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Quest Means Business

Fed Hikes Rates Despite Banking Turmoil; Macron Stands Firm On Reforms As Protests Escalate; UN Official Urges President Not To Sign Uganda Anti-LGBT Bill; Wall Street Investing In Water Rights; Businesses Push Back On Norway Fish Farm Tax; Mowi's Vindheim: Norway's Fish Farm Tax Is "Anti-Business". Aired 4-5p ET

Aired March 22, 2023 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[16:00:20]

ELENI GIOKOS, CNN INTERNATIONAL HOST: The closing bell is ringing on Wall Street, a late session following the Fed Chair's testimony. As you can see,

the Dow is down 1.6 percent. That's a loss of 531 points for the day.

Well, those are the markets and these are the main events: The Federal Reserve hikes interest rates for a ninth straight meeting, but Jay Powell

says the banking crisis could complicate the path forward.

President Macron breaks his silence after a week of protests against his pension reforms.

And the UN urges Uganda's President not to sign a new bill criminalizing gay people.

Live from Dubai, it is Wednesday, March 22nd. I'm Eleni Giokos. I'm in for Richard quest, and this is QUEST MEANS BUSINESS.

All right, a very good evening. Great to have you with us today.

Tonight, the Federal Reserve says the banking crisis is likely weighing on the economy and suggests its rate hikes may be near an end. The Fed raised

its benchmark rate by a quarter of a percentage point, that brings it to just under five percent. More notably, it dropped the phrase "ongoing

increases may be appropriate" from its statement. Now the bank says some additional policy firming may be appropriate.

At his news conference, Fed Chair Jerome Powell explained the change. Take a listen.

(BEGIN VIDEO CLIP)

JEROME POWELL, US FEDERAL RESERVE CHAIRMAN: We believe, however, that events in the banking system over the past two weeks are likely to result

in tighter credit conditions for households and businesses, which would in turn affect economic outcomes. It is too soon to determine the extent of

these effects and therefore too soon to tell how monetary policy should respond.

As a result, we no longer state that we anticipate that ongoing rate increases will be appropriate to quell inflation. Instead, we now

anticipate that some additional policy firming may be appropriate.

(END VIDEO CLIP)

GIOKOS: The consensus at the Fed is for just one more rate hike this year and you can see that on the left side of this dot-plot. It shows most of

the Fed's Monetary Policy Committee thinks that rates will peak at just over five percent. If you still think that it could go higher, Richard

Quest is in Tokyo on assignment. He joins us now live.

Richard, markets are not doing so well after Jerome Powell's statement. What was it that, you know, is scaring investors at this point? I think the

25 basis point rate hike was largely anticipated. There was hope, there would be a pause, but there is something that he said that perhaps could be

spooking the markets.

RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": Yes, what he has basically said is -- and you heard him just then is that the banking

crisis itself will slow the economy. Banks will be harder -- it will be harder to borrow money, lending criteria will be tightened, so banks will

not be so willing to lend, that will slow down the economy, that will slow down inflation.

He is not taking his eye off the inflation ball. What he is saying basically, to paraphrase is there is more than one way to skin a cat. And

whilst the Fed was quite happy to do it with rising interest rates, now that work is being done or will be done or potentially will be done by the

banking crisis itself.

Where he's left himself wiggle room is if for whatever reason the banking crisis subsides quickly, and things don't tighten, then I'm going to read

my -- then he says, "some additional policy firming may be appropriate."

So Eleni, you know, the long and short of it is the economy is going to slow down, whether by bank action or Fed action, the slowdown is going to

continue, and that is what the market doesn't like. There is going to be no cuts in interest rates. There is going to be no easing. There is going to

be no pivoting. Inflation still remains the number one goal.

GIOKOS: But, Richard, isn't it sort of normally the case when you have quantitative easing or you've got hot money, it usually is fed through the

banks.

[16:05:05]

GIOKOS: Similarly, you have a tightening in monetary policy and banks are the way that it's transmitted and it was interesting, because something

that stood out for me is that the latest bank stresses, obviously having an impact in terms of the way they're dealing with credit, that seemed to have

been taken into consideration during this decision.

So I guess that is countering what they needed to have done on the interest rate hike in France, and that sort of becomes interesting in terms of their

projections, because, frankly, we are still sitting with major uncertainty. We don't know what this is going to look like.

QUEST: No, we don't. And he admits that again, and again, that they don't know what's going to happen, but they are pretty darn certain, the economy

is going to slow down.

You're right, the monetary transmission mechanism is through the banks and through blending, and through higher interest rates. That's how monetary

policy works.

But if somebody else is going to do the dirty work for you; now, they don't want a mega banking crisis. That's certainly the case. So he is very much

aware of that.

I was surprised, there wasn't more or something in the statement, offering liquidity promises. The ECB did that last week, making it clear that all

you can eat is still on the table, but I guess the banks know that.

They don't want a banking crisis, but they have got a situation where a slowdown is probably inevitable and they are going to ride it and take it.

I think this idea of the dot-plot, I will take the dot plot with a pinch of salt, because, you know, the one thing he also said in his statement, the

FOMC said in the statement is that they are going to be -- the monetary policy will be very aware of risks. Now, what that means is if the whole

thing turns turtle, and things get bad very quickly, with banking, they will move in the opposite direction, but nobody is expecting that at the

moment.

GIOKOS: Do you believe they are just too married to the two percent inflation target that perhaps that needs to be reviewed? It would give them

more wiggle room?

QUEST: There is no chance of the two percent, I say that, but being reviewed. And the reason is simple, look, they're at four point something

percent on inflation. Let's just say you say the new target is four percent or we're not going to worry too much about two percent. Then immediately

people start flirting with five and six percent.

So they have to at least get it in the closer vicinity to two percent, and that is the same for all the major Central Banks -- the BOE the ECB, the

Fed -- I've asked again and again, will they keep to the two percent, and everybody says if they don't, they're in very deep trouble.

GIOKOS: Well, I mean, maybe there could like extend that to a bit of a range. Who knows what will happen in the future.

Richard, good to have you on. Always good to see you. Great. Enjoy Tokyo. We'll see you soon back on the show.

QUEST: Thank you.

GIOKOS: All right, Chair Powell said the US banking system is strong even as the Fed says it is monitoring the effects of the recent crisis. Shares

in regional banks fell after the Fed's announcement. Take a look at this red board.

Powell said earlier, the Fed is prepared to use all its tools to keep the system safe as it raises rates.

(BEGIN VIDEO CLIP)

POWELL: Our banking system is sound and resilient with strong capital and liquidity. We will continue to closely monitor conditions in the banking

system and are prepared to use all of our tools as needed to keep it safe and sound.

In addition, we are committed to learning the lessons from this episode and to work to prevent episodes -- events like this from happening again.

(END VIDEO CLIP)

GIOKOS: Alan Blinder is the former Vice Chair of the Fed. He's now a Professor at Princeton University. He joins me now.

Sir, great to have you on. Thanks so much.

ALAN BLINDER, FORMER VICE CHAIR OF THE FEDERAL RESERVE: Good to be with you.

GIOKOS: You have said that the Fed should perhaps pause right now, right, after what we saw with SVB. Do you think that this was the wrong decision

to hike rates by 25 basis points?

BLINDER: I think it was the wrong decision and maybe that's the answer to the question you were asking Richard before about the market, although the

market was expecting it.

I want to emphasize, it is only 25 basis points. So we say the wrong decision. That means a little bit wrong versus a little bit right. Can I

read you a sentence of the statement?

GIOKOS: Yes. absolutely.

BLINDER: It reads this: "Recent developments are likely to result in tighter credit conditions for households and businesses and to weigh on

economic activity hiring and inflation. The extent of these effects is uncertain." I agree a hundred percent with every syllable. That's an

argument to pause you.

[16:10:08]

BLINDER: You don't know what's coming at you, so you pause and wait till you learn more.

GIOKOS: And that's the thing, you've actually -- you've been the one that has been very vocal about, you know, we've got to shake things up a little

bit to see what's going on, we need to look under the hood even deeper. What is your prognosis in terms of what lies ahead? Because you've said,

this isn't about too big to fail, it is about too interconnected to fail. And there is a concern that we'll see more state and regional banks coming

under pressure.

BLINDER: That is the concern and we don't know that. The hope, cross fingers is that the handful of banks that have already I was going to say,

step forward, have been pushed forward into the spotlight led by Silicon Valley Bank is the whole thing and there won't be any more.

Would you bet a million dollars on that? I don't think so. There may be more.

If it's only one or two or three more, this is not going to be a big deal. And in a year's time, we'll have forgotten about it. If it's 30, 40, 50

more, this is a much, much bigger deal and we don't know the answer to that right now.

GIOKOS: The inflation target, the two percent. Again, you have said this is something that should be taken into consideration, but probably not even

remotely discussed. So, I'll put something else forward. What about creating a bigger range to give the Fed wiggle room? Is the two percent

inflation level even viable in this day and age for the US?

BLINDER: That's an excellent question. I have thought and said for years now, maybe decades, I'm not sure when I started that a range, maybe a

hundred-basis-point range makes a lot more sense than an exact number.

So instead of a two percent target, have one-and-a-half to two-and-a-half. That by the way, had we done it many years ago would really leave the angst

the Fed had when inflation was running, can you imagine about 1.7 percent? That was a worry?

I mean, I don't think anybody should have been worried about that, and if they had the broader range target, it would have been in the range.

GIOKOS: Exactly. And look, we know the Fed was behind the curve, they should have acted sooner. We've discussed this in the past.

I'm just curious, in terms of regulation around the banking sector right now. So we know that the Dodd-Frank bill in 2010 was the threshold in terms

of what was systemically important. It was at $50 billion. They then changed that to $250 billion in 2018. Then the rate, you know, the

threshold is too high. You've been very vocal, SVB was sitting I think, just over $200 billion when this crisis broke out.

What is the happy medium? And how quickly can that regulation get into effect to protect the system that clearly is vulnerable?

BLINDER: Let me answer the second question first, because it's so easy, not quickly at all, because that was a law that Congress passed in 2018.

And you know what's going on in the American political system these days to get anything through Congress is a Herculean task. So I don't see that

happening in law.

Now, the Fed can go beyond the law and just look more closely at banks of that size, even though they are still below the 250 threshold.

If I had my druthers, it's clear to me, and it was clear at the time that 50 was too low. A threshold 250 was too high, a threshold that leaves a

pretty wide range. I don't know what the right number is. A hundred, hundred fifty maybe, something like that. But in any case, Congress is not

going to change it.

GIOKOS: As long as it is a Herculean task and not a Sisyphean task, we could live with that.

Alan, great to see you, sir. Always good to have you on the show. Much appreciated for your time.

BLINDER; Thank you.

GIOKOS: All right, moving on now, French president Emmanuel Macron has broken his silence on his pension reforms vowing the changes will be law by

the end of the year, that's despite escalating protests. We're heading to Paris next.

Stay with CNN.

(COMMERCIAL BREAK)

[16:02:15]

GIOKOS: Welcome back.

So French President Emmanuel Macron is standing firm on his pension reforms amid a wave of protests and violence. In a TV interview, Mr. Macron

defended his decision to force a bill to raise the pension age through Parliament and he declared he wants the changes implemented by the end of

this year.

There were some protests today. A ninth nationwide strike will take place on Thursday.

Melissa Bell joins me now from Paris.

Melissa, great to have you on. He also said this reform isn't a luxury, it's not a pleasure, it is a necessity. How is this message being measured

by the public?

MELISSA BELL, CNN CORRESPONDENT: It's doesn't really seem to be getting through. This is exactly what the government has been saying ever since he

announced this would be the year of pension reform, that because of the deficit says the government inherent to the budget system, more than 1.8

billion as it stands that will increase they say by 2030, to more than 13 billion, this is a necessary reform.

Now, there are those in France who question the figures themselves and certainly in terms of the reform, and the way it has been pushed through,

there has been what's been apparently growing opposition when you look at the polls from the public, not just that the reform itself and the idea of

working for two extra years, but the manner in which it's been pushed through and we're seeing once again tonight, Eleni, out on the streets of

Paris, those spontaneous protests that we've seen so much of these last few days.

(BEGIN VIDEOTAPE)

BELL (voice over): The protests have been unplanned. The scuffles almost nightly, ever since the French government announced it would push its

pension reform through Parliament without a vote.

French lawmakers in uproar as well last Thursday as the announcement was made. The government narrowly surviving two no-confidence votes on Monday

with the retirement age in France now one step closer to being raised from 62 to 64.

EMMANUEL MACRON, FRENCH PRESIDENT (through translator): We will not tolerate any flareups. We will make sure that life is as normal as possible

in spite of those who are blocking normal life.

BELL (voice over): But since the start of the year, there have been demonstrations and strikes across the public and private sector. Ten

thousand tons of garbage now piled high on the streets of Paris.

MAHER TEKAYA, SENIOR OFFICIAL, CFDT UNION: What is sure that was the biggest social movement we had since the beginning of the 80s. And sure,

it's quite complicated. A lot of people went into strike even if it was hard in the current condition to go on strike to lose a day of wage, but

probably this is pointing out other problems to come.

[16:20:04]

BELL (voice over): Unions and protesters now looking beyond Parliament to the streets with the lack of a vote only likely to have further fueled

their determination.

(END VIDEOTAPE)

BELL (on camera): Now, in terms of the law itself, Eleni, the next step is that it goes to the Constitutional Council where its constitutionality

will be considered, but barring a massive reversal of fortune or surprise, it is likely that the government will now get its way.

The question is, what more the unions and the wider public as angered as they are by the manner in which this reform has been pushed through as much

as by the reform itself can now do, we are likely once again tomorrow to have that massive day of protest countrywide, many more strikes, they can

continue to hold those.

Beyond that the next four years of Emmanuel Macron's presidency can be made difficult in terms of future reforms, certainly at parliamentary level and

the union say in the streets as well -- Eleni.

GIOKOS: Melissa Bell, thank you so much.

The UN High Commissioner for Human Rights has asked Uganda's President to block a new anti-gay bill described as draconian. Ugandan lawmakers passed

legislation on Tuesday making it a crime to identify as LGBTQ and imposing the death penalty for other cases.

The bill is expected to go to President Yoweri Museveni for an approval. Last week he derided gay people as deviance.

Larry Madowo is in Lagos, Nigeria covering the story.

Larry, good to see you. Museveni has used derogatory phrases against the LBGTQ community in the past before what we saw a few days ago. Frankly,

he's been very vocal on how he defines this community. The question now becomes with the international pressure that he is feeling, what will he do

with this vote?

LARRY MADOWO, CNN CORRESPONDENT: I think we don't have an exact answer for that. The government was in Parliament and supported the bill. His

Prime Minister and his Attorney General said the government is fully supportive, but I don't think they expected this much level of

international condemnation from the UN Commission of Human Rights and this is one of the worst bills like this in the world, not just in Africa, but

also condemnation from the European Union, from the US, from the UK, from the UN, all saying the same thing. This is unconstitutional. As well as

Uganda's own laws, it reintroduces the death penalty which the EU opposes, and it is just really draconian in many aspects.

So President Museveni has 60 days to either sign this bill or send it back to Parliament. But here's the thing, even if he were not to assent to it

and send it back to Parliament, an absolute majority of MPs in Uganda can still override his veto and pass it because the mood in Parliament is

almost celebratory when they passed this bill.

(BEGIN VIDEOTAPE)

MADOWO (voice over): Joyous scenes in Uganda's Parliament on Tuesday, after lawmakers passed a sweeping anti-LGBTQ bill.

UNIDENTIFIED MALE: It is our country --

MADOWO (voice over): Same sex relations were already illegal in the conservative East African country, with convicts risking a life sentence.

Now, legislators have taken it one step further.

(UNIDENTIFIED FEMALE speaking in foreign language.)

MADOWO (voice over): Anyone who identifies as lesbian, gay, bisexual, transgender or queer now faces up to 20 years in jail, and the death

penalty for "aggravated homosexuality," a broad term used in the legislation to define same sex intercourse with children or disabled

people, rape, or incest.

Supporting lawmakers saying the aim is to "protect our Christian culture and traditional family values."

ASUMAN BASALIRWA, UGANDAN LAWMAKER: What we have done really is for the people of Uganda, it is beyond us as individuals.

MADOWO (voice over): And some had quite a flippant attitude towards the issue.

CHARLES ONEN, UGANDA LAWMAKER: There is nothing so sweet and so good for a man more than a woman.

MADOWO (voice over): Only a few lawmakers disagreed.

RACHEL MAGBOLA, UGANDAN LAWMAKER: I do not agree with homosexuality in principle, but I don't agree with criminalizing it.

MADOWO (voice over): The United Nations called the law among the worst of its kind in the world, and is passing a deeply troubling development.

Human Rights campaigners in Uganda have condemned the move, calling it barbaric and unconstitutional. Ugandan rights activists vowing to fight

back.

A human rights lawyer in Kampala told CNN that: "This regressive and draconian law promotes hatred and discrimination and institutionalizes

homophobia."

MADOWO (on camera): Homosexuality is illegal in more than 30 of Africa's 55 nations and Uganda's move is just the latest in a series of setbacks for

LGBTQ+ rights here on the continent.

MADOWO (voice over): The legislation now waits for the Ugandan President's signature.

YOWERI MUSEVENI, UGANDAN PRESIDENT: The homosexuals are deviations from normal.

MADOWO (voice over): And no one is expecting a surprise from him.

(END VIDEOTAPE)

MADOWO (on camera): An umbrella body of LGBT groups in Uganda is calling on President Museveni not to sign this bill because it will fuel hate,

harassment, violence, and abuse of gender and sexual minorities.

[16:25:06]

MADOWO: They've put out a statement that call themselves convening for equality and they say this bill means that anyone's identity, how we

express ourselves will be policed and criminalized. Society will be weaponized and turned into the police to forcefully out and report

suspected gender and sexual minorities, including family members.

So Eleni, a real concern there for anybody who identifies as LGBT in Uganda because their very existence could be criminalized if this bill comes into

law. So far, no word of condemnation of support from the African Union or the East African Community.

But a quick background here, some of these anti-LGBT legislation in Ghana, in Uganda, and other parts of the continent are actually sponsored and

financed and supported by American evangelical groups.

GIOKOS: Very concerning indeed. Larry, thank you so much for that report.

All right, the Ukrainian authorities are calling this missile strike on an apartment block in Zaporizhzhia a deliberate attack on civilians. At least

one person was killed and 32 others injured. Ukraine says seven others were killed when a drone struck this building south of Kyiv.

The attacks come with the departure of China's President Xi Jinping from Moscow during a three-day State Visit. He and Vladimir Putin pledged to

deepen ties.

Britain's Prince William has made an unannounced trip to Poland meeting troops near the border with Ukraine. The Prince of Wales met British and

Polish soldiers and Poland's Defense Minister.

He then headed to Warsaw to visit a center providing support to Ukrainians fleeing the war.

CNN's Max Foster has been traveling with the Prince and sent this report from Warsaw.

(BEGIN VIDEOTAPE)

MAX FOSTER, CNN ROYAL CORRESPONDENT: Eleni, Prince William arrived early on Wednesday, but we weren't able to report it because he headed straight

over to the east of the country to an area called Jezow, which is about a two hour drive from Lviv in Ukraine, so quite close to the border.

And he went there because he wanted to meet the British and Polish troops working together to, in his words, support the freedom of the people of

Ukraine, which he described as all of our freedom.

So he spent time there, thanking them for all of their work. Then he headed over here to Warsaw to visit and accommodation center set up in a former

office for Ukrainians who wanted to settle here in Poland, for now, at least, 1.5 million people have decided to do that and Poland has given them

full access to public services such as schools and hospitals.

And Prince William wanted to recognize how much Poland continue to support all of these Ukrainians and on Thursday, he will actually meet the

President, President Duda to, in his words underline the support and gratitude he wanted to express to the people of Poland -- Eleni.

(END VIDEOTAPE)

GIOKOS: Thanks to Max Foster there for us in Warsaw.

Now, the UN projects water will become more scarce by 2050. Some parts of Wall Street are betting on that, too.

We'll talk about the firms investing in water rights coming up next.

(COMMERCIAL BREAK)

[16:31:24]

GIOKOS: A warning from the U.N. on World Water Day. It says water use must be treated as a common good and not a commodity. It's a sign of things to

come as Wall Street takes an interest in water rights. One investor went as far as saying that water will be the resource that defines this century.

CNN's Lucy Kafanov reports from Colorado for us.

(BEGIN VIDEOTAPE)

LUCY KAFANOV, CNN CORRESPONDENT (voice-over): Cibola, Arizona, is a place few are likely to have heard of. Home to some 300 people, this windswept

community is a tiny oasis in the Sonoran Desert, sustained by water from the Colorado River.

But this rural corner of the American West has caught the eye of East Coast investors. Much of this farmland now belongs to Greenstone, a subsidiary of

the financial services conglomerate MassMutual.

(on-camera): So what does investment firm want with farmland like this?

HOLLY IRWIN, LA PAZ COUNTY, SUPERVISOR: They want it for the water. They want it to make money, you know, off the water rights that are attached to

the land.

KAFANOV (voice-over): La Paz County Supervisor Holly Irwin is fighting Greenstone's recent sale of Cibola water to a growing Phoenix suburb more

than 200 miles away.

IRWIN: And make millions off of it, you know, at the expense of what it's going to do to our communities in the future and the precedents it's going

to set. It's opening Pandora's box, and who is going to be the next one in line to roll the dice?

KAFANOV (voice-over): A lawyer for Greenstone told CNN its plan was subject to public review approved and that it will have no impact on the potential

of cities along the river to grow. But it's not just happening in Arizona.

(on-camera): Wall Street firms have been snapping up properties up and down the Colorado River, not so much for the land, but rather for its precious

water rights. It's a growing interest in an increasingly scarce natural resource, with investors betting big on a major payoff.

MATTHEW DISERIO, PRESIDENT, WATER ASSET MANAGEMENT: It's a trillion dollar market opportunity.

KAFANOV (voice-over): Matt Diserio is president of Water Asset Management, an investment firm headquartered in this New York City building, which has

also been buying water rights in states along the Colorado River. Diserio described its strategy in 2020 interviews with institutional real estate

and Fintech TV.

DISERIO: Water, we believe, is the resource that is defining the 21st century, much like oil defined the last century.

KAFANOV (voice-over): The company did not respond to CNN's specific inquiries, issuing a statement that said, it was proud of its investments

and will manage assets in a manner that contributes to solutions to water scarcity.

TRAVIS LINGENFELTER, SUPERVISOR, MOHAVE VALLEY COUNTY: They come out west, they purchase and pick up cheap rural agricultural land. They sit on it for

a little while, and then they're trying to sell the water.

KAFANOV (voice-over): Mohave County Commissioner Travis Lingenfelter says a number of large east coast investment firms are trying to get in on the

action. His is one of three Arizona counties that sued the federal government to block the Cibola water transfer.

LINGENFELTER: If they're coming after a portion of our only water supply on the river for many of our communities, we have to fight it.

ANDY MUELLER, GENERAL MANAGER, COLORADO RIVER DISTRICT: They're drought profiteers. They're trying to suck the very lifeblood out of these

communities for their own financial benefit.

KAFANOV (voice-over): Andy Mueller is tasked with helping to protect Colorado's share of the river and says the full scale of the land purchases

is difficult to track because investment firms use different names to disguise ownership.

MUELLER: It's a very unpopular move to come from New York and invest in real estate, in irrigated agriculture with the intent to dry it up and

watch it blow away. It's all about making money.

KAFANOV (voice-over): Under a pilot program, the federal government has dedicated $125 million in drought relief funds to pay Colorado River

farmers and ranchers to conserve water by not growing crops on their land.

[16:35:03]

Something Former State Senator Kerry Donovan worries investment firms will take advantage of.

KERRY DONOVAN, COPPER BAR RANCH, RANCHER: That's where I think we start to see this investment speculation. These outside landholders get big dollars

to grow nothing, and that's when we start to see farm and ranchers go away.

KAFANOV (voice-over): Her efforts to strengthen the state's anti- speculation laws failed, leaving her and other ranchers worried about how Wall Street will influence their future.

DONOVAN: It's not their land. It's not their legacy. It's their bottom line. And their -- by law, they're responsible to make money for their

clients. My family's brand is on the barn behind me. This is my family's land. It's our legacy. We work to keep it this way. That's a totally

different mentality than a New York investment firm.

KAFANOV (voice-over): Lucy Kafanov, CNN, Western Colorado.

(END VIDEOTAPE)

GIOKOS: Water is at the center of a controversial tax proposal in Norway. It concerns one of its biggest industries, fish farming. The original

proposal was for a 40 percent tax, but that's faced major pushback from the industry. Officials say fish farmers should share more of their profits,

since the waters they use belong to everyone.

Fish farmers say the tax is bad for business and will lead to job cuts as well as higher prices. Reports say Norway's parliament could decide on the

tax this month.

We have Ivan Vindheim, the CEO of Mowi, which is the world's largest producer of farmed Atlantic salmon. He joins us now from Norway. Sir, good

to have you with us. I want to talk about this 40 percent tax that you could be facing. What does that mean for your business and what does that

mean for the industry in Norway?

IVAN VINDHEIM, CEO, MOWI: Good afternoon, Eleni, and thanks for having me. So this proposal came last year, the 28th of September, and it came as a

shock. And this tax level is unprecedented. And if it's put in action, it would impose major limitations to future investments and development of

this fantastic industry. So, it would be devastating. That's why we are so strongly against it.

GIOKOS: You've also posted all time high financial results for last year. Your numbers are looking good. You're competing effectively with your

peers. You've been able to contain costs. Do you believe that is -- you are going to be facing some kind of tax? Perhaps it won't be the 40 percent,

but what are you pricing in right now. And, you know, in terms of your financials that are looking so strong, what percentage, what level would

you be able to cope with?

VINDHEIM: Yes. So the strange thing here is that we already pay between 40 percent and 50 percent in taxes of our earnings in Norway. So it's not like

we are not paying taxes. There is no private industry in Norway that pays the kind of taxes as we do. So we really contribute to the society. We pay

for the common areas we use.

And frankly speaking, we are in favor of taxes, but they must be balanced. So when you exceed 50 percent, then you come into trouble. And I think most

people would agree to this reasoning. So that's our take here. So, of course, it will continue to contribute, but we also need some money left to

continue to invest with.

GIOKOS: What's fascinating to me is that Norway produces around half of the world's farmed salmon. That's an interesting fact. I think a lot of people

don't realize that. This 40 percent tax, could that shift, you know, businesses? What does that mean for businesses down the line in terms of

Norway being a viable option for fish farming?

VINDHEIM: Yes, of course. This is not it. The salmon is a fantastic product with great product features, and the demand is impeccable. So, if this

becomes the result, then the development just move abroad from Norway and carry on in other countries.

But having said that, I don't think this is the end game. I think when the politicians see the consequences, the negative consequences of this

proposal, then they will change it and reach to some kind of equilibrium. So I'm actually an optimist in the longer term here. We just need some time

to persuade the politicians.

GIOKOS: I want to talk about the environmental impact here. Of course, there's been a lot of talk about whether what kind of impact it has from an

environmental perspective. The use of chemicals, for example, survival rates, all of these things being discussed.

[16:40:09]

I know that you have been ranked as the most sustainable animal protein producer in the world, but how much more can you do on the sustainability

front? Do you feel that there's more work that needs to be done from your end?

VINDHEIM: As you say Eleni, Mowi has been ranked as the most sustainable animal protein producers, actually, four years in a row, so we are actually

already delivering the goods, so to speak. But we can do more. The industry can do more.

So I think we all have to do our share in the green shift. Having said that, salmon has fantastic sustainability credentials, so we just have to

do more of it and even more sustainable. So -- and we are ready to do our share.

Ivan Vindheim, thank you so very much. Great to have you on the show. Much appreciated for your time.

VINDHEIM: Thanks for having me.

GIOKOS: Well, that's it for Quest Means Business.

Up next, we've got Marketplace Europe. For me, Eleni Giokos in Dubai. Thanks so much for joining us. I will be with you tomorrow as well. I'll

see you then. Take care.

(MARKET EUROPE)

END