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Quest Means Business

Netanyahu Delays Judicial Reform Plan; European Strikes; Dow, S&P 500 Higher As First Citizens Buys Silicon Valley Bank; Jack Ma Makes Rare Public Appearance; Beijing Hopes To Correct Economic Slump Due To COVID; London's Rival Financial District Is Reinventing Itself. Aired 3-4p ET

Aired March 27, 2023 - 15:00   ET

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

[15:00:23]

RICHARD QUEST, CNN INTERNATIONAL HOST: An hour left to trade on Wall Street. I would say the market is on a firm footing. If you take a look at

the Dow, it's been in the green all day and we are clearly at the best of possession on the Dow, it is up one percent. I'll give you more details of

exactly what is moving in the larger market or the wider market in just a moment.

Those are the markets and the main events of the day.

Prime Minister Benjamin Netanyahu agrees to delay judicial reform in the face of mass opposition.

Nationwide strikes, grounding flights, and paralyzing public transport in Germany.

And, SVB bank as a buyer for most of its US assets.

Tonight, I am live in London. It is Monday, it is March 27th. I'm Richard Quest, and in London as elsewhere, I mean business.

Good evening.

We begin tonight in Israel where Benjamin Netanyahu says that the country is at a dangerous crossroads as he postpones his divisive plan to overhaul

the judiciary.

The Prime Minister has added to the unrest this weekend when he sacked the Defense Minister, Yoav Gallant, who had publicly suggested that the plan be

delayed.

Meanwhile, hundreds of thousands of protesters have been filling the streets in Jerusalem, and Israel's largest trade unions called for a

general strike.

At Ben Gurion Airport, flights were grounded, and at the ports, shipments were halted. Some of the country's largest banks, shut. Union leaders have

now called off the strike, the general strike this evening, after Benjamin Netanyahu went on TV and backed down for now.

(BEGIN VIDEO CLIP)

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER (through translator): Most of the citizens of Israel from both sides. They don't want to cut the country

and to tear it apart. I'm not ready to tear the country apart.

(END VIDEO CLIP)

QUEST: Now, in Jerusalem tonight, we've got Hadas Gold. We also have Nic Robertson, our international diplomatic editor. I'm going to start with you

Hadas. Give me a brief overview of the events of the last couple of hours and where we stand now.

HADAS GOLD, CNN CORRESPONDENT: Well, I mean, we do need to start with the Defense Minister being fired on Sunday evening after he dared to give the

speech speaking out against this reform actually calling for exactly what happened today, which is a halt.

Then we saw protests erupt on Sunday evening. These were angry protests in what we've seen over the last 12 weeks, and then this morning, that huge

historic strike that affected everything from universities to nurses, as you noted, the ports and the airport. Richard, even McDonald's here were

closed down as part of this strike. That strike has since been called off because after hours of speculation that he was going to do so, Prime

Minister Benjamin Netanyahu finally did announce at least a pause to legislation.

But I should note that the initial announcement about the pause of the legislation actually came from the National Security, Minister Itamar Ben-

Gvir, the far-right wing Minister in Benjamin Netanyahu's government. And I think, Richard, that should give you an indication of potentially who is

really in control of the situation here, because it does appear was that it was Ben-Gvir who was the ultimate obstacle to Netanyahu to come out and

call for this pause in legislation.

And meanwhile, the opposition is saying let's wait and see whether this is a real pause before we come to talks for over some sort of compromise over

these reforms.

QUEST: Nic Robertson, why should we think -- because it's not a very long pause, just a few weeks, and they've had months of dialogue or attempt or

opportunities for dialogue. So why should we think that when they come back after the Pesach break for the next session, will it be any different?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: We shouldn't think that at all. Talking to some of the protesters who've been here, you say

the country is at a crossroads. Well, part of the country was at this crossroads here. That was a pro-government protest, the first time that

pro-government protesters have come out in big numbers to voice their opinion.

I was speaking to some of them, who many of them have drifted away now, speaking to some of about what they thought Prime Minister Netanyahu had

said about this delay and it just gets precisely to your point, a lot of them were really disappointed. They feel, as he says, the country is being

held hostage to what they call the minority, these very large other anti- government, anti-judicial reform protests.

[15:05:05]

ROBERTSON: So I think the stage is being set not for this problem to be diminished, just delayed slightly, so it is a good question that's not gone

away.

QUEST: Hadas, surely all Netanyahu has done is recognize both the physical and political reality. He has gone away to regroup for another

day.

GOLD: Yes, I mean, but he is still vowing that this reform will happen and his right-wing Ministers are still vowing that this reform will happen.

And in fact, Itamar Ben-Gvir, appears to have gotten something out of this, which is something called -- that he is calling a National Guard that will

be fully formed under his authority. Somebody, I should remind you who has in the past has convictions on his own record.

But I think the real question will be what will be the talks? What would they look like over the next few weeks? Will they actually take place with

the Israeli President at his residence? Will the opposition be fully involved? Because if you do have those talks at the actual level of the

opposition and the President have been calling for, that's not going to be done for weeks before the Israeli Parliament comes back into session.

QUEST: Nic Robertson, finally to you, it might have been a while since you were last in Israel. I know when I was there, just a couple of weeks

ago, it felt different. The place felt like, if you will, the bone China was being broken. How does it feel to you?

ROBERTSON: Yes, it definitely feels more brittle. When I was here, about a month-and-a-half or so ago, a lot of the tensions were really being

expressed with tensions with the Palestinians here. This very much internal, goes to the heart of division within Israeli society.

And at that time, a month-and-a-half ago, the protests, the street protests, anti-government, anti-judicial reform protests were building. And

as you say, those tensions have grown much more brittle today because the pro-government protesters have come out.

So yes, the crockery, to use your metaphor here is stacked and it is not in a very -- it's not stacked well, Richard. It could come crashing down.

QUEST: Nic Robertson and Hadas Gold, both of you in Jerusalem, grateful for you tonight. Thank you.

To give you some, of course, background, the unrest in the country has taken months of sustained protests from all corners of society, if you

would have been with me a couple of weeks ago when the program came from Tel Aviv. And then we brought you leaders from the tech sector, venture

capital, even the Central Bank. There was consensus, judicial reform as put forward would hurt Israel's economy.

(BEGIN VIDEO CLIP)

AMIR YARON, GOVERNOR, BANK OF ISRAEL: We have seen some high tech leaders and industry leaders telling us that maybe investment first won't come in

and some of them are even talking that they might take their business elsewhere,

JACOB FRENKEL, FORMER GOVERNOR, BANK OF ISRAEL: Countries that weakened its judicial powers are performing economically much worse.

ASSAF RAPPAPORT, CEO, WIZ: It is basically a financial risk assessment that we're doing and we are saying the same thing that we took out the

funds from SVB, for example, lately. The same thing we're thinking about the Israeli economy nowadays.

(END VIDEO CLIP)

QUEST: That's a story we will continue to watch.

Tonight, we are also watching very closely the massive transit strike in Germany, which has disrupted greatly travel across the country. Now, trade

unions say tens of thousands of workers walked out. It's Germany's largest strike in decades, and indeed forced Munich Airport to close entirely.

If you are trying to get there by rail, you weren't much better off, long distance and commuter lines were shut down. As for buses and streetcars,

they didn't go anywhere. Bonn was all part of this mega strike.

The two main transit unions want a 10.5 percent pay increase to offset the rising cost of living.

Now to France, workers there are still protesting against the increase in the retirement age. There was a picket line today that blocked tourists

from entering the Louvre Museum.

Sam Kiley is in Paris watching over the European unrest.

Sam, two very different reasons in a sense in Germany and in France, but a common underlying theme, which is the need for economic reform and

therefore taking it out on the work as it would appear.

SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, that's certainly the French argument. I think it is slightly different in Germany, which is

an old fashioned wage dispute with inflation running at 8.5 to 8.7 percent, unions asking 10.5 percent, getting offered five, and before we saw the

German strikes and the French strikes, which is of separate issue, as you suggest, we've seen very similar strikes in the United Kingdom right across

private and public sector including even nurses and young doctors.

[15:10:07]

KILEY: So in a lot of European countries, people are feeling the pinch economically, and then on top of that, here in France, you've got Macron

trying to push through what he believes are essential, although painful that he acknowledges, they are painful. He acknowledges is even unwilling

to have to do it, to raise the pensionable age here from 62 to 64, which he believes, Richard would mean that he could avoid massive deficits of 12.5

billion euros annually by 2027, rising much further than that, by the end of the decade.

Now the unions argue that it's not going to save more than 10 billion if that -- and that it hits the poorest people, the people at the bottom of

the economic food chain, if you like, most hard and of course, it's the people who are earning the least who are hit most -- face the most

difficulties whether they're in Germany, Britain, or France when it comes to these high inflation rates, rising interest rates and very little sign

that they're going to be able to get wages to match them -- Richard.

QUEST: Sam Kiley in Paris.

Let's stay with the French side of the story. Laurence Boone is the French Minister for European Affairs. She is with me now from New York.

Minister, grateful to have you with us this evening. My apologies that I'm not in New York to be with you in person.

If we look at the deteriorating situation, particularly in France, it is difficult to see a way out for the President, short of ditching or amending

his pension proposals, which is not prepared to do. France is in a dreadful state tonight.

LAURENCE BOONE, FRENCH MINISTER FOR EUROPEAN AFFAIRS: Well, listen, the President has been very clear, we need this pension reform. We know it's

not popular, it's tough, but we need it.

In 2017, when he was elected, there were 10 million pensioners; in 2030, there will be 20 million pensioners. Now there has been a democratic

process. We've had hundreds of hours of debate at the Parliament. The bill has been passed, and I think we need to move on.

As you know, the President is young, he is very dynamic, he has got this vision making France modern and active, creating lots of quality jobs, and

that's the next step.

QUEST: One of the problems in Europe, of course, is that so many of the issues, national government related whether it's cost of living in Germany,

or pensions in France, and yet, so much of the power now has been ceded to the EU and its various constituents -- the EC, the Parliament, the Council

-- which really can't do much about these other issues. And I'm wondering whether there is now a dislocation between where the power is and where the

responsibility is.

BOONE: So I wouldn't say it like that, actually. The separation of power between the EU and national countries is very clear. When it is about

social policy, the power of the EU are fairly limited. When it is about social policy, it is mostly individual countries. When we're talking

industrial plants, climate change, big macro issue, then the power is within the EU on the impulse of each of our leader.

QUEST: So in this situation, as for example, when interest rates went up, and there is the possibility of recession, it was the Commission that came

forward with this very large budgetary thing to keep things moving. It was the Commission that moved first and really had the commonality of funds.

But I wonder where the responsibility of individual countries last? And the reason I ask this is because if we take, for example, the IRA, the

Inflation Reduction Act of the United States, which now Europe is grasping to put together something similar, because it sees the US with a central

theme has moved forward faster.

BOONE: Well, actually, you're very right. Both are very good examples. It's on the impulse of national leaders, and actually, the French

President, Emmanuel Macron, has been very forceful about it, that we got the Commission to actually design a common law and the next generation of

the EU to actually support the recovery of all countries across the EU. The implementation of this recovery plans was done at the national level in a

coordinated manner with EU.

[15:15:06]

BOONE: For the response to the Inflation Reduction Act, let me say first that we are actually quite happy to see the US finally addressing climate

change. And then again, there was a huge impulse from the French leader and from other leaders to put in place the response and the response had been

agreed last Friday at the European Council, it is, we have a Net Zero Industry Act. It's the same as the Inflation Reduction Act, 400 billion tax

credit, streamline permitting procedures, streamline bureaucracy, and business is coming up.

QUEST: Right, but can you execute and implement that as effectively as it would seem the US is being able to implement and execute the IRA?

BOONE: Yes, absolutely. Let me give you an example.

France will be designing its energy transition plan based on nuclear and a ramp up of renewable energy. And we have already started, a law has been

voted, a permitting law has been voted to go faster.

Germany will be ramping up its climate transition based on hydrogen, and they have started the plans. They will also passed a law to accelerate

permitting. So, you can see that it's as efficient as what the US is doing.

QUEST: Good to see you, Minister. The next time, we'll do it in Paris, we will speak in Paris, and it will be face-to-face and I'm looking forward to

it already. Thank you very much.

BOONE: So do I. Bye.

QUEST: It is QUEST MEANS BUSINESS tonight coming from London.

The First Citizens Bank has snapped up what was left at the failed Silicon Valley Bank, that's been -- the deal is easing concerns. You can see the

market. We'll take a closer look in just a moment.

(COMMERCIAL BREAK)

QUEST: A US regional bank, First Citizens has bought a large part of the failed Silicon Valley Bank, SVB. It has helped encourage the market quite

dramatically. You saw the Dow there and now, you're seeing this basically, the NASDAQ is off on something else, but there is a solidness about today's

market.

As for the bank itself, First Citizens shares were up 50 percent, and it has been a good day for regional banks overall as you can see here, 54

percent, look at that. If you knew that one was coming, you would be well and truly home and dry.

[15:20:10]

QUEST: Here is what First Citizens agreed to. It is going to take Silicon Valley Bank assets, $110 billion worth of deposits, and $56 million loans

of 72. Regulators have backstopped the deals, and it will cost the FDIC's Deposit Insurance Fund around $20 billion.

Rahel is with me in New York.

And so, I mean, somebody was going to buy it. The question, of course, is having bought it, did they get a deal or did they get a steal? Judging by

the share price, the market thinks they were -- they've made off to the desert.

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Judging by the share price, Richard, the markets think that First Citizens got a pretty sweet deal. I

should point out that its shares are trading at levels that we haven't seen since November of 2022. So, the markets like it.

And just to put a fine point on the deal, Richard, as you pointed out, it also is not -- it is not taking -- First Citizens is not taking SVB's

Treasuries, it is not taking those US Treasuries. It is not taking mortgage-backed securities to the tune of $90 billion. So, that's another

reason why markets like it.

It's also sort of survival of the fittest. You have one of the weaker banks essentially being taken, acquired, swallowed up by a stronger bank. So,

it's essentially one less thing for the markets to think about.

QUEST: Okay, so can we say that sufficient oil has been poured on banking waters?

SOLOMON: No, I don't think we can say that. I think we can say stability today, which is a relief, we will take, but stability today does not

guarantee stability tomorrow, we certainly have certain things on the horizon in terms of Capitol Hill hearings this week, that could really

spook the markets.

QUEST: Okay. But I'm just thinking back to that line of Jerome Powell at the press conference last week, where he basically said that tighter bank

credit was going to do, it was effectively the same as an interest rate hike.

Now, that's not the same thing as a market rallying, but I'm guessing we're now all going to be watching to see what bank lending looks like, and

whether or not de facto there is this tightening in the market?

SOLOMON: I think it's a great point. I think you would be surprised to learn that what we learned on Friday in terms of deposit, inflows and

outflows certainly wasn't as bad as we were expecting. But lending actually increased, Richard, and you and I privately have had conversations about

this, perhaps it was surprising to see that lending actually increased with some of these banks.

So I think, you know, it's hard to make a prediction or a pattern out of one week of data, but that will certainly be something people will be

watching for, certainly as it applies to inflation and the larger economy and of course, the R word -- recession.

QUEST: Knowing that we could have done under the various regulations upon which we are employed, but don't you wish you'd bought First Citizens on

Friday?

SOLOMON: Well, who could have seen that coming? I mean, who could have seen a 50 percent jump? The stock now trading at levels it hasn't traded

out in about six months?

Yes, the short answer is yes, Richard, I wish I had, and I'm sure you did, too.

QUEST: I didn't, before anybody accuses me otherwise, I didn't. Thank you, Rahel, in New York. Today's purchase of the bank was welcomed by the

British government. You'll recall, the UK arm of SVB was sold to HSBC for only a pound after the US bank went under.

I spoke to the Chief Secretary to the Treasury, the number two, if you will, John Glen, who told me this whole crisis demonstrates UK regulators

have sound policies in place.

(BEGIN VIDEOTAPE)

JOHN GLEN, BRITISH CHIEF SECRETARY TO THE TREASURY: I was the City Minister for four-and-a-half years in the UK and I've always been very

clear that we have very sound regulation in the UK, the Prudential Regulation Authority, Sam Woods, does a fantastic job and we had in the UK

a solution lined up and we are delighted with the outcome.

But obviously, I recognize it was very disconcerting for businesses that had large deposits with Silicon Valley Bank, and I am very pleased with the

resolution, both in London and obviously in the US as well today.

QUEST: Do you support what the US administration, the Fed did, which was basically bail out the uninsured deposits, which was the majority of the

bank making somewhat of a nonsense of, if you like, guarantee limits?

GLEN: Well, it's not for me to comment on the way that the US regulate their banking system. There are significant differences between the UK and

the US. And, you know, I respect very much the regulators in the US to do what they see as fit. All I can say is that in the UK, we have a slightly

different system, and we were very pleased with the outcome. But we're constantly looking at how we can make our regulatory environment more

suitable to deal with all eventualities, but I think after the crisis in 2008, we had significant reforms and they've stood the test of time, but

there's always more that we should be looking at and we are never complacent.

[15:25:03]

QUEST: The Swiss regulators on Credit Suisse having to defend their decision to, if you will, protect equity. Several people have basically

said that if this was done in their jurisdiction, they wouldn't support it. The bondholders, in this case wiped out somewhat surprisingly, would you

have done the same thing?

GLEN: I think what happened in Switzerland reflects their approach in a different set of circumstances. And, you know, it will be for them to

account for the outcomes and the implications for the way the market functions.

QUEST: Except in global markets, you sort of rely on a one size fits all, at least in terms of regulatory framework. That's the whole point of Basel.

And I do wonder, you know, now AT1 bond holders around the world in different jurisdictions will be saying, will we be treated like the Swiss,

or like the British, or like the Americans? A level of confusion, an unwelcome level has been introduced.

GLEN: Well, I don't quite accept that. I think that we have international institutions like IOSCO, the Financial Stability Board, which the UK and US

and other jurisdictions very much participate in. The implementation of Basel will differ slightly in different ways and in different

jurisdictions.

What must happen, though, is there must be maximum cooperation between regulators and we have seen that happen throughout the recent challenges as

we did previously. I think that's to be welcomed. And obviously, lessons need to be learned.

QUEST: You must have been relieved that the Bank of England basically now says it doesn't even see a technical recession in the UK, but that

shouldn't mask the fact that growth is just about zero, rates went up again and I wonder how much more pain is still to come?

GLEN: Well, I do welcome the fact that we don't face a recession in the UK, but I don't -- I'm not complacent again, about the challenges we face

in terms of getting growth going and that is why the budget just two weeks ago in the UK, was designed on creating a platform for investment. We've

now got world-leading expensing of capital investment, worth 27 billion pounds.

And I take on the challenge to beat the forecast, as we have done since what happened at the autumn statement and growth is where we need to be

going for in the UK.

QUEST: We learned in the ill-fated budget last year, mini budget, whatever you want to call it.

GLEN: Mini budget.

QUEST: That there are dark corners in the financial world. In this case, it was pension funds that suddenly sort of erupt into problems. We've

learned this year, SVB, higher interest rates and that, so we always know that there is potential for an eruption somewhere. But I thought 2008 was

designed -- and the post regulation was designed to prevent these sorts of things. How worried are you that we have much more work to do?

GLEN: No economy is going to remain exactly where it was 15 years ago. There will be new challenges and new opportunities. What we've got to do is

be vigilant to step up to the mark and as we saw with SVB, make sure that we've got the right frameworks in place to find solutions when those

difficulties occur. We won't always be able to anticipate where they come from.

The LTI matter that you referenced last autumn, it was stress tested, but it hadn't been anticipated you could get to that level of stress and there

will be lessons to be learned from that as well.

(END VIDEOTAPE)

QUEST: That is the number two at the UK Treasury, it is the Chief Secretary.

QUEST MEANS BUSINESS tonight -- I've got my teeth to work properly -- commercial real estate reinvention apparently is the key to survival. The

head of London's CanaryWharf Group, he is bringing the property into a new age, in a moment.

(COMMERCIAL BREAK)

[15:32:14]

QUEST: Jack Marquardt, the founder of Alibaba made a rare public appearance today in China when he visited students at a school that was funded by his

company. Now the billionaire has kept a low profile in the last two years after Beijing crackdown on tech companies. China has dialed back some of

that pressure and it's trying to boost its economy and move on from the pandemic.

Unemployment and government cuts are making it very difficult for China to turn on the -- turn the page fully. Selina Wang now reports from Beijing.

SELINA WANG, CNN CORRESPONDENT: The crowds are back in Beijing. During the pandemic, this popular shopping area was virtually empty. The stores were

starved for business and the restaurants did not allow people to dine inside. But now people are back in the streets and they are ready to spend.

(BEGIN VIDEOTAPE)

WANG (voice over): China dropped its harsh zero-COVID policy last December. And families like this one from Inner Mongolia are traveling for the first

time since the start of the pandemic.

He tells me people are finally going out after being stuck inside for so long. It's a busy Saturday night and getting a table is a battle.

WANG (on camera): At a 30-minute wait. But this line is huge to get into this restaurant. Follow me.

WANG (voice over): But it's not so bad compared to other places.

WANG (on camera): They're not even taking weights anymore. It's all fully booked for the rest of the night.

WANG (voice over): We try our luck in another area. But it's not any better.

WANG (on camera): There are these long lines out of so many of the restaurants. I've been talking to people here who've been waiting for more

than an hour.

WANG (voice over): Including this man, a tourist from Wuhan where the pandemic started.

I asked him if people are feeling happy that the country has opened up. Not necessarily, he responds. The mood is still depressed because people's

incomes were unstable during the pandemic.

Beneath the surface of busy shops in streets are deep economic wounds. Nearly one in five of China's youth is unemployed. That could be about 20

million people according to CNN's calculations. Across the country, they're flocking to job fairs like this one.

WANG (on camera): The organizers here say that things have really picked up since pandemic restrictions and daylight.

WANG (voice over): These two women graduated college last summer but still haven't found work.

She tells me she majored in chemistry but if she can't find a job in the sciences, she'll take any job she can get. This computer science graduate

tells me he's been applying to jobs everywhere. Online and in person with no luck yet. He says he's worried about the mass layoffs at China's

technology companies. But it's not just higher paying tech jobs getting hit. This factory owner gives an impassioned speech claiming that a lot of

factories in Guangdong, China's manufacturing hub are laying off workers and cutting salaries.

[15:35:01]

Meanwhile, local governments are struggling to cope with mounting debts after years of paying for mass testing and COVID quarantines. Just one

province, Guangdong spent $22 billion fighting COVID over the past three years. Some cities are reducing costs by cutting government provided

medical insurance for residents. The change sparked protests in several cities last month.

Crowds of senior citizens took to the streets in Wuhan and Dalian shouting for their money back. Some of them pushing against rows of police.

Back on the streets of Beijing, normal life has returned. But each person and business is still dealing with the aftermath of years of economic pain.

Selina Wang, CNN, Beijing.

(END VIDEOTAPE)

QUEST: Delighted to be in London tonight, and our studio and office isn't newsrooms. It's close to the traditional London financial district, the

famous city. But if I keep going east, eventually, I ended up in the main rival to the city's economic heart. There you see the famous towers of

Canary Wharf. They are spectacular when you come around and go up the river as you approach Heathrow Airport.

Canary Wharf and its location is almost stranded in Docklands, and it's made establishing Canary Wharf difficult in its 35 year history, especially

during the pandemic, and the daily flow of nearly a million commuters all but dried up. Canary Wharf is reinventing itself as a matter of survival,

attracting tourists, shoppers, and a residential community. At least that's the plan.

Shobi Khan is the chief executive of Canary Wharf with me now. Sir, as long as I can remember, Canary Wharf has been reinventing itself. I mean, it

went -- the thing went bankrupt in the 90s. It's been difficult throughout. Why are you more hopeful of success this time?

SHOBI KHAN, CHIEF EXECUTIVE OFFICER, CANARY WHARF GROUP: I think three main reasons. To your point, Canary Wharf started 35 years ago, eight years ago,

we started building residential. And actually, three years ago, we went on a big push of sustainability, amenities, and health and life sciences. And

the Canary Wharf now is transformed itself into a really mixed use of vibrant neighborhood.

QUEST: Can you get it to be mixed use?

KHAN: It is mixed use.

QUEST: Can you -- can you get more mixed use I suppose?

KHAN: Absolutely so. What people don't realize is that we've already built eight residential towers. They're all full. We've got another eight under

construction. So that residential community not only exists on Canary Wharf, but around the surrounding docks of south key.

QUEST: Can you make yourself more attractive than "Docklands" per se? You know, so that's really what you need to do -- you want to do, isn't it? You

want it not just to be oh, I live in Docklands. But I live in Canary Wharf?

KHAN: Absolutely. And actually, the people that live in Canary Wharf are paying a premium over the people that are in the south key Docklands. Why?

We've got amenities. We've got water. We've got biodiversity and we've got a safe and secure estate. And that rent premium of people wanting that.

It's all here.

QUEST: Listen to what Jeff Lowe, who you know, who's the CEO of Related, told me in New York recently about property prices and the sort of office

buildings that are getting there. Have a listen.

(BEGIN VIDEO CLIP)

JEFF LOWE, CHIEF EXECUTIVE OFFICER, RELATED COMPANIES: The demand for our new product, the class double A office space is incredible. Like it's never

been before.

The question is, are people going to want to go back to these older buildings that aren't built for today's kind of modern office environment?

And then you even have the class. So, those Class B buildings, I would say, people aren't coming back.

(END VIDEO CLIP)

QUEST: So, if we look at your buildings, they look great. But they were built 20 years ago. So, how are you -- what would you class them as now?

What needs to be done to them? Those that you own, obviously, you don't own them all?

KHAN: All our buildings are -- the U.K. has passed an EPC rating of how green your building is sustainable. All our buildings meet that code. And

so, we've been investing over the time in upgrading the lighting, the water, the filtration systems, all that has been done. And so, in fact,

Citibank moved into 40 Bank Street that took over almost 200,000 square feet there.

QUEST: Is the battle -- does the battle still royal go between the city and the financial east, if you will, Canary Wharf, Docklands?

KHAN: I think the financial battle is between the best A buildings and the rest of the market is just talking about. Corporates are all moving to the

best in class that has the great -- not only the light, narrow, but the sustainable features. There's a green premium and there's a brown discount.

And that's market has continued to bifurcate and will continue to bifurcate.

QUEST: And it's harder, of course, for the city to get those new elements. Isn't it? Just simply old buildings riddled with asbestos or whatever. And

you can't put -- you can't make them as sustainable.

KHAN: Exactly. The filtration, the water, the lighting. I mean, that's where -- and that's where the market is. The vacancy rate for that. That

kind of premium product is very, very low.

QUEST: Canary Wharf, thank you very much. We look forward to coming in during the program from the (INAUDIBLE) the views are spectacular.

KHAN: My pleasure. We'll be opening up that middle dock where we were having this year and you're invited to come and see that opening.

[15:40:07]

QUEST: I see. You know me. When invited I'll turn up it. Thank you, sir.

KHAN: Thank you.

QUEST: It's good to see you.

That's QUEST MEANS BUSINESS for the moment. In 20 minutes or so, together, we'll do a dash for the closing bell. Coming up next, World of Wonder. Cape

Town, South Africa.

(COMMERCIAL BREAK)

[15:58:26]

QUEST: I'm Richard Quest. Together -- excuse me. Let's have a dash to the closing bell. Just under two minutes before it happens. The major U.S.

averages are mixed after the regional U.S. lender bought the remains of Silicon Valley Bank. The Dow is up more than 200 -- oh, we've given back a

lot of the gains. You can see we're now just over 192. We were one percent higher earlier but things have eased off.

And if you look at the triple stack, you will see the wider and the narrower or put together, that's barely holding. That has now extended its

losses. Not hugely but it is down.

Tonight, we've covered protests in Israel as well as strikes and unrest across Europe. Laurence Boone is the French minister for European Affairs

who told me President Macron had to raise the retirement age.

(BEGIN VIDEO CLIP)

LAURENCE BOONE, FRENCH MINISTER, EUROPEAN AFFAIRS: The President's been very clear. We need this pension reform. We know it's not popular. It's

tough, but we need it in 2017 when he was elected, there were 10 million pensioner. In 2030 there will be 20 million pensioner, Now there has been a

democratic process. We've had hundreds of hours of debate at the Parliament. The bill has been passed and I think we need to move on.

(END VIDEO CLIP)

QUEST: Disney says it's laying off 7000 workers starting this week. Look at the Dow 30 and you get a feeling of where we are. IBM at the top. You don't

see that very often. You're Nike down to the bottom. You don't see that easily overall. But that's the way the market is more green than red for

today. The Dow is barely up.

[16:00:04]

And that is QUEST MEANS BUSINESS. And that's the market. Whatever you're up to in the hours ahead, I hope it is profitable. The closing bell is ringing

on Wall Street. "THE LEAD" with Pamela Brown is next.

END