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Hala Gorani Tonight

A Judge Rules Lawsuit Against Prince Andrew Can Continue; Boris Johnson Apologizes For Office Party During Lockdown; Talks Between NATO And Kremlin On Ukraine Produce No Breakthroughs; Novak Djokovic Back On Court As Tournament Draws Near; Fed Chair Says Sharper Hikes If Inflation Persists; Tough Talk, Little Trust In Ukraine Meeting; Russian-Led Troops Begin Withdrawing Thursday From Kazakhstan. Aired 2-3p ET

Aired January 12, 2022 - 14:00:00   ET



HALA GORANI, CNN INTERNATIONAL HOST: Hello, everyone, live from CNN in London, I'm HALA GORANI TONIGHT. Prince Andrew's legal worries not just far

from over, they could just be starting. A judge has just ruled that the sexual assault lawsuit against the royal can go ahead in New York. Also

this hour, Boris Johnson apologizes over a lockdown party at 10 Downing Street. Can the political opposition in the U.K. capitalize on this? I'll

ask the deputy Labor leader, Angela Rayner.

And Russia says it feels ignored by NATO. That means its troops will stay poised on Ukraine's border, no de-escalation in sight. A U.S. federal judge

has ruled that the sexual assault lawsuit against Prince Andrew can move ahead. That means the British royal could end up in a U.S. court later this

year. Prince Andrew's lawyers had filed, you'll remember, a motion to dismiss the whole thing.

The civil lawsuit that was brought forward by Virginia Giuffre, the young lady in this photo who was 17 at the time. She says she was sexually

trafficked by Jeffrey Epstein to the prince when she was that age, and she claims that the prince was aware that she was under age. He has always

consistently denied all of these allegations. Part of the prince's motion to dismiss was because he believes a settlement agreement that Giuffre

signed with Epstein years ago releases him from legal action, shields him from legal action.

Today, the judge did not rule in his favor. Let's talk it over with CNN legal analyst Joey Jackson. You've had an opportunity to go through the

judge's ruling and the legal language that the judge used. Why did he not side with the prince's team? They said Giuffre signed this settlement and

she promised within the settlement not to go after anyone associated with Epstein. Prince Andrew falls in that category, the judge disagreed.

JOEY JACKSON, CRIMINAL DEFENSE ATTORNEY: Yes, good to be with you. And so in essence, I'll start with the details and then we can do broader picture.

The judge basically said this. This was a motion to dismiss. The motion to dismiss was predicated, as you noted upon an earlier agreement that Mr.

Epstein signed and entered into with Miss Giuffre. In that particular agreement, it indicated that Mr. Epstein would be released from any further

liability at all, in addition to any potential defendants, right?

And so, what the judge essentially opined was, number one, how do we know that in essence, the intention of those parties were to have it apply to

you, Prince Andrew? How do we know that? Why do we not or could potentially we not know that because you, number two, were not a party to that

particular proceeding. As a result of that, it may not have been contemplated that it meant to apply to you. Now, it's important to note

that the judge in his decision is not indicating whether these allegations are truthful, whether they're not, whether --

GORANI: Right --

JACKSON: The interpretation of the agreement as it relates to how the prince's people interpret it, that he is released, that he was a potential

defendant,, that it should apply to him, is proper or not. The judge essentially said it was ambiguous, to the extent that it's ambiguous, it

can be further litigated and a lawsuit --

GORANI: Sure --

JACKSON: Can continue. And that was the essence of the judge's decision.

GORANI: So this is a civil case, and Virginia Roberts, formerly Giuffre, is bringing this, saying she was sexually essentially abused by the prince

all these years ago. What are the options here? The option here is either a settlement or it goes to court, right?

JACKSON: Yes, that's right. So now, we get into the big picture, having addressed the specifics of the judge's decision. They, of course, just one

other quick thing, talked about they, being the prince's team, that the facts are legally insufficient. The judge said that's a jury question,

leave me alone with that. Also indicating that, hey, you taking me to court, it's unconstitutional. The judge saying, you know what? That's to be

determined, but I disagree.

But on the general issues, now the issue is what happens now, Hala, right? And so, generally, in a civil case, you then move forward to discovery.

Discovery means in English that now we get to the heart of the matter, both sides sitting for depositions, what happened, how it happened, if it did

happen at all, when it happened, what was your recollection? Now, the significance of this would be that the prince would have to himself sit

down and otherwise be deposed, meaning asked specific questions about his conduct.


That subjects you, and as you know very rightfully, this is a civil matter. As a civil matter, it relates to money and monetary damages. It has nothing

to do with illegalities or criminality. However, I should hasten to add, in the event you sit for a deposition, if that happens, right? Where lawyers

ask you questions, there's no judge to be had, but you swear to tell the truth with respect to your recollections, with respect to the facts, and

you lie, we have this thing called perjury.

Now, perjury, not suggesting the prince or anyone else would lie, I'm just saying that in the event that any party lies, you subject yourself

potentially to criminal exposure. So now, the prince has --

GORANI: Yes --

JACKSON: A decision -- and neither option is really that favorable, Hala. On the one hand, do you now settle this case, that is throw a number of

millions of dollars at it and his own release, that he be further released from any liability, and that would be confidential, right? That's one --

GORANI: Right.

JACKSON: Thing. But if he does that, even if there's no admission of guilt, people are going to say, hey, wait a second, why is he --

GORANI: Right --

JACKSON: Settling if he didn't do this? The other option would be to proceed to trial. And if he proceeds to trial, now the dirty laundry is

aired. He has every right to say, I didn't do this, I don't know who you are, I don't remember the picture --

GORANI: Right --

JACKSON: I took with you. And she, of course, will say, yes, you do, and here is what happened. So neither option favorable, either trial or

settlement. Those are the two things most immediate to be considered, Hala.

GORANI: Last question. What if Prince Andrew just ignores the whole thing, doesn't travel to the U.S., does not appear, then what?

JACKSON: Very dangerous. What happens then is you get what's called a default judgment. A default judgment, Hala, in English is essentially you

have two sports teams, where we're waiting for a big game, you and I, we can't wait. We're chatting, one team is on the field, the other team

doesn't show up.

That means the team that showed up wins, but here is why this cannot be a sports analogy. Because unlike sports where it's simply a forfeit and

there's no game played but the team that showed up wins. In real life, what happens is, you get to attach people's assets. You get a fine --

GORANI: Right --

JACKSON: A significant financial judgment against you, and any properties, anything that he has, any bank accounts or anything in New York would be

subject to seizure in connection with this particular lawsuit. The financial imposition of damages could be huge, and that also could be

deemed an admission. Why didn't you show up in the event you thought that you did nothing wrong? So these options are what his attorneys are

considering at this point, Hala.

GORANI: Thanks for laying it out so clearly. Joey Jackson, as always, a pleasure. This situation, a British royal facing a possible public trial in

a U.S. court with all the dirty laundry, as Joey was saying there, potentially exposed for the world to see, is to say the least,

unprecedented. Max Foster is here to talk more about it. What is the prince and the prince's team, what are they likely to do now, settle or fight this

case in court?

MAX FOSTER, CNN ROYAL CORRESPONDENT: Well, as you've been hearing, there's no great options. But with this situation, when your family is inextricably

linked with, you know, being head of state in the United Kingdom, you have to consider the wider monarchy in all of these decisions, particularly when

your income comes from the monarch herself. Prince Andrew doesn't have an independent income anymore, so he has to rely on the monarch If there's any

settlements to pay, presumably, he might have to go to her to ask for it.

So, they are involved. I think settlement does seem like the most likely option, however. But with that, the optics are that you're accepting some

level of wrongdoing there as well. So, the damage, many branding experts in this country are saying has been done to Prince Andrew. He needs to just

get out of this process as quickly as possible. That does suggest settlement, but does -- how does the queen stay out of it? That's the

really tricky part of this.

Does he have some kind of private fund he could use to pay the settlement, which presumably will be huge. Giuffre knows she can get a large

settlement. Even if he does pay that, then he's going to need an income in the future from the queen.

GORANI: OK, Max Foster, thanks. Well, to parliament in the U.K. now, where the British Prime Minister Boris Johnson, is under fire like he's really

never been before as a prime minister. He's had to apologize publicly for attending a party during lockdown in 2020. Now, this was when people

couldn't visit relatives dying in hospital. Coming to his own defense, he said he didn't realize he was at a party. He thought it was a work event.

Listen to the prime minister.


BORIS JOHNSON, PRIME MINISTER, UNITED KINGDOM: I know that millions of people across this country have made extraordinary sacrifices over the last

18 months. I know the rage they feel with me and with the government I lead when they think that in Downing Street itself, the rules are not being

properly followed.


GORANI: So Keir Starmer is the leader of the opposition Labor Party, he's called for Johnson's resignation. And Johnson's comments come amid mounting

political pressure and outrage from MPs, some outrage coming from his own party it has to be said.


One lawmaker broke down in tears in the comments earlier this week.


JIM SHANNON, DUP MEMBER OF PARLIAMENT: In Northern Ireland, we reached a milestone of 3,000 deaths due to COVID just last week. Three thousand

people who followed the rules and grieve today. So will the paymaster -- including my mother-in-law who died alone.

UNIDENTIFIED FEMALE: Keep going, dear.

SHANNON: Will -- will the paymaster general confirm there will be a full and complete disclosure to enable the police service to ascertain if all

was done decently and within the regulations on the date and at that time - - I'm sorry, Mr. Speaker.


GORANI: Breaking down in the House of Commons. The question remains whether Boris Johnson can ride this out politically or if it's simply one

scandal too many. Let's go live to Downing Street with our Salma Abdelaziz. So, what is the answer to that question? Can he survive this because the

next election is a couple of years away.

SALMA ABDELAZIZ, CNN REPORTER: Hala, you're looking at a prime minister right now who is really trying to defend the indefensible. The accusation

here is that parties, multiple parties across multiple lockdowns, across a series of months were held by his staff at a time when a deadly virus was

spreading through this country. It puts a serious question mark over the prime minister's moral authority, over his ability to lead, over whether he

is fit for office.

These are the questions being asked right now about Prime Minister Boris Johnson, and yes, he has apologized, but it's a kind of, sort of apology.

He says, I am sorry for how the public has seen this, but at no point does he say, "I broke COVID rules, we violated the laws in place." He said all

of that should be decided by an independent investigation. And it's a contradiction that the opposition Labor leader was very quick to call out.

Take a listen.


JOHNSON: And so I'm sorry about --

KEIR STARMER, LEADER OF LABOR PARTY, UNITED KINGDOM: After months of deceit and deception, the pathetic spectacle of a man who has run out of

road. His defense, his defense that he didn't realize he was at a party --


Is so ridiculous that it's actually offensive to the British public. He's finally been forced to admit what everyone knew, that when the whole

country was locked down, he was hosting boozy parties in Downing Street. Is he now going to do the decent thing and resign?


ABDELAZIZ: Now, Hala, this is absolutely not the apology that his critics wanted, that the opposition wanted. Again, he lacked that actual admission

of guilt, but it's a massive about-face and it tells us just where the prime minister is. He is cornered. He had to give some sort of reply, and

the perception here is, this is what he had to do. He had to say something to fight for his political survival, and it's not just about what happened

in parliament. take a look at the latest snap polls.

It shows that two-thirds of adults in this country -- and again, it's a snap poll, small survey, only 1,000 adults, but it begins to give you an

indication when two-thirds of the adults in this country want to see that prime minister resign. Two things we need to watch here, of course,

politically. How does Prime Minister Boris Johnson survive this? Does he continue to hold the support of his party. Of course, the prime minister's

worst case -- worst fear here is that they turn against him and you see the possibility of a no-confidence vote.

That would require a mutiny, we are nowhere near that. But that's the nightmare scenario he is looking at. And then there's the public of public

opinion. Already, I've told you, two-thirds of adults in this country according to a snap poll, small snap poll saying they want to see the prime

minister resign. His favorability ratings are the lowest they have ever been since he's held office. There's absolutely cracks in the system. This

apology might be too little, too late, Hala.

GORANI: Right, you talked about the favorability, so according to the latest Ipsos MORI poll, he's at 20 percent, which is very low, lower than

it was even when it hits its lowest point a few weeks ago. How does the prime minister expect anyone to believe that he thought he was at a work

event when an e-mail was sent out to a 100 people asking them to bring their own alcohol to a garden party? I guess -- I don't know. How does he

expect that to fly?

ABDELAZIZ: Look, Hala, I think just like you were struggling to find words, I think the way that most of the British public is dealing with this

is trying to create memes, making jokes online, making light of something that is absolutely tragic because, yes, you're right, it's not just about

trying to believe this latest bit of information that the prime minister thought he was at a work event or was it a party or was it a gathering.

It's about the fact that you have this growing amount of information, videos, pictures of Prime Minister Boris Johnson sitting at the garden,

drinking wine with cheese on the plate and still saying, no, that was not a party.


So, how can we not believe our own eyes, our own ears at this point? And that's really what the question is, Hala, because it's no longer I think,

about how many parties took place or who was there. It's about the fact that the prime minister is overwhelmingly being seen as someone who has

betrayed public trust, who has lied to the country, who does not have the moral authority to lead, Hala.

GORANI: All right. And one last -- oh, we actually have our guest, thank you very much. I'll ask that question next hour to you, Salma Abdelaziz.

You heard there in Salma's report from Keir Starmer; the leader of the opposition who has told the prime minister the party is over and asked for

his resignation. With me now is Angela Rayner; the Shadow Chancellor and deputy leader of Starmer's Labor Party. She had strong words for the prime

minister in parliament on Tuesday. Before we get to you, Angela Rayner, we'll listen to what you said in parliament yesterday.


ANGELA RAYNER, DEPUTY LABOR PARTY LEADER, UNITED KINGDOM: The public have already drawn their own conclusions. He can run but he can't hide.


GORANI: All right. Well, she's joining me now live from London. The prime minister has apologized. He said he is sorry that the country feels misled,

feels that the political class has acted hypocritically by not following rules that they're setting themselves. Are you satisfied with that apology?

RAYNER: I think more importantly, the British public are absolutely disgusted. And I've never seen people so angry as they are at the moment

because, of course, many people didn't get to say goodbye to their loved ones who were dying at the time because they followed the rules that the

prime minister had set. So I don't think his apology will suffice for anybody, and the British public are outraged by the prime minister's


You know, a couple of days ago, he was smirking on the U.K. media, thinking it was all a big joke, but for now, I think he's lost his sheen and people

are really seeing him for what he is, and that's a class clown.

GORANI: But do you believe him, that he's -- that it's a sincere apology? Do you accept his apology?

RAYNER: Not at all. I mean, he came to the house today because he had been found out. He was apologizing for being found out. And, you know, if you

listen to the flippancy of what he says, he says he thought it was a work event. I mean, he knows that he's been caught breaking the rules. He spent

weeks trying to claim there wasn't any parties, and now the party is over for him because even his own conservative MPs rightfully are very angry

with what the prime minister has done.

And you know, he had very good public opinion. You know, he was a very popular prime minister --

GORANI: Yes --

RAYNER: And now he's wasted and squandered all of that popularity on breaking his own rules.

GORANI: So his favorability is down to 20 percent. Do you believe the leader of your party, Keir starmer is the one to take you into a

victorious next chapter? The general election in your country is two years away, and, as you know, in politics, that's an eternity. Do you think --

and Keir Starmer in the same poll that gave the prime minister 20 percent favorability, had a 25 percent favorability in terms of support for him

becoming prime minister in this particular Ipsos MORI poll. That's not very high.

RAYNER: No, but if you look at the bar that was set and where we were back in 2019 at the last general election, the Labor Party lost a historic

defeat. We lost many seats in our homelands where we would normally win. And we took a batter, and therefore myself and Keir Starmer, when we took

over the Labor Party, we were not in a good place, you know, and we had a lot of -- earning the respect, part of the focus(ph), and I think Keir

Starmer is gradually been doing that.

And just because Boris Johnson is not doing well, doesn't necessarily mean that people are going to just rush back to us. We've got to earn that

respect, and that's what myself and Keir have been doing. But you know, it took a long time for people who voted Labor all their lives, to say, I

can't vote for you, and we have to understand why they said that. And there were a lot of soul searching as a party to ensure that the public could see

us as a party that they wanted to vote for, and I think we're getting there.

GORANI: I was going to say with the -- with the -- with the Tory Party and the prime minister in such disarray, it should be -- I mean, politically-

speaking, easier for you, right? And does it feel like you're not landing the kind of punches politically that you could be, given the weak position

in which the prime minister finds himself?

RAYNER: I think we've made significant progress. But like I said, I think the general public in the U.K. at the moment are very disillusioned with

politics in general and have been for a very long time.


And I think Boris Johnson came and, you offered, you know, the populace different -- you know, I'm not part of the establishment, I understand you.

And people who put their trust in him and people that would never vote conservative put their trust in him. And I think he squandered that over

the last couple of weeks in particular with his lying and behavior where he broke his own laws, the lockdown rules.

And I think we've proven over the last 12, 18 months that we started to come back from being in a very low place, you know, for many of the public,

and I think things are turning around for -- it takes -- it's very easy to lose somebody's trust. It takes a hell of a lot more to regain that, and

that's what Keir and myself have been doing. And I think we're doing that with some success, but I think the British public are very angry with what

Boris Johnson has done over the last couple of weeks.

GORANI: OK, Angela Rayner; the deputy leader of the Labor Party, thank you so much for joining us, appreciate it. Still to come tonight, friendly

gestures, but little movement toward resolving the increasingly tense standoff between NATO and Russia over Ukraine. We'll go to Brussels to find

out what did and mainly what did not get accomplished today at these long- anticipated meetings. Plus, even more drama surrounding the world's number one tennis star, Novak Djokovic. We'll explain. Stay with us.


GORANI: A very serious and direct exchange, That's how NATO Secretary General is describing today's four-hour talks between NATO and Russia on

the contentious issue of Ukraine. Well, it doesn't appear they made any headway, unfortunately. The Secretary General said NATO is under no

illusions how difficult this will be.


JENS STOLTENBERG, SECRETARY GENERAL, NATO: NATO allies are clear about the prospects for progress in these talks. They express serious concern about

the Russian military build-up in and around Ukraine, and called on Russia to immediately de-escalate the situation.


GORANI: But Russia refused, saying it is NATO that must de-escalate by stopping any eastward expansion. Russia has some 100,000 troops on

Ukraine's border, and wants that and other guarantees that NATO diplomats say are non-starters.


Let's better understand the meetings today, Nic Robertson is in Brussels for us and Matthew Chance is in Moscow. So, it appears Nic Robertson as

though the two sides are not any closer to coming to some sort of -- to moving to some sort of middle ground here?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, in many ways, Hala, it was a rerun of what we saw in Geneva on Monday. Both sides stating

their positions, although it does feel, you know, after a second round of it today, as if the positions maybe feel even more entrenched. Wendy

Sherman, who led the U.S. delegation in Geneva and was again leading the U.S. delegation at NATO said that it wasn't clear to her that the Russians

were just using these talks as a way to eventually get to a position of fighting.

But she also said that the Russians had not said that they wouldn't de- escalate, but neither had they committed to deescalating. I spoke today with both Secretary General of NATO, Jens Stoltenberg and with the lead

Russian negotiator, and both of them very pointedly and clearly said that the ball remains with the other side to take the next move. Here is what

they both said.


STOLTENBERG: And right now, the ball is firmly in the Kremlin's court now. Yes, we will -- we're waiting for their answer to our proposal to continue

series of meeting, addressing a wider and show important issues for European secret.

ROBERTSON: Sir, the NATO Secretary General today said that the ball is now in the Kremlin's court. Your turn to answer.

UNIDENTIFIED MALE: No, the ball is in NATO's court.


ROBERTSON: And I think that really sums up, you know, what's happened. Essentially the ball -- it's in the middle ground. It's moved neither

forward nor backwards. The language that we've heard from the Russian side this evening is very tough language, perhaps tougher than we heard in


That if they -- essentially, if they continue to feel pressure, then they will respond back. And if there isn't ultimately a political solution, then

they would default to sort of legal, political, military solution. There's no buckling on either side and no apparent common ground yet where there

could be common ground. It doesn't exist at the moment.

GORANI: And Matthew Chance, what are the Russians saying today?

MATTHEW CHANCE, CNN INTERNATIONAL CORRESPONDENT: Well, as Nic was just saying. i mean, they are doubling down on their core demand that NATO

doesn't expand any further eastward. They say that impacts Russia's national security. They also want military forces in countries that joined

the NATO alliance since the fall of the Soviet Union to be -- to be pulled back as well. Both of these are, you know, they're non-starters.

All western officials that have spoken about this have said that is not ever going to happen. And what the Russians have said today is that, it is

intolerable, intolerable was the word that they've used, to describe the ongoing situation with those demands, the ongoing situation with

encouraging Ukraine, putting weapons into it, you know, kind of not ruling out the fact -- not ruling out the idea that it could one day join the

western military alliance.

And so, you know, the Russians are saying, look, when we get to the end of these rounds of negotiations at the end of the week -- remember, there are

more in Vienna, tomorrow at the USCE, the organization was scheduling incorporation in Europe, they are then going to take a step back and

they're going to decide whether it's worth having any more talks or whether they will decide -- you know, the red lines that Russia has set out are not

being addressed seriously.

And perhaps look at -- I think they're calling it military technical steps that they might take in response. There's only one man, Hala, that is going

to be able to make that final decision, and that's Vladimir Putin, the Russian president here in Moscow.

GORANI: All right, Matthew Chance, thanks so much. Nic Robertson as well. Coming up, we'll have much more on that NATO-Russia dispute. I'll talk with

a former U.S. ambassador to Ukraine about where he believes this standoff goes from here. And tennis star Novak Djokovic has been facing one

controversy after another ahead of the Australian Open. He's now apologizing what he said just hours before the tournament draw. We'll be

right back.




GORANI: OK. So we're getting close to this whole Australian Open thing starting, because the draw is supposed to happen in a few hours and we are

still waiting to see whether Novak Djokovic will be able to defend his title.

The Australian immigration minister is still considering apparently whether to remove him from the country. And the men's number one player is coming

under fire again. Now it is because he sat down for an interview in person last month, even though he knew he had tested positive for COVID-19 and

even took his mask off for pictures.

Djokovic says on social media it was, quote, "an error of judgment."

That's not all. He's addressing the controversy over an apparently false travel declaration when he arrived in Australia. His form said he had not

traveled in the two weeks ahead of the trip.

But there are images of him in Spain and in Serbia during that window. He says his support team submitted the declaration on his behalf, calling it a

"human error and certainly not deliberate," quote-unquote. Here is CNN's Paula Hancocks.


PAULA HANCOCKS, CNN CORRESPONDENT: The immigration minister still holds the power to personally intervene and to revoke his visa. We don't know at

this point when we will hear from Alex Hawk.

But as it is, the Australian Open starts next week. In fact, in less than 12 hours, there will be a draw for the men's single tournaments. Djokovic,

his name is still on the cards at this point and he is seeded number one for that tournament.

So what we're seeing from Djokovic himself is, he is now training. He is assuming that he will be in the tournament. But he has given this statement

on social media, knowing that there were many questions surrounding his positive test result and his declaration.


GORANI: That was Paula Hancocks in Melbourne.

Officials in Serbia are also concerned over the tennis star's behavior around the time he tested positive for COVID. CNN's Scott McLean joins me

live from Belgrade in Serbia with more reaction there.

Hi, there, Scott.

SCOTT MCLEAN, CNN CORRESPONDENT: Hey, Hala. Yes, you are absolutely right. The prime minister of Serbia has said, look, if, in fact, Novak Djokovic

did break his quarantine, did go out and do that interview with the French magazine, then that would be a clear violation of the rules.

But look, the Serbian government has made no secret about the fact that they are very supportive of their home-grown hero. This is the best tennis

player in the world right now. And he comes from a very small country and people are extremely proud of that.


You know, the Serbian press, with some small exceptions, is not trying to pick apart his statements, pick apart his PCR test, when he knew he was

positive, all of these questions that the rest of the international press is doing.

They, by and large, have more questions for the Australian authorities over why exactly he's not being let in when they say his paperwork seemed to be

in order.

And when you talk to people on the streets, Hala, you get this sense that they are extremely reluctant to criticize and they're extremely reluctant

to believe that he didn't tell the truth.

Several people that I spoke to, when I explained, look, he says that it was an error in judgment for him to break his isolation, I had to read them his

statement, because they just didn't believe that that was something that he had said.

It was something -- they thought that it was something that the international press had been putting out there but that was unverified. So

here is a sense of what people told us about the situation with Novak Djokovic and the Australians. Listen.


UNIDENTIFIED MALE: We don't get it. If he's negative, if he has PCR test and he had the papers that actually prove, he proved that he's excluded

from receiving jabs.

So why not?

I mean even if he was responsible in Serbia, you know, with PCR test in his hands, it has nothing to do with the fact that, at the border control, he

had all of the required necessary documents. He did everything on his end. So we don't see how -- how it is normal to do something like that.

UNIDENTIFIED MALE: You know, we are Serbs, we are on his side. So everybody he says is right.


MCLEAN: And, Hala, look, you also have to appreciate the perspective that Serbians are coming from. This is not a country that had the very strict,

long-lasting lockdowns we saw elsewhere in the Western world. So they come at this from a very different perspective than perhaps Australians, who

have gone through, you know, the last two years of being really isolated from the rest of the world.

I asked people as well what they thought about whether Novak Djokovic was setting a good example for his fellow countrymen, a country, Serbia, that

is really struggling to get people to actually take the vaccine. Fewer than 50 percent of the people in this country have even one dose of the vaccine.

And, by and large, the answer that I heard was, look, it is a personal choice. You will be hard pressed to find many people in this country who

believe that the government should be mandating anyone to put anything into their arm.

One last point, Hala, and that's that the Serbian president is giving an interview on Serbian television in a couple of minutes from now. So

obviously we will be watching that closely to see what he says about "our Novak," as one woman told me on the street tonight.

GORANI: All right. Scott McLean, thanks very much, on the street live in Belgrade.

You are watching from all around the world -- and we probably don't have to tell you it is a trend we are seeing in so many places. We don't have to

tell you that the pandemic has led to price increases on a lot of consumer goods we buy every day.

But today we are seeing a pretty stark indicator of the sticker shock; in particular, in the United States. Listen to this number: the U.S. consumer

price inflation index, inflation basically rose 7 percent year on year. That -- in December. That is the steepest jump in nearly 40 years. The last

time it was this high was 1982.

Just yesterday, the World Bank warned, rising inflation could jeopardize economic recoveries around the world. My colleague, Richard Quest, is

reporting on this story tonight from Dubai.

So 7 percent, year on year. We will talk about other countries in a moment. But a big, huge red flag, too, is grocery prices are up 6.5 percent. That

hits people across all income levels.

RICHARD QUEST, CNN HOST: It does but of course, it hits people especially hard at the lower income levels.


QUEST: Where there is a higher portion or their percentage of income going for basic staples. This is why Jay Powell, the chair of the Fed, said

yesterday in his confirmation hearings before the Senate, that he would do whatever it takes effectively to bring inflation down.

In fact, it is so high and so disconcerting that Goldman Sachs now believes that the Fed will raise rates four times this year -- official Fed

documents only suggest three. Hala, we have not seen this sort of entrenched inflation for years.

And what is even more remarkable is that we've been told by the Fed, pretty much for the last 12, 14, 18 months it was transitory.

It is not. It is here and it is rising.

GORANI: And it is not transitory because, initially the argument was, well, there are supply chain issues. This is increased, pent-up demand from

earlier in the pandemic.


People didn't purchase big-ticket items then; they're doing it now. So therefore, prices are going up.


GORANI: That's all true, by the way. Two things can be true at the same time. Then you have the other issue, you have labor shortages. Therefore,

the cost of labor is going up. And this is prolonging this inflationary environment. This is really worrying.

QUEST: Right. So you start with the enormous amount of fiscal and monetary stimulus being put into the economy by the authorities. Now you layer onto

it the supply chain issues.

Now you layer on top of that the labor issues that you are talking about. And you layer, on top of that, rising wages. You end up with this lovely

phrase, inflationary expectations.

And the moment people believe prices are going up, they buy; they, therefore, create more and, therefore, they demand more in their wages.

This vicious cycle is underway.

GORANI: Absolutely. And the other issue, too, is it is only not just in the U.S. We live in an interconnected world, economically. The Bank of

England is predicting inflation will hit 6 percent year on year in April, the highest since 1992. Then you have other countries, Turkey, for

instance, which is seeing 36 percent inflation.


GORANI: You know, this is not conducive to a healthy recovery anywhere.

QUEST: No, and what is particularly worrying about this is the disparity around the world. So you've got the U.S. and the U.K. But inflation is not

a major concern yet for the ECB across the Eurozone. It could be. But there it is still recovery and growth.

But go out to Japan and you are really talking about still very low inflation and trying to get things moving again. So we have a -- we have

always had a divergent world economically. But the risks and the difficulties now -- in fact, on "QUEST MEANS BUSINESS" coming up at the top

of the hour -- forgive the shameless plug.

GORANI: I was going to do it for you, Richard.


GORANI: Who do you have?

QUEST: We have the IMF managing director, Kristalina Georgieva, who will be telling us, basically, inflation is a problem and the Fed needs to deal

with it.

GORANI: All right. Well, then I'm not going to read my promo for your show. You just did it. Thanks so much, Richard.

We will look forward to that interview at the top of the hour.

Still to come tonight, neither NATO nor Russia giving any ground. A former ambassador to Ukraine will tell us what is at stake because this standoff

is not showing any signs of easing. We will be right back.





GORANI: Well, there were lots of words but very little trust or progress today in Brussels, as NATO and Russia confronted one another about Ukraine.

A top American diplomat said it is unclear if Moscow is sincere in trying to reach a diplomatic solution or is just using the talks to claim that

diplomacy can't work.

For its part, Russia says NATO's eastward expansion is a direct threat to its security and accused the U.S. and its allies of seeking supremacy. Its

deputy foreign minister says Moscow will resort to military measures if diplomacy fails.

NATO ministers are calling Russia's demands "nonstarters," so you are hearing it here. It sounds a lot like what was said yesterday, with perhaps

even starker rhetoric coming from the Russian side.

Let's turn now to Ambassador Steven Pifer, via Skype from California. He is a William Perry fellow at Stanford University and a former U.S. ambassador

to Ukraine.

Thanks for being with us. So what I was referencing there is what the deputy foreign minister has said, that Russia would resort to military

technical measures if the political process does not pan out. What do you think that means exactly?

STEVEN PIFER, FORMER U.S. AMBASSADOR TO UKRAINE: Well, we've seen, over the last two months, as the Russians have built up a relatively large

military force near Ukraine, perhaps as many as 100,000 troops.

And that build-up seems to be continuing. So I think there's the military threat to Ukraine. The question now is, NATO officials told the Russians

today what the Russians heard from U.S. officials on Monday in Geneva, which is that some elements in their proposed draft agreements are


But there are other elements which might be a basis for negotiations. Now we have to see how the Russians react.


What would be a basis for negotiation and could it move things forward?

PIFER: Right. Well, the Russian -- the two draft agreements, the U.S.- Russia agreement and the NATO-Russia agreement, talk about things like some constraints on the size and scope of military exercises. They talk about

perhaps --


PIFER: -- on missiles in Europe. And those are areas where both the United States and NATO officials have said there is a possibility of a negotiation

here, provided the Russians take account of U.S. concerns and NATO concerns.

GORANI: So I spoke --


GORANI: -- sorry, please continue. I thought you were done with that sentence. Continue, please.

PIFER: Yes. But the unacceptable demands, that NATO foreswear any further enlargement, that NATO withdraw forces from their NATO countries that

entered the alliance after 1997, that NATO have no military to military contacts with other post Soviet spaces, those are really not acceptable.

GORANI: Right. And Wendy Sherman, by the way, spoke with our Christiane Amanpour, was essentially saying it's a nonstarter. Russia does not have a

veto on who we accept or don't accept within NATO.

I spoke with Brett Bruen, who was a former global director of engagement at the White House, who sat on the National Security Council in 2014, the year

that Russia invaded and annexed Crimea. His whole concern about what is going on now is he doesn't believe Russia should be appeased.

He believes that the U.S. and its Western allies need to be more forceful with Vladimir Putin.

Do you agree or not?

PIFER: Well, I think the Biden administration has it about right. On the one hand, President Biden has articulated directly to President Putin that

there will be major costs if the Russians launch a new military attack on Ukraine, significant sanctions on Russia that go far beyond what have been

imposed to date.

More Western military assistance to the Ukrainians so they can better defend themselves and that NATO would then enhance its military presence on

its eastern flank.

Of course, the big cost would be imposed by the Ukrainians, who will resist and the Russians will pay a price. And at the same time, saying that there

is this possibility for dialogue. But the Russians have to be realistic in what they seek in that dialogue.

GORANI: How does Vladimir Putin's leadership style, his personality, how is it a factor in these discussions?

Because, ultimately, he's the decision maker.

PIFER: Yes, he certainly will be the one with the major voice in the Kremlin. But this does seem to me to reflect Putin's style. I mean, you

have seen that, although the Russian diplomats today at NATO and on Monday, when they met after their meeting with the Americans, were expressing and

reiterating Russian demands.


They also left the door open for further dialogue. So they have done nothing to foreclose Mr. Putin's options -- and he likes to have options.

And it could be he has not yet made this very crucial decision, whether or not to use military force against Ukraine.


GORANI: Sorry, I don't mean to interrupt, because I think the audio is cutting every once in a while, I get the sense that you are done. I don't

mean to do it. But one quick last one here.

Do you believe that the Russians, asking for guarantees, airtight guarantees that NATO will not expand eastward, knowing full well that the

U.S. and its allies will say no to this, is this just an opening position that they know they can negotiate from?

Or is it truly, do you believe, their -- a demand that, if not met, will lead to possibly more military confrontation?

PIFER: That's exactly the right question to ask.

You know, is this the opening bid for a serious give-and-take negotiation or does the Kremlin seek rejection of its demands so that it can then use

that as another pretext for military action?

I don't think we know. Mr. Putin may not yet have decided. But certainly, if you look at the rhetoric coming out of Moscow, the military buildup, it

would be wise for the West to assume the worst and to be doing everything it can to dissuade Russia and deter Russia from launching a military attack

on Ukraine.

GORANI: All right. Really appreciate your take on things, Steven Pifer, the former U.S. ambassador to Ukraine. Thank you for joining this evening

Europe time.

What time is it for you now?

It is the beginning of the afternoon. Thanks for joining us.

We will be right back on CNN.




GORANI: The president of Kazakhstan is praising a Russian-led peacekeeping force for helping, quote, "stabilize" the country after anti-government

protests turned violent. He calls their mission a success and says the troops will begin withdrawing from Kazakhstan Thursday. Fred Pleitgen made

it inside Kazakhstan and is in the capital with more.


FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, you can see the situation still is pretty tense here on the ground of the capital

of Kazakhstan in Nursultan. There certainly is a lot of law enforcement out in the streets.

Also the military on some corners as well. Key areas of the city still remain cordoned off; like, for instance, the presidential palace that you

can see behind me.


However, the government is saying that it increasingly has the situation under control, not just here but also in the hardest hit city, which is

Almaty, where 103 people were killed in that city alone as those protests unfolded.

Now the Kazakhstani government told us that things became very, very difficult for them as those protests and especially the rioting unfolded

here in this country. In fact, a senior member of the government here told me that they were very close to losing control of Almaty.


ERZHAN KAZYKHANOV, DEPUTY HEAD OF PRESENT ADMINISTRATION, KAZAKHSTAN: They frightened the civilian population. They were looting properties. They were

attacking businesses.

All these things created a very big threat among the population. And if they were -- take -- they were to take control on the city, that might be -

- would have been an even bigger problem for the central authorities to control the situation.


PLEITGEN: Now the government is saying that it is continuing its crackdown on the people who took part in the protests and those who were behind the

protests as well. The government here continues to insist that there were foreign forces at play.

However, so far has not named which forces it believes was actually behind all of this. The government also says that one of the reasons why it

managed to get the situation under control again was the fact that you had foreign forces that were deployed here for the country. Those forces, of

course, were led by the Russian Federation.

Now the Kazakhstani government says right now it has the situation under control to an extent where those forces can leave. That exit of the foreign

forces will begin on Thursday and it is set to take about 10 days -- Fred Pleitgen, CNN, Nursultan, Kazakhstan.


GORANI: Organizers for the Beijing Winter Olympics are coming up with some novel ways to try to keep diners safe from coronavirus. For one thing,

they're making robots do the serving. Journalists arriving to Beijing ahead of the games were served noodles and other dishes dropped down from the



GORANI: I hope they have liability insurance and helmets.

And the food is not just being served electronically; here you can also see robots actually putting together a burger. Beijing is implementing very

strict protocols for media, athletes and officials. But the thinking goes, robots are not bursting anyone's COVID bubble.


GORANI: Thank you for watching tonight. I'm Hala Gorani. I will see you next time. Do stay with CNN. "QUEST MEANS BUSINESS" is live from Dubai