Return to Transcripts main page
Quest Means Business
IMF Warns Of Rising Chances Of An Economic Hard Landing; Biden Visiting Northern Ireland To Mark Good Friday Agreement Anniversary; Major Cryptocurrency Gains 80 Percent This Year; Italy Declares State Of Emergency Over Migrants; Around 100 Kills In Myanmar Junta Airstrikes; Israel Bans Jewish Visitors And Tourists; Navalny's Health Rapidly Deteriorating; Cineworld Shared Crushed As Bankruptcy Plan Filed; Harsh Ugandan Bill Court Deter Investment; Uganda's Anti-LGBT Bill; Interview With Open For Business Kenyan Country Director Yvonne Muthoni; Uganda's Anti-Gay Bill Could Jeopardize Foreign Investment; Biden's Irish Welcome; U.S. Markets Mixed Ahead Of Inflation Report. Aired 3-4p ET
Aired April 11, 2023 - 15:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:27]
RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": And the markets have an hour or so to go and we're looking forward to tomorrow's
CPI inflation numbers. It will be crucial, of course, in determining which way the market interest rates will go, but we're still bullish. I think the
thinking is the Fed is done for the moment and if it's not, well, it's not got much further to go.
So strong gains on the Dow. The markets as they look and the main events that we are following.
The IMF downgrades its forecasts for global growth after the banking crisis.
Brexit soft: Creating opportunities for some businesses in Northern Ireland. President Biden arrives there in this hour.
And Cineworld shareholders may be wiped out. The movie theater chain is now giving details of its bankruptcy plans.
Live from New York, Tuesday, April the 11th. I'm Richard Quest. I mean business.
Good evening.
The IMF has warned that there's a rising chance the world economy is heading for a hard landing, and it points to the difficult tradeoffs that
policy makers are making to bring down sticky inflation on the one hand, and maintaining growth and managing financial risks on the other.
The IMF has downgraded its global growth forecast to 2.8 percent and three percent next year.
Core inflation will be around 5.1 percent this year. It had been predicted at 4.5 at the beginning, so that is a worsening situation. The IMF says the
fog around the world economic outlook has thickened, and this is why the road ahead is so difficult to navigate in that fog.
You have the banking crisis that first emerged in the US pretty much like the UK gilt turmoil last fall, it showed the vulnerability of financial
institutions, dark areas which need light pouring upon them. Inflation remains -- is falling, it remains stickier than anticipated, and that is
going to keep interest rates higher for longer and that slows down economies.
When you have weak growth and high borrowing costs, debt can become unsustainable. And yet, despite all of this, US Treasury Secretary says the
global economy is in pretty good shape. Janet Yellen was speaking ahead of her participation in the Spring Meetings from which by the way, we'll be
reporting from later this week.
The Treasury Secretary was asked whether she thinks there is currently a credit crunch.
(BEGIN VIDEO CLIP)
JANET YELLEN, US TREASURY SECRETARY: I've not really seen evidence at this stage suggesting a contraction in credit. Although that is a possibility. I
believe our banking system remains strong and resilient. It has solid capital and liquidity, and the US economy is obviously performing
exceptionally well.
(END VIDEO CLIP)
QUEST: Now with me is Pierre-Olivier Gourinchas, the IMF Economic Council Director of Research. It's good to see you, sir. Thank you.
I'm reading the notes about this and it is interesting, it is sort of, on the one hand -- on the other hand, as it so often is in economics, in that
you admit that inflation is coming down, but at the same time, not fast or far enough and you're still talking about growth slowing down and the
possibility of a hard landing.
PIERRE-OLIVIER GOURINCHAS, ECONOMIC COUNCIL DIRECTOR OF RESEARCH, INTERNATIONAL MONETARY FUND: Yes, that is right. I mean, we have a baseline
scenario that is one of modest growth this year, 2.8 percent, just revised a tad from our January projection by 0.1 percentage point and increasing
back a little bit next year, and headline inflation coming back down.
But core inflation, as you pointed out has still not turned the corner in many countries. In Europe, it is still increasing. It has not started
decreasing. In the US, it is sort, of we get different readings from one month to another, but certainly not as has been decisively coming down, so
inflation has proved more persistent.
It's actually one of the reasons why we have a mild downgrade, is we anticipate that there will be a need for monetary policy to remain tighter
for longer.
QUEST: Right. However, you also say debt levels remain high, which limits the ability of policy makers to respond, so since you can't have
your cake and eat it, which is it? Are things okay? Are things going to get to get dangerously worse? What is your judgment?
[15:05:12]
GOURINCHAS: Our judgment is that, sort of our modal scenario is one that, you know, gradually improves recovery, but rocky. The main concern we have
is that the downside risks around that scenario have increased a lot since our last round of projection, and that is largely because of the financial
instability episode we've had.
And there are two channels here and they are playing at sort of different speed and different strength. One is that, you know, as a result of this
financial instability, banks around the world, certainly in the US, but also in the Euro area, and other advanced economies, you could look around
and say, well, you know, maybe now is not the time to extend a lot of credit.
And so we will have to watch and see, but there could well be a lending -- a credit crunch coming down the pike in a number of countries.
Now, mind you --
QUEST: Right, but can I just jump in there? Because I want to just advance on that, because that is essentially Jay Powell's point, to a large
extent that the credit -- potential credit crunch is going to do our work for us, it is a de facto rate increase, do you subscribe to that?
GOURINCHAS: Yes, by and large, if there is for whatever reason, in a particular case, a credit crunch, if there is a slowdown in aggregate
demand, and global demand more generally, then Central Banks around the world don't need to do as much to bring inflation back to target.
Now, you know, a lending punch is not something that is necessarily as controlled as the Central Bank hiking rates, so there is volatility around
that, but there is some degree of substitution.
QUEST: Right. But you say inflation is unlikely to return to target to 2025. Now, in this scenario that we are in at the moment, is there
sufficient tightening both through the policy rate and through a possible credit crunch? Is there sufficient in the economy to bring down inflation
sufficiently? Or do you think higher rate rises will be necessary, even if it's just one or two more?
GOURINCHAS: Well, right now, given where we are in our, again, in our baseline scenario, where we have rates in the US peaking at around, you
know, a little bit above five percent and in the Euro area, around 3.75 or something like that, that is what would bring inflation back to our targets
by the end of '24 or '25.
There could be surprises to inflation because it has been proving more persistent in the last few reads that we've had, and so that might require
a little bit more tightening.
But again, on the other side, you have this lending contraction that might sort of do the job for the Fed or the European Central Bank.
Now, this is one thing and we've tried to quantify this. You know, if there is a lot of lending contraction, then in fact, we could see growth slowing
down faster. We have in our report, we call a plausible alternative scenario. So it is to say, you know, here is another way things could
unfold. And it is, you know, quite reasonable that it might unfold that way, and with that lending crunch, the credit crunch, then we would have
growth of about 2.5 percent, instead of 3.8.
QUEST: I'm looking forward to discussing all of this with you over a cup of coffee, when I hopefully see you at the IMF, at the Spring Meetings
later in the week. Sir, very grateful. Thank you.
President Biden is due to arrive in Northern Ireland, around an hour from now. The Air Force One making its way. One of the reasons for the visit is
to commemorate the Good Friday Agreement signed 25 years ago this week. It was that deal brokered in large part by the US, effectively ended decades
of sectarian violence. It was known as The Troubles.
The President often speaks about his Irish Catholic roots. He is approaching this visit as part of politics, part homecoming, he spoke about
the importance before he left the United States this morning.
(BEGIN VIDEO CLIP)
REPORTER: What's your top priority on this trip, sir?
JOE BIDEN, PRESIDENT OF THE UNITED STATES: Make sure the Irish Accords and the Windsor Agreement stay in place to keep the peace. That's the --
that's the main thing, and it looks like we're going to -- keep your fingers crossed.
(END VIDEO CLIP)
QUEST: Nic Robertson is in Belfast. "Keep your fingers crossed," says the President. I mean, that's hardly a rousing call for an agreement that
has been in place 25 years. With all its imperfections, I think you and I would both agree having covered The Troubles, Northern Ireland is a very
different place.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: A very different place, indeed, Richard, and I think interesting, the President referenced there
the Windsor framework, because that gets to the political difficulties here over Brexit and the fact that one of those five parties of whom with which
President Biden will meet tomorrow at the Democratic Unionist Party is unhappy about the Windsor framework, refuses to go into government.
[15:10:13]
The President is unlikely to confront the DUP on this, but he is likely to talk about the benefits of business and how the economy here, as we've seen
over the past 25 years has improved, can do better and can help sort out some of the remaining issues.
We've been around Northern Ireland talking to some of the businesses to find out just how it could work.
(BEGIN VIDEOTAPE)
ROBERTSON (voice over): Blinds maker, Bloc and its boss, Cormac Diamond are at the cutting edge of their business.
CORMAC DIAMOND, CEO, BLOCK,: We will take orders up to 4:30 of any day, and they will be turned around the same day.
ROBERTSON (voice over): And they are object lesson on beating Brexit's impact on Northern Ireland.
DIAMOND: And these are going to Aherla (ph). This one's going to Zwolle.
ROBERTSON (on camera): In the Netherlands?
DIAMOND: In the Netherlands. And then --
ROBERTSON: So, this whole pallet is going to places in the EU.
ROBERTSON (voice over): He can sell direct to the EU without the Brexit problems mainland UK companies have.
DIAMOND: You're a third country within the European market, so there is additional paperwork and tariffs associated with selling products directly
to consumers.
ROBERTSON (voice over): So this is your advantage.
DIAMOND: Absolutely.
BETH LUNNEY, SAINTFIELD NURSERIES: The problem with getting plants from England is that the haulers don't want to do drippage.
ROBERTSON: But Brexit isn't working for everyone, even with the new UK-EU Windsor Framework Deal.
LUNNEY: It doesn't seem that it is going to get any easier. Where now, not only have we the border to Ireland's say, we also have to adhere to all of
these European rules.
ROBERTSON (voice over): Beth Lunney runs Saintfield Nurseries says she'll still face a near impossible challenge to get some plants from Mainland UK.
LUNNEY: There is just a lot of these strings are being cut, and they are being cast drift and that's how it fails.
ROBERTSON (voice over): In pro-British communities, the issue is totemic. The power sharing government here is stalled over it, yet business here is
somehow powering ahead.
STEPHEN KELLY, CEO, MANUFACTURING NORTHERN IRELAND: A miraculous thing has happened. Our exports to the UK, the EU and the rest of the world are all
increased, whilst the rest of the UK market has decreased.
ROBERTSON (voice over): But political sensitivities are not Brexit's only challenge here. Better business is putting a squeeze on labor.
US mining giant, Terex, which first invested here right after the Good Friday Peace Agreement, and now has eight sites turning close to a billion
dollars in sales last year needs to grow their 2,000-person workforce and is taking untraditional steps.
UNIDENTIFIED FEMALE: We are in massive recruitment drive and we are actively trying to recruit females into our business, so when we actually
actively went out under our academy, we were very successful in attracting women into the workforce.
DIAMOND: So this is the next generation of blinds production.
ROBERTSON (voice over): Blinds maker Cormac Diamond has a solution, too.
ROBERTSON (on camera): All robots.
DIAMOND: Yes, largely robots. The type of employee that we would see in the future will have the skills with advanced manufacturing techniques.
ROBERTSON (voice over): So successful, it is breaking into the US blind market, selling the robots, not the blinds.
ROBERTSON (on camera): So this is where the future is going to be for you. More automated system.
DIAMOND: Absolutely. Absolutely. Replica systems are thus here, deployed around the world, we will help manage it on a day-to-day basis.
ROBERTSON (on camera): Business groups estimate that for every job generated in advanced manufacturing, another three are created in the wider
economy. And right now, in Northern Ireland, one in every four families is estimated to rely on manufacturing for their income.
ROBERTSON (voice over): The political issue in play is business delivering more Brexit winners than losers. The answer to that likely see that the
ballot box next month.
(END VIDEOTAPE)
QUEST: You know, the fascinating part about that report is that in theory, and I was thinking of the flower seller there, in theory, Northern
Ireland with the Windsor framework should be in an ideal position to be the boom economy for both.
ROBERTSON: And I think it very much depends if you're the big business that can use big trucks to bring in big amounts of equipment that you're willing
to go through the paperwork, because you know you're going to export the product into UK and into Europe.
But if you're a small business like the garden center, Beth Lunney who we spoke to there, it's much harder. She has to club together with lots of
other little nurseries to convince a hauler to be able to bring the lots of little bits and pieces of it have plants et cetera over and that's hard and
it is costly and it puts her at a huge economic disadvantage.
[15:15:08]
She is buying her plants now from Holland and Ireland, but her customers, you know, come to and say, you know, I want this potato from England, I
want this rose from England. We heard this last year about -- or the year before about sausages that people are here wanting the sausages from
England that they will remember and all love.
It's that kind of issue. It is hard to get people to change on some of those issues, but it seems to me where we're headed, the big businesses can
succeed with this framework, the smaller businesses, maybe tougher.
QUEST: Nic, the President is only, goodness knows how many miles away, but he is probably starting their approach to Northern Ireland. You'll be
able to cover. I look forward to talking to you in the next hour. So thank you, sir.
Now, as we continue tonight, if you put money into Bitcoin at the beginning of this year, you're probably feeling rather smug and good about it. It is
up more than 80 percent and that could have something to do with investors betting we might be near the end of the sharp rate crisis.
(COMMERCIAL BREAK)
QUEST: Okay, Bitcoin has been on a tear this year. The crypto is up more than 80 percent since January. A single bitcoin is now worth more than
$30,000.00 for the first time in 10 months. The rally is in part because investors believe that the Fed is just about almost done. And tech stocks
are also climbing on the back. The NASDAQ is on the verge of a bull market, I mean, depending on your definition, but it's up 17 percent from its
recent low in January.
Now, Rana is with me, our global economics analyst and associate editor at "The Financial Times." Good to see you.
So the core issue here, I think, ma'am, is have -- I almost hesitate to say this.
RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: You can do it. No, go for it. You're fine.
QUEST: No, because I can feel you sort of saying oh, don't be ridiculous, Quest. Have we turned? Has the turn taken place or are we
turning now?
FOROOHAR: Well, it depends on what turn you're talking about. You know, when I think about why Bitcoin is up, I've always thought that there is an
argument, I don't buy it, but there is an argument that crypto in general is a dollar alternative, you know, it's an alternative to traditional
Central Bank backed investments and at a time when the Fed is bailing out, you know everything.
[15:20:01]
And as you said, it is kind of done, I'm assuming you mean done in terms of firepower, then yes, I can see why some investors would say, all right, the
dollar may be depreciating at some point. We may start to see dollar assets depreciate, I'm going to buy into Bitcoin.
Now, let me just say, I wouldn't do it.
QUEST: Oh, well, then, that's fine. Thank you. We'll take that under advisement and we'll play those words back when it is up 5,000 percent.
I know, look, but Rana --
FOROOHAR: That's totally fine. But, you know, let's be clear about what Bitcoin and crypto are. They are non-Central Bank backed very speculative
assets, and I don't care if they're up 5,000 percent, and you can call me ma'am, I still wouldn't invest in this.
I mean, invest in gold, if you want to do that, you know?
QUEST: No, let's not go down that road.
FOROOHAR: I really --
QUEST: Let's not go down the gold road. More importantly than that, in a sense, I suppose what I also meant is, do you feel that the sentiment has
changed? Now, the IMF is really saying, well, you know, on the one hand, on the other hand, it's quite difficult to work out what their core message
is, other than that things may be more grim than first thought.
But do you think the market now says, you know something, it may be not this month or next month, but the worst is over.
FOROOHAR: You know, I think the market is very confused right now and it has reason to be, because we -- and we've talked about this, Richard, we've
come out of a period where there are more vectors of change in play than I've ever seen. Right?
So you know, let's dial back and just pretend that we didn't have a pandemic. I think we already would have seen probably a pretty significant
recession, and maybe be into recovery cycle by now.
But we weren't there. We had a pandemic, that changed everything. It was a pandemic that played out differently in different regions, that changes the
time cycles for recovery. We've got geopolitics that are unbelievably complicated, you know.
Are Europe and the US going to come together in a new sort of multilateral block that will counter China? China is on a charm offensive. Is that going
to work? Is it going to sort of pull other trading partners into its orbit? Technology, don't even get me started, you know, and the state of the US in
the world, which kind of goes back to your crypto question, do you believe in the dollar? Do you not believe in the dollar? Do you think we're moving
to a multipolar currency world?
All of this is really difficult to track, and I think that the market is confused, actually.
QUEST: All right --
FOROOHAR: And you know, some of the best of us are, let's be honest.
QUEST: Okay, so I am feeling mischievous to lead you into temptation this evening.
FOROOHAR: Do it.
QUEST: I'll put 100 bucks in if you put 100 bucks in into a crypto.
FOROOHAR: You are mischievous. No, but I will bet --
QUEST: Oh, you'll take that the profits when I win. You'll say that --
FOROOHAR: I'll ding that bell when you're when your losses come in. No, I won't.
Now, I think you'd probably be okay. I'm still -- I'm cautious. Not going into crypto at a time when regulators are still sharpening their pencils
around this stuff.
QUEST: I think you've just shown us all we need to know, sharpening pencils. I don't know too many people who do that these days, but there we
go, Rana, it is good to see you. Thank you.
I've got news for you --
FOROOHAR: Good to see you.
QUEST: My hundred is staying in the wallet as well. Thank you.
Now North Korea is suspected of stealing nearly $2 billion in cryptocurrency last year. US analysts say the money is helping Pyongyang
fund its military ambitions. The question: How did they steal it?
Alex Marquardt with this exclusive report on the effort to get the money back.
(BEGIN VIDEOTAPE)
ALEX MARQUARDT, CNN SENIOR NATIONAL SECURITY CORRESPONDENT (voice over): As North Korea's nuclear and missile programs race ahead, their hackers had
been busy on a newer front.
CNN has exclusively learned about a counterpunch against North Korea's aggressive efforts to steal cryptocurrency by the hundreds of millions to
fund Kim Jong-un's military programs.
JOHN PARK, DIRECTOR, HARVARD KENNEDY SCHOOL OF KOREA PROJECT: Right now, with North Korea trying to figure out ways to open up border trade again,
the only sustainable recurring source of revenue in any meaningful way is the crypto theft angle.
MARQUARDT (voice over): Last year, according to the crypto firm, Chainalysis, North Korea stole an estimated $1.7 billion, nearly half of
the $3.8 billion in crypto stolen in '22 globally.
NICK CARLSEN, GLOBAL INVESTIGATIONS, TRM LABS: It is the kind of return on investment that North Korea can only dream about. Other things they can do
like mining, selling coal, iron ore, while tens of thousands of laborers, slave laborers, but this, they can do it with a handful of people and make
enormous sums of money.
MARQUARDT (voice over): To cut off this revenue stream, the US and South Korea are stepping up efforts with increasingly sophisticated tactics.
Last June, the California based crypto startup, Harmony was hacked for $100 million primarily in the cryptocurrency, Ethereum. The FBI determined that
North Korea was behind the hack.
[15:25:10]
South Korean Intelligence and American crypto investigators were quickly on their tail, able to track the stolen crypto through the system until the
moment they tried to convert it to a dollar-pegged account.
SEAN LYNGAAS, CNN CYBERSECURITY REPORTER: So there's a moment, you know, a matter of minutes where the North Koreans have to send the crypto money to
other accounts that they're not controlling, and that is when these private investigators, South Korean spies, the FBI, they try to pounce right then
and there.
MARQUARDT (voice over): But the sting seized just one percent of the amount stolen, or $1 million, showing just how big the challenge is to disrupt
North Korea's crypto schemes.
CARLSEN: To act at that moment of opportunity when we can do something that's extremely time intensive and difficult. To be able to provide law
enforcement with the tools, they need to track those asset movements in real time. That's the real innovation here.
MARQUARDT (voice over): The synergy between private crypto companies and Intelligence and law enforcement is growing. The Biden administration
credited with taking the threat seriously.
LYNGAAS: In my conversations with senior administration officials, they are emphasizing that this is indeed a regular part of the President's
Intelligence briefing.
MARQUARDT (on camera): This is North Korea and its criminal ways moving into the virtual age. As cryptocurrencies become more and more popular, it
means the opportunities for North Korean hackers also continue to grow. This is clearly an area Kim Jong-un is prioritizing and it is far less
labor intensive than other efforts.
Now in just the past few days, the State Department's envoy for North Korea met with Japanese and South Korean counterparts in Seoul, and together they
issued a statement calling out North Korea's crypto theft and reiterating they're working together closely to try to block it.
Alex Marquardt, CNN, Washington.
(END VIDEOTAPE)
QUEST: Good Lord. Who knew? Fascinating. Maybe Rana is right, keep your money in your wallet.
As we continue tonight, you and me, the COVID pandemic took a heavy toll on many businesses. Now imagine opening a chain of movie theaters during the
lockdown. Some investors are learning how much that will cost them, as we QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
[15:30:00]
QUEST: Hello. I'm Richard Quest.
One more "Quest Means Business" in just a moment. Shares in Regal Cinemas owner Cineworld hit an all-time low as the company says (INAUDIBLE) will be
wiped out.
And the Ugandan parliament has passed a bill, making it a crime to identify as part of a LGBTQ Plus community. The group says there will be negative
economic effect.
All of that in a moment. All the after-news headlines because this is CNN. And on this network, the news comes first.
Italy's coast guest says rescue operations are underway for two ships in difficulty in the Mediterranean carrying something like 1,200 microns
between them. The Humanitarian Observer say another large boat carrying hundreds more people has been spotted near Malta on Tuesday. Italy declared
a state of emergency to enable government services to offer more help in receiving a processing arrivals.
Myanmar ousted government says the ruling military Junta killed about a 100 people when its aircraft bombed and fired on a (INAUDIBLE), the Sagaing
region. Community government -- national energy government said schools of civilians were among the dead.
The government in Israel has announced it will Jewish visitors and tourist from the compound in the al-Aqsa Mosque in Jerusalem until the end of
Ramadan. Violence between Israel and Palestinians have been escalating since Israeli forces stormed the mosque last week, outraging people across
the Arab and Muslim world
Now, a spokesperson for the jailed Kremlin critique, Navalny, Alexei Navalny, says his health is rapidly declining. Kira Yarmysh says, Navalny
has lost eight kilograms in the past two weeks and is suffering severe stomach problems.
Matthew Chance is with me in Moscow. What is the latest on this, Matthew?
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Kira Yarmysh there, the spokesperson for Alexei Navalny, she says that things have got
so bad that an ambulance was actually called to the prison, which is about 150 miles or so to the east of Moscow, to treat Alexei Navalny. Although,
it's not clear what the diagnosis was because none of them have been told what the issue is.
Here's the most worrying thing about what Kira Yarmysh, she's saying. She's saying this, we don't rule out that at this time in prison, Navalny could
have been poisoned with something to make his health deteriorate slowly but steadily.
I mean, that sounds sort of fantastical. But when you consider the context of Alexei Navalny and the fact that in August 2020, he was diagnosed as
being poisoned with Novichok, a Soviet era nerve agent, then -- you know, you can see why, you know, there's such concern about this latest health
scare.
It's not the first time there's been a health scare. In fact, just in January, 500 doctors in Russia signed an open letter calling from more
medical attention for Alexei Navalny because they feel that he is being mistreated and, you know, basically, his medical conditions not being
properly looked at while he is in solitary confinement for much of the time in that high security penal colony, Richard.
QUEST: Now, there is this question of what would have caused -- I mean, the condition he's, you know, probably dreadful. But this suggestion that
some long-acting sort of poison or whatever. But I mean, we'll never know
CHANCE: Well, I mean, look, the Navalny team have said that they have requested a toxicology report to try and get to the bottom of what's behind
this. But it's not clear whether they'll get that report.
We have reached out to the Russian prison authorities. Well, I mean, it's quite late at night here. And so, I understand people aren't responding
immediately. And we haven't had a response yet. But I expect over the next couple of days there may be some official reaction to this.
But, you know, you're right. You know, in Russian prisons people do not tend to fair very well and diseases, like tuberculosis, for instance, are
endemic in the prison population.
QUEST: Matthew Chance in Moscow, where it is late and we're grateful. Thank you, sir.
[15:35:00]
Shareholders in the movie theater chain, Cineworld, will be completely wiped out under the company's bankruptcy plan. The stock is down 37 percent
to an all-time low us over penny, 1.09. The company submitted its final plan to a U.S. bankruptcy court in Texas. The shares have now lost their
entire value just about since listing on the London Stock Exchange in 2007.
Eleni Giokos is in Dubai. So, why have they faired particularly badly?
ELENI GIOKOS, CNN CORRESPONDENT: Well, it's a conference of things, right? Firstly, have $9 billion in debts. And this is a company that's collateral
damage, Richard, from the pandemic. I mean, you remember those days, we were under lockdown. No one is going to be -- but there's a few other
things, right? You've got Box Office ticket sales that are down 30 percent from 2019 and you also have movies that been released into theaters down 30
percent as well.
So, I think all of those issues together as well as inflationary impacts, of course, in many markets, people are not spending as much, people are
saying, well, I can catch on those on streaming services perhaps at a later date. I can stay at home. I don't have to spend so much money on my
popcorn, might not have to buy the slush puppie which I'm totally guilty of buying.
But then, spending a lot of money and people are thinking different in a way they consume, I guess, watching movies.
QUEST: OK. But the differenced here, I mean, is it -- how much of this is Cineworld's problem versus an industry problem? I mean, well, obviously,
AMC had the whole meme stock business going on. But it's difficult -- I mean, you know, people also going -- people are going back to the cinema.
GIOKOS: Well, that's the issue, people are not going back to the levels that they were. They're not going pre pandemic levels. And even AMC,
sitting with a lot of debts, have to do a bit of restructuring, thinking differently about its business.
This is an industrywide problem, and that's why you've got the studios now starting to strike deals specifically with movie theaters so that they are
released first in the theaters. They're trying to figure out a way how to circumvent the streaming services, because there has been a tug of war
between streaming and going to the theaters.
And by the way, in the movie theaters, 40 percent of revenue, of their margins actually coming through from their overly priced food, and they're
thinking about how to give the consumer a better experience, Richard.
I mean, you're talking about a lot of debt. I mean, Cineworld has $8 billion, $8.8 billion in debt.
QUEST: Right.
GIOKOS: They're trying to sell (INAUDIBLE) and Ireland and U.S., and they couldn't get the right price. So, they decided not to sell anymore. Now,
they're going to their creditors to ask for assistance. Shareholders are going to be completely wiped out. It's look like a disaster at this point
in time. I just -- I wonder what way to from here.
QUEST: Well, I'll take -- next time I'm in Dubai, I'll take you and the family to the movies. There we go. How about that?
GIOKOS: You're going to take me to the movies, Richard?
QUEST: Not a problem. Absolutely, right. Thank you, Eleni Giokos.
Now, after the break, Uganda's parliament has adopted an oppressive ant-gay bill. Major business coalitions now warning that signing it into law will
cost Ugandan economy dearly. The group's director in Kenya is with me after the break. "Quest Means Business."
(COMMERCIAL BREAK)
[15:40:00]
QUEST: When Uganda's parliament approved one of the world's harshest anti- gay bills, I made my views absolutely clear on it, I said, Uganda's economy would suffer if it threatened to imprison people who identify as LGBTQ.
Now, a major business coalition has some estimates about the potential costs. It's the group Open for Business, which says, countries that don't
criminalize same-sex relations attract four-and-a-half times more foreign investment than those that do.
Yvonne Muthoni is the Kenya country director for Open for Business. She joins me now from Nairobi.
I suppose the critics will say, well, you would say that, wouldn't you, in a sense, you would argue that it helps business, but where's the evidence?
YVONNE MUTHONI, KENYAN COUNTRY DIRECTOR, OPEN FOR BUSINESS: Thank you, Richard, and thank you to the International Chamber of Commerce for being a
great partner, by creating opportunities like this for us to speak about the work that Open for Business does with the private sector for LGBTQ
inclusion.
Just to explain who Open for Businesses is, we are a coalition of about 14 global companies advancing LGBTQ equality all over the world, and
particularly, in challenging markets. For us, challenging markets are markets where LGBTQ communities still face challenges with the laws as they
are.
Our partners include Microsoft, Google --
QUEST: All right. Yvonne, tell me, the evidence that Uganda's economy will suffer.
MUTHONI: Yes. So, the economic costs, you know, we've seen data that shows that open and inclusive societies are more innovative, more entrepreneurial
and more productive. And the data from all over the world where we work results in similar findings.
We know that when countries criminalize homosexuality that they lose out economically. There are economic impacts to these laws that are springing
up and coming up across Africa. The economic case in Kenya --
QUEST: Right.
MUTHONI: -- can provide an overview of what the economic impact in Uganda would look like.
QUEST: OK. So -- and yet, at the same time, these countries, particularly Uganda and others, are moving towards these more repressive laws. So,
they're either saying they don't believe you or they don't care that the commodities at markets, the commodities, investors. And so, maybe we won't
have those funny, sort of, nice companies, but will still have commodities oils, energies, banking.
MUTHONI: Yes. And our work, as Open for Businesses, is to continue to highlight the case for the economic inclusion of LGBTQ individuals and the
case that this is a business issue and this is an economic issue.
And I'll give a good example of the effect of this. We've already seen how this bill has affected tourism, and we have confirmed reports that
businesses have withdrawn their bookings as a result of the AHB, Anti- Homosexuality Bill. So, it's not that they don't believe this, it's not that governments don't to see that this is an economic issue, it's that
they're more drawn to criminalizing people identifying as LGBTQ.
QUEST: So, the governments always say, and I've heard this a million times, that the -- either on religious grounds or the population don't want
LGBT people. I mean, whether you want them or not, they're there anyway. But you know what I'm saying. The governments are refusing to lead on this
issue. Why do you think that is?
MUTHONI: I think the work comes in -- when businesses pick out and explain and articulate towards the business issue is. This is not about politics.
This is about sound business, judgment and good economic policy. This isn't about being politically correct. This is about businesses committing to the
global standards of best practice that they've all signed up for.
[15:45:00]
QUEST: Related to that, how concerned are you by trends and developments here in the United States? The Florida don't say Gay Bill, the Anti-Drag
Bills that are now populating the United States. Because in countries like Kenya and say Uganda, these will be used as examples, well, if America does
that, what are you complaining about us doing this?
MUTHONI: Yes. I mean, policies of this kind are tackily out of step with the significant efforts that have been going on in the global world. Human
rights efforts and also, global business communities to be more inclusive, not less. To unlock value through diverse perspectives and backgrounds for
customers, shareholders and society at large.
It is concerning that the work that has been put into LGBTQ inclusion is seemingly going back to the dark ages and it is worrying because we are
seeing that contagion spreading to Africa, spreading to Uganda. Kenya has submitted a Family Values Bill. So, it is very concerning for us as a
community.
And as a society that is just coming off of the impact and especially, the economic impact of COVID. So, it is very concerning. And that's why we are
calling on businesses and encouraging more and more business to speak on the issues.
QUEST: Good to see you. Thank you. I'm grateful. A lot more of this on the profitable moment at the top of the hour. Thank you.
Ireland has given usually a warm welcome to U.S. presidents. It goes back to JFK's ramp (ph) of visit in 1963. After the break, Donie O'Sullivan
reports from Ireland.
(COMMERCIAL BREAK)
QUEST: Returning to one of our top stories. President Biden is set to London Ireland in roughly an hour. The president's heritage makes his trip
a bit of a homecoming. CNN's resident Irishman Donie O'Sullivan reminds us the history of U.S. presidents is littered retirees (ph) to the Emerald
Isle (ph).
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I'm currently at probably the most highly regarded landmark in Ireland.
UNIDENTIFIED MALE: Welcome to Barack Obama Plaza.
DONIE O'SULLIVAN, CNN CORRESPONDENT (voiceover): It's become a viral favorite on TikTok, on the side of an Irish motorway, a rest up named after
President Barack Obama.
BARACK OBAMA, FORMER U.S. PRESIDENT: Hello, Ireland. My name is Barack Obama of the Moneygall Obamas.
[15:50:00]
O'SULLIVAN: Barack Obama Plaza was built here in the tiny village of Moneygall, where Obama's ancestors immigrated from in the 19th century.
OBAMA: I suspect you don't always dress up this much.
O'SULLIVAN (voiceover): Obama visited the village in 2011.
OBAMA: Cheers.
O'SULLIVAN (on camera): So, that makes you guys --
HENRY HEALY, EIGHTH COUSIN TO FORMER PRESIDENT BARACK OBAMA: Eighth cousins.
O'SULLIVAN: OK.
HEALY: Yes.
O'SULLIVAN: And what's your nickname?
HEALY: He gave me the nickname Henry VIII.
O'SULLIVAN (voiceover): Henry Healy is Obama's distant cousin and is now a manager at the Barack Obama Plaza.
O'SULLIVAN (on camera): I think it definitely raises some eyebrows in the United States when they hear there is a rest stop at the side of a highway
named after an American president.
HEALY: There does be some shock and awe. The cardboard cutouts that we have here are phenomenally popular.
UNIDENTIFIED MALE: Thousands cheer with the enthusiasm that only Irishman can muster.
O'SULLIVAN (voiceover): Ireland's love affair with U.S. presidents began when President John F. Kennedy visited his ancestral home here in New Ross
County, Wexford in 1963.
O'SULLIVAN (on camera): And you were sitting in the front row?
MARK MINIHAN, IN CROWD FOR JOHN F. KENNEDY'S 1963 SPEECH IN IRELAND: I was about, I'd say, maybe 10, 15 yards out there.
O'SULLIVAN (voiceover): Mark Minihan's dad was mayor of New Ross at the time and was to introduce Kennedy to the crowd.
UNIDENTIFIED MALE: Can you hear me now? Can you hear me?
O'SULLIVAN (voiceover): Some of the microphone stopped working just as JFK arrived.
MINIHAN: The microphones broke down just before he started. So, he was even more uptight.
O'SULLIVAN (on camera): The microphones broke down?
MINIHAN: The microphones broke down when President Kennedy was only over at the -- coming along the street here.
UNIDENTIFIED MALE: We're in right trouble now.
O'SULLIVAN (voiceover): The technical glitch was eventually resolved and the speech ended up going ahead.
JOHN F. KENNEDY, FORMER U.S. PRESIDENT: It took 115 years to make this trip.
O'SULLIVAN (voiceover): A trip which included a visit here.
UNIDENTIFIED MALE: So, this is the original farmyard. The president -- the president's great grandfather, Patrick Kennedy, left from him. He actually
left through that gate, the same gate --
O'SULLIVAN (on camera): Oh, wow.
UNIDENTIFIED MALE: -- during the famine when he went off to Boston.
O'SULLIVAN (voiceover): Like many Irish Americans, Kennedy's great grandfather immigrated to the United States during the Irish potato famine.
UNIDENTIFIED MALE: I think he decided to come back to Europe and show that he was proud of his peasant roots.
O'SULLIVAN (voiceover): Kennedy began a tradition of presidential visits to Ireland. Reagan visited in 1984.
RONALD REAGAN, FORMER U.S. PRESIDENT: So many Irish men and women from every walk of life played a role in creating the dream of America.
O'SULLIVAN (voiceover): The interiors of this pub in Reagan's ancestral village of Ballyporeen were eventually shipped to California to the Reagan
Presidential Library. Now, perhaps the most Irish of Irish American president is about to visit the country. And his cousins, the Blewitts,
here in Ballina County Mayo are getting ready.
O'SULLIVAN (on camera): Tell us how you're related to the president, first of all.
JOE BLEWITT, IRISH RELATIVE OF PRESIDENT JOE BIDEN: So, my dad is his third cousin. So, his great, great grandfather, Edward Blewitt, left
Ballina in the 1860s. And he went to -- moved to Scranton.
O'SULLIVAN: Girls, how does it feel to be related to a president?
EMILY BLEWITT, IRISH RELATIVE OF PRESIDENT JOE BIDEN: It's very exciting.
LAUREN BLEWITT, IRISH RELATIVE OF PRESIDENT JOE BIDEN: Yes.
E. BLEWITT: He's president.
O'SULLIVAN: And have you met him before?
E. BLEWITT: Yes, we've met him twice.
LAUREN BLEWITT: Yes, we've met him twice, yes.
O'SULLIVAN: What did he say to you?
LAUREN BLEWITT: He was just eating our chips. And when the fancy meals came out, he just wanted the chips and chicken nuggets. So --
O'SULLIVAN: He was stealing your chicken nuggets?
E. BLEWITT: Yes.
LAUREN BLEWITT: Yes.
O'SULLIVAN (voiceover): Biden's ancestors, the Blewitts and the Finnegans, immigrated from counties Mayo and Louth.
O'SULLIVAN (on camera): Your dad and Joe Biden are third cousins?
LAURITA BLEWITT, IRISH RELATIVE OF PRESIDENT JOE BIDEN: Yes.
O'SULLIVAN: But you seem to be the favorite cousin.
LAURITA BLEWITT: I don't know why, but, well, maybe it's just my personality.
JOE BIDEN, U.S. PRESIDENT: Hi, everybody.
O'SULLIVAN (voiceover): Biden has visited Ireland in the past and Laurita Blewitt has made multiple trips to the White House. But this would be the
first time they will welcome him to Ireland as president.
LAURITA BLEWITT: We've struck up a great friendship since the first day that we met. You know, his family are steeped in Irish traditions. He --
you know, he talks about it all the time. And so, he tells great stories of growing up and basically, growing up in an Irish household, even though,
you know, obviously, they were very much American.
O'SULLIVAN (on camera): Yes.
O'SULLIVAN (voiceover): From accepting the Presidential Medal of Freedom.
BIDEN: You know, I can't let a comment go by without quoting an Irish poet.
O'SULLIVAN (voiceover): To accepting the Democratic Party's nomination for president.
BIDEN: The Irish poet Seamus Heaney once wrote -
O'SULLIVAN (voiceover): Biden always seems to have a line of Irish poetry to hand.
BIDEN: But then, once in a lifetime, the longed-for tidal wave of justice can rise up and hope and history rhyme.
J. BLEWITT: And he's just so proud of his Irish roots. Like he's really proud of his Irish roots. Yes, we have had the other presidents, but this
president is more important, I think, to Ireland than the rest of them.
O'SULLIVAN (voiceover): Donie O'Sullivan, CNN, County Mayo, Ireland.
(END VIDEOTAPE)
QUEST: We'll be watching closely. The markets are mixed. Tomorrow's inflation report and the data has given up a lot of its gains. You saw it's
much higher when we started. But there we are. It's fallen off its session highs. And looking at Dow -- the Dow 30, Caterpillar leads to the second
straight day. (INAUDIBLE) is 3 percent.
[15:55:00]
Microsoft is the low. Goldman Sachs is in the green report, earning next week. Boeing is about half a percent higher. Delivers more planes and
aiports (ph) in the first quarter. That's unusual. Tech is lagging ahead of tomorrow's inflation. Report with Apple sales force. Microsoft at the
bottom. But they have very good gains of late.
I'll have a profitable moment, a different one in a moment.
(COMMERCIAL BREAK)
QUEST: Tonight, a profitable moment. Yesterday, I was proud and pleased to become a U.S. citizen. It had taken many years and I finally raised my hand
and took the oath at the ceremony here in New York. It made me reflect on that today as we cover the story of Uganda and the anti-gay bill. Because
I'm also, as it's well known, gay and quite openly out about it.
And it means that under the new law, I really couldn't go to Uganda because I would be committing an offense as I do identify as being gay. So, why am
I bringing that to your attention? Because those economies that attract -- I'm not saying me, the biggest, the brightest, the most open, the diverse,
whatever you want to say, will be the winners in the future.
There were 140 people who took the oath with me yesterday. They were all looking for a new life here in the United States. Now, countries like
Germany, France, the U.K, of which I've still kept my citizenship, they are also, of course, going to attract the best and the brightest because they
are open, diverse and tolerant.
As for Uganda, you have to be left in the position of saying, well, yes, you have that law, but how are you going to attract the best talent in the
world? Who is going to want to go there if you're feeling that you can't be who you are? Which is why at yesterday's ceremony, I was proud and
privileged to both become a U.S. citizen and have my husband standing next to me when I took the oath. That's what it means to be in an open and free
economy.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I hope it's profitable.
(COMMERCIAL BREAK)
[16:00:00]
END
