Return to Transcripts main page

Quest Means Business

French Finance Minister: Not Distracted by Election; Georgieva: Countries Must have the Courage to Reduce Debt; Global Tech Stock Selloff Deepens. That's Foreign Minister on Thailand Getting Back on Track; Thailand Aims to Spark Its Sluggish Economy; Europe's Competitive Push Stalls. Aired 4-5p ET

Aired October 15, 2026 - 16:00   ET

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

[16:00:16]

RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": Closing markets on Wall Street after the turmoil of the last few days these are how

the markets have closed on this Thursday in New York.

A strong day up, 550 for the Dow Jones Industrials and the broader market - - oh there we go! The gavel has fallen. Those are the markets. For most of you, it is Thursday, October the 15th. Here in Bangkok, it is already

Friday, October the 16th. I am Richard Quest, in Bangkok, Thailand and I mean business.

Good evening.

We begin tonight here in Bangkok. It is 3:00 in the morning and we turn our immediate attention to France, where the government's financial situation

has sent bond yields soaring.

(BEGIN VIDEOTAPE)

ROLAND LESCURE, FRENCH FINANCE MINISTER: And she is right. She's right. I mean, obviously, we don't need any bailout, you know, issuing debt every

couple of weeks and it is going well. The rates are high and the rates are high because our deficit is are high, so we need to bring that deficit down

and we are doing it with the budget we have tabled in.

We are going through the process of Parliamentary discussion and my job is to make sure that next year's deficit is five or below. No more!

QUEST: Right. But the amount you're having to pay on your current debt and future debt is rising and that is going to cause a budget crisis.

No, it is not going to cause a budget crisis, okay, those five percent deficit next year, there is 2.9, which is the debt service, and that's

given by the market as you said, as long as rates are high.

QUEST: But the market is clearly raising French rates and along with Italy's rates because they are worried. You know you're familiar and have

you been in the business, the bond vigilantes.

The bond vigilantes are sending a message and the message is they are unhappy with obviously, U.S. debt levels, the U.S. economy, the U.S.

budget, and therefore either you're on your own or you're being swept along as well.

LESCURE: Well, there is a global debt issue because there is about $18 billion being issued by governments and then there is the private debt also

so there is competition from hyperscalers. So we have a global issue, and that's why there is a global repricing of interest rates across the globe.

And you said it, we are not the strongest of the pack and that's why we have to be very adamant on the fact that that budget I tabled in two weeks

ago, which is very strong on spending efforts, has to be adopted, and I can tell you it will be.

QUEST: Okay, but you've got a problem, protests in France over education. You can't find the money to keep those protesters, those students, happy

and at the same time keep the bond market happy.

LESCURE: No. We can -- that's the thing. If we act now, we can still act and have priorities. That's why I am acting on pensions.

You know, there is the choice today by paying pensions fully or saying we are going to save on pensions to make sure we can spend. We are not going

to spend a fortune, but we can spend enough to make sure that the kids go back to school.

And again, I know how you guys work. I know how the world works. So there is an idea there that all French schools are burning. They are not.

Most of those protests are peaceful. We are having conversations with them. They need more teachers to replace the teachers that are ill. We are going

to do that. But this is not expensive.

What is expensive in France is health and pension, and we are working on both to reduce them next year.

QUEST: Do you think the election -- at what point does that start to drive economic policy, if not already?

LESCURE: Well, from after the election on obviously --

QUEST: No, now because you're going to try and buy votes.

LESCURE: No, we are not. That's the beauty of the thing. I am not running for president. The President is not running for president, you know. So all

the candidates are not in the current government. We've kind of split the thing in two.

We are doing the heavy lifting, and then whoever inherits it is going to have to inherit it and make further effort. But we are very much focused. I

am very much focused on the next eight months to make sure that, you know, whoever takes off can take off.

QUEST: The right in France. I mean, this story has been around a long time now, several electoral cycles.

LESCURE: Yes.

QUEST: But it has got onto steroids because of what has happened in Italy, what then happened in Germany, what is happening elsewhere. So, it is no

longer academic. There is a high possibility of a further right government in France.

LESCURE: Yes.

QUEST: That must be -- is that a concern to you?

[16:05:10]

LESCURE: It is a concern. I mean, I was in business for 20 years and I decided to run in politics to fight far-right, so it is a concern.

But once you have a concern, when you're in action, you have to act. So the first thing to do is to make sure we have a good budget next year so that

we don't go, you know, the wrong direction.

The second thing is to tell the truth about Madame Le Pen. The main issue today that is dividing us is the way France should look at the world.

Ukraine, they want to stop helping Ukraine. We don't want to betray Ukraine. Immigration: They want to stop immigration. We have a demographic

bomb. They want to stop spending some money in Europe so that our farmers get help. These are the main issues we don't agree with.

(END VIDEOTAPE)

QUEST: There we have the -- that was the French Finance Minister responding to the comments from Christine Lagarde, of course, the President of the

ECB, saying that she was not about to bail out France or otherwise, saying it was up to the French government to sort out the problem.

The problem, of course, is that of rising bond yields in international markets, and the President of the Eurogroup says he is mindful and note

that word that he used, "mindful" of Europe's debt problem, but he says he is not alarmed.

I sat down with Greece's Finance Minister, Kyriakos Pierrakakis here in Bangkok. He said, not to compare this current crisis with that which would

seem before, and of course, he then went on to, somewhat sardonically point out, as a Greek Finance Minister, he knows a thing or two about debt

crises.

(BEGIN VIDEOTAPE)

KYRIAKOS PIERRAKAKIS, GREEK FINANCE MINISTER: First of all, I agree with what Christine Lagarde said, it is the same thing that was said by Emmanuel

Moulin, the governor of the Bank of France, but in reality, the situation that you're seeing right now in the bond market, it is more or less an

international situation.

Average bond yield in Europe 10 years ago was 1.1 percent. Average bond yield for the 10-year yield. Now, it is 4.4 percent.

And globally you're seeing inflation expectations getting higher and higher -- energy, A.I. many, many things are different.

QUEST: So if those yields are higher, that is going to create a budget financing problems for European governments.

PIERRAKAKIS: The era of cheap and abundant capital is behind us globally. So overall now, we are in a different situation with higher yields.

Obviously, this is adding to the fiscal pressures that we already have.

I mentioned before a comparison with what happened 10 years ago in yields, look at the average deficit in Europe 10 years ago, and today, it was 1.7

percent. Now, it is more than double.

But Europe got its fiscal house in order in the meantime, and has developed and capacity built fiscal institutions.

QUEST: Are you saying that you do not see a debt crisis in -- and I am not suggesting anything similar to what happened 10 or 12 years ago, but do you

say you're not going to see a debt crisis for major European economies?

PIERRAKAKIS: I would say that the situation is completely different to what we saw back then.

I mean, this is coming also from the Greek Minister of Finance. I would say that I am mindful, but I am not alarmed.

And yes, markets are closely looking to the fiscal trajectories of countries in each one of the countries, and the more credibility you have

in your fiscal policies, the more credibility you have in your political system. This is reflected in the yields, and Europe has a very solid fiscal

framework, which we are implementing right now.

Okay, so we've got -- but there is a contradiction here. Firstly, European governments have been asking yourself included, for greater fiscal space

from the European Commission, you're looking for basically a relaxing of the rules at the moment. At the same time, the IMF in its World Economic

Outlook, said governments have to get -- have to constrain fiscal expansion. You can't do both at the same time whilst you've got bond yields

rising.

PIERRAKAKIS: A: It is a balancing act between the increasing energy needs that we have and the support that we need to provide to citizens. B:

Obviously, we have a situation in the bond markets. C: I think there is not a contradiction inherent to this because within the existing fiscal

framework, within the existing fiscal clause, we can have flexibilities integrated within the existing system without fiscal expansion.

So I think you can achieve both at once.

QUEST: I think that you're putting a rosy scenario. You've got the -- you've got governments asking to spend more. You've got the IMF telling

governments to spend less.

PIERRAKAKIS: No, actually, our proposal was one of a different composition of the existing fiscal agreement. So it was not about spending more, it was

about spending different if I were to codify this.

We have the Escape Clause, as you know, in Europe.

QUEST: Yes, you're going to have to need it.

PIERRAKAKIS: Well, it is the escape clause for defense, which introduced energy investments, and then we are having a debate about how to optimally

target this Escape Clause in order to support the --

QUEST: So you don't see a crisis.

PIERRAKAKIS: As already replied, we are mindful, but were not alarmed.

QUEST: Mindful, but not alarmed.

[16:10:01]

Let's talk about the issue of where you see this energy crisis going for -- prices are not coming down anytime soon. It is going to be difficult over a

hard winter.

PIERRAKAKIS: This is why we need to support citizens and coming from now, with my Greek hat on as Greek Finance Minister, we have a package which we

introduced, a 1.4 billion package this year to support citizens and businesses, and we have the capacity to do that exactly, because we've got

our fiscal house in order.

But overall, we are mindful of the fact that Europe needs to support its citizens in a difficult winter while keeping our fiscal house in order and

keeping fiscal credibility.

I think it is achievable. We are certainly at a much more solid situation compared to the one that we were at in 2022, when Russia invaded Ukraine.

We made more energy investments. We diversified in the process. We certainly need to do more.

We need to invest more in storage. We need to invest more in grids. We need to invest more in interconnectors. But Europe is doing that.

(END VIDEOTAPE)

QUEST: As we continue tonight, we are going to talk more. When we return, the IMF's managing director, there may be debt, debt, debt everywhere. But

Kristalina Georgieva tells me there are two forces that policymakers here in Bangkok should be worried about.

(BEGIN VIDEO CLIP)

KRISTALINA GEORGIEVA, MANAGING DIRECTOR, INTERNATIONAL MONETARY FUND: There is a saying: Be aware of two forces, God and the bond markets.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

QUEST: Welcome back.

It is QUEST MEANS BUSINESS. Tonight, we are live in Bangkok. It is 3:15 in the morning from the balcony of the Ritz-Carlton Hotel.

I was hoping it might be a little bit brighter with a few more lights on, but apparently not this morning, I guess, things are still -- the bankers

have yet to get moving, but there are two things the policy makers here to fear, God and the bond market.

That's the message from the IMF's Managing Director, Kristalina Georgieva. She has got to worry about this year, an enormous amount, a debt crisis in

Europe, bond market jitters in the U.S. and a global energy shock. If that wasn't enough, she also has to worry about how to put it all together and

keep everybody on board.

So I asked the M.D. how she is dealing with it all.

(BEGIN VIDEOTAPE)

GEORGIEVA: When you have this sequence of events where you have a high level of debt, you have to brace for higher yields. So what do we do?

[16:15:10]

Well, we tell countries melt it, bring it down, have the courage to reduce your debt and your deficit, and look at the countries that have done it.

Look at Greece, Ireland.

QUEST: They did it in better times when they were alone. Now, everybody is having to do it at the same time, and that's the difficulty.

GEORGIEVA: Well, the problem is not so gigantic if you have highly productive economy, and when you look at the countries where debt levels

are high, where now yields are demanding more for servicing this debt, by and large, these are productive economies.

So what's your advice to those countries like France and Italy, the United States might listen, but probably not a follow-through. What is your advice

to those countries? What do they need to do?

GEORGIEVA: Well, Italy has already been doing it. Italy brought the deficit under three percent. Italy is very serious about consolidation, so they can

reduce also the level of debt and it is paying off. They are not shooting through the roof.

France has a budget that is now in the Parliament. They are aiming to do the same thing, bring the deficit down, bring the debt level down.

There is no magic, you have to do it. Otherwise, you will be punished.

There is a saying, be aware of two forces: God and the bond market.

QUEST: Which should they fear most?

GEORGIEVA: Well, at this point, I think they should fear the inaction that would postpone the problem and make it even bigger.

QUEST: So there is another difficulty, though. In the World Economic Outlook, the WEO.

GEORGIEVA: Yes.

QUEST: You talk about the need for fiscal constraint. This is a common message, which basically means don't overspend. Keep your budget deficits

under control.

But at the same time, you've got people hurting because of higher inflation and affordability. It is what I am calling the perfect storm.

GEORGIEVA: Richard, we, by now should have learned that we live in a more shock prone world. Shocks have been coming. Guess what? They will continue

to come.

I don't know what the next one is going to be, I just know there would be one. What can we do in a world of more uncertainty of more frequent shocks?

What we can do is have a very solid foundation.

When we talk about macroeconomic and financial stability, get your budgeting in in order. Bring your debt down. Can you fight inflation? It is

because you have to have buffers for the next shock that would come.

QUEST: But if you're France, for example, you've got protests on the streets, you're wanting more expenditure on education or health, and you've

got to cut the deficit.

GEORGIEVA: Yes.

QUEST: And you're cutting -- I just sort of see it all ending badly. I feel we've seen this movie before.

GEORGIEVA: You know, it is a movie that we are watching in a movie theater, much more enhanced.

The story today is different from what it was before the global financial crisis, before the eurozone crisis. At that time, there were elements that

were very wobbly. The banking sector was not well-capitalized.

The constraint on budgets and on borrowing was not at all there. Now, we have much more of this holistic approach to keeping your house in good

order, and even if at this moment of time, we see yields going up, markets are functioning, they're orderly.

Why are they orderly? Because there is this system that is put in place to protect against shocks becoming catastrophic.

(END VIDEOTAPE)

QUEST: That is the Managing Director of the IMF, Kristalina Georgieva, talking to me earlier.

Now, in just under seven hours from now, the Managing Director will appear alongside the Fed Chair, Kevin Warsh. It is being billed as a "fireside

chat."

[16:20:10]

I don't know too many fireside chats that will be watched as closely because it will be his last public commentary before the Fed October's

meeting and hotter than the expected U.S. inflation data is putting more pressure on the Fed to hike interest rates.

The Fed isn't the only one feeling the pressure at the moment from the threat of higher rates.

Global tech stocks have taken a real hit, a true beating on rising borrowing costs. Further driving down the sentiment are comments from the

boss of TSMC, the world's largest manufacturer of advanced chips.

Che-Chia Wei is warning of rising component prices coupled with macroeconomic uncertainty, and that could weigh on demand in some sectors.

And the world's biggest tech companies you see here are all trending lower.

Clare Duffy is with me.

Clare, we have had two or three days of sharp falls here in Asia to see things like the cost be down five percent, then seven percent or eight

percent. I guess -- I mean, don't worry, I am not going to ask you as a market analysis, but is there worry in the sector that what is happening is

an unwinding and that, frankly, borrowing may become much more difficult?

CLARE DUFFY, CNN BUSINESS WRITER: Yes, Richard, I mean, I think that is really the big concern. We already knew that this A.I. infrastructure build

out was extremely expensive. The big companies that are building out these A.I. data centers have been borrowing huge amounts of money in order to

build out this infrastructure. And the concern here really is if we continue to see interest rates rise, that that could make the cost of

borrowing to fund these A.I. infrastructure projects even more expensive.

That, of course, bad news for the semiconductor companies, because if we see any pullback in the build out of ai infrastructure, that is a problem

for them. They are expecting this build out to continue at the rapid pace that we have seen over the last few years.

I think the other factor that is potentially playing in here is political uncertainty ahead of the U.S. midterms. We have seen this really

significant populist backlash to A.I. and data centers, it has become a major issue for candidates across the country and if we see candidates

across the country elected on this issue of pulling back on A.I. data center development, again, that is going to be a problem for these

semiconductor companies.

And then, of course, there is the issue of competition in China. We saw Chinese semiconductor maker CXMT announcing progress on its own advanced

memory chips. That's raising questions for the chip makers in the U.S. and in places like South Korea and Taiwan -- Richard.

QUEST: So, in that scenario, what on Earth do you do? Because they've all got these huge -- I mean, a trillion dollars' worth of spending is

estimated by this. They want to build their data centers. They need this money and they need to keep having it funded. If that dries up, then we --

well, it is almost cataclysmic for markets.

DUFFY: Yes, I mean, I think that is the big -- the big A.I. bubble concern that people have been talking about for months here is this potentially

this boom going to dry up. Now, I don't think that we are going to see this completely disappear. You hear a lot of these tech companies, NVIDIA

certainly has hammered on this a number of times saying there still is more demand than there is supply for A.I. compute.

They are still trying to build out these new data centers. The problem is just that it is getting more expensive, but that doesn't mean that the

demand side is drying up and so I think this may be more of a correction rather than a crash that we are seeing here, and I think we are seeing that

reflected throughout the market as well.

You know, we are seeing investors moving out of these semiconductor stocks, but not out of tech altogether, just into parts of tech that feel a little

bit less dependent on this infrastructure build out.

QUEST: I am grateful. Clare is New York, quarter -- well, it must be 4:20 in the afternoon there. It is 3:20 in the morning here. Thank you, Clare.

It is good to see you.

By the way, later in this program, one of my guests is going to tell us that if there is going to be a crash, it had better happen -- it would be

better now rather than later.

A thought to be had as we continue, because Thailand's economy has been stagnant compared to many of its neighbors. The Foreign Minister of the

country tells me that the government's stability will help right the ship.

That interview is after the break. It is QUEST MEANS BUSINESS live from Bangkok.

(COMMERCIAL BREAK)

[16:28:07]

QUEST: Hello, I am Richard Quest. There is more QUEST MEANS BUSINESS in a moment when Thailand's Foreign Minister tells me the economy needs to

become more dynamic and that the government's stability is the way to get there.

It has been two years now since the Draghi Report was released. We probably should all have a drink on that. So, I asked the president of the Eurogroup

when leaders might start listening to it.

Before that, of course, this is CNN, and on this network, the news always comes first.

Two cargo ships have sunk near the Strait of Hormuz. They were hit by unknown projectiles in two separate incidents. One was struck on Tuesday

and the other was first hit late September.

The attacks have increased significantly in the waterway since the end of last month.

President Trump has called off the planned live stream of the Fort Hood shooter's execution, reversing an announcement from the Pentagon last week.

The former U.S. Army Major Nidal Hasan, was convicted of killing 13 people and wounding dozens at a Texas military base in 2009. President Trump

posted on Truth Social earlier, saying "Hasan will die as scheduled by firing squad, but this event will not be live streamed."

And Pope Leo is carrying out daily activities today after getting surgery for lung cancer on Tuesday. The Vatican says the Pope also went through

post-operative checks with positive results. Doctors say an x-ray show of his chest shows good recovery of the operated lung. Officials said the

medical team is optimistic as they await results from more tests.

[16:30:12]

Getting around bustling Bangkok can be challenging at the best of times. The traffic here can be quite infamous and horrendous.

Now, if you -- we can hear a siren in the middle of the night here. Now the traffic is awful. And when the IMF is in town, it is virtually impossible

to get around. To bring you this program tonight, I had to take drastic measures.

(BEGIN VIDEO CLIP)

QUEST: We are ready. Well, of course it did have to rain, didn't it? Sure enough, the rain arrived. But there we go. All is well onwards and upwards.

This really is a very effective and efficient way of getting around.

(END VIDEO CLIP)

QUEST: Now Thailand's -- by the way, when I was first suggested to do that, everybody looked in horror. And I have to say, when you see the bankers

looking at me as I got on those bikes, they were all rather impressed. By the end of the day, I got where I needed to go. They were still stuck in

traffic. Who cares for a limo when you can have a grand bike?

Thailand's foreign minister says the government is getting the country back on track. The country isn't exactly known for its dynamic economy. The IMF

projects that the economy here will only grow 2.1 percent this year, which is amongst the slowest in Southeast Asia. The foreign minister told me that

the government's stability will help give them the spark that it needs.

(BEGIN VIDEOTAPE)

SIHASAK PHUANGKETKEOW, THAI FOREIGN MINISTER: We've all been impacted by what's happening, what has happened and what is still happening in the

Middle East. And at first, I think the impact was quite severe, shortage and rising prices. But prices are higher than normal, of course. But I

think we've been able to manage the supply side. And so we're trying to cope with it, you know.

And also on the debt, I think many countries are facing, you know, rising debt. We are trying to keep it at, you know, not beyond the ceiling that we

have set for ourselves. So I think macroeconomic stability is important.

QUEST: Obviously, you're a member of a government now that you will, if I ask you the stability, you're going to say, yes, very stable. But that

question of changing of government, stability of government, why should investors believe that it's stronger now or that it's better now, or that

it won't change again?

PHUANGKETKEOW: Well, of course, politics is always unpredictable.

QUEST: Particularly in this country.

PHUANGKETKEOW: Well, in every country, and we've had frequent changes of government and, you know, but stability is important for the confidence of

investors. When I say stability, I look at the numbers in parliament. You know, I think we have quite a solid majority in the parliament. And we're

also, you know, determined to use the stability that we have to push through programs that we haven't done for a long time.

QUEST: So let me ask you a question. I was being -- I was being interviewed yesterday by a journalist and he asked me, he said, Richard, what do you

think about this idea that people have this perception of Thailand? Friendly smile, obviously, but maybe not as, not as aggressive, not as

forward moving, not as innovative, not as thrusting as some of the -- so I'm going to ask you the same question, sir.

PHUANGKETKEOW: Well, I -- you know, I served in the foreign service. I was ambassador in many places. That has been my frustration that when we talk

about Thailand, everything, you know, everybody had good words about Thailand, friendly people, good food, good tourism, good shopping. But one

word was lacking, dynamism.

QUEST: You've done my job for me.

PHUANGKETKEOW: And that's why it's important that this government get the country back on track. And I think we can.

QUEST: Why do you -- well, how do you get that back? I mean, if it is a cultural aspect, if it is the --

PHUANGKETKEOW: No, no, it's not a cultural aspect.

[16:35:01]

It's just, you know, as I said, we've had frequent changes of government. And for that, you know, because then when you have, you know, politics was

not -- was not right. And we focus a lot on politics. But now I think with the stability, it's time for us to focus on getting the country moving back

on track.

QUEST: Where do you think you are in that reform program to get the country back on? Admittedly, the government is relatively new in office. So, you

know, I'll be fair to you. You know, you've only just sort of --

PHUANGKETKEOW: Yes, but we have many paths to reform. The reform program of the government, we're really serious about deregulation. You know, we have

one deputy prime minister who's looking after that. We have so many laws that are not needed anymore. But the other path that we have is the path of

our membership in the OECD. And we're, you know, negotiating the accession process.

And that requires us to make a lot of changes to our domestic legislation, allowing our laws and regulations with the standards of OECD. So there are

two paths. And, you know, this is the chance that. And we have to make use of this chance.

(END VIDEOTAPE)

QUEST: That was the Thai foreign minister discussing the various reforms here in Thailand. The government is aiming to hit 3 percent growth in the

next few years and plans to do so by drawing foreign investment for sectors like semiconductors, data centers and manufacturing.

With me now, Dr. Supavud Saicheua, the chairman of Thailand's National Economic and Social Development Council.

Sir, first of all, just thank you for getting up in the middle of the night and coming and talking to -- and meeting us here. Thank you very much.

DR. SUPAVUD SAICHEUA, CHAIRMAN, NATIONAL ECONOMIC AND SOCIAL DEVELOPMENT COUNCIL: Thank you. Pleasure.

QUEST: Now, when the government agrees with us that there is this -- the foreign minister agrees that there is a lack of dynamism. Are they just

using that as an excuse to get through their reforms, or are these reforms badly needed in the economy?

SAICHEUA: Oh, the reforms are badly needed. I think we have structural headwinds, aging population. Obviously, geopolitics is not in our favor.

Things like that mean that you really need to make fundamental changes. So just to allow more data centers and producing more electronic parts, that's

not enough. That's not going to be putting Thailand on a better growth path.

QUEST: How did the country sort of get into this mess in the first place on that front? Because after the great -- after the financial -- the Asian

financial crisis, which sort of put the balance sheet on a better footing.

SAICHEUA: Right.

QUEST: Many reforms took place. Is it a case of that wasn't enough or just more needed to be done?

SAICHEUA: Well, I think there were other intervening factors. As I mentioned earlier, right, aging set in Thailand very dramatically during

the first two decades of this century. And then you have obviously Thailand losing competitiveness.

QUEST: I'm just looking at these numbers here since 2002.

SAICHEUA: Yes. Right.

QUEST: Never really seen growth. I mean, the best was in 2024, 2024, 2.9 percent. For an Asian tiger that's almost like rolling over.

SAICHEUA: That's right, that's right. I think the drag has been quite significant. And so that's why we think we have to redesign the Thai

economy to make sure that you find new engines of growth.

QUEST: So putting the political scenario into this, the government was -- the coalition was essentially reelected this year. And the mandate is a

strong one in a sense, but is the -- is there the will in parliament to put in these reforms? Because that's where it could all fall apart.

SAICHEUA: You're right that the will has to be there.

QUEST: Is it?

SAICHEUA: It is in the sense that we realize now the need to make those reforms, and they have to come quickly. I think the government is therefore

trying to find other things to prompt us there. For example, the OECD membership.

QUEST: Is it -- when they said that about the OECD membership, why is that so important?

SAICHEUA: Actually it's a roundabout way to get someone else to come in and tell us these are the things that need to be done, such as government

procurement, anti-corruption, competition policy.

QUEST: I really want to talk about, though, the other side, the tourism side.

SAICHEUA: Right.

QUEST: Because the Thai smile, amazing Thailand.

SAICHEUA: Yes.

QUEST: Let's -- we've talked a lot about data centers and how that's such an important part of the economy. In fact, it's the largest part of

computer components in a sense. It's a huge part. But tourism is vital and this country is par excellence in terms of its tourism product.

SAICHEUA: That is true. But then we can also --

[16:40:01]

QUEST: No but.

SAICHEUA: No, no, no.

QUEST: Tell me, go on.

SAICHEUA: But, you see, the thing is you need to move up the value added ladder. You just don't want people to just come in and look at the nice

scenery. You want to move up to say wellness, where the value added is higher. And that requires you to move up another notch in terms of the

sophistication of service into what is an aging society.

QUEST: And one of the interesting things is that the tourism authority does seem to be doing that. They -- I mean, some years ago they decided to stop

chasing numbers and start chasing value.

SAICHEUA: Right.

QUEST: Now they're chasing not only value, they're chasing wellness.

SAICHEUA: That's right.

QUEST: It's a strategy that is the right one. I suppose time tells whether or not they are going to beat the competition at doing it.

SAICHEUA: Well, the competition is much less intense than the industrial sector. And don't forget the other thing, agri-foods, particularly on the

food part. Good food in a very delicious food, nutritious food. That adds up to the wellness theme as well. And in fact, the World Bank has indicated

that, agri-food is actually 31 percent of Thailand's GDP. That is even a bigger driver than tourism and wellness.

QUEST: I'm grateful to you, sir. Thank you so much for joining us.

SAICHEUA: Thank you.

QUEST: Thank you, sir.

Now I am old enough to have witnessed another major moment for Thailand's economy. The opening of the national airport in Bangkok, Suvarnabhumi. I

pass through Suvarnabhumi Airport this week. I came here just before it opened. I didn't realize how old I was.

(BEGIN VIDEO CLIP)

QUEST: You know you're getting old or you've been around a while when, yes, it's the 20th anniversary of Suvarnabhumi Airport. And I remember covering

the opening of the airport 20 years ago. Actually, it was before then because they tried to open it and there were problems and they weren't able

to. So there you go. 20 years on, the airport still here, and so am I.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

QUEST: "Call to Earth." Success in conservation requires, amongst other things, great patience, perseverance, and adequate funding.

[16:45:01]

Arguably for us on QUEST MEANS BUSINESS, that last bit is always the important part because business first.

Coral Gardeners are an organization dedicated to reef restoration as part of the Rolex Perpetual Planet initiative, knows this all too well.

Today on "Call to Earth," Bijan Hosseini continues our coverage of the nonprofit, which has spent the last 10 months preparing to announce a major

change.

(BEGIN VIDEOTAPE)

TITOUAN BERNICOT, FOUNDER AND CEO, CORAL GARDENERS: All right, we will start.

BIJAN HOSSEINI, CNN SENIOR PRODUCER: Chilly. It wakes you up.

(Voice-over): It's around 6:00 a.m., and Titouan Bernicot, the founder of Coral Gardeners, is taking me to one of his favorite spots in Moorea.

BERNICOT: There is a crack in the reef, a swimming pool. And it's cool because you have all the fish.

HOSSEINI (voice-over): With a jampacked schedule of meetings ahead, swimming in the fringing reef on the outer edge of the island's lagoon

helps him prepare for the day.

BERNICOT: I always love that underwater scenery, that underwater seascape, and the ocean is an important place for me, and it has always been my happy

place. Huh? It's a cool place, huh?

HOSSEINI: Oh, it's amazing.

BERNICOT: Imagine starting all your mornings like this would be cool.

HOSSEINI: I don't know if my body can handle it. I am exhausted.

(Voice-over): A few weeks after my visit to Moorea, some of the Coral Gardeners crew found themselves in a very different part of the world.

BERNICOT: We're in New York. I'm so happy to be here. You know, like it's been a couple times I have the opportunity to come to this city. And I love

the energy.

Hey, bro.

UNIDENTIFIED MALE: Hey.

BERNICOT: You know us?

HOSSEINI (voice-over): It's Climate Week NYC, which has become an annual journey for Titouan.

BERNICOT: Broadway.

HOSSEINI (voice-over): But two of his childhood friends are joining him for the very first time.

BERNICOT: This trip is really different for us because we have a bigger team. We brought the boys from Moorea, the gardeners, the OG ones, Taiano

and Maurit, I'm so happy to be with my brothers.

Hello. Is your Coral Garden as pretty as that?

UNIDENTIFIED MALE: I prefer my Coral Garden.

HOSSEINI (voice-over): This week represents the opportunity to reconnect with current sponsors and partners and hopefully meet some new ones.

UNIDENTIFIED MALE: She stands out. Proud girl.

HOSSEINI (voice-over): But this year, they're stepping it up with a milestone announcement, which they've hinted at in a uniquely cryptic way,

proclaiming it's the, quote, "end of an era" on social media.

BERNICOT: I think a brand that doesn't take risk is a dying brand, you know? So we decided to remove all our pictures, Instagram posts, all the

logo, everything, like total blackout, for four days. And also, we are launching the rebranding of Coral Gardeners.

UNIDENTIFIED FEMALE: And now we're getting crazy.

UNIDENTIFIED FEMALE: Stolen linen bags.

HOSSEINI (voice-over): To kick off this new era they are throwing a relaunch party. Their first time hosting an event during Climate Week.

BERNICOT: Bro, this is your nursery. They look like a bit like reef. You know?

UNIDENTIFIED FEMALE: Here's the ice.

BERNICOT: Oh, they are the logo.

UNIDENTIFIED FEMALE: Yes, you can see. It feels like really cool in the glasses.

BERNICOT: You know, this event is a lot of cost for us. You know, it's expensive. But the return on investment is going to be crazy big.

BENEDICT CUMBERBATCH, ACTOR: The boardrooms have decided.

HOSSEINI (voice-over): Their in-house media team even produced a short film narrated by actor and Coral Gardeners ambassador Benedict Cumberbatch.

CUMBERBATCH: They say the experts will handle it. The ocean is too big for you to fix.

HOSSEINI (voice-over): Which ends with the reveal of their revamped platform and look.

BERNICOT: Power to the Gardeners.

So, yes, tonight we're introducing what is the next chapter for Coral Gardeners.

HOSSEINI (voice-over): From the streets of New York City.

BERNICOT: Come visit one day.

UNIDENTIFIED FEMALE: Yes. No, absolutely. I would love it.

BERNICOT: Thank you for the support.

HOSSEINI (voice-over): To the reefs of French Polynesia. It's safe to say Coral Gardeners is making waves. But for its founder and CEO, the most

critical work is yet to come.

BERNICOT: This is going to be the biggest movement that conservation ever seen in the coming years. A world revived from the reef up.

(END VIDEOTAPE)

QUEST: Fascinating story. My goodness. Now, as always, let us know what you're doing to heed the call. Its usual hashtag, it's CalltoEarth.

QUEST MEANS BUSINESS.

(COMMERCIAL BREAK)

[16:52:20]

QUEST: Now, if you are a regular viewer of QUEST MEANS BUSINESS and if not, why not, a regular viewer of QUEST MEANS BUSINESS know I am a little

obsessed with chairs. The Draghi Report unveiled two years ago by the former ECB president Mario Draghi, it identifies the barriers to greater

European growth in the face of competition from China and the U.S.. So when I met the Eurogroup president, I couldn't resist asking where they are in

implementing the recommendations and that means with Draghi Report chairs banking reform.

(BEGIN VIDEOTAPE)

KYRIAKOS PIERRAKAKIS, EUROGROUP PRESIDENT: I disagree. I think it will. And yes, you are fully right about politicians making speeches. I agree to

that. It's all about delivery. The motto should be delivery, delivery, delivery.

QUEST: There's been almost no improvement on banking reform in the last five years.

PIERRAKAKIS: Let me disagree in the following sense. There is improvement on the reform agenda of Europe. Take -- I'm not going to use another

European acronym. Take capital markets, capital markets integration. We have been debating that for, what, 10 years as well? In the last 10 months

we saw more progress compared to what we had seen in the previous 10 years. We actually delivered an agreement, an original agreement, at the Council

on Capital Markets Supervision because there you have the lowest of the hanging fruits. You can channel more investment into the European economy

fast. You're going to see the same in banks.

QUEST: Mario Draghi's report, it's widely quoted. It still requires further implementation.

PIERRAKAKIS: That's why it's all about delivery. I agree. I mean it requires further implementation. We have the diagnosis there from Mario

Draghi, from Enrico Letta. We understand that we need to pull resources and scale up more. I mean you mentioned banks. What do European banks need to

do? We need larger banks. They need to scale better. They need to scale more, invest more in Europe. I think it's achievable if you remove all

those barriers that we have in the European Union.

QUEST: Oh, if, if, if.

PIERRAKAKIS: Well, we have started doing that. I mean, we're here at the IMF in Bangkok, right? The IMF made a calculation. It put a number that in

services we have the equivalent of a tariff of 110 percent tariff and manufacturing 44 percent. European banks scaling up more, European

champions scaling up more. You mentioned Christine Lagarde.

QUEST: So that requires --

PIERRAKAKIS: One-third of the productivity gap of the United States is attributed to us not having big enough companies.

QUEST: That requires the European governments to -- and this is in banking. It's in A.I..

PIERRAKAKIS: In telecom.

QUEST: It's in telecoms, to accept that there will -- not every country can be a winner. And you're going to have to have pan-European giants.

PIERRAKAKIS: Well, by having pan-European giants, I would claim that every country will be a winner. I mean --

QUEST: No, but you know what I mean. You're seeing it in defense. You have to pick winners and losers.

PIERRAKAKIS: It's a mentality change.

QUEST: You have to pick winners and losers across Europe for certain sectors in certain companies.

[16:55:01]

PIERRAKAKIS: Well, my claim would be that. Exactly if you do what you're suggesting, the pie will expand to such an extent. Not every European

country --

QUEST: But you're not doing it. Exactly my point.

PIERRAKAKIS: We've started doing it.

QUEST: My point is that European governments' national policies and blinkers won't let them do it. Everybody wants to have everything.

PIERRAKAKIS: That's the historical observation. The historical observation is that we agree in theory, but in practice we raise our hand and we say we

have this little national asterisk.

QUEST: Exactly.

PIERRAKAKIS: This is shifting and this is shifting because international context has shifted. We have the era of geopolitical innocence being over.

You have geopolitical fragmentation, energy diversification needs. The world is changing very fast. European governments, regardless of political

color, are acutely aware of this change in context. And this is why my claim would be, and it's not an optimistic take. It's a realistic take.

My claim would be that we will deliver the results needed. It's not a black and white thing. It's not a fully yes or no thing. It's a question of

distance. You will see distance covered in the next 12 months.

(END VIDEOTAPE)

QUEST: That's the Eurogroup president, the Greek finance minister.

Let me quickly show you. Wall Street ended higher despite that hotter than expected wholesale inflation numbers. That's the big board number. I want

to show you both the big board up. It closed up 556 points. And if you take the triple stack, you will also see exactly how things traded the triple

stack. It was a strong day right across the board.

And we will take a "Profitable Moment" indeed. We'll get into details of exactly what's happening here in Thailand after the break. QUEST MEANS

BUSINESS.

(COMMERCIAL BREAK)

QUEST: It's been absolutely amazing to be here in Thailand. It's such a wonderful place with a great warmth and so much to talk about. But if we're

talking economics and we're talking about the IMF, then we're into a different territory. The message seems to be measured, mindful, no panic.

The issue that's coming from, by the way, all the ministers, all the leaders. And yet, and yet, and yet one very senior central banker said to

me privately, there's more pain to come.

Now, can those two things be true at the same time? Yes, of course there can be. Everybody says now is not the time to panic, that it is not 2008.

It's not 2012. It's not 2015 all over again. We've got better buffers, better capital, better resources. The problem is the gray rhino theory. I

was talking to Michele Walker here in Thailand, in Bangkok, and she says, of course, the gray rhino is we all see it. We think we know what to do

about it, and we don't actually do it until it's too late.

And that's really the issue. Are we ignoring things that we really need to be panicking now? Are we dealing -- not dealing with things that we should

be? Guess what? We don't know, and of course we won't know until it's too late. At least that's the unfortunate part about it. But, hey, at least

we're in amazing Thailand.

And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in Bangkok, in Thailand. Yes, I even left the bell behind upstairs. So instead,

whatever you're up to in the hours ahead, cheap and cheerful, I hope it's profitable. I will see you in Sri Lanka next week.

END