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Quest Means Business
Former Treasury Secretary Janet Yellen Speaks To CNN; Yellen: Bond Market Intervention Only Had Short-Term Impact; United States Waging "Economic Asphyxiation" Of Iranian Regime; United States And Canada Barrel Toward Deeper Trade War; The Evolving Use Of Drones In The Ukraine-Russia Conflict. Aired 4-5p ET
Aired August 24, 2026 - 16:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": Closing bell ringing on Wall Street. A slightly bifurcated market. We've got the Dow
going one way and the other two going the other, as you'll see from the numbers.
Time to bring trading to an end. Hit the gavel if you would be as kind, Madam. And one and a two and a one, two three, four. There we are. Up 144
percent on the Dow. The broader market shows down for both the NASDAQ and the S&P 500. I will show you more of those numbers. There you go. You're up
to date with what they are.
Those are the markets and these are the main events of the day.
Operation Economic Outcast, the U.S. Treasury Secretary is trying to squeeze Iran's economy into submission. On this program, I am joined by
Janet Yellen, the former head of both Treasury and Fed. You'll hear Secretary Yellen in just a moment.
President Trump announced damaging new tariffs on Canada after trade talks fell apart in dramatic fashion at the weekend. The head of the Canadian
Chamber of Commerce will be with me on this program.
And drone warfare is turning the tide in favor of Ukraine in the war against Russia. I will speak to the CEO of a billion dollar company behind
some of Ukraine's most advanced drones.
We have a very busy time ahead of us. We are live in New York. It is Monday. It is August the 25th. I am Richard Quest and yes, as always, I
mean business.
Good evening.
We begin tonight with the United States waging economic warfare on multiple fronts. The U.S. Treasury Secretary, Scott Bessent, threatens new sanctions
on countries that refuse to cut economic ties with Iran, secondary sanctions. He did not provide many details and Iran's top negotiators
arguing the U.S. is not in a position to further restrict its relations with other countries.
A second front of war, the Canadian Prime Minister, Mark Carney, says his country is at war with the United States, and President Trump is planning
to impose 50 percent tariffs on vehicles, steel and other items from Canada.
As the administration ratchets up the economic tensions. The Treasury is trying to calm things down, if you will.
A report from CNBC says Scott Bessent might actually tap into the Treasury's $1 trillion general account to fund more bond buybacks at the
long end of the curve. It is all aimed at borrowing, reducing borrowing costs.
My next guest is uniquely qualified to address all of this. Janet Yellen led the U.S. Federal Reserve from 2014 to 2018. She also served as the
Treasury Secretary under President Biden, and during that time, the Treasury sanctioned Iranian oil and some of the ghost fleet, bringing it to
market.
Former Secretary -- Treasury Secretary and Fed Chair Janet Yellen is with me now.
Madam Secretary, there is so much for us to get into whichever way we look, whoever knew economics could be so exciting. Let us start with today's
announcement at the idea that somehow the U.S. can extend the range of secondary sanctions in this economic warfare to bring Iran to its knees, as
announced by Secretary Bessent today.
What do you make of that? Is it viable?
JANET YELLEN, FORMER U.S. TREASURY SECRETARY: Well, I think it is a step that makes sense and it is one that Treasury has a lot of experience with
sanctioning Iran, but there are ways that Iran and other countries have to get around these sanctions using the shadow fleet, purchases by Chinese
firms that really are all but immune to the impact of sanctions from corporations that Iran uses to buy materials to produce drones and
missiles, and so it can be difficult, but I think it makes sense to clamp down and to try to use all of Treasury's tools.
QUEST: And even if this means and involves, as it invariably will, arguably, you know, annoying, frustrating allies, whether it be, say for
example, Turkey or indeed Pakistan or any of the other countries that somehow manage to still do business in one shape or form, even if several
positions removed from Iran, because ultimately it is the dollar where everything finally ends up, and that's the strong part.
[16:05:23]
YELLEN: Yes, and the fact that the dollar is used for so much of trade means that treasury has a great deal of scope to threaten sanctions, to use
secondary sanctions. There can be costs involved in doing that, that the United States has to weigh very carefully foreign policy costs and as I
say, some practical limits to what can be accomplished.
QUEST: But at the moment you think this is the right move in the right direction.
YELLEN: So I am not trying to weigh in on what the broader strategy should be that the administration should be using with respect to resolving the
war with Iran, but it is an approach that can increase the economic pressure on Iran if that's the route that the President wants to take.
QUEST: You're uniquely qualified, having been Treasury Secretary and Fed. This maneuver that the administration is doing, trying to twist the yield
curve down at the long end. Now, the sums involved are much less than they were in 2011. The market has given its reaction to it by basically
restoring long yields to where they were.
And on this war against the bond market, do you think it is doomed? Is it just inevitably, and also arguably trying to pull down the long end whilst
the also worried about the short end? It seems like a no hoper.
YELLEN: Well, I think experience has been that these small scale interventions and relative to the size of the bond market, both the
Treasury bond market and global markets more generally because yields are rising not only in the United States, but also in the Euro area, the U.K.,
Japan. This is really a small intervention.
And experience shows that such interventions, whether they are in the bond market or as recently, Treasury intervened in the foreign exchange market
support the Japanese yen. Unless these are signals of more fundamental changes. They really have only short term impacts.
They can catch short sellers off their guard and impose some losses and restraint that moves, yields for a few days, or possibly a week. In this
case, we have seen that it took only days for the intervention to be virtually fully reversed.
And, you know, I think what Treasury and the administration should be thinking about is the fact that bond market purchasers are now focused on
the entire fiscal outlook. The United States budget deficit is very large, almost six percent, almost unheard of, except in a deep recession or during
a war. Other advanced countries also have expansionary fiscal policies, large deficits now competing with the hyperscalers that are issuing a lot
of long term debt to fund A.I., a market that now has marginal buyers that are price sensitive and really want to be compensated for these extra
holdings of long term debt and are worried about the fiscal trajectory.
And I think the administration should be focusing on how we can get our fiscal house in order, changes in taxation or spending on entitlements that
would put us on a sustainable path and I think that is what market participants are looking for.
And frankly, in none of the countries do you see much focus. It is politically difficult, of course, but you don't see much focus on what can
be done to address underlying fiscal sustainability.
[16:10:07]
And now, you have a situation where higher rates exacerbate things by enlarging deficits, increasing interest payments, making the fiscal
situation that much less sustainable. And I think markets are now focused on that. Also uncertainty about the new framework for monetary policy. So,
a lot of uncertainty.
I don't think inflation expectations have gone up. We are not seeing that in inflation compensation movements, but there is a lot of uncertainty
about long term fiscal policy and the fiscal trajectory at a time when investment spending for A.I. is really soaring.
QUEST: If we -- we will deal with the new monetary framework after the break. But I just want to focus on this inflation question.
At the moment, do you believe because I know your views on demand inflation versus supply inflation and arguably here, the look through. Do you still
think it is valid to look through the inflation that we are seeing and not react with higher rates at the moment.
YELLEN: So, I think that that's a plausible story and expectation that the inflation that we are experiencing is really due to three waves of supply
shocks that arguably could pass and inflation would move back down toward the Fed's two percent target.
So I am thinking of first tariffs, the impact of which is now petering out. Second, the energy shock from the developments in the Middle East, and
third, the A.I. boom is pushing up electricity prices, semiconductor prices. It is flowing through into consumer electronics.
So arguably, as these three waves pass, you know, we are seeing a labor market where wage inflation is not at all threatening. It has declined to
the lowest we've seen, really since before the pandemic.
QUEST: Would you wait and see?
YELLEN: But you know --
QUEST: Sorry. Carry on.
YELLEN: Well, no, but we have had five years with inflation exceeding the Fed's target and the Fed has to be very careful to make sure that this
doesn't become generalized in wage movements and inflation that has its own continuing momentum. So it is uncertain whether or not, in my view, it will
or won't be necessary to raise rates.
I believe the Fed mainly paused in July to watch incoming data and tried to sort this out. The date has been by and large favorable. The inflation data
we've gotten, there will be additional inflation and employment data in the coming weeks and I would watch it for a while, keep an open mind and be
prepared to move, but possibly, it won't be necessary.
QUEST: Before we take a break and move on, does it worry you that on the economic front, the U.S., the Treasury, the administration is fighting on
so many fronts, it is fighting the bond market, it is fighting sanctions and now -- and also fighting a trade war with the closest ally of Canada.
Is that a concern from an economic point of view?
YELLEN: Well, I mean, some of the developments that you cited, I do think are a significant concern. I think that the recent action against Canada is
going to greatly harm both Canada and the United States.
We import oil, which we need for the refineries that operate in the Northeast -- aluminum, steel -- and we are driving up the prices of these
important intermediate inputs and harming what has been a long run, very productive relationship with our friend in neighboring Canada. I think that
the approach that we've taken with tariffs toward Canada is very adverse for Canada, for the United States for economic well-being and it concerns
me.
[16:15:10]
Of course, I am also worried about the situation in the Middle East and what it can portend going forward for energy markets, transportation costs,
food, fertilizer prices and the like.
QUEST: When we come back after the break, Secretary Yellen, we will talk about the new monetary framework. Kevin Warsh's upcoming speech in Jackson
Hole.
And interestingly, I mean forward guidance, dot-plot press conferences, all things that you either were part of or introduced now seem to be on the
chopping block.
We will discuss after the break, ma'am. Thank you. Stay with us.
(COMMERCIAL BREAK)
QUEST: QUEST MEANS BUSINESS.
Tonight, we are very fortunate, we are joined by Janet Yellen, the former Treasury Secretary and chair of the Fed. We've been discussing how the
United States is ramping up its economic offensive, threatening new sanctions on Iran, et cetera., and planning to hit Canada with fresh
tariffs.
But we are also talking about growing anxiety in the bond market and inflation and it is all raising stakes for the U.S. Fed Chair, Kevin Warsh,
as he prepares to make his first speech, the major speech of Jackson Hole this week.
Janet Yellen has delivered this address three times. There you see her with the head of the ECB, then Mario Draghi and Haruhiko Kuroda of Japan 2014,
2016, 2017 -- she has discussed everything from labor market to financial stability.
Janet Yellen is with me now.
How carefully do you have to put together that speech, knowing that people like myself and everybody else are literally looking to see where the
periods and the commas are to see what you actually mean.
YELLEN: Very carefully. A lot of work goes into that speech. It is one of the most important and carefully watched of the year.
Generally these are research conferences and often the focus is on something, you know, reasonably deep economically, something about how the
economy works, an aspect of it, perhaps Chair Warsh might talk about A.I. and its future impacts on the economy, I am not sure.
[16:20:10]
It could be something about how to think about the inflation process, but this is an important speech and is always carefully watched and certainly
will be on Friday morning.
QUEST: Now, a lot of what Chair Warsh is doing, essentially, and I am trying to be sort of as tactful as I can in putting it like this, but
essentially is unwinding much of what not only you put in place, but also your successor, Jay Powell.
Forward guidance, press conferences, dot-plots -- all the various machinations of keeping the markets informed of where the Fed's thinking
is. He actually seems to believe that that's not as essential.
Do you think it is a mistake to get rid of forward guidance or press conferences?
YELLEN: Well, I think it is fair for a new chair to ask some deep questions about the practice of monetary policy. He set up task forces to do that and
I think once the committee to rethink its approach, that doesn't mean that everything that has been put in place will or should be thrown out.
You know, with respect to forward guidance, I think it is rarely appropriate for a Central Bank to make an unconditional promise about how
it is going to set rates in the future. That's something that has been done only in the most extreme circumstances.
We considered that generally stopped short of unconditional forward guidance, but used forward guidance to influence market expectations. after
the financial crisis, interest rates had been pinned at zero. There was really no room at the short end of the curve to influence rates and, we saw
an opportunity to lower long term rates and thought it was appropriate to do so by informing the market about our monetary policy strategy and why we
thought it would be appropriate to hold short rates low for longer than market participants generally expected.
And I think research shows it worked, it was helpful. Those are extreme circumstances.
But look, when the market is pricing long term bonds, the most important thing they need to figure out is what is the likely path of short term
rates and of course, that depends on what is going to happen in the economy, how inflation and unemployment behave and they need to bring their
own expectations to that.
But they do need to understand the Fed's reaction function, namely contingent on economic outcomes. How does the Fed think it is appropriate
to set rates? That's not an unconditional promise, but it is explaining to the markets what the Fed's monetary policy strategy is.
And I do think that's an essential element of communications to help the market appropriately price at the longer end and also beyond that, an
institution that is important as the Fed is in determining the course of the economy, has a responsibility to the American people to explain why is
it making the choices it is making and how is it understanding economic developments? How does it intend to go about achieving its mandated goals
of full employment and price stability?
And that does require, I think, more discussion of the economy and monetary policy strategy than we've seen so far.
QUEST: Can I finish with the politicization of the Fed, arguably, by this administration. The Lisa Cook case, for want of a better word.
The Supreme Court ruled decisively that the Fed is sui generis, whether the administration goes back for another bash at this is still up for grabs,
but on the fundamental point of independence of the Fed, do you think it is under threat today?
YELLEN: I do believe it is under threat. I've been very concerned about the attacks that president Trump has made on the Fed. The attempt to remove
Lisa Cook for a cause that hasn't been spelled out to the public or to her. She hasn't had a chance to defend herself, it remains to be seen how that
will be sorted out.
[16:25:15]
And the threat of criminal proceedings against Chair Powell, Really, these are threats that are unprecedented, and I still see a Fed that is
independently making decisions according to its best assessment of the economic outlook and what is needed to achieve its congressional mandate.
But I also see an administration that is trying to bring pressure to bear for monetary policy to be set in the way that President Trump regards is
appropriate and there is no proposition that has been more thoroughly tested. And most countries have, through their own hard experience, come to
realize that inflation is lower, economic growth is stronger, the economy is more stable when you have an independent Central Bank that is not
pressured by the government to make decisions for political reasons or to help the government finance its fiscal policy.
QUEST: My producer will kill me for throwing this one extra question in, because we are almost out of time. But I've just got to ask you, Madam
Secretary, which of the two -- I am sure you've been asked a million times, but which of the two -- Treasury Secretary or Fed Chair -- which did you
enjoy more? Not make a better contribution. Which did you enjoy more?
YELLEN: I enjoyed both. I am not prepared to rank them. They are different. They are great jobs. I was immensely fortunate to have been entrusted with
both of them. And you know, I've been a lucky person to have these opportunities and they were both great.
QUEST: I would venture to suggest, ma'am, that we are the lucky ones to have had you to steering these major institutions in difficult times.
Secretary Yellen, Chair Yellen, I am never sure which one I am supposed to put first, but whichever it is, Janet Yellen, thank you so much for joining
us tonight. I am grateful to you.
YELLEN: My pleasure. Thank you.
QUEST: QUEST MEANS BUSINESS continues tonight.
The latest on the collapse of the Canada trade relations. Candace Lang will be with me. She is the CEO of the Canadian Chamber of Commerce. She is
joining us in just a moment.
(COMMERCIAL BREAK)
[16:30:50]
QUEST: Good evening, good day. I'm Richard Quest. There is a lot more QUEST MEANS BUSINESS between you and me.
When Canada's Prime Minister says his country is at war with the U.S. after the trade talks fell apart, head of Canada's Chamber of Commerce will be
with me.
And the chief executive of Ukraine's defense or Ukrainian defense company is UFORCE, about how his machines are helping turn the tide of the war
against Russia. We'll only get to that after those lines, because this is CNN, and here the news always comes first.
United States has announced what it calls an economic D-Day against Iran. The Treasury Secretary Scott Bessent says countries that refuse to cut
economic ties with Iran could face secondary sanctions. He stopped short of imposing those new penalties, or indeed naming Iran's biggest backers,
China and Russia.
Iran's top negotiator dismissed the announcement as bluster.
President Trump's raised the stakes in growing trade war with Canada. Mr. Trump's threatening to double the tariffs on Canadian-made cars to some 50
percent. Mr. Trump's already enacted a 50 percent tariff on certain Canadian goods after the trade talks collapsed on Friday.
Canada's Prime Minister Mark Carney's vowed to respond dollar for dollar.
The British Prime Minister Andy Burnham's promising to help boost Ukraine's air defenses, saying that the allies of Kyiv must do everything in their
power to protect against Russian attacks.
Mr. Burnham is visiting Ukraine as it marks 35 years of independence from the Soviet Union. It's Andy Burnham's first trip abroad as prime minister.
When it comes to Iran, the United States has threatened sweeping new sanctions on those who refuse to cut economic ties with Iran. And the U.S.
says it's expanding the categories of Iran-related conduct that could trigger future sanctions within the realms of including digital, tech,
shipping, even worsening inflations affecting many of Iranians.
Videos on social media now showing empty markets in Tehran and Karaj, with sellers complaining of their struggle to sell fresh produce. The U.S.
presses on.
(BEGIN VIDEO CLIP)
SCOTT BESSENT, UNITED STATES TREASURY SECRETARY: We are launching an economic onslaught against Iran's financial connections around the globe --
around the globe. Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.
This is economic asphyxiation of this regime.
(END VIDEO CLIP)
QUEST: Joining me now, Tom Keating is the director of the Centre for Finance and Security at RUSI, Royal United Services Institute.
On this program, Janet Yellen, former treasury secretary, says, look, it's the right idea to cut these ties, to actually put the pressure on. But I
guess the marketing that people are saying is, does this going to work? Is it going to be possible to take these sanctions to the next secondary
level?
TOM KEATINGE, DIRECTOR, CENTRE FOR FINANCE AND SECURITY, ROYAL UNITED SERVICES INSTITUTE Well, the thing about sanctions is you need friends
alongside you in order to get them to work. That's what the United States did last time, and in the Obama administration when it managed to persuade
Iran to come to the negotiating table.
The U.S. has soldiered on down this path with Iran essentially on its own. You know, I said in London, people are not talking about this issue here in
London. They are not talking about it in Europe, and we can't, I think, imagine that Europeans and others will be shoulder to shoulder with the
United States on this.
So, a lot of talk, but I just wonder, actually, whether Iran will feel the pressure that Secretary Bessent would like them to feel.
QUEST: Are Europeans going to go along with it? Because the Europeans, I mean, to some extent, there is a -- there is a -- this may be a war that
was a war of choice from the United States.
[16:35:04]
But at the same time, the Europeans don't want Iran to get a nuclear device. And if there is a perception that these sanctions will make that
more difficult, wouldn't Europeans be wise to support it?
KEATINGE: Well, they might do if that was the mission. But of course, the mission from the White House keeps changing. And the conversations I have
in in London and Brussels are sort of baffled about, well, what is it you are actually trying to achieve here? Are you trying to dismantle financial
infrastructure? Are you trying to stop oil trade with China?
I mean, at the end of the day, the threat on these sanctions is not so much against Iran; it's against third countries and secondary sanctions.
So, it just is extremely muddled. And I had hoped to hear some clarity today from Secretary Bessent after his comments last week, his writings
over the weekend, but we just remain, I think, in the dark as to precisely what is going to happen. Now, that might be part of the strategy.
(CROSSTALK)
QUEST: Right, that he --
KEATINGE: it remains to be seen.
QUEST: He didn't mention any countries. Besides, obviously, China, who do you think is most at risk from the secondary sanctions, particularly as it
relates to dollar clearing, dollar trading.
KEATINGE: Well, you know, an ally like the UAE must be very nervous. I mean, the UAE is not exactly known for the cleanliness of its banking
system. And Iran has very effectively, wittingly or otherwise, on the part of the Emiratis, used the UAE for many, many years.
So, you know, is the treasury, is the U.S. Treasury really prepared to lean on the Emiratis to the extent it would need to? And that's not just
throwing a few exchange houses under the bus and sanctioning them.
That's actually going after some of the big Emirati banks that have connections to the royal family, the leading family in the United Arab
Emirates. That's a big thing for the United States to do against a crucial ally.
QUEST: Tom, I'm grateful for you tonight to joining us. Thank you, sir.
(CROSSTALK)
KEATINGE: Thank you.
QUEST: As we continue the second collapse of U.S. Canada trade talks, as I'll definitely be wondering what is the state. The latest on that, and
what it means to consumers on both sides of the northern border.
(COMMERCIAL BREAK)
[16:40:01]
QUEST: So, it's the rapidly escalating trade war between the U.S. and Canada. President Trump now threatening to double tariffs on Canadian autos
to 50 percent He's already enacted 50 percent on a variety of other Canadian goods. That happened on Saturday when the talks collapse.
They cover $20 billion worth of goods. Canada's Prime Minister Mark Carney is vowing to respond dollar for dollar, and in his words, he says the
country is at war with the United States.
(BEGIN VIDEO CLIP)
MARK CARNEY, PRIME MINISTER, CANADA: The new U.S. tariffs are designed to hurt us and divide us. They are a miscalculation.
I warned that America is trying to break us so they can own us. And I promise that, that will never ever happen.
(END VIDEO CLIP)
QUEST: Candace Laing is with me, President and Chief Executive of the Canadian Chamber of Commerce. I think when we've spoken in the past, look,
Candice, this is getting worse. And even though you might wish to put a rather brave face on a deteriorating situation, the fact is now, the idea
of a 50 percent on autos, I mean, Mark Carney is right, isn't he? This is war.
CANDACE LAING, PRESIDENT AND CHIEF EXECUTIVE, CANADIAN CHAMBER OF COMMERCE: Well, I have said that for some time, Richard, and good to see you, by the
way. That we've in fact been in economic warfare for some time. So, let's talk about where we were up until Friday.
The intensity of the negotiations over the past month was, in fact, intended to stabilize the relationship, so that we could find a pathway to
broader discussions, and ultimately, to what we need to have is the formal review of our actual trade agreement, the USMCA.
So, finding ourselves in the place we are, we didn't want to be here, but from the business community's perspective, as things unraveled on Friday,
there was really no way Canada and the business community in Canada, and actually, I would say in America as well, would have been happy with a deal
that challenges our competitiveness, limits our growth, and leaves us with little confidence and certainty.
QUEST: You see, the issue, for example, just taking one of them, this idea of French content in musical films or French content and the requirement of
a dual language. When that becomes an issue, either the United States is just being bloody-minded because it must know the significance of the dual
language mandate in Canadian culture and society, and that may suggest to me that there is no middle ground; that the U.S. is hell-bent, as the prime
minister says, on break to own.
LAING: Yes, our prime minister in his remarks today built on what he shared on Saturday. Today, he talked about how the attitude would need to shift as
part of that pathway back to the table, and I would say as things, you know, got to the 11th hour on Friday. This this sense of, you know, where
we thought we would be able to work things out from a mutual perspective, it came down to, you know, really an expectation of you will do what we say
for this tariff relief, and that's really not in good faith.
(CROSSTALK)
QUEST: Right.
LAING: And that's not how Canada entered the negotiations. So, the example, you know, from business that I think should be concerning, that was really
concerning for me, is an expectation that Canada would put a limit on its free trade agreements with other markets, and so, that really does, you
know, limit our growth and diversification, and puts a, I think, a huge concern on any Canadian exporter.
(CROSSTALK)
QUEST: OK. So, I realize this is -- you've got many members, and they will all have different views, but by and large, do you think that Canadian
business, SMEs, and large businesses are behind the prime minister when he basically takes this policy of, look, there is no point in talking, we
bring the negotiators home because it's not going to work. Does he enjoy the support of corporate Canada?
LAING: You know, it's something I've been talking a lot about today, both with our vast members, which span, you know, very small enterprise to the
largest of enterprise and multinationals, and there is a solid level of support.
[16:45:03]
You know, we know that about three quarters of Canadians were very comfortable walking away from a bad deal. And you know, I would say the
business community, and again, the business community in Canada and the United States, because we are in a different place, seeing the value that
is at stake with our trade deal.
There was an intentional trade agreement made, you know, with the -- with the intent to integrate our economies and our supply chains, and the policy
-- the trade policy of the current U.S. administration, is in a different place regarding that.
(CROSSTALK)
QUEST: Right.
LAING: So, that value is at stake. So, from the business community's perspective, again, on both sides of the border, there is a lot of support
for the trade relationship, and a lot of effort to try to protect the value destruction and the threat to that, that we currently see.
And the onset of additional tariffs, we know that, that, that just costs consumers on especially on the American side of the border, where our
tension is right now, Richard, because we do believe it will be some time before we get back to the table, so, in fact, our focus right now is solely
on -- actually, not the threats of tariffs yet to come in a January, which is worlds away, but managing the impacts of the threat that was made good
on come Saturday.
(CROSSTALK)
QUEST: Right.
LAING: Which is these 338 tariffs, which are entirely new, uncharted territory that Canada is really, you know, heading into now, and I'm sure
the world will be watching as we navigate tariffs where they are invoked for one reason: there is zero investigation, and you can apply them to
whatever you want.
So, here we are with a very targeted, seemingly less macroeconomic impact of those tariffs, but they are meant, as our prime minister said, to create
angst and hurt and pain and potentially divide Canada. So, we are very focused on business supports and keeping a strong Team Canada approach.
QUEST: I'm grateful, Candace. Thank you. We'll talk more, obviously, as this thing develops in every twist and turn. Thank you for speaking to us
now on Quest Means Business.
LAING: Thank you, Richard.
QUEST: We could -- we continue tonight. This week, it's in "AFRICA INC." and we are going to explore the African music business and its global
influence.
I'm going to take you to a beach in southern Portugal, where a festival founded by a Nigerian entrepreneur, now has big crowds and business.
Adefemi Akinsanya has more.
(BEGIN VIDEOTAPE)
ADEFEMI AKINSANYA, CNN INTERNATIONAL HOST: On a beach in southern Portugal, thousands of fans gathered from around the world to see some of the biggest
names in African music. But this festival isn't just a big party; it's a big business founded by a Nigerian.
OBI ASIKA, FOUNDER, THE MALACHITE GROUP: Afro Nation came about to prove a point, and you know, and that was what it was. It was like we wanted to
prove that you know this audience is like, or buy tickets anywhere, and just to show that we could do something special.
AKINSANYA: In 2019, Asika co-founded Afro Nation. Four years later, he turned that festival's success into a broader entertainment business.
NATASHA MANLEY, CHIEF EXECUTIVE OFFICER, THE MALACHITE GROUP: So, I'm Natasha Manley, and I am CEO of TMG.
TMG, the Malachite Group, is a global entertainment company, very much with live experiences at the heart of everything we do.
And when I say live experiences, what I mean by that is very deep, immersive, culturally led experiences.
AKINSANYA (voice over): From this office space in London, a relatively small team runs a truly global events company.
MANLEY: We have had shows in the past five or six years, from Puerto Rico to Detroit, to Ghana, Portugal, all over the U.K., Dominican Republic, and
that is a really operationally challenging thing to pull off, and it's also a difficult thing in terms of message and culture and how we keep a very
credible sort of core of who we are to our audience while moving and reflecting the cultures of everywhere we go.
AKINSANYA (voice over): The global live event space is dominated by a handful of companies, but they split a very large pie.
For instance, one of the biggest players, Live Nation, generated more than $25 billion in revenue last year.
Small operators need an edge to carve out a small slice of that pie, and TMG believe this location gives them that.
[16:50:01]
ASIKA: Reason I chose Portugal is because of the amount of flight routes. Flight routes and the amount of hotels. I can sleep 250,000 people, right,
within an hour of that site. It's incredible. In the summer, Faro as an airport has the most flights from the U.K. to any European airport. It's
incredible amount of infrastructure there for, you know, bringing large groups together.
AKINSANYA (voice over): The mayor of the host city says that the relationship with Afro Nation has been beneficial.
ALVARO BILA, MAYOR, PORTIMAO, PORTUGAL (through translator): The direct economic impact is around 90 million euros each year. Beyond that, there
are the wider benefits to the local economy, from hotels and restaurants to tourism, not just here in Portimao, but across the entire Algarve region.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
QUEST: Ukraine's been expanding its attacks on Russia's online retailers. The video shows the drone strike from Monday on a warehouse owned by Ozon.
That's Russia's second-largest e-commerce firm, and Ukraine has now hit several of its -- of its logistics hubs.
It's also been hitting different parts of the economy in a sophisticated drone campaign that's hit refineries and industrial plants. Joining me now,
Oleg Roginsky, he is the chief executive of UFORCE, one of the companies' making drones for Ukraine's armed forces.
We know that the -- we know the sophistication, the ingenuity of the Ukrainian drone forces, but now it's getting really tricky, because the way
Russia is responding, often ballistic, often having its own sophisticated weaponry, A.I. weaponry that we have been hearing about in the last few
hours, last few days, makes this more difficult. What comes next from your side?
OLEG ROGYNSKYY, CHIEF EXECUTIVE OFFICER, UFORCE: Hi, thanks for having me here.
So, what comes next is, is more innovation. Russia outproduces Ukraine in every category: in men, in shells, in missiles, in armor. So, Ukraine has
made the speed of change and speed of innovation its primary advantage. And so, that's why we are seeing as many unmanned systems, all with A.I., all
with one too many capabilities, taking more and more space on Ukrainian front lines, and as you might have seen in today's Ukraine independence
parade, fully unmanned forces of Ukraine are not too far away.
[16:55:03]
QUEST: What about this latest story over the overnight about Nvidia chips being in some of the drones that have basically A.I. controlled right the
way to the point of explosion, which seems to suggest an advancement that will be very worrying?
ROGYNSKYY: Russia has some advantages, capital being one of them. And, of course, it is unfortunate that Nvidia chips were smuggled into Russia
despite all of the sanctions to power some of the A.I. capabilities.
One thing to keep in mind that's important is that Ukraine has access to some of the capabilities that Russia doesn't, such as Starlink. And so,
with that, we'll definitely see Russia focusing more on the capabilities of its -- on the autonomous capabilities because those can operate without
satellite communications.
And so, we are going to see this continuous exchange of innovative leaps over there.
(CROSSTALK)
QUEST: Right.
What's the one thing you now need more of? I mean, as you develop your own highly sophisticated technology to retaliate, what do you need, sir?
ROGYNSKYY: As UFORCE, we are producing some of the most sophisticated Ukrainian origin weapons. And what we are looking to the West now is how to
manufacture those using some of the latest manufacturing techniques. That is where Ukraine is borrowing some of the know-how in terms of cutting-edge
production, quality, as we have seen coming from German automotive industries, latest in chip design, what we are seeing in the U.S. in
Taiwan, et cetera.
And so, all of those pieces are going to be built, used to build more and more of Ukrainian innovation on the front lines.
QUEST: And you decided this announcement today that the British government's giving the plans of particular weaponry across.
I mean, how quickly can you get these highly sophisticated anti-missile technologies build? You get the plans, you build the factory, you get --
how quickly can you do it all?
ROGYNSKYY: I think, knowing what's happened in Ukraine, it's going to be months, if not weeks, before we start making use of those technologies. We
have -- we have learned to move really fast, operate things and update them on an hourly basis. That's kind of the mode of, of UFORCE, where we
collocate engineers and our operators from the government and Ukrainian armed forces together, so that engineers can update the technology the same
day, if not the same hour.
It's not unheard of for us to upload the new software in the middle of the mission and add new functionality to the weapons as they are on their way
to the target.
QUEST: All right, sir. I'm grateful for your time tonight. I appreciate it. Thank you for joining us on QUEST MEANS BUSINESS.
And that is our report tonight. I'm Richard Quest. What a very busy show! Delighted that you are along for the ride. As always, I wish you whatever
you are up to in the hours ahead -- where is my bell?
Whatever you are up to in the hours ahead, I hope it's profitable.
(COMMERCIAL BREAK)
END
