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QUEST MEANS BUSINESS
Europe's Workers Protest Against Austerity Measures; Interview With Former Prime Minister of Ireland Bertie Ahern
Aired September 29, 2010 - 14:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST, QUEST MEANS BUSINESS: Europe's balancing act. Thousands are demonstrating against austerity measures. Governments are told they must do more.
Ireland gets its knuckles rapped. The former prime minister tells me tonight comparisons with Greece are unfair, unreasonable, and unjust.
And Daimler's chief exec also on tonight's program.
I'm Richard Quest. And yes, midweek, and I mean business.
Today there was a show of force against public spending cuts across the continent of Europe. Thousands of protestors took to the streets in Brussels, in Spain, in Poland, Italy, Ireland, and in Latvia. At the same time governments in Ireland and Portugal were told they must do more to show they are serious about the austerity measures.
The protests across Europe came as the European Union itself thrashed out details of its austerity measures. Now these austerity measures will be the core and the backbone about the way the Union will deal with miscreant countries in the future.
Come and join me over in the library and you'll see what I'm talking about. The core proposal is that instead of being-there will now be fines for breaking the rules. Fines that would be based on a small fraction percentage of a country's GDP, where the money would then be deposited, non-interest bearing deposits, that are already there with the commission, that would then be sequestered as fines. These fines would be really the first time that the Union has had almost automatic variance for actually penalizing countries that break the stability and growth pact (ph).
Come with me, though. Portugal, one of the two countries that is sharply in focus at the moment. There is to be an emergency government meeting. You'll know the OECD has told Portugal it needs to do more. Now the European Commission has said it needs to do more. The debt burden is increasing and the cost of borrowing for the Portuguese government on the market is also rising quite sharply. The government debt has now become the core problem.
And in Ireland the EU is now saying that Ireland must do more. The thing about Ireland, it is a twin track problem. Yes, debt levels, the cost of debt is once again rising for the Irish government, which is planning on Thursday to announce a further bailout of the banks. For Jose Manuel Barroso, the president of the European Commission, the totality of this is governments need to get a grip.
(BEGIN VIDEO CLIP)
JOSE MANUEL BARROSO, PRESIDENT, EUROPEAN COMMISSION: The message is clear. We will pull the hand break before the car rolls down the hill. And today's proposals are part of our broader reform agenda for Europe. Europe is not reviving itself through the structural reforms that were agreed in Europe 2020 Agenda, by the end of the year the commission will have put all of its proposals on the table. We are making Europe the first region in the world to have topnotch financial supervision and regulation that is up to the challenges of the future.
(END VIDEO CLIP)
QUEST: So that was the story as was seen from the Commission's point of view. The headquarters of the Commission, in Brussels, and it was in Brussels that the largest demonstration today took place. Phil Black, our correspondent, is in the Belgium capital tonight.
Two very different sides of this crisis. You were looking at the demonstrators today.
PHIL BLACK, CNN CORRESPONDENT: Yes, indeed, Richard. And it was a pretty big turn out on their part. One of the biggest demonstrations, we're told, this city has seen for a while. The Belgium police counted, or estimated, around 80,000 people on the streets marching through Brussels. The organizers had hoped for around 100,000, or so. There was a little less than that, but they say they had delegations here from 30 countries across the region. So they're quite proud of the fact that they were able to draw n as crowd of that size. So a good turn out. People showing commitment and traveling vast distances to be here, to fight for their cause.
You would expect a big fiery union event, but it wasn't really. We followed the march along and it was rowdy in parts, but it was on the whole pretty flat, Richard.
QUEST: Phil, but the fundamental objection, is what? Is it against the austerity plans already in place, the prospect of more austerity, or were they just taking the opportunity of it being Brussels to rail against the Union?
BLACK: "Say no to austerity" was the very simple message of this demonstration today. No to austerity, absolutely. The union says that its message is no spending-public spending and welfare cuts. No cuts or freezes to wages and pensions. No further deregulation of the labor market. They believe that the austerity measures go too far, too quickly. And in their words they say that the fragile economies of the region that are only just beginning to recover and now are being put at risk again, by these measures.
And so they mounted this big march today. I asked many of the protestors whether or not they thought a protest like this could go anyway towards a win for them. Could actually persuade the European governments to rethink their whole position on this and not want to bring down debt as quickly as they do. This is what some of them told me.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I hope that all the governments, tall the countries here in Europe can see this and can change their politics.
UNIDENTIFIED MALE: It's not time to forget the people. It is not time to forget the workers. It is time to hear what is happening in the street.
UNIDENTIFIED MALE: Together with the parliament, pressures on the parliament, and other pressure groups, I think it could make a difference.
(END VIDEO CLIP)
BLACK: So, there was some optimism among people today but it could at least be part of a more successful war against austerity. But even on the whole that optimism was pretty hesitant, Richard.
QUEST: Stay with me for a moment, Phil Black in Brussels. We need to go now to Madrid to Al Goodman who was watching the protest, the general strike taking place in the Spanish capital.
I'm hearing mixed reports about the effectiveness of that strike.
AL GOODMAN, CNN CORRESPONDENT: Hi, Richard.
Well, the unions claim success. They say 70 percent following the strike. Clearly this was not a normal day across Spain. Starting right at the beginning of the day with trains and metros and bus service, that was much lower in Madrid right here, and across the country, in the big cities. And that meant that a lot of people, even if they wanted to get to work, could not get there. The few trains and buses that were running, were packed. Now there was a lot of traffic, but I would say less than on a normal day right here in Madrid.
The unions say that they really had an impact on industry. They point to a 17 percent decline in electricity over normal use on a weekday like this. So they say that they are feeling pretty good. The government has been trying to take a moderate stance and they are really not coming out with their own figures, Richard.
QUEST: Al Goodman, who is in Madrid. Back to Brussels and Phil Black.
Phil, pull the strands of today together. Did you get a feeling that the, if you like, the people had spoken back and that this crisis or the next phase of this crisis was moving into a further phase?
BLACK: In terms of whether they are going to take this further? Well, its hard to say, Richard, really. I mean this is a big set piece day for them. They have called it a European day of action. So, remember, not just protests here but across other European countries as well, a long list of them, as well as the industrial action in Spain that we've been talking about. Will they take it further? It is just hard to say. They wouldn't commit to it. We talked to them about it. We asked them, we pushed them. They say they are going to maintain the battle, maintain the rage, if you like, but just how far they are prepared to take this, what sort of widespread industrial action across European nations they are prepared to take, in their battle against austerity, that still remains to be seen at the moment, Richard.
QUEST: Phil Black, who is in Brussels. We had Al Goodman who is in Madrid, with out coverage tonight, after demonstrations.
When we come back in just a moment, the markets in New York, have been busy. We need to update you on whether they're up or down.
QUEST: Now there is a big shuffle at BP. The incoming Chief Exec Bob Dudley, who takes over at the end of the week, has shaken up the top level team. And he has also sent a message by restructuring safety and risk management and saying that that is now at the heart of BP. You'll see what I mean over in the library.
The big move, of course-the higher you go, the harder you fall. Andy Inglis has fallen, the head of BP's exploration and reproduction. We could put it charitably and say he's leaving the company at the end of the year. You can basically say he got sacked. He's not going without a penny in his pocket. He was the head of drilling during the Macondo well debacle. He leaves with a $9 million pension pot and a salary of just over $1 million.
The Deepwater Horizon, of course, killed 11 people. The explosion killed 11 people and it spewed oil into the Gulf of Mexico for three months.
So, he's out. And Mark Bly is part of the reshuffle and becomes the new head honcho of all things safety. According to Bob Dudley, it will Bly's responsibility to look over the risk management, the projects, the execution, all of these. It will be a powerful new safety unit with BP.
As for Dudley, himself, he was of course-he was the man put in charge by the board, after Tony Hayward goes at the end of the week. Dudley is an American. He is believe and seen to be far more, if you like, the safe pair of hands that will, perhaps, keep the government off BP's back.
Dudley says the changes are designed to restore the battered reputation.
Take a look at stock price. And you'll see, interestingly, how it has performed; up 4 percent today. And BP, overall, has been up quite sharply, certainly from the low points when it dipped under 3 pounds a share. But that was some time ago. The stock now over 4 pounds. So if you are into BP, or you were, you are showing a strong gain on recent lows.
The sinking feeling across Europe drove shares to a three-week closing low. H&M, Hennes & Mauritz, was a big reason. Third quarters disappointed investors it weighed on the entire retail sector.
The markets in New York-I misled you when I said it might have been exciting; a 9-point gain. Well, I had to keep you watching somehow. So we tried to keep you watching. Nearly just under 10 point gain for the Dow Jones.
This afternoon there have been reports all over the place suggesting Facebook and Skype-now one of course is social media, the other is the internet telephony company-are getting closer to announcing a deep integration deal.
The technology news site, AllThingsDigital says the two are talking about a far-reaching partnership. It would allow users of the world's biggest online social networking site to send text messages and make Internet phone calls from their Facebook profile page.
OK, reaction to this development, if announced, Om Malik is the founder of GigaOm.com. A business media company which links the world's leading technology to a global audience.
Why does it make sense for these two to get together? Anybody who, frankly, is a computer user knows how to use Facebook, knows how to use Skype, what is the advantage?
You have to look at it in two-from two angles, right? The role of communication is changing from what we have know for one or two weeks or so, for thus far. You know, you've had the phone, you've had IM and we've had somewhat like e-mail and all, that is from the early version on communication.
Then there is a whole generation of people who are growing up using Facebook, by exchanging status updates, then exchanging photos. So there are two different kinds of communications methodology.
QUEST: Right, right.
MALIK: And they need to come together.
MALIK: I mean the world is very different.
QUEST: But that doesn't answer the question.
As to why Facebook and Skype want to integrate their two programs. I can see, why they would want to. But what benefit will it give to anybody using one or the other do you think?
MALIK: So Facebook is all about name spaces, right? When I say the name space, your real-life entity is tied to Facebook, which allows you to forget the six, or the 10, or the 12 digit phone number you have. Your identity is tied to your name and through Skype you can start making calls in and out, by working together. So if you really think about it. That this personalizes the idea of communication even more.
QUEST: Om Malik, many thanks indeed. Interesting stuff. We'll be following that further.
As we continue tonight, it doesn't end there. I've posted a fascinating article, in fact, it is the article on Facebook page that details some previous collaborations between Facebook and Skype. You can find it at Facebook.com/CNN.Quest.
We're seeing a growing market share, upbeat words from the mind behind Daimler. We talked to him in Paris ahead of the big auto show.
QUEST: Now we've been talking about the new normal tonight, but the head of Daimler says his market share is growing. CNN's Jim Boulden caught up with Dieter Zetsche, ahead of one of the big highlights of the automotive year, the Paris Auto Show.
Jim is in Paris with a beautiful-well, I'm not-not that Jim isn't always beautiful. But it looks like a lovely night in Paris, tonight. Is it nice or is it just-
JIM BOULDEN, CNN FINANCIAL CORRESPONDENT: You really can't beat this view, can you, Richard. And it was here on the Champs Elysees, at the Mercedes showroom where Dieter Zetsche actually talked to the press and showed off some of his wares a day before we got to the car show. Before the two days of previews that we see.
And I did start by asking him exactly how it was that Mercedes was able to accelerate growth this year, much better than he had expected.
DIETER ZETSCHE, CHAIRMAN & CEO, DAIMLER AUTOMOTIVE: There is no doubt that we have tailwind. That the economy and the car markets in particular are recovery much faster than all of us expected and this is even more true for the premium market. But within this growth we are gaining market share, plus we see the significant impact of our high accomplishments in cutting costs last year. We maintained that discipline and now we have to go together, the top line and the bottom line, and that, of course, helps.
BOULDEN: You have a target of selling 1.5 million cars by 2015. We are sitting near an e-cell (ph) car. How realistically-or how many of those cars will be battery cars, electric cars, how many will be hybrid? I mean is it realistic that Mercedes customers want an electric vehicle.
ZETSCHE: 2015 is around the corner and we will certainly have a significant amount of hybrid cars at that time. We will offer mass production, all-electric cars, battery electric and fuel cell electric cars, but realistically the percentage of sales for these all-electric cars, zero emission cars be relatively small.
BOULDEN: 5 percent? 10 percent? Less than that?
ZETSCHE: I think 5 percent is an optimistic assumption.
BOULDEN: A lot of debate whether China or the U.S. will your number two market by 2015, what's your guess?
ZETSCHE: Well, it will be a close race. We assume that we will be around 300,000 units in China at that time. And that is something what we want to beat in the U.S. as well. We were close before and we hope that recovery will continue and strengthen in the U.S. and then it will be a very close race.
BOULDEN: Now, Richard, even though Mercedes might not see a lot of growth from the electric vehicles, I've got to tell you, all the other major car makers here, from Ford, Nissan, they all want to talk about electric cars. They all have electric cars or batteries to show us. And they are really, really putting a lot of effort into this. And this show will show us some of the new vehicles that are actually mass produced and ready to go, not just concept cars.
QUEST: But, Jim, the thing about Daimler, and as I've seen the numbers, record sales or very strong sales. The company has got its act together. So I'm wondering, the austerity that is coming, does that hit hard for them?
BOULDEN: What he told me tonight was that during the economic crisis Mercedes was able to take a lot of money out, a lot of cost out. They did a big cost reduction plan, so that when we came out into the good times- which currently we are at for Mercedes, certainly-that they were able to keep their costs down, which means they could hit a profit earlier. Obviously, looking into 2011 and '12, they are looking at big expansion in China, in India, and even in the U.S. So there is a possibility that the austerity measures won't impact them because like so many other companies, they are looking at Asia. They are not looking for growth, necessarily, in Europe.
QUEST: Jim Boulden, half past eight, for you, in Paris, I'm guessing. That is just time to pop to the Champs Elysees and perhaps a bit of dinner. Just don't send us the bill from there, Jim Boulden in Paris tonight.
In a moment, we talk to the former Irish Prime Minister Bertie Ahern. We'll ask him how Ireland's boom went so quickly to bust and whether the Celtic Tiger really was paper tiger in disguise?
QUEST: Hello, I'm Richard Quest. QUEST MEANS BUSINESS, this is CNN. And here, the news always comes first.
QUEST: Speaking to this program the former Irish Prime Minister Bertie Ahern says lumping Ireland and Greece into the same pot is wholly unjustified. Mr. Ahern's comments come as "The Financial Times" is saying the Anglo-Irish bank is set to get another bailout from the government. The FT says Ireland will inject nearly $7 billion into the bank.
Ireland's fate (ph) is it is having to pay from its debt on the market is now starting to rise quite worryingly.
I spoke to Bertie Ahern and I put it to him that two years ago Ireland was praised for the measures it put in place to deal with the financial crisis. What's gone wrong since then?
(BEGIN VIDEO CLIP)
BERTIE AHERN, FMR. PRIME MINISTER OF IRELAND: The last two years have been difficult for the Irish economy. We have had real cut back in terms of quality of life and standards of living. We have to re-orientate our budget and substantially to where it was and that has meant wholesale cuts right across the board, including public service pay, including welfare, to readjust ourselves.
I think the-and that will reassure, I think, the economy and internationally that we're doing the right things. We were praised, as you said, by the IMF, by the World Bank, by the European Union.
Concerns, I think, have increased, you know, recently, that the ultimate cost of recapitalization of the banking system combined with some weak public finances would result in some, you know, some difficulties. But the Irish government has been able to -- to deal with the position.
Now, that has been an international view. I've seen some of the articles in "The Financial Times" and elsewhere.
However, I think given all the estimates that have been done independently here, even on their staff scenarios, together with, you know, gradual underlying improvements in the public finances, we believe that this is a very unreasonable conclusion.
QUEST: Yes, but -- you say...
QUEST: -- you say it's an unreasonable conclusion, but working on the lines that you can't buck the market, the market is forcing up the price of Irish government debt and forcing what we expect tomorrow, the recapitalization of the banks.
AHERN: Well, I think that, no, the recapitalization of banks is something that has been indicated by the Irish government that we're going to do by the end of September as -- so -- so that had nothing to do with the market state. The Irish government has said that the final amount of money that the -- the ultimate task of recapitalization of the banking system would be announced at the end of September. So -- so that has been the -- you know, the position throughout. And the reason for that was the banks were not in a position to be able to give total and complete figures all along until now. So...
QUEST: So are you...
AHERN: -- the Irish (INAUDIBLE)...
QUEST: -- are you saying, though, that this judgment is unfair on the economy?
AHERN: I tell you -- it -- it is. You know, I -- I'm saying categorically. And it is the view of -- of Irish stockbrokers -- Irish financial houses that -- that they are -- they are saying that we, perhaps, will have a difficulty being able to fund our own borrowing. In fact, when -- when the opposite is the case, we -- we have -- we have borrowed up until next year. So we're not in the market in -- in the present time for -- for funding.
QUEST: So putting Ireland in the same sentence as -- pardon me -- Greece, is -- is not right?
AHERN: No. We have -- you know, until earlier this year, we -- we were totally separated from -- from the Greek situation and we...
QUEST: But you could end up being in the same boat now?
AHERN: Yes, well, I -- I mean I don't wish any problems on them, needless to say, Richard. But the fact is that they -- the markets have started pushing this open. You know, we see this as -- as wholly unjustified.
(END VIDEO TAPE)
QUEST: The former Irish prime minister, Leticia (ph) Bertie Ahern.
Banking institutions like the Anglo-Irish bank were hit hard when the housing boom went to bust. Thousands -- tens of thousands of homes sit vacant in Ireland. It's a stark reminder of what's happening in the country.
And looking back, many are asking, who's to blame?
CNN's Carol Jordan reports.
CAROL JORDAN, CNN CORRESPONDENT (voice-over): Rows of empty houses, abandoned building developments, construction projects that were never even started -- these are what the Irish are calling ghost estates -- an unwanted byproduct of the building boom during the years of prosperity, when Ireland was known as the Celtic Tiger. But the country was brought to its knees when, finally, the building bubble burst.
This is Cian O'Callaghan. He works for NIRSA, an official body that has advised the government on the issue of ghost estates. It defines a ghost estate as developments of 10 houses or more where over half are empty or unfinished.
CIAN O'CALLAGHAN, NATIONAL INSTITUTE FOR REGIONAL & SPACIAL ANALYSIS: Actually, there's about 620 of those in the country, from our estimate, from the data we're using.
JORDAN: And there is a massive over supply of homes -- about 103,000 more houses than needed. And that's Mr. O'Callaghan in the town of Midleton in the east of County Cork. A commuter town, it has a population of just over 10,000 people. We visited three ghost estates -- a fraction of the number here.
O'CALLAGHAN: This is an estate which has, I think it has 76 houses in it. And it's all boarded off. It's all vacant. It's probably the last phase of a bigger development, you know, which stretches back and has got more occupancy in the estates further down. But as you can see, there's this whole, you know, rows here of empty houses.
JORDAN: NIRSA says that there's no doubt that developers and consumers alike over indulged during Ireland's building boom. With developers borrowing money against existing and unfinished developments, from banks that were lending money freely. Homeowners bought second homes, borrowing against properties they already owned.
But NIRSA says it's what they call a catastrophic failure of the planning system, which was also responsible for allowing the building frenzy to spiral unchecked. It's a charge the Irish Planning Institute vehemently denies.
GORDON DALY, PRESIDENT, IRISH PLANNING INSTITUTE: Certainly, weakness in the planning system have contributed to the (INAUDIBLE), but neither should the planning system be viewed as a scapegoat for everything on the ground.
JORDAN: Whoever is to blame, it's agreed something must be done, though what is still not clear. Although I tried to talk to some of the residents of ghost estates, none agreed to be interviewed on camera. They're facing the prospects of living in these ghost estates for the foreseeable future. Right now, none of the empty homes can be sold.
Many of these ghost estates are now in the hands of the state-run NAMA, a bank that has taken on other banks' bad debts. They will decide what to do next.
Carol Jordan, CNN, East Cork, Ireland.
(END VIDEO TAPE)
QUEST: As good as it gets -- in just a moment, I'll be talking to the head of Spain's low cast carrier, Vueling, about strategy expansion and the future of the airline industry. All of the time, of course, when there was a strike in Spain.
QUEST: More than 300 executives from the world's biggest budget airlines are in London today for the Seventh World Low-Cost Airlines Congress. They're discussing the future of an industry which is seeing unprecedented turmoil -- over capacity, increasing cost pressures, extremely competitive landscapes, and, really, questions about the very fundamental abilities of low cost carriers to survive. They could certainly learn a thing or two from my next guest. Last year, he successfully merged two loss making low cost carriers into a profitable one, Click and Vueling.
I began by asking the chief exec, Alex Cruz, of Vueling, how his airlines have been affected by today's strikes in Spain.
ALEX CRUZ, CEO, VUELING: Completely uneventful. All the flights that had to fly, they have flown. And there haven't been any incidences either reaching the airport or coming out of the airport. So we were quite lucky. I think things have gone really well and -- and very peaceful.
QUEST: So all in all, what do we make from the fact -- because there were -- there have been demonstrations. And in some parts of Spain, it has been very difficult to get around and get services.
CRUZ: Somehow, there's been a great deal of preparation for this day, just making sure that we had the right level of services defined, all this nation covered, etc. And I think that has paid off today. Once again, no incidents at all.
QUEST: How concerned are you that the level of industrial action is rising and the worries about the economy in Spain are growing?
CRUZ: Somehow, we hope that both things will come to an end at some point soon. We have suffered a great deal from trying to control over this summer. The Belgians, just yesterday; France; and our own Spain.
We hope all of this will come to an end, really, over the next few months, as agreements are coming into place.
QUEST: Within Spain -- well, we'll come to Spain in a moment. Just - - you talk about that. You had the volcanic ash. You've had air traffic control problems left with -- with industrial actions.
Do you get the feeling it's -- it's getting better or worse?
And at the moment today, it seems worse.
CRUZ: It definitely was a bad year. But it seems like almost every year that something has happened. It was -- it was not the oil price at over $140 a barrel, increased competition this year. The ash definitely and the air traffic control. It seems like we're an industry which is quite re -- redundant and we can live through all these problems. And I think we will be able to. Let's hope next summer, no more problems.
QUEST: On the Spanish economy front, the austerity measures, again, what percentage of your business is Spain?
CRUZ: About 60 percent.
QUEST: Right. So you're going to be clobbered as a result of what's happening.
CRUZ: Well, we'll see, because this past year, really, has not been that good for the Spanish economy and yet we've done quite well -- the second most profitable company in Europe. And I think that this year, we're not going to be far -- too far from that. We'll see what happens.
QUEST: What are you planning to do in terms of expansion?
Because the way the airline was put together, you're part owned by Iberia. Iberia and B.A. now have become IAG.
So what happens to Vueling?
Do you get caught in the middle here?
CRUZ: Well, Vueling has its own expansion plans. We're a quoted company in -- in the stock markets and we are going to grow. We are going to add six more planes next year. We'd like to open a free -- a few new bases in Spain and perhaps in Europe. And we'll wait and see if there is any opportunities with Iberia and British Airways. For the moment, we're going to continue growing.
QUEST: When -- when Visignani (ph) at ARTA says this is as good as it gets, the current environment, that's rather depressing.
CRUZ: It is at a global airline level. But I think there are also a lot of opportunities for niche players such as ourselves. We'll take advantage of them.
(END VIDEO TAPE)
QUEST: Niche players taking advantage, Alex Cruz, of Vueling.
And tomorrow, our weekly segment, Q&A, is back. And it's on the aviation industry. It's Q&A. And it's Quest and Ali Velshi, from our sister network, CNN USA. You select the topics, Ali and I take them on. We're talking tomorrow about airlines and merging and making money and the core question, what's good for the airlines is good for the passengers.
Ali and myself battle it out and see who can give the best answers in one minute with the bell. There'll even be a little quiz for us to go along with. It's CNN.com/qmb for Q&A.
Now, it's been a harsh summer for parts of Central American and Mexico. Tropical rains of thousands, really. It was no different this time around.
Pedram is at the CNN World Weather Center.
PEDRAM JAVAHERI, CNN METEOROLOGIST: Yes, Richard, the rainfall here has been just tremendous the last couple of months for much of Central Mexico, not so Central America, to speak of. And you take a look at the color contours of the satellite-based rainfall here just past 72 hours and then yesterday. Notice the color contours of white there being well over 225 millimeters of rainfall. And notice the concentration of that right there, in the state of Veracruz, all the way out there toward the state of Oaxaca, where we've had some major, major landslide concerns, with a tremendous amount of rainfall coming down in a short time period.
And, again, you take a look at the photographs coming out of this part of the world. This area, high atop the Sierra Madre Mountains, very much a mountainous terrain there -- a lot of hillsides, a lot of cliffs. And with that tremendous moisture, this soil literally could take no more. And, of course, we've heard reports of at least -- at least 11 people missing out there because of the torrential rainfall.
And you take a look just to the north in the state of Veracruz, again, 48 hour rainfall totals ending yesterday -- 701 millimeters of rainfall in a 48 hour period. And the latest report put us 72 hour rainfall totals over 860 millimeters in this area.
This was remnant moisture from Tropical Storm Matthew. That, again, works its way south into the mountains and produced all the flooding concerns. As you can see on satellite imagery there that it was just a complex of storms there caught up in a circulation out there in the Pacific.
That moisture now is going to be a concern. Follow the track -- El Salvador, Honduras, the next 48 hours, the moisture is certainly going to move away from Mexico. And that's the good news, since they're going to begin to clean up. But this is going to work its way into Central America, where some heavy rainfall is possible.
And to the northeast, we're talking about Tropical Storm Nicole. That's over Cuba. The moisture from this is going to produce a lot of rainfall around South Florida and already quite so, down to Jamaica and also Cuba picked up nearly 200 millimeters of rainfall just in the last 24 hours.
This is the radar imagery. Look at South Florida Miami already getting some rainfall. The National Hurricane Center puts the storm offshore inside the next 24 or so hours. And, again, landfall possible on the southeastern coast of Florida there, but eventually, a weak tropical storm, perhaps a tropical depression by the time, say a couple of days from right now, it comes around.
So a lot of active weather in the tropics and a lot of rain expected out there, too, across the East Coast of the United States as well -- Richard.
QUEST: And many thanks there.
The weather as seen at the moment.
We'll be back with more of that tomorrow, because that is QUEST MEANS BUSINESS for tonight.
I'm Richard Quest in London.
I thank you for your time and your attention.
Whatever you're up to in the hours ahead, I hope it's profitable.
"MARKETPLACE AFRICA" is after the break.