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Quest Means Business
Officials: At Least Nine People Killed More Than 900 Injured In Taiwan Earthquake; Key Israeli War Cabinet Member Calls For Early Election; Disney Wins Proxy Battle Against Trian's Nelson Peltz; U.S. Cities In The Path Of Total Solar Eclipse; Australian Winemakers Rejoice As China Business Returns; Special Counsel Blasts Judge's Order In Classified Docs Case; Uganda Court Upholds Anti-LGBTQ Act. Aired 4-5p ET
Aired April 03, 2024 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:04]
JULIA CHATTERLEY, CNN INTERNATIONAL HOST: Cheering, smiling end to the closing bell and the trading session on Wednesday. The doubt just ending
the day I was going to say eking out gains there at the end, but probably not. We will call that unchanged.
Still questions being asked about when indeed, the Federal Reserve can cut rates this year. Bonds are under pressure and therefore, so are stocks.
Those are the markets and these are the main events: Rescue crews in Taiwan race to free dozens trapped after the most powerful earthquake in 25 years.
Bob Iger is King of Castle at Disney after shareholders back him in the face of activist investors' challenges.
And award-winning singer and producer, Raye joining us live, well talk about how she is fighting for songwriters in the digital age, and much
more.
Live from New York, it is Wednesday, April 3rd, and Julia Chatterley, in for Richard Quest and this is QUEST MEANS BUSINESS.
Good evening once more.
Multiple aftershocks are hampering rescue efforts in Taiwan as crews there try to reach people trapped after a powerful earthquake.
At least nine people have lost their lives and hundreds have been hurt. The heaviest damage was reported near the epicenter in Hualien County. Dozens
of buildings there are damaged or have collapsed, more than 70 people have been trapped in two mines.
Ivan Watson is there in Taiwan.
Ivan, they are familiar with the damage, the pressure, the dangers of earthquakes given their positioning. How has that played into what we are
seeing today and what can you tell us about the latest in the rescue efforts?
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Right. So this is a place where people are accustomed to earthquakes, and yet, the power and
the intensity of this earthquake did alarm some people, some people saying they've never experienced anything of this force before, a deadly tremor.
And as you pointed out, there are efforts still underway to try rescue, at least 71 miners that are believed to be trapped authorities say in two
mines in that county, Hualien, up in the mountains, which is the epicenter of this historically powerful earthquake.
(BEGIN VIDEOTAPE)
WATSON (voice over): Just before 8:00 AM on Wednesday, the ground in Taiwan starts to shake. The island rocked by the most powerful earthquake to hit
Taiwan in a quarter century.
UNIDENTIFIED MALE: Okay, a big one.
WATSON (voice over): In the capital, Taipei, CNN photojournalist, John Mees tries to protect his wife and children as the walls of their home lurch
back and forth.
(UNIDENTIFIED FEMALE speaking in foreign language.)
WATSON (voice over): "An earthquake has just hit," announces the anchor of this morning news show, as she struggles to stay on her feet.
But the worst damage is at the epicenter in the rugged mountains of Hualien County on the island's East Coast.
(UNIDENTIFIED MALE speaking in foreign language.)
WATSON (voice over): The 7.4 magnitude earthquake triggers massive landslides. Authorities say several people were killed by falling rocks.
In the town of Hualien, apartment buildings on the verge of collapse. Emergency workers in action. Authorities say they've rescued scores of
people from toppled buildings and highway tunnels, but more than 900 people have been injured and rescue teams are still trying to reach others trapped
high in the mountains.
The work has continued in Hualien throughout the night.
(LEE ZHI-JING speaking in foreign language.)
WATSON (voice over): "No one is left inside this building," says this firefighter. He adds: "People are frightened."
(CHUNG TING-HSUAN speaking in foreign language.)
WATSON (voice over): "There are constant earthquakes here," says this woman. "I've lived here 50 years and never felt one so big. It's really
scary."
People in Taiwan are accustomed to feeling the earth shake, but rarely with this much destructive force.
(END VIDEOTAPE)
WATSON: One of the challenges now, Julia, is that a lot of the roads that run through these mountains to reach that area of Hualien from the capital,
Taipei, they've been cut off by those landslides that have blocked the entrances to tunnels, for example.
[16:05:00]
Though you can reach that town from the south of the island, one of the complicating factors as well is the large number of aftershocks.
The Taiwanese authorities are predicting that there could be powerful aftershocks up to a magnitude of six or more for the next three to four
days.
Meanwhile, the US Geological Survey, it says that in the first 12 hours after the initial earthquake, there were dozens of strong aftershocks, some
of them with a magnitude of five, one even a magnitude of six.
One striking thing is that you come to a place like Taipei, where people are accustomed to earthquakes and yes, this was alarming in the morning,
what people felt here, and yet the city was back up on its feet and moving very much so.
And the same could be said, eyewitnesses say, to the town of Hualien, yes, there were some buildings that were being demolished where rescue efforts
had been underway, but businesses in other parts of the town were very much back to life as usual already.
Electricity, for example, had not been shut down and that shows you how resilient many Taiwanese communities are despite the power of this, again,
historically powerful earthquake -- Julia.
CHATTERLEY: Yes. Pretty incredible, the level of preparedness to your point, Ivan. But as we said, 25 years since we've seen one this big.
We wish everyone well and safe. Ivan Watson, thank you.
Now, a top member of Israel's War Cabinet is calling for early elections amid growing criticism of Prime Minister Benjamin Netanyahu.
Benny Gantz, one of Netanyahu's main rivals called for a vote in September. He joined the Cabinet in October as a show of unity.
Now after Gantz's speech, opposition leader, Yair Lapid said on X that the current government should resign, "as early as possible."
Meanwhile, Jose Andres, the founder of World Central Kitchen accused Israel of targeting his workers in that airstrike on Monday.
(BEGIN VIDEO CLIP)
JOSE ANDRES, FOUNDER, WORLD CENTRAL KITCHEN: In the process, we know that they were trying to call, but in the chaos of the moment, whatever happened
to try to be telling IDF that, why are they doing that? They were targeting us in a deconflicted zone, in an area controlled by IDF, them knowing that
was our teams moving on that route.
(END VIDEO CLIP)
CHATTERLEY: And in the last few minutes, a US official telling CNN that President Joe Biden will talk to Netanyahu on Thursday. That will be there
first conversation since the death of those aid workers.
Jeremy Diamond is in Jerusalem.
Jeremy, I know you've heard what Jose Andres say what he said many times it does though fit directly with what you've been reporting since Monday and
the facts on the ground as we see it.
JEREMY DIAMOND, CNN CORRESPONDENT: Yes, there is no question that Jose Andres' comments here reflect the facts that as we've seen from the footage
on the ground of these three different vehicles about one-and-a-half miles separating the first vehicle from the third vehicle, it is very clear, as
Jose Andres is saying here, that these appear to have been separate strikes and they also appear according to an arms expert who spoke with us to be
precision-guided strikes likely carried out by a drone with surveillance giving the Israeli military full visibility into the situation.
And it is also clear that there are a number of reasons why these vehicles should not have been struck, starting with the fact that they had given the
Israeli military warning beforehand about the convoys' movements, the logo that appeared on at least two of the vehicles of the World Central Kitchen,
and then of course going beyond that, the fact that they were traveling on this road, which was a deconfliction route and which the Israeli military
already controlled and had a visibility of.
So, a number of questions that the Israeli military still has yet to answer, even as they are accepting responsibility for this, acknowledging
that it was a grave mistake and going so far as to how have the Israeli military's top general, Herzi Halevi delivering a video statement publicly
apologizing on behalf of the military for this strike.
Going forward, the military says that they are going to establish a joint command center to coordinate, to better coordinate the delivery of
humanitarian aid in deconflicted with Israeli military operations in the area, but of course we know that humanitarian aid agencies for months now
have been talking about the problems with that deconfliction, the lack of coordination with the military, which put their workers in danger. And in
this case, in a very fatal way for seven workers the World Central Kitchen.
CHATTERLEY: Yes, it is a mistake, but a devastating one, nonetheless.
Jeremy, the words of the British Prime Ministers still ringing in my ears from yesterday when he called the situation "increasingly intolerable" and
it now seems even the likes of Benny Gantz, who is, of course the main opposition leader, but he also joined this Unity War Cabinet after October
the 7th now coming out stringently against Benjamin Netanyahu and saying, look, we need change, we need fresh elections.
[16:10:14]
DIAMOND: Yes, I mean, I would be careful to distinguish between on the reasons for why Benny Gantz is doing so. He is a member of this War
Cabinet. If you were to be prime minister, it is hard to imagine that he would be conducting this war in Gaza in a very different way from the way
that the Israeli Prime Minister is conducting it.
But he is also and remains, the Israeli prime minister's chief political rival, and at a time when the Israeli prime minister is facing very low
approval ratings in this country, there are rising protests calling for new elections, Benny Gantz today stepping out into the fray and calling for
elections to be held by September.
That is the first time and that he has done so, and it is obviously a very public step for him to take, one that he does not take lightly.
We know that his team has been considering for months the possibility of him leaving the emergency War Cabinet, so far, he has decided to remain in
it for the sake of unity in the country.
But now, we are seeing him take at least one step out in the open in defiance of the Israeli prime minister, making it known that he believes it
is time for new elections, time for the Israeli people to show that they have confidence in their government and for Israel's political leaders to
face their reckoning.
CHATTERLEY: Yes, the pressure on this government certainly building.
Jeremy Diamond, thank you for that report.
Now, Disney's leadership has emerged victorious after one of the most expensive proxy battles in history.
Trian Fund Management had put its founder, Nelson Peltz up for a board seat after he criticized Disney's streaming business and theatrical flops.
The shareholders overwhelmingly rejected the challenge, Disney's CEO, Bob Iger, thanked investors for backing him.
(BEGIN AUDIO CLIP)
BOB IGER, CEO, DISNEY: I just wanted to take a moment to thank our shareholders for your trust and confidence in the Disney board and
management and the ambitious strategy we are implementing across our businesses to build for the future.
Now that this distracting proxy contest is behind us, we are eager to focus 100 percent of our attention on are most important priorities -- growth and
value creation for our shareholders, and creative excellence for our consumers.
(END AUDIO CLIP)
CHATTERLEY: And Disney spent tens of millions of dollars in the boardroom fight, it even put some of its famous characters and materials provided to
convince shareholders.
Let's get to Sara Fischer now out to talk more about this.
It was expected to go Bob Iger's way, but I think you get a sense perhaps of after what has been months and months and months now of building
pressure, some relief today for Bob Iger and the Disney board.
SARA FISCHER, CNN SENIOR MEDIA ANALYST: Huge relief because this has been so distracting. There are so many things that Disney is looking to do right
now that they've had to put on hold, and it is the thing I keep hearing from executives across the company, we couldn't move forward until the
proxy fight was done.
Now, they thought they were going to win this, particularly because Disney to your point, has far more retail shareholders, meeting everyday investors
than most average companies do, 40 percent of their investor pool comes from everyday people.
And because of the strength of the brand, they thought that would help them to pull the win, but still, they didn't want to move forward with a lot of
projects until this was off the plate. And so I definitely think Burbank is breathing a sigh of relief and expect them now to move forward with
rigorous projects, streaming with ESPN, rebuilding the studios, et cetera.
CHATTERLEY: Yes, I mean, well, a third of their investors are retail and I actually watched it and it was like a political campaign using Disney
intellectual property, it was actually very cleverly done.
The problem I've got is that if you looked at what Nelson Peltz was saying, look, he was saying that we have to stop with these theatrical flops. We
need Netflix-like margins. It all makes sense. It is very -- not very much different from what Disney is already saying.
The problem is, how do you go from A to B? It is like -- it is difficult for all media companies at this moment.
FISCHER: Yes, I think that was the big problem by the way, with the Nelson Peltz argument. Nothing he was saying was so extraordinary that Disney was
already considering.
CHATTERLEY: Right.
FISCHER: You know, he said, all right, I want you to be a little bit more cost-efficient. Okay, Bob Iger did 7,000 layoffs. Improve your studios? I
am sure Bob Iger wants to be doing that, too. They haven't had major theatrical hits.
But in terms of getting from Point A to Point B, Julia, I think the big change that they're going to have to do is rethink distribution, and they
are starting to do that thinking about pulling ESPN out of the cable bundle, creating more direct-to-consumer products.
They also have to rethink what they're doing with parks. They announced last year that they are going to double the investment in parks over 10
years, and that's because they need to lean more into experiences while they figure out how to lift the margins on the TV side.
Remember, television cable was so lucrative for so many years. Once you move over to streaming, your margins aren't as big, so they need to figure
out where they are going to get the money from in the meantime.
I think, overwhelmingly what this suggests, by the way, is that activists are going to have a hard time not just for media, but in general. We've
seen some rule changes that have resulted in more activist settlements. I think the big loss from Trian and that's what Nelson Peltz will quiet a lot
of activist investors moving forward.
[16:15:20]
CHATTERLEY: Yes, I was going to ask you that whether this has a chilling effect. Do you think it ends the Peltz pressure specifically on Disney
though, because this was so embarrassing, and an enormous loss for him, but I think what became clear is that Bob Iger, actually doesn't want to deal
with him either, so I just wonder whether if he'd just stay around and still sort of try to stick the knife in, even if he has not got board seat,
whether Bob Iger can be bothered to deal with him and his exit plan still is what? 2026. Does he stick around even if Nelson Peltz remains an
irritant if not on the board?
FISCHER: Well, one of the big complaints from Nelson Peltz is that the succession planning was not up to par from his purview, so I think that
that's going to continue to be an issue for Bob Iger and for Disney.
But look, Nelson Peltz and Trian still have a substantial stake in the stock, so there are going to be people who are going to want to have their
voices heard.
I think this relieves a lot of pressure, Bob Iger doesn't have to address every little thing to prevent another activist push, but I think what this
shows by the way, overwhelmingly is that there is just a lot of confidence in Bob Iger.
You know, this was a board vote, but really it was about Iger's strategy, that was on the line here, and I think a lot of people think that Bob Iger
has got this under control. You know, it is not going to be pretty, this is a company who has dealt with a lot, not just the pandemic and the closure
of the parks, not just with the transition to streaming and the core cutting, but also trying to now figure out what is their future in an AI
world, right?
They are an IT company, they are going to have a lot of challenges there. This vote suggests that they think Bob Iger, at least for the short term is
the person to be leading on that.
CHATTERLEY: Yes, and if Nelson has got a problem with it, then his option now is to sell his shares.
FISCHER: Exactly right.
CHATTERLEY: He can do that. He can vote with their feet. We will see.
Sara Fischer, great to have you. Thank you.
FISCHER: Thank you.
CHATTERLEY: Now, Trump Media is suing two of its co-founders in an attempt to eliminate their stakes in the company. Both of them are from Trump's
"Apprentice" reality show. More after the break.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to QUEST MEANS BUSINESS.
NATO's foreign ministers having mixed response to a proposed five-year $100 billion funding plan for Ukraine. The alliance's secretary general, Jens
Stoltenberg, wants to shield Kyiv from the "winds of political change" or perhaps in other words, to Trump proof Ukraine's funding.
[16:20:04]
The proposal was put to ministers that are gathering in Brussels. It would also give the alliance a more direct role in managing the supply of weapons
to Kyiv, too. That task is currently coordinated by an informal coalition led by the United States.
Thierry Breton, one of the EU's top officials recently told this show that it was time for Europe to manage its own defenses.
(BEGIN VIDEO CLIP)
THIERRY BRETON, EU COMMISSIONER FOR INTERNAL MARKET: We should have our destiny in our hands. Of course, we have allies, the United States, but
regarding what we see, there is a very big consensus now, here in Europe that we need to take our destiny into our hands.
In other words, we can do everything now in terms of our defense industry.
(END VIDEO CLIP)
CHATTERLEY: Our international diplomatic editor, Nic Robertson has more.
(BEGIN VIDEOTAPE)
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Julia, Jens Stoltenberg, the NATO secretary general had started the day by saying that
there need to be a change in the dynamics of support for Ukraine that is needed to be a multi-year process.
He spoke as well, 75th anniversary of NATO coming up the following day, 32 nations for the first time joined by the Swedish foreign minister.
But as we began to understand from the secretary general, this is a meeting about sort of setting up the basis for agreement, but not the details about
it.
So he did lay out some bare bones of what they'd agreed.
(BEGIN VIDEO CLIP)
JENS STOLTENBERG, NATO SECRETARY-GENERAL: Today, allies have agreed to move forward with planning for a great NATO role in coordinating security
assistance and training. The details will take shape in the weeks to come, but make no mistake, Ukraine can rely on NATO's support now and for the
long haul.
(END VIDEO CLIP)
ROBERTSON: Even so, Stoltenberg was pressed by journalists for more details. One of them asking about reports that that it was a $100 billion
commitment he was looking for over five years though some have reported the question was to Trump proof NATO, that if Donald Trump should be re-elected
US president, that somehow this military aid package for Ukraine could withstand and sustain during the period of his presidency.
Now, the secretary general, as he typically does, didn't again, get into details, said, look, you've been briefed by someone, but not briefed by me.
But what he wanted to achieve and what NATO is trying to achieve here is this financial commitment that allows Ukraine to plan for the coming years
of the war, know that it can have enough ammunition, let's say if it chooses to have an offensive in 2025 and for defense providers,
manufacturers throughout Europe, the United States, to know that there is long-term commitment for them to produce the armaments so that of course is
where the devil will be in the detail of those details Stoltenberg hasn't yet spoken about and says, will be worked out in the coming weeks and
months.
Nic Robertson, CNN, London.
CHATTERLEY: And it was another bumpy day for Trump Media shares, falling more than five percent in Wednesday's trades. There is new drama involving
the country's leadership -- company's leadership.
Trump Media has filed a lawsuit against two co-founders seeking to eliminate their stakes.
Matt Egan has more.
MATT EGAN, CNN REPORTER: Julia, this is yet another legal twist in what has already been a fee bonanza for the legal profession.
Now in essence, the founders of Truth Social are fighting amongst themselves. They are arguing over their stake in a company being valued in
the billions of dollars, billions of dollars despite the fact that Truth Social user base is shrinking and the company makes little revenue.
Now, in this lawsuit, Trump Media, the Truth Social owner controlled by former President Donald Trump, Trump Media isn't just suing two of its own
co-founders, it is suing to former contestants on "The Apprentice," the NBC show that helped fuel Donald Trump's rise.
Now the lawsuit alleges that Andy Litinsky and Wes Moss fumbled the launch of the company and the lawsuit calls for a judge to zero out their stakes
in the newly public company. That would wipe out states currently worth nearly half a billion.
Let me read you parts of the lawsuit: "Moss and Litinsky failed spectacularly at every turn. They failed to get the corporate governance
established, they made a series of reckless and wasteful decisions at a critical time that caused significant damage to Trump Media."
Now, Trump Media's lawsuit goes on to claim that the two were "riding President Trump' coattails" and that without Trump, "Truth Social would
have been impossible."
Lawyers representing the company through which Litinsky and Moss do business declined to comment, but this comes after Litinsky and Moss, they
filed a lawsuit of their own in Delaware, arguing that Donald Trump, the former president was planning to drastically water down their stake in the
new company.
The legal fighting here continues and continues, and listen, hundreds of millions of dollars or even billions of dollars here are at stake -- Julia.
CHATTERLEY: Drama.
Our thanks to Matt Egan there.
[16:25:10]
Okay, still to come, could bad weather eclipse Monday's eclipse? Severe storms are expected in parts of the United States. We've got the latest
forecast next.
(COMMERCIAL BREAK)
CHATTERLEY: Hello, I'm Julia Chatterley, and there is more Quest Means Business in a moment when the singer-songwriter, Raye will be with me. We
will discuss her work on Beyonce's new album and her upcoming appearance on "Saturday Night Live."
And Australian winemakers are popping bottles after China lifted restrictive tariffs. We will speak to one of those who was impacted.
Before that, though, the headlines this hour.
Uganda's Constitutional Court has largely upheld and anti-LGBTQ law condemned by human rights groups. The law criminalizes same-sex
relationships and would impose the death penalty for acts it defines as "aggravated homosexuality."
The law has also been criticized by groups like the World Bank, which stopped new lending to Uganda after it was adopted.
Protesters in Argentina denouncing president Javier Milei's planned austerity measures. Milei wants to fire 70,000 government workers, sparking
a backlash from the State Workers Union.
Poverty in Argentina has soared as its inflation rate spirals.
[16:30:03]
And prosecutors in Donald Trump's classified documents case have submitted a new filing showing their frustration with the judge who was appointed by
Trump. The special counsel says the judge's request last month for potential jury instructions are "fundamentally flawed". The former
president claims his actions fall under the Presidential Records Act and should not be prosecuted.
Severe thunderstorms are threatening to eclipse Monday's eclipse over North America. Not only could they obscure the view of the highly anticipated
total solar eclipse, that could also affect millions of travelers hoping to witness the event. About 20 million people in the U.S. travel to another
city for 2017 total eclipse. Many more are expected to travel for Monday's event as the path will be much wider. You can see it there.
Meteorologist Chad Myers joins us now from the CNN Weather Center, also doubling up as eclipse central.
Chad, give us the latest on where should we and should we not be if we want to see this.
CHAD MYERS, CNN METEOROLOGIST: Well, you know, Julia, we've been forecasting this now for 10 days. About as far as the models go out, as far
as I felt comfortable, because I saw in the forecast, you know, 21 days ago. But the forecast really have not changed much and it does look like
parts of South Texas could not be probably the best place to be. And that's what we typically in the summertime, you get sunshine, it's a clear day in
Texas right now.
There's not a cloud in the sky, but that eclipse going right through the heart of Texas. And then all the way up even into Atlantic Canada. So here
it goes. Across Waco, millions and millions in the path of this. They don't even have to move. This is 122-mile-wide darkness across the globe all the
way up just to the east of St. Louis. You'd have to go off to Indianapolis, perfect viewing there. Across Cleveland, across my hometown of Buffalo, New
York, and then up into upstate New York, and then across Maine and even into New Brunswick.
So, yes, a long path of this. So many millions in the path, but so many millions here down across the deep south in the way, especially after 4:00.
Now the good news is, it's over after 4:00, but there could be severe weather building there for people trying to get home. These puffy clouds,
we call them cumulus, are sometimes -- as they go higher, they become more than cumulus. It could be cumulonimbus. That would completely block your
view.
There would be nothing to see if you're under one of those clouds. A cirrus cloud, no big deal. But, hey, we're still going to watch, we still have
about four to five days whether this changes. But the models haven't changed for the past six days. So this is our real threat.
Now, the total eclipse typically will run through this area of the northeast, which is a cloudy time. I lived in Columbus, Ohio, for a while
in my career, we had 61 days in a row where the sun did not come out. A cloud stayed in that Scioto River Valley and they never left. So do we have
that kind of scenario? No, not really because the pattern is moving.
But here's the American model showing so many clouds down here where I was pointing because of the rain possibilities and a little bit less, a little
bit thinner on up toward upstate New York. The European model has stayed right on its money, too, saying, this is exactly what I think. So models
haven't changed much, and I think this is the problem. We're going to see some rain showers across parts of the Great Lakes early in the day.
And then these storms could fire up across parts of Texas, Arkansas, and even as far north as about St. Louis, you just don't want to be under one
of those big thick clouds. You just want to be under a thin cirrus clouds and sometimes it's only three minutes, I understand. But it can be so cool
that the clouds can actually evaporate. So don't give up on it if you can't move. But this is going to be difficult for some people to get out of the
way of these clouds.
If can stay on the blue line here, you're in good shape at least for now. You know what, you're still going to have to wait another two or three days
for a perfect forecast because we can't do perfect. It's just not five days out just yet. We'll see -- Julia.
CHATTERLEY: Yes. And if you watch it, you still have to wear the appropriate goggles. But I'm still, I'm sidetracked --
MYERS: The best way to watch is on television.
CHATTERLEY: Exactly. You're right. On CNN.
MYERS: That's right.
CHATTERLEY: I'm still shocked by the 61 days without sunshine in a row. Is that why you ended up in sunny Atlanta?
MYERS: You want to talk about seasonal affective disorder, where people were just like buying, they're buying flood lights to put on themselves so
that they could get some kind of sunshine. At least even if it was fake, it was some type of light. It was a very tough couple of months without a peak
of sun.
CHATTERLEY: You need one of those lights that they put on flowers to make them very -- yes.
MYERS: I do hydroponics at home. I have plenty of those lights.
CHATTERLEY: Line to the hydroponics. I have to go, Chad. A pleasure, sir, as always.
MYERS: See you tomorrow.
[16:35:02]
CHATTERLEY: All right. And you can join us next Monday for the total solar eclipse as it travels from Mexico across America and into Canada. Our
special coverage starts noon Eastern, 5:00 p.m. in London.
All right. Coming up next for us winemakers in Australia have a reason to say cheers. China has lifted crippling tariffs on Australian wines. I'll
ask a winery owner what it means for her business.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to QUEST MEANS BUSINESS.
Australian winemakers can say cheers to getting back to business as usual in China. Beijing lifted crippling tariffs on Aussie wine last week. The
duties went as high as 218 percent. They were enacted more than three and a half years ago during a tense period between the two nations. Australian
officials welcomed the news and for good reason, too. The Chinese market for Australian wine was once worth more than $653 million.
Nikki Palun is an Australian winemaker, and she joins us now from Melbourne.
Nikki, fantastic to have you on the show. You've had a fascinating and challenging time over the last three and a half years. You're fluent in
Mandarin, I believe. Your business before this all happened was 95 percent exports to China, and then the tariffs hit. It was during the pandemic. And
you totally had to transition. How tough was that?
NIKKI PALUN, OWNER, OCTTAVA WINES: Well, I have to say it was incredibly tough. Actually in my life, I never imagined that it would be like a
perfect storm of having these two things happen at the same time. So it was -- there was a lot of very difficult moments in the last three and a half
years. That's for sure.
CHATTERLEY: But two things you learned, I think, was the ability to change its speed, but also the importance of diversification. Where are you today
and what do you produce?
PALUN: Well, I'm still obviously in the wine business. I'm a winemakers. So I love wine and it's something I'm so incredibly passionate about. But what
I did during the last three and a half years was diversify into not just other export markets so I now export to Korea, to Taiwan, to Japan, but
also really building strong foothold into the domestic Australian market.
And so also there's so many different channels there, so I've opened up a cellar door. I've got a little urban winery going now. I do lots of events.
I sell into restaurants and bars. So what this has actually done for me is to build a very strong foundation.
[16:40:00]
So now that China is open again, I'm able to have this very strong base as well as export to China. And that's the biggest thing that I've really
learned is that, as you said before, to diversify.
CHATTERLEY: Yes, a stronger, more diversified business. OK. So what was your reaction when you heard that the tariffs were going to lift?
PALUN: I was absolutely elated. I can't tell you how happy I was. It was just like a, you know, better than winning any prize in the world. It was
just incredible.
CHATTERLEY: OK. So talk to me about how quickly you think you can perhaps, and I'm sure you've already been talking to your contacts there about
shipping to China because obviously the market there has evolved. We've also got a global overcapacity problem. China is facing it, too. The
economic environment is changed. How are you going to approach it? And what are you expecting in terms of demand?
PALUN: Well, it's very interesting. Initially I was thinking that perhaps it would be a little bit less and I guess a little bit more cautiousness.
But what I'm finding so far is that a lot of my Chinese customers from the past have come back and some of them came back within minutes after the
announcement. And so I'm finding that there's -- I feel personally there'll probably be a little of a (INAUDIBLE) happen.
So, initially, I'll be able to get back into the market. I'm hopeful within the next four, five weeks you start shipping containers over there. And
then after that, I think we'll see. It might settle down a little bit as, you know, people start to find their feet in the new dynamics of the
market. You know, as you said, there's a -- you know, there's an economic slowdown in China at the moment.
So we'll see. However, that said, I really feel that I'm going to approach the market differently this time. You know, this is what's given me an
opportunity of not being there for three and a half years. You sort of think, well, how could I do it better? And what would I want to change from
last time? So I'm pretty ready to pack my bags and get on a plane and go to China, and just find some new opportunities as well.
CHATTERLEY: How is your business there going to evolve? Because that comment is really interesting. How is the approach going to differ this
time around? Because I read that you were selling around 200,000 cases in China. How much of that do you think you can capture? But to your point,
and I'll ask it again, how are you going to do this differently this time?
PALUN: Well, because I speak fluent Mandarin, it's actually gives me an incredible advantage in the market. And I've also been engaged in China for
actually nearly 30 years now. So I'm quite very, you know, comfortable with the culture and the way China works. So I plan to go to China and really
look for partners that I think want to work slowly and in a very long sense in the market because I think that's what's really important is to slowly
build up the brand, build up the customer base, and just build a very nice foundation.
But the other thing is really looking at two-way trade because I think that one of the things in the past that Australia did, we exported a lot of our
wines to China but I just want to start exploring well, what -- how can we work more closely together in a two-way trade perspective. You know, maybe
we should be seeing more Chinese wine in our shelves here in Australia.
CHATTERLEY: That's interesting, and that builds resilience for the business as well because they then have something that hurts them if those barriers
start to rise again, which I think are really important point. I mean, what we learned through that period was a false word, a false phrase. You say
the wrong thing, you accuse someone of doing something where COVID-19 is concerned, and that can create real geopolitical tensions and sort of
overnight tariffs can go from very low to being punitively high.
Are you concerned, Nikki, that something like that could happen again? It's not really something that you can prepare for. You just have to be aware of
it. Are you worried about that?
PALUN: I don't think I'm that particularly worried. I mean, our current Australian government, they have very skilled diplomacy and I believe that
their approach now hopefully shouldn't create any more tensions in the future. But that's to say, you can't really count. You can't discount that
that could happen again in the future. So it's certainly something I've very much learned is that, as I said, don't put all the eggs in one basket,
and really just try and make sure that you have that very diversified portfolio of different channels, different markets, different countries,
because it could happen again.
And that's something that I think every winemaker in Australia is aware of. But that said, you know, I hope it doesn't happen again. I feel -- I'm
hoping that that was just one moment in time and that future governments can learn from, you know, the mistakes of the past. And that we can just
continue on with a very, you know, mutually beneficial two-way trade.
CHATTERLEY: OK, I want to get your wine wisdom now. What was the average price of the bottles that you were selling to the Chinese market? And how
do tastes in the Chinese market perhaps differ to what you've now built in the domestic market, for example, or those that are drinking from Korea,
Taiwan, and Japan? Can you give us a flavor of how tastes different in the different countries and regions?
PALUN: Sure. So, well, that's just an interesting point. So China in the past, because I think China has evolved as well over the last three and a
half years. So China in the past was predominantly I guess that more premium entry-level wine. You know, wines that were this soft, they're red,
they're -- you know, they're quite approachable. Like low acidity, very quite fruitful.
[16:45:01]
And I think that's something that Australia has always done incredibly well, especially if you compare it to certain parts of, you know, the old
world wines as well. So that's what in the past. And then if you -- but I think now China actually has evolved. They've had three and a half years to
explore all the other different varietals and all the different regions in the world. And what I'm really seeing now is that I'm hoping and I'm seeing
that there's an interesting, more affordable entry level, but also into mid and also premium wines as well.
Not that there wasn't a premium wines in Australia before, but I'm saying that, for example, I make a Nebbiolo. And Nebbiolo is something that it's
light in color. It's got really interesting tannin structure. But the Chinese have actually taken incredible interest for it. It's something I
was not expecting.
So back to the other part of the question which is about different markets. So Japan, they have, they love pinot noir, their love chardonnay, and they
also love Australia Shiraz. So -- and they take the wines at many different price points. Japan is quite a mature market. In South Korea, for example,
I'm selling a lot of my other Italian varietals. So things like Montepulciano. Things like Friulano. Things like Nebbiolo again.
So that's absolutely fascinating. So I think with not just in an Asian sense, but I think globally I think the youth and the younger people, they
have a more exploratory, like they're more incurious about different styles. So I'm really hoping that the palate will broaden and then in the
future we can really just send all these different interesting styles and price points to all the markets around the world.
CHATTERLEY: Nikki, I love your enthusiasm. I'm so glad you stayed in the wine industry because clearly you're a perfect fit. It's wonderful
somewhere in the world to know I have a real taste. Yes, don't drink and drive on TV.
Nikki, great to chat to you. Good luck with rebuilding the China business.
PALUN: Thanks so much.
CHATTERLEY: Thank you.
All right. We're back after this for more QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to QUEST MEANS BUSINESS.
Earlier this week, I spoke with the CEO of chip and software giant Arm Holdings about artificial intelligence and the growing importance of
geopolitics in the tech sector. Here's what Renee Haas had to say about how the game has changed in a post-COVID world.
(BEGIN VIDEO CLIP)
RENE HAAS, CEO, ARM HOLDINGS: I think one thing that myself and just about every major technology CEO thinks about now is geopolitics, and if you were
to go back five years ago, I think even just a few years ago, the amount of energy that we spent and my brethren with folks in Beijing or in
Washington, or in Brussels, is at a different level.
[16:50:13]
And, you know, candidly, that's the world that we live in now. We now have to be much more mindful of the geopolitics. The issues that we face on the
globe. I think what the world has also recognized, particularly, you know, post-COVID, is at semiconductors are really, really important. And as a
result, whether it's myself or other CEOs in the semi-world, we spend a lot of time with government officials trying to understand and make sure that
we are navigating through all that because it's a different game now for us.
CHATTERLEY: You're also on the board of Softbank, which many my audience will understand a giant investor and has had a roller coaster ride over the
past few years as well, which is part of the form I think with the vision fund that they have. How did they and you, if you're wearing both those
hats, view not only the impact of the future of artificial intelligence, but also on where the limits should be applied, and perhaps swiftly for
safety purposes?
HAAS: It's top of mind whether it's Softbank, whether it's Arm. You know, frankly across our partners. I attended a U.K. AI safety summit last fall,
which put many countries together, many industry leaders, and maybe akin to the first time there was a discussion about climate change. It's almost on
that level where I think globally countries and companies need to get together to think about how to navigate AI safely.
(END VIDEO CLIP)
CHATTERLEY: OK, so I know it's hard to keep up with all of these, but I'm going to give you a quick reminder of Donald Trump's classified documents
case.
Paula Reid takes a closer look at what exactly the special counsel's team is requesting at this moment and the Trump team's counter arguments.
(BEGIN VIDEOTAPE)
JACK SMITH, DOJ SPECIAL COUNSEL: We very much look forward to presenting our case to a jury of citizens in the Southern District of Florida.
PAULA REID, CNN SENIOR LEGAL AFFAIRS CORRESPONDENT (voice-over): A trial in the Mar-a-Lago classified documents case appears highly unlikely to happen
before the 2024 election. And Special Counsel Jack Smith expressing frustration with Judge Aileen Cannon.
In a new filing late Tuesday, Smith's team said Cannon had ordered briefings based on a fundamentally flawed legal premise that had no basis
in law or fact.
JUDGE AILEEN CANNON, SOUTHERN DISTRICT COURT OF FLORIDA: My sincere thanks to the president for the honor of this nomination.
REID: Prosecutors harshly criticizing the Trump-appointed judge's request for hypothetical jury instructions. She asked both sides to take into
account the former president's claim that he had broad authority to take classified documents under the Presidential Records Act.
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: Whatever documents a president decides to take with him he has the right to do so. It's an absolute right.
REID: But prosecutors have repeatedly said that law is not relevant because Trump is accused of obstruction and storing highly classified material in a
bathroom and other unsecure locations at his Florida estate. Prosecutors also point out that telling a jury that Trump had the authority to take
records he wanted from the White House would make it nearly impossible to secure a conviction.
Prosecutors insist that legal premise is wrong, and a jury instruction that reflects that premise would distort the trial. But Trump's attorneys, who
were also asked to weigh in here, suggested that the judge tell jurors Trump was authorized to possess a category of documents defined as personal
records both during and after his term in office. The idea that classified documents belonged to Trump, Smith's team said is pure fiction.
JEREMY FOGEL, FORMER U.S. FEDERAL JUDGE: I was a judge for 37 years. I have never seen an order like this.
REID: Former federal judge Jeremy Fogel says the government will likely appeal.
FOGEL: If she makes that decision, and then the case goes to trial and then he's acquitted as he certainly would be with that instruction, the
government has no recourse. There's double jeopardy.
REID: But an appeal will likely further delay the trial, something Trump has been seeking in all his criminal cases. Critic say Cannon is playing
right into that strategy. She has yet to decide more than a dozen outstanding issues, including setting a firm date for the trial, and how
much witness information to keep under seal.
(END VIDEOTAPE)
CHATTERLEY: And that was Paula Reid reporting there.
Now a five-judge panel has upheld Uganda's anti-homosexuality act. The ruling keeps in place harsh laws that outlaw gay marriage, punishes same-
sex acts with life imprisonment and calls for the death penalty for so- called aggravated homosexuality. It also requires Ugandans to report violations to authorities. A member of the LGBTQ community spoke earlier
about the ruling.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The ruling today was disappointing. That is for sure. But it does not make us lose hope. It actually puts us in more energy to
ensure that we actually go to the Supreme Court to be able to appeal on what has happened, because what has happened today is an injustice.
(END VIDEO CLIP)
CHATTERLEY: And David McKenzie has more from South Africa.
(BEGIN VIDEOTAPE)
DAVID MCKENZIE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Human rights activists and lawyers are deeply disappointed in the decision of the
constitutional court in Uganda to unanimously uphold a draconian anti-LGBTQ law that calls for a life sentence in some cases, even the death penalty in
certain circumstances for the LGBTQ community in Uganda.
Now there were two aspects of the law that the judges said could be thrown out, including issues of privacy and health. But in the main, they let it
stand. Despite the incredible pressure coming from Western governments and others, ever since President Museveni signed the law last year.
And extensive reporting by CNN has shown that LGBTQ Ugandans have been harassed, evicted and beaten, and in some cases even had to flee their
country to seek asylum elsewhere because of the conditions in Uganda. Now, it's likely the lawyers will appeal this ruling at the Supreme Court.
David McKenzie, CNN, Johannesburg.
(END VIDEOTAPE)
CHATTERLEY: All right, coming up, we'll have the final numbers from Wall Street. Stay with us. We'll be back after this.
(COMMERCIAL BREAK)
[16:59:01]
CHATTERLEY: And it was a mixed day on Wall Street with the S&P and Nasdaq closing higher, the Dow couldn't shake off, however, at least for now the
second quarter sluggishness. It actually finished 43 points lower as you can see, a tenth of a percent. We'll call that unchanged. Tending to the
Dow components, Caterpillar finished on top. Disney down over 3 percent after CEO Bob Iger went on a bruising fight with activist investor Nelson
Peltz. Now the hard work really begins. Intel down over 8 percent after disclosing huge losses for its chip manufacturing unit.
And that is QUEST MEANS BUSINESS. I'm Julia Chatterley. "THE LEAD WITH JAKE TAPPER" starts now.
JAKE TAPPER, CNN ANCHOR: Welcome to THE LEAD. I'm Jake Tapper.
This hour, the deadly shooting of a 15-year-old girl at the hands of California deputy sheriffs. Savanna Graziano was believed to have been
kidnapped by her father. New video shows her walking towards deputy. Why did they fire their weapons at her? We're taking a closer look at the 2022
case. Plus a new way to treat depression. The FDA just cleared the first digital treatment. We'll explain how that works.
END
