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Quest Means Business
Biden Welcomes Macron Amid Dispute Over Subsidies; SBF Speaks Out After FTX Collapse; Wall Street Mixed Ahead Of Tomorrow's Jobs Report; China Signals "New Stage" In COVID-19 Strategy After Protests; Macron Says Provisions In U.S. Climate Bill Are Protectionist. Aired 3-4p ET
Aired December 01, 2022 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN INTERNATIONAL HOST: After a very strong day yesterday with the markets, we start out today a split session, if you will. You'll
see what I mean. There is the split, the Dow is off, but the NASDAQ and the S&P are higher, not huge gains, but then after yesterday, I think, taking a
chance for a bit of a breather on the upside.
The markets as they're trading in the last hour and the events that we are looking at.
We aren't apologizing for prioritizing American manufacturing. That's President Biden to President Macron of France. The leaders pledging to find
ways to include European allies in American investments.
FTX founder Sam Bankman-Fried, SBF says he won't stop talking, despite legal advice telling him to shut up.
And Germany is fighting for its World Cup future, but it is complicated. They hopefully you have the mathematics as to how they'll do it.
We all live in New York, the last month of the year. Where did it go? For goodness sake.
It is Thursday, December 1st, I am Richard Quest and as we head out to December, I mean business.
It is a unanimous message from the US and French Presidents. They say they are working hand in hand despite a simmering trade disagreement. Joe Biden
welcomed Emmanuel Macron to the White House with a full 21-gun salute. In a few hours, they will sit down to a State dinner, buttered lobster and
sparkling wine will be on the menu tonight.
Behind the warm welcome, there is a disagreement over US subsidies for American-made electric cars, and President Macron says US protectionism
could fragment the West. Speaking at the White House, he called for better cooperation.
(BEGIN VIDEO CLIP)
EMMANUEL MACRON, FRENCH PRESIDENT (through translator): We want to succeed together, not one against the other. It has been clear -- this is -
- the outcome of our discussions this morning and this is exactly the philosophy that I share and it is the one that we need.
(END VIDEO CLIP)
QUEST: Now the concern is about some of President Biden's key achievements, particularly the Inflation Act. He says measures in the
Inflation Reduction Act unfairly help American companies. Then you've got Europeans worried about the Chips Act, which promotes US made
The two of course had a brief falling out last year over the US-Australian submarine deal that snubbed France. President Biden says he does not regret
his signature legislation.
(BEGIN VIDEO CLIP)
JOE BIDEN, PRESIDENT OF THE UNITED STATES: The United States makes no apology, and I make no apology since I wrote it for the legislation you're
But there are occasions when you write a massive piece of legislation and that has almost $360 billion for the largest investment of climate change
on all -- of all of history, and so there's obviously going to be glitches in it, and need to reconcile changes in it.
(END VIDEO CLIP)
QUEST: Melissa is watching events from Paris. What particularly are the French getting upset about?
MELISSA BELL, CNN CORRESPONDENT: It is, Richard, first of all, the substance, of course of what the Inflation Reduction Act will mean. It'll
have huge implications for Europe's automobile sector. For instance, Germany's in particular, and I think just as with that submarine round that
you alluded to a year ago, there is the substance of the issue, and then there's the form in which this was announced.
Emmanuel Macron, he spoke to lawmakers of that working lunch in the Library of Congress yesterday, had some pretty harsh words that you mentioned a
moment ago, but also explained that they simply hadn't been kept abreast, and I think this goes to the heart of European concerns.
They've gone together with the United States on Ukraine, but ever since Joe Biden became the American President, despite shared views on
multilateralism, and all the expectations on the European side of the Transatlantic Alliance would once again be at the heart of Washington's
concerns, or at least at the heart of its courtesy, but that has failed to happen on a number of occasions, I think has really gotten their backs up.
On the substance, of course, we have to wait more to find out exactly what measures will be taken, what concessions can be made, after all for an act
that will come into effect next month that will go up far enough to the Europeans.
But Macron does appear to have been heard on the fact that some concessions and some finding a way to work together in funding for instance some
industries together does appear to have been heard by President Biden, and I think President Macron will bring that home as something of a victory --
QUEST: Right, Jeremy Diamond is with me from Washington.
Jeremy, the President is not giving any ground is he here? And understandably, bearing in mind, first of all, there was the Midterms, and
now it's all downhill to the presidential election.
JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: Yes, Richard, I just joined you, so I'm not sure exactly what you guys were discussing, but I think
you're talking about this issue over the Inflation Reduction Act. Is that correct?
QUEST: We are. We are, indeed, and the way in which President Biden isn't apologizing for, if you're like, prioritizing US business.
DIAMOND: Well, that's true, Richard. The President did say that he "makes no apologies" for this Inflation Reduction Act, which of course, he has
touted as this historic, you know, largest climate investment in United States history.
But at the same time, he did try and smooth things over. I do think that there was an effort here to try and take some of the air out of the
tensions between the US and France on this issue.
The President said that he acknowledged that there were some "glitches in the law" and he also said that he believes that there are tweaks that can
be made to accommodate Europe and its concerns of being left out of these efforts to transition essentially, to a greener economy.
So, there was an effort there, it does seem to try and reduce some of those tensions, acknowledge that there are things that can be changed here, and
the French President for his part, he repeatedly talked about resynchronizing, the relationship, particularly on this front. And what he
also said was that he believes that while this law will hurt industry in Europe, industries that are trying to move towards green energy, he said
that he didn't believe that it was the intention of the Biden administration for that to be the result.
So, the question now is, what can they actually do? Because this is enshrined in legislation, there is this working group between the United
States and Europe to try and resolve this issue. So, we'll have to see exactly what they're able to do, whether via executive action, or if
somehow Congress has to try and take action again.
QUEST: Melissa, last word to you. Is Europe spoiling for a fight here? Or are they hoping this can be solved? You sort of know what I mean. There
are times when, for European domestic political agenda, it behooves them to sound harsher than they actually feel about a subject.
BELL: I think this probably reflects more that Europe, Richard, finds itself in extremely difficult times -- the energy crisis, the fact that
it's impacting it so much more harshly than any other part of the world, the result of those sanctions against Russia, it feels pretty bitter that
it is being made to carry this on its own, given that this was a global effort on the part of NATO.
And it is asking not just the United States should allow for a level playing field as the world tries to get back to something like business as
usual or beyond the war, economies that can flourish once again. But it is also concerned about the fact that it is not being given much help with
And of course, these are things that have a direct impact on electorates, Richard, poorer economies, people struggling to pay rent, inflation, high
energy prices, this is hurting European politicians and worrying them a great deal and I think that's what is behind his going there with such
He wants Europe to be heard, because Europe is going to be in big trouble if this inflation that goes through as it is, at a time when it is already
facing such difficulties -- Richard.
QUEST: Melissa Bell in Paris and Jeremy in Washington, and by the way, we have no idea why there were fireworks behind Melissa Bell this evening
in Paris. Thank you.
BELL: I can tell you.
QUEST: Oh, I was Googling quickly to see why there were fireworks.
BELL: Well, no, I can tell you, and Richard, I am no football expert, but I gather that Morocco has just qualified for the kickout round of the World
Cup for the first time since 1986. Hence, the fireworks behind me on the Champs Elysees and a great deal of activity.
QUEST: Well, there you are. I wasn't expecting a full answer to that, but there we go. Thank you. Melissa Bell. No fireworks behind Jeremy
Diamond, which is just as well since it is the front lawn of the White House.
Thank you very much indeed.
Arancha Gonzalez Laya is the Dean of Sciences Po at the Paris School of International Affairs. She used to serve as Spain's Foreign Minister. She
joins me now from Florence in Italy. I'm not sure whether there are fireworks for you tonight, but anyway, this dispute between Europe and the
US, bearing in mind Ukraine and all of that. I mean, how much of it is rhetoric and how much of it is real?
ARANCHA GONZALEZ LAYA, DEAN OF SCIENCES PO, PARIS SCHOOL OF INTERNATIONAL AFFAIRS: Now, let's put things into perspective, Richard.
First total unity between the US and Europe on defending Ukraine against this brutal attack by Russia and hand in glove working together, not a
single difference. Second, Europe applauds the efforts taken by the Biden administration to rejoin the fight against climate change and to get
serious about reducing emissions at home.
This is good. It is good for the US, it is good for Europe, it is good for the world. But we are not in agreement over the manner in which the US will
do that because there are parts of this that will have negative spillovers on Europe, because the manner in which it is crafted, it is unfair.
So what we are saying is, and I think it is normal to do that is sit down - - let's sit down and let's discuss this, and let us make sure that the US fight against climate change does not end up impacting negatively on the
EU, because of unfair trading practices.
QUEST: Right. But the US knew all of this when they introduced that law. They must have known that Europe was going to be frothing. They clearly
didn't care or didn't bother about it. I can see by your smile. There's a sort of a realpolitik about this.
What does Europe do next? How far do they push it, do you think?
LAYA: So Europe tells the US that if these things about fighting climate change, and we think it is, then the nationality of the cars matter less
than the fact that we impose -- that the US imposes the sales of electric vehicles to reduce emission and the nationality of the cars matter less.
What matters is that the vehicles be electric.
So whether they come from the US, whether they come from Japan, Korea, or the European Union would make -- should make no difference because
otherwise what we have is an industrial policy, which looks a bit protectionist.
So first, we sit down and we explain. And second, we try to fix it like adults, like adults that understand that it has to be done in a responsible
manner. But I think it's important to hear the other side, too. On the other side, again, is the EU, but it's also Japan, it is also Korea -- it
is many countries that want to help the US succeed in the fight against climate change, but don't want to be on the short end of the stick.
QUEST: I want to just quickly turn subjects. You saw that -- you'll be aware the EU is suggesting to freeze both the development of COVID funds
and others for Hungary. It could be worth 13 billion unless Hungary decides to follow various measures the EU is requiring on rule of law.
It doesn't seem likely Hungary will and the Commission and the Council are at some point going to have to decide whether to withhold these 13 billion
euros. Do you think they have a stomach for a real fight with Hungary?
LAYA: Well, it is about whether or not we are serious about respecting the rule of law in Europe. It is Article I of the European Union Treaty,
and it is the Treaty that every nation has signed on to.
So it's just a question of coherence. We have to de-traumatize it, but we have to reform about this because, again, Richard, we care about the rule
of law in Europe and because we care about the rule of law in Europe, we have to make sure that it is respected in all the member states.
So we've got to do this in an intelligent manner with a bit of a stick, a bit of carrot, but being serious. This is a fundamental principle of who
QUEST: Thank you. Good to see you. Thank you very much for joining us.
LAYA: Thank you, Richard.
QUEST: As we continue, SBF, Sam Bankman-Fried has been talking about what happened and about the way he has had handled FTX. We will have that
in a moment.
QUEST: The man behind the $32 billion FTX crypto collapse says he didn't intend to commit fraud. Sam Bankman-Fried issued another mea culpa at "The
New York Times" DealBook Summit last night, even claiming he was surprised by the situation.
His move has baffled legal experts, who once call it litigation suicide. But SBF says his lawyers have encouraged him not to speak.
CNN's Christine Romans has more on what he said and why.
SAM BANKMAN-FRIED, FOUNDER, FTX: I mean, look, I've had a bad month.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT (voice over): Disgraced FTX founder and ex-CEO Sam Bankman-Fried speaking out on camera for the
first time since he resigned after the implosion of his multibillion dollar empire.
BANKMAN-FRIED: I'm down to one working credit card left. I think it might be $100,000.00 or something like that.
ROMANS (voice over): Bankman-Fried who was known as crypto's white knight sitting for a wide ranging interview at "The New York Times" DealBook
Summit. Speaking about FTX's liquidity crisis and bankruptcy filing.
BANKMAN-FRIED: I didn't ever try to commit fraud on anyone.
ROMANS (voice over): The collapse of FTX is under civil and Federal investigations into whether FTX misappropriated customers funds when it
made loans to his hedge fund, Alameda Research.
Bankman-Fried addressing this --
BANKMAN-FRIED: I didn't knowingly commingle funds. I was frankly surprised by how big Alameda's position was.
ROMANS (voice over): Bankman-Fried now acknowledging the lack of corporate controls and risk management within the businesses he oversaw.
BANKMAN-FRIED: Look, I screwed up like, I was CEO. I was the CEO of FTX, and I mean, I say this again and again, that that means I had a
responsibility, that means that I was responsible.
Ultimately, there was no person who is chiefly in charge of positional risk of customers on FTX and that feels pretty embarrassing in retrospect.
ROMANS (voice over): FTX, which was once marketed as an easy way for people to get into crypto using star athletes like Tom Brady, Naomi Osaka, and
Steph Curry and even a Super Bowl ad with Larry David, to amplify the platform.
[VIDEO CLIP PLAYS]
ROMANS (voice over): Now, its customers don't know how much if anything, they'll be able to get back.
QUEST: James Murphy is with me, securities lawyer from -- he joins me from Virginia.
When I read what he said, I could certainly see and make an argument, some would say, well, he shouldn't have said this and he shouldn't have said
that. Was there anything that jumped -- that jumped out at you that sort of has a big red flag on it?
JAMES MURPHY, SECURITIES LAWYER: Well, for a lawyer, the big red flag is that he did the interview at all. Of course, no lawyer here in the United
States would encourage a client to do that. He had a very good law firm that represented him briefly, and my understanding is they fired him.
What surprised me is he did a very good job of sticking to his talking points. His talking points where I didn't do anything wrong intentionally.
I may have been negligent. I may have breached fiduciary obligations. But those two things get you sued, get you penalized, they don't get you to
And so he steered clear of anything that sounded like intentional misconduct and he is a very, very bright man and managed to do that for an
QUEST: Because that is what is required, isn't it? It's not just enough to be incompetent or foolish and stupid, you have to have the mens rea. You
have to intend to commit the components of the crime.
But then you get an entire raft of ways in which the US managed to get people before the Criminal Court. Mail fraud is always a good one, isn't
it? Anything that might involve sending something through the post is always a good way when you can't prove something else.
MURPHY: Well, you've nailed it, Richard. That's what I would expect the prosecutors to go for. We are told that there is an active investigation. I
hope that's true, and they don't have to prove that there was securities fraud, they can go with mail and wire fraud, you're spot on.
And if the money of customers was misappropriated and given to this affiliated company, Alameda, that is a fraud and should qualify under the
statutes, and I sincerely hope that our Department of Justice is looking at it very hard.
QUEST: From your information on the DOJ and from what you understand, where are they -- what is their thinking on crypto and crypto crime? I know
they are very hefty, they are very heavy, for example, on all sorts of cybercrimes, which are important, but at the moment, is crypto crime,
regarded where it's not state actors or state sponsored. Is it just regarded as something that is an accident waiting to happen?
MURPHY: Well, the DOJ has formed a particular working group to focus exclusively on crypto crime. The SEC, which is a civil enforcement agency
has bulked up significantly in their enforcement group to go after crypto fraudsters civilly to penalize them and get their money. So, I think the
United States is taking it seriously, and there is some embarrassment that there are now so many victims both in the United States and in the UK, by
the way, eight percent of the account holders in FTX are resident in the UK, and then another 40 percent are in tax havens like the Cayman Islands,
Bermuda, and BBI where there are likely UK citizens participating through entities located there in those tax havens.
So we're wondering, we're waiting, but the US did enter into an extradition treaty with the Bahamas in 1994. There is a legal right, right now for the
United States to demand that the Bahamas turn over. Mr. Bankman-Fried to US authorities, that demand has not yet been made.
QUEST: No. And of course, and of course, then there is -- something tells me that even if and when it will last a long time, those legal
proceedings. I'm grateful, sir. We'll talk more about this as we get further details. Thank you for dedicating time tonight.
In some news to update you with, Austan Goolsbee has been named as the next head of the Chicago Fed taking over Charles Evans, one of the more senior
members who is retiring in January.
Now, Austan Goolsbee, of course, is a Professor at the University of Chicago, and during the Obama administration, he was the Chair of the
Council of Economic Advisers. Perhaps more importantly, from our point of view, he has been a frequent guest on QUEST MEANS BUSINESS offering frank
and critical insight.
(BEGIN VIDEO CLIP)
AUSTAN GOOLSBEE, INCOMING PRESIDENT, US FEDERAL RESERVE BANK OF CHICAGO: As we learned in 2009 and 2010, and as we have seen just in the past year,
that you do too little, you wait to see, it's like a sunburn, by the time you see it, it is too late. It's an infectious disease, the damage is
(END VIDEO CLIP)
QUEST: We hope he will continue to give such forthright views right here on QUEST MEANS BUSINESS.
US markets are mixed ahead of tomorrow's Jobs Report. The numbers could influence the Fed's next move. Remember what of course, the Fed Chair said
yesterday in his press conference or in his speech.
So the Dow is now off. The optimism of yesterday has been tempered. We're down just over half a percent. The NASDAQ has been in and out of the red,
they're bouncing around. At the moment, we now have two down and one up.
Workers are having a harder time finding fully remote jobs. The positions are drying up as companies are heading back to the office. Demand remains
high. LinkedIn says half the applications submitted through its website are for remote jobs.
Despite the move away from remote work, technology is still a priority. A new report from the Boston Consulting Group says 60 percent of companies
plan on increasing tech next year.
Rich Lesser is the Global Chair of the Boston Consulting Group, BCG with me from New York.
So before -- I think this is one of those interviews that we have to start with cards on the table, Rich, what's BCG's policy on working from home?
RICH LESSER, GLOBAL CHAIR, BOSTON CONSULTING GROUP: We have some jobs that can be fully remote, mostly we're looking to make hybrid work. Mostly we
believe we do think there is value in being together, face to face, sometimes. It can be at a client site, it can be in the office and we want
some of that, but we don't think it needs to be five days a week and we expect each of our teams to be looking at what that client needs, what that
particular activity needs, and managing it.
So, there is a role for fully remote. It's a relatively small one. But there's a big role for hybrid, and we are not back to the pre COVID world,
we don't think we'll need to go back to that world.
QUEST: Which ties in nicely with the report that you get about the amount of money that companies say they are going to spend on tech going
forward, because a lot of that spending is going on convenient, you know, making obviously, cybersecurity and those issues, but also making the work
environment conducive, the necessary technology so you can work from home, work remotely, work in different ways.
LESSER: Yes, well, what was very interesting from the study is that for all we hear about an uncertain economy, it is the substantial majority of
literally thousands of executives we spoke to see investing more in digital transformation next year than they invested this year, that they see that
the future, whether it's in how they engage with their customers, how they allow their workforce to be most productive, and attract the best talent to
their organizations, how they adapt to the sustainability challenges that are out there requires really advanced digital NAI capabilities.
And that comes through so strongly, as well as the dissatisfaction with where things are today, whether it's choosing among technologies, whether
it's scaling, whether it's recruiting digital talent. So there are big challenges they're trying manage, and they're going to need to spend more.
QUEST: This is a big fighting ground, isn't it, in a sense? I was just at WTTC, the World Trade and Tourism Conference in Saudi and there, the big
talk was bleisure, people traveling for work, and then saying, we're going to stay on for a couple of days, because we can continue to work for the
rest of the week, if we're in Rome, or we're in -- is this something that companies have to be more aware of, allowing employees?
I mean, BCG, you have lots of people traveling, obviously. You're cutting back on your travel budget, essentially. But if somebody says, I'm going to
stay on, on my own dime, and work from X, are you okay with that?
LESSER: I think that we want to trust our employees to make smart judgments within a framework -- within a framework -- which means that there's going
to be certain days and you can't decide it individual by individual, you just get chaos.
So teams need to say, these weeks, we're all going to be together or these days, every week, we're going to be together. And these days, we're going
to allow for flexibility and we're going to allow you to work from home or work from the office, whatever works best for you.
And I think that that intersection of recognizing hybrid is here to stay, building the tools and capabilities to do it well, and at the same time,
acknowledging that some time together is really important.
I wasn't surprised to see that purely remote work, there are still -- there will always be some of those jobs, but they're not as many. I think the
other thing that we are finding is the ability to bring the right kinds of capabilities to help our clients is incredibly important right now.
Just today, we announced our new business unit, BCG X, to pull together all of our build and design capabilities into one group, nearly 3,000 people,
and we believe that that kind of capability combined with our advisory and capabilities to help clients change is really what companies need. They
want to bring the two together.
They need to be strategically oriented. They need to know how to make change, but they also need really advanced design and build capabilities in
order to accelerate that pace and manage this issue that they often have with tech vendors being somewhat disconnected with their core strategies.
QUEST: Rich, thank you very much, sir. It's good to see you. I appreciate your time tonight. Thank you.
LESSER: It's great to see you. Bye, Richard.
QUEST: QUEST MEANS BUSINESS.
New signs that Beijing may be softening its COVID stance. Reuters is reporting Beijing is set to ease quarantine and testing rules. It follows
days of protests across the country.
QUEST: Hello, I'm Richard Quest. We have a lot more QUEST MEANS BUSINESS. We're going to continue with France's president saying his truth against
U.S. climate legislation. (INAUDIBLE) the former head of the World Trade Organization.
And more cities could soon ease COVID restrictions in China. This follows a nationwide protest. We will get to those in a moment. This is CNN and here,
the news always comes first.
QUEST (voice-over): President Biden says he is prepared to speak to Vladimir Putin about ending the war in Ukraine. He said the Russian
president must first show interest in ending the conflict. He made the comments during a new conference with President Macron of France.
He also said one way to end the war is for Putin to pull out of Ukraine.
Spain says it has increased security in Madrid in response to a series of letter bombs. One of them was intercepted by the U.S. embassy on Thursday.
Another exploded on Wednesday at the Ukrainian embassy.
There is more on the line for Germany right now in the World Cup. Only a win takes them through to the next round. Right now, it is Germany 1-0. And
in the other match we are watching, Japan is taking on Spain.
QUEST: China seems to be about to relax its zero COVID policies after a wave of unrest, according to Reuters. Beijing is set to announce a wave of
quarantine and testing rules. The country's top pandemic officials said the fight against the virus is entering a new stage.
The comments are a boost to Asian markets with the Shanghai composite up almost half a percent. The bigger rise in stores. Amongst the cities that
are beginning to ease the lockdown is home to the world's largest iPhone factory, owned by Foxconn, where employees staged a protest over working
conditions and restrictions. CNN's Selina Wang reports.
SELINA WANG, CNN CORRESPONDENT (voice-over): Anger boils over into violent protests at the world's largest iPhone factory. Workers stream out of
Foxconn's factory doors in central China. Protesting unfair treatment, dirty living conditions and chaotic COVID rules at the Apple supplier.
Videos obtained by CNN show a group of police in white hazmat suits, beating workers with batons and metal rods. "The police are hitting
people," a worker shouts in the video.
A Foxconn employee told CNN, "The scene turned into a river of blood. Police hit the workers ruthlessly."
Earlier, squadrons of riot police had pulled in.
"They are going to start beating us," protesters yelled in fear, facing off rows of law enforcement with riot gear. The protest escalated into the
evening. Workers tearing down COVID barriers, using metal beams against police, hurling metal parts toward law enforcement, even using a COVID
barrier as a shield against rows of authorities.
They worked together to push over police cars, cheering and chanting. Since October, the Foxconn plant has been sealed off from the outside world after
a COVID outbreak. That forced employees to live and work onsite.
And what videos obtained by CNN show are filthy conditions, garbage piling up in the hallway. The factory plunged into chaos. Videos show workers
scrambling, fighting to get enough food and supplies.
Then came the exodus. Masses of workers walked miles along highways to escape the plant. Analysts estimate this factory produces more than half of
Apple's iPhones. Apple already warned customers, they will need to wait even longer to get their new products, because of China's COVID lockdowns.
So to attract workers, Foxconn promised higher paying bonuses. New workers signed up. But when they got to the factory, the pay package was worse than
what Foxconn advertised. A Foxconn employee said workers felt cheated, leading to thousands of people protesting.
Foxconn later blamed the payment discrepancy on a, quote, "technical error" and sent text messages to workers, offering to pay them $1,400 to quit and
go. Soon after, videos showed long lines of workers boarding buses to leave the factory.
Their departure, possibly putting an end to another violent and dramatic scene. But increasing the pressure on Apple, it is just the latest victim
of China's zero COVID policy -- Selina Wang, CNN, Beijing.
QUEST: In a moment, President Macron says provisions in the U.S. climate bill are protectionist. The former head of the World Trade Organization
tells me how to make an old drink new. And we will see if will I drink it.
QUEST: To our top story, the simmering trade dispute over U.S. climate rules. The French president clean energy subsidies are protectionist and
fed to European fronts. President Biden acknowledged, there are glitches in the new norm. With me is Roberto Azevedo, the former V.P. at the World
Trade Organization. Now chief corporate affairs officer at PepsiCo.
Joining me now. Good to see you, sir. So this dispute, how real -- with your knowledge of trade and the way trade works, is this a real risk on
investment flows, that the U.S. is prioritizing its own domestic chip industry, its own VE industry in such a way?
ROBERTO AZEVEDO, CHIEF CORPORATE AFFAIRS OFFICER, PEPSICO: First of all, nice to see you again, Richard. It is a pleasure to be back. I think the
most important part here is, it's very difficult to assess the subsidies part or the investment flows.
What is important is that, at least right now, governments are talking about helping the transition to the green economy. I think that's the
positive side of this conversation.
We are seeing governments trying to facilitate with incentives, with developing the infrastructure. And all of that is extremely important. I
was in Sharm el-Sheikh a few weeks back for COP27. And we see a mind shift. It was all about commitments; now it's about action. And the private sector
was very much there, right?
Trying to be active, to be vocal. So I think that shift is very healthy. And we are doing everything we can to help in that sense. We need to be
perceived as part of the solution to this. I think that's where we should be focusing as far as the conversation is concerned.
QUEST: The way that the private sector helps, it is now starting to look like the private sector, perhaps -- and this is the case with greenwashing
-- in many cases, the private sector is leading the way.
AZEVEDO: Well, I think we have to. Because, in many ways, governments can be helpful, they can set up enabling policies, for example. But they are
slow, they sometimes take a long time to get policies in place.
The private sector does not have the luxury to wait for that. We do not, as the international community, wait for a long time. We have to take action
now. In fact I will share with you news about PepsiCo tonight.
In Reno, Nevada, we are receiving the first batch of electric trucks from Tesla. They are just 36 but they are very important in our journey. We have
the largest fleet in North America.
We have 80,000 vehicles in North America and we need to shift to electric as quickly as possible. So we hope that our action, together with others,
will bump up supply. We need to scale up the supply of electric vehicles fast. And we cannot wait any longer. So we must be doing everything we can
here. Everybody has a role to play here. I think the private sector, PepsiCo, is definitely taking a part here.
QUEST: I do wonder, when I look at the way in which PepsiCo is taking this, was it an eye-opener for you going into this?
You're coming from an organization where no one could agree on much but you've come to an organization where you can get more done.
AZEVEDO: Absolutely. I think that not only the fact that the company can decide in a more expeditious way, that we have the leverage and the scale
to do that, that's really inspiring. And having the right mindset, knowing that fighting climate change is not only the right thing to do, it is
something that is good for the business.
I mean, we are a food company. Every time we talk about climate change, we are thinking about the bottom line. Every 1 degree centigrade that the
Earth warms up, about 10 percent of staple crops are lost. That's huge for humanity. That's huge for the business. So it's something that is really
exciting to be part of.
QUEST: Are you familiar with Pilk?
AZEVEDO: I heard about it.
QUEST: I'm going to make it now. You can't say, hang on. I'm opening a bottle of Pepsi but it's got danger written all over it. So Pilk is this
idea, Pepsi is promoting a new drink for the holidays. It has an unusual provenance about it.
Apparently, I pour two thirds of Pepsi and a third of milk. You can't see me doing this. And, oh, my goodness. It could be --
QUEST: I'm going to try it on air.
AZEVEDO: Tell me how it goes.
QUEST: Well, if you had served it at the World Trade Organization, you'd probably got an agreement quicker from everybody. It's actually not that
bad. It's not bad. I think it probably needs a liqueur in there, to make things taste a little bit more rounded.
Thank, you sir. It is good to see you. I wish you well. I will take the Pilk and I will say, seasons greetings to you.
AZEVEDO: Absolutely. Same to you and to the listeners. All the best.
QUEST: Thank you. I can't decide what I might have gotten wrong on this.
QUEST: And I will have a Profitable Moment after the break. QUEST MEANS BUSINESS, next.
QUEST: Tonight's "Profitable Moment." I was always very skeptical with the whole working from home thing. We talked about these many times. I pretty
much believe that companies will demand that employees came back to work, probably sooner rather than later.
And the idea of a hybrid model, that always seems a bit farfetched to me, as well. I have been proven right and proven wrong. More and more companies
are demanding, saying we want you in the office more days than not.
And more and more employees are saying I want the flexibility to work from home when I want to, which is why I'm not surprised by the latest
statistics showing that there is a dearth of jobs for people who want to work from home. And there are many applicants who want to do it. And
companies are being difficult about it.
The reality is, there is a revolution underway. Now of course, I can't work from home everyday. I have to be here under the lights of the studio to
talk to you. But there's a million and one people who can work from home, want to work from home and they're not being allowed to in different
organizations around the world.
The future will be for employers, those who show flexibility. We heard it from Macron, from Radisson, we heard it many times on this program. That is
going to be the way of the future.
By the way, tomorrow night's program comes from London at the National Gallery. And that's QUEST MEANS BUSINESS for tonight. I am Richard Quest,
in New York. Wherever you are, I hope it is profitable.