must go?

And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I hope it's profitable.