Return to Transcripts main page
QUEST MEANS BUSINESS
Interview with Former Egyptian Trade Minister; Snow Storms Put a Freeze on Hiring in the U.S.
Aired February 4, 2011 - 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: On this program tonight, the former Egyptian trade minister tells us he is ready to answer any allegations against him.
One of the Wise Men, part of a committee sent to negotiate, tells me we must listen to the demands of the protestors.
And a cold chill hits the U.S. job market. Snow storms put a freeze on hiring.
It may be Friday but we have a busy hour together. I'm Richard Quest and I mean business.
Good evening to you.
On the streets of Cairo tonight protests grow in size and intensity. Meanwhile, on the political front, behind the scenes, talks are held on the future of President Mubarak. Tonight, as I say, we speak to a member of the so-called Committee of Wise Men, a group of businessmen and intellectuals who are calling for negotiations on the transfer of power in Egypt. And we also consider what might capitalism and a market economy look like in Egypt when all this is over.
We begin, though, banned from travel, assets frozen, but Egypt's former trade minister says, from Dubai, he has nothing to fear. Rachid Mohammed Rachid told me he will face any charges leveled against him. After becoming the latest former Egyptian minister to be hit with a travel ban by the Egyptian authorities.
As for the protests on the streets, some call it a day of farewell. Others called it a day of loyalty. The stance on President Mubarak, it was another impassioned protest in the capitol as thousands pour into Cairo's Tahrir Square for peaceful demonstrations, pro and anti government protestors fighting just a few hundred yards away.
The crowds also gathered in the thousands in Alexandria, and in Suez. A government official says a rocket propelled grenade was fired at a government building in the Sinai Peninsula. The Muslim Brotherhood and Al Jazeera television reported their facilities in Cairo has been ransacked by gangs of thugs.
We need to bring you up to date with the position as it stands just at the top of the hour, just after. Ivan Watson is in Cairo for us this evening. Joins me now.
Ivan, the crowds tonight, growing? Diminishing? What's the mood?
IVAN WATSON, CNN INTERNATIONAL CORRESPONDENT: It has shrunk just a bit, but it is still pretty much the largest crowd I've seen in the days and nights of protest here, in Tahrir Square. And certainly notable because this same area, Richard, last night, was really a combat zone. And for the past two days, and two nights, this-there was a siege underway here. And the government appears to have backed off and have brought in the military to allow some space for its opponents, for its critics, to gather here and to repeat their demands en masse, and for the most part, peacefully, for Hosni Mubarak to step down.
I do have to had to that, though, there have been clashes, ongoing, in the side streets off to the east of Tahrir Square, which has been the focal point of defiance to Hosni Mubarak, with gangs of anti-government and pro- government youth, clashing in the streets, setting up barricades. There have been a number of people wounded. I saw people being rushed to first aid station. And all this taking place in the heart of a city, in a busy- what should be a busy commercial district here, Richard.
QUEST: Throughout the course of the day Ivan, politicians from the prime minister to the vice president and all points in between have been speaking about the need to continue with President Mubarak, the need to have reform, but the protestors don't really have a organization with which they an negotiate. So are any of these statements by officials having any affect to them at all?
WATSON: At times, for instance, one of the opposition leaders, Ayman Nour, that we spoke with yesterday, he said that he appreciated a more positive and more open change in tone that had come from some of the statements of the new Vice President Omar Suleiman, yesterday. Important to note that you do have a wide group of different splinter opposition groups, many of which have suffered quite serious repression at the hands of the government in past decades, and then you have a government that seems to be reeling at the pace, the incredible pace of events here. On the one hand, making concessions, offering to investigate some of its former most highest ranking officials. And the next moment apparently orchestrating attacks on the demonstrators, or on foreign journalists.
WATSON: Sending mixed messages, there. Perhaps not knowing quite how to deal with this, Richard.
QUEST: Ivan Watson joining us with the latest position in Cairo tonight.
Now, the other main story: Banned from travel, his assets frozen, Egypt's former trade minister says from Dubai that he has nothing to fear. Rachid Mohammed Rachid told he will face any charges leveled against him, after becoming the latest former minister to be hit with a travel ban by the authorities. Just over an hour ago I spoke to the minister who was in Dubai, and I asked him, had he actually been informed of the allegations?
RACHID MOHAMMED RACHID, FMR. EGYPTIAN TRADE MINISTER: Well, I've never been informed about anything. I just heard it in the news like everybody else here. So this, just to tell you the sequence of events, our government has resigned last Saturday, after the events, President Mubarak asked the government to resign. I resigned, of course, as part of the government. On Sunday there was a new government to be formed in Egypt. The new prime minister approached me and he wanted me to join the new government. And I did apologize, not to join the new government, expecting that this is a new phase, with a new direction, with a new policies. He graciously accepted my apology. We had a number of contacts after it.
I left the country two days later, because I finished my job and I had family members who are in different places to attend to. And now after two days I am just hearing in the news that now they are accusing me of things which I have never heard. I don't know what they are talking about. And they closed my accounts and they stopped me from leaving the country.
QUEST: Have you had now-so you haven't been informed that there was a travel ban. But have you been informed either by the government or the officials, prosecutors, or by your banks that your bank-accounts and your assets have been frozen?
RACHID: Nobody informed me about anything at all. Well, you have to be aware that banks in Egypt are not functioning. But also the government, or the prosecutor, or whoever took that decision, did not inform me about what is going on. I heard about it in the news, as everybody else did.
QUEST: So, in this situation, Mr. Rachid, is it fair to say that the, if you like, the public life and the commercial life of Egypt is basically- or has, basically, sunk into chaos?
RACHID: Well, of course, we have a very challenging situation. My biggest concern, of course, is that this is a situation where reform and some of the decisions taken in the past to reform the economy is now seen as negative decisions by some people. And I don't know, I'm not trying to explain anything, because, unfortunately, I don't know. But there is definitely chaos. There is a lot of un-clarity.
RACHID: There is a lot of unclear situations there.
QUEST: Do you fear? Do you fear that people like yourself might be made the scapegoats? And a witch hunt will now begin for people who were part of the previous government?
RACHID: Well, Richard, I have nothing to fear. I have served my country for six and a half years. Everybody knows, inside of Egypt, outside of Egypt, what I have been doing. And I am willing to face any charges if somebody tells me what are the charges. I hope that this is not a scenario of having scapegoats and just trying to throw some people to the mobs. But at the end of the day there is a lot of uncertainty and un- clarity. And I'm willing to face and challenge any serious allegation, but nobody is talking about that.
QUEST: Right, so you are-
RACHID: And this is not only my case, this is also other people's cases now.
QUEST: So you are in this position of hearing the allegations, not being able to answer them because you don't know what they are. And nobody has actually formally told you what they are.
RACHID: Exactly. And at the same time, as I told you, for days ago I was offered to be a member of the new government. I was-and now you now I am in that position.
RACHID: I can't understand what is going on. This is the same government that I was supposed to be sitting at now.
QUEST: When all of this finally comes out, as they say, and when calm settles, there is a concern about what form of economy, market oriented, capitalist looking, more state intervention Egypt will be left with? What do you think the future sight and sound of the Egyptian economy will be?
RACHID: Well, Richard, there are some text which we all need to know. Egypt needs in the next two years, at least 1.5 million new jobs to be created. If that doesn't happen, you can add to the number of unemployed people, another 1.5 million unemployed people.
Egypt's biggest challenge has always been unemployment. We have a challenge in terms of the level of income, the level of services. That will not disappear. That will continue. And what happened in the last few days it will make it even more difficult and challenging for that to happen. And Egypt has tried all systems in the last 50 years. Today we have seen that in the last few years there have been some significant results done in terms of unemployment. Maybe, maybe the level of distribution of wealth was a big challenge for everybody to deal with, but at the end of the day, the level of challenges that Egypt has, in terms of economy, will increase dramatically. And any sense now, or any willingness to change course, in terms of openness, of the economy, and not encourage investment, will make that situation very, very serious.
QUEST: That is Rachid Mohammed Rachid, the former trade minister of Egypt. Saying that he is prepared to answer allegations, but so far, nobody has put any of them to him.
The Committee of Elders, or the Wise Men Group, whatever you want to call them. They want to rise to Egypt's rescue. It is a group of wealthy businessmen and intellectuals and one of them is Orascam's chief. And you'll hear from him after the break.
QUEST: A group of wealthy and prominent Egyptians have offered themselves as mediators in the dispute. Now, despite, or depending on your translation, there are either the Wise Men, or the Committee of Elders, whatever. Their aim is to act as go-betweens to the protestors and the government. And among them is the Arab League Secretary General Amr Moussa, who joined the protest in Tahrir Square on Friday. He was once described as perhaps the most adored public servant in the Arab world.
Also, involved is the executive president of Orascom Telecom, Naguib Sawiris. And just a few moments ago I spoke to Mr. Sawiris, and I asked him, when you look at this particular group, what role he hope to play?
NAGUIB SAWIRIS, EXEC. CHAIRMAN, ORASCOM: First we are not between the protestors and the president. We are just a group of intellectuals and, what you call, wise men, who are not related to any party, who think they would like to express what is the best solution for Egypt right now. And for us the best solution is now for Mr. Mubarak to remain in power until he ends his period, delegating some of the important issues that are a matter of concern for the street (ph), who is vice president, to execute, which are a new general assembly and parliament. A new committee that should immediately starts forming the constitution and changing the articles that are the source of all our trouble. Three, to create a national government, unity government that will manage matters until the new election. Four, to guarantee that the new elections will free and under judicial control and under international observers.
SAWIRIS: To ensure that there will be free and not rigged. And in the end we have called on the government to ensure the safety of the demonstrators in Tahrir Square. And to release anybody who has been captured, because freedom of rights is essential.
SAWIRIS: And the last point was to remove the emergency rules.
QUEST: To do this, you are going to have to obviously talk to the demonstrators, to other political parties.
SAWIRIS: I am talking-I talked to them. I am talking to everybody all the time. And I think that our suggestion that next, the consensus, the problems we have to day, Mr. Quest, is that the guys in the square, they have no speaker. They have no delegate. They have not chosen a two or three among them that represent them. I have a slogan on my TV station right now asking them to, if they don't like our proposals they should then delegate two or three of-and elect two or three of them, now, to represent them and negotiate a resolution of that. Because the country is coming a standstill.
QUEST: And your authority, and the authority that comes with your other wise men, the elite, that you are with, where does your-
SAWIRIS: We have no authority.
QUEST: You don't. You have none. So this is something-
SAWIRIS: They have no authority, because the ones who have-there are two people who have authority. The young people of Egypt, the Internet generation that went to the streets and are in Tahrir Square now. They are the only authority right now. The second authority is Mr.-our president and his vice president, and our prime minister, and the army.
SAWIRIS: Now these are the two authorities in Egypt right now. Whatever we are doing we are (UNINTELLIGIBLE) as a national citizen that wants to find a resolution out of that deadlock. But nobody has authorized us or has mandated us.
QUEST: Right. Finally, what is your strongest argument that you will use to convince those youth, that Internet youth, that waiting and seeing through the Mubarak year, through to September, is the best way forward?
SAWIRIS: Number one, whatever they say, Mr. Mubarak has not everything he has done is evil. He has maintained this country in stability. There has been economic growth among all the years, going forward. It has been enough for the poor. The jobs that have been created were not enough, that is correct. But he is a military man who has worked for this country in the '72 war (ph). And we owe to him and his colleagues the liberation of our country from the Israeli occupation. He has done that in honor. And the last argument is that he has behaved as a military man. He has not run away, like Ben Ali, and left the country in chaos, you know. So, my point is what is the big deal about him remaining and preserved as an Egyptian, and as we are an emotional people. We don't want anybody to, let's say, antagonize, or hurt the pride of our president. He has been our president for 30 years. I see no benefits for this humiliation, that is all.
QUEST: Sawiris joining me earlier.
Now, the full impact, the economic impact of Egypt's anti-government protest is way too soon to assess. The figures from the OECD suggests that the clampdown on communications has already cost around $90 million. The Paris-based think tank estimates the five-day shut down in Internet and cell phone networks resulted in a loss of $18 million a day; 3 to 4 percent of Egypt's economic output. But that is not all. The OECD is warning that the long-term economic impact will be obviously much greater. Taylor Reynolds is a communication analyst and economist at the OECD. He was put in charge, or is in charge of the division that looked at that analyst. Taylor joins me now live, from CNN Paris.
I think you will be the first to agree, the $90 million, you know, loss of economic impact from Internet and phones, is small beer, as we would say, compared to the totality of the devastation.
TAYLOR REYNOLDS, ECONOMIST, OECD: OK, I would agree. This actually just the beginning. The $90 million that we are talking about is just the direct impact of cutting off the Internet. This represents the telecommunication revenues of Internet firms, and telecommunication firms. But really, I think, the impact for Egypt is going to be much larger, when you look at the impact for businesses that weren't able to function on the Internet or use mobile communications. And also, when we look at the long- term impacts, because this is going to scare away some investors, particularly in certain industries, like out-sourcing within Egypt.
QUEST: But, OK, how likely is it that the spillover effect, into other regional countries, creates so much instability. I mean, you know, the losses multiply many fold, if you then start including Jordan, Algeria, Morocco, and all the other countries.
REYNOLDS: I think the important thing to look at with this analysis is that when you cut off the Internet, for any reason, you are going to have a large economic and social impact. So I think the message that we are trying to say is just the basic numbers, alone, when you look at this $90 million in lost revenues. This is just the beginning. And if you can show to political leaders that cutting off the Internet has these large impacts, I think they are going to have to think twice before taking any steps that would cut Internet access, because it is going to have such a large carry on within the economy.
QUEST: Taylor, forgive me, we have to draw this to a close, earlier and shorter than I wanted to. Robert Gibbs, the White House press secretary is now briefing at the White House in Washington. And that is where we need to be.
(BEGIN LIVE FEED, IN PROGRESS)
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I just outlined a series of steps, right here, in public, that I think the government can and should take to address that very instability and that very uncertainty. And I said I think on the very first day of this crisis my guess is that this will be said at this podium for months to come. This is not a solution that can be imposed on, or that can be forced on, anybody in Egypt. As I said earlier, it is not-I doubt there is anybody in Cairo that is looking for my definition of their freedom of speech. And that is not going to be determined here. It is going to be determined in Cairo. That is why they are marching there.
But, look, it is safe to assume that this country has, for the past several decades had a very important relationship with the government and the people of Egypt. The Camp David Accords, signed by Egypt and adhered to by Egypt have provided a cornerstone for regional security for more than three decades. We have a vested interest in the foreign policy in Egypt and throughout the region as it relates to our national interests.
So, as I said a few days ago. They are meetings here about a whole range of issues and a whole range of scenarios. And I was in one of those meetings at 8:30 this morning. Those meetings will continue with the president over the weekend.
QUESTION: How much intelligence did the White House have about this kind of unrest potentially happening?
GIBBS: We, we have, we have seen and I think the White Houses and administrations here for many years have seen intelligence about instability in countries in the Middle East, and throughout the region. I think the question you are alluding to, Dan, is did we-did somebody foreshadow the specific events in Tunisia? And as we recall, a fruit vender in Tunisia had his fruit stolen, and lit himself on fire, and that started, in Tunisia, a series of events that have greatly impacted that country.
I don't think anybody expects that we would have gotten a report in December that might have predicted a particular fruit vendor doing something like that. Obviously, as things transpired in Tunisia, as I've said in this room before. We saw, I read intelligence that talked about what the result might be in countries throughout the region. Because as the president has said throughout this, the governments must be responsible to the people that they represent, and when they are not, you have uncertainty and unrest. So-
QUESTION: So, there was no intelligence that predicted this kind of unrest? Not necessarily telling you what the trigger mechanism would be, but--
GIBBS: No, no, no, I didn't say that. I want to be clear, I did not say that. I said, was there specific intelligence about this specific incident that started in Tunisia? No.
QUESTION: Right, well, I'm not asking that. Not the specific incident that started it, but what-
GIBBS: I understand. I think some reporting has intimated that somehow that there was some intelligence failure that that didn't happen. Rest assured that there are volumes of reports that have been read by this administration and past administrations about the potential for instability and unrest, in Tunisia, in Egypt, and throughout the world. Understand, you know, the-I think some of the passion you see in Cairo is not because, not necessarily because people have felt as if their government hasn't fully represented their views and respected their individual rights in 2011. I think this is something that goes back quite some time, which is why the administrations that predated ours, have brought up with President Mubarak the steps that they believe needed to take place, just as President Obama brought up with President Mubarak, the steps that we felt needed to take place to address the lack of freedoms that we knew they weren't adhering to.
QUESTION: And is the president satisfied with the level of intelligence that he received on Tunisia and Egypt?
GIBBS: The president expects that in any case that he will be provided with relevant, timely, and accurate intelligence assessments. And that is exactly what has been done throughout this crisis.
QUESTION: On the orderly transition, that (UNINTELLIGIBLE) that you guys have called for, Wednesday you were quite direct by saying, now means yesterday. Meaning Tuesday when President Obama first called for that. Three days have gone by since, days to matter in this instance. Are you satisfied with the changes that have taken place on Cairo's side?
GIBBS: I don't think we are. And it appears based on the pictures I've seen on television today, neither are the people in Cairo, or throughout Egypt. And that is why, when we talk about whether or not we're going to see unrest, or whether or not we're instability, we are, until or unless, some real change is made, and some progress-people can see and feel progress on that path toward free and fair elections.
QUESTION: OK, days matter. So how soon would like to see that tangible change?
GIBBS: Tuesday. I mean, again, I wasn't-I wasn't-I wasn't, that- President Mubarak said we needed that transition. President Obama agreed that that transition needed to happen and that the time for that was now. And I think it is readily apparent that those in Cairo, those in Egypt, need to see this process, happen. And they need to see this process begin. And it needs to begin in a real and concrete and legitimate way. It cannot be, it cannot be for show. It has to include, as I've mentioned, it has to include that broad section of people. Many of whom we see, protesting for their rights in Egypt.
QUESTION: And about the back and forth going on between different, about that orderly transition, do you believe that a transitional government headed by the Egyptian-
(END LIVE FEED, IN PROGRESS)
That is Robert Gibbs at the White House there, reiterating the president's position that there has to be change, but going no further than basically saying, whatever change there is, and the form and direction that that would take, making it quite clear that it wasn't the U.S.'s position that they would dictate the nature of that change to the Egyptian people.
We will be back in a moment when we will turn our attention to the U.S. economy and the Euro Zone and bailouts. QUEST MEANS BUSINESS on a Friday, good evening.
QUEST: Hello, I'm Richard Quest, QUEST MEANS BUSINESS.
This is CNN. And here, the news always comes first.
And the story, of course, of the hour, the Egyptian Health Ministry now says the death toll from this week's clashes in Cairo stands at 11. More than 900 people were injured in Wednesday's violence alone. Protesters continue to fill Tahrir Square for a so-called Departure Day rally. There have been some sporadic violence all day, but the day mostly has been peaceful.
Elsewhere in the Arab world, new pictures from a major demonstration in Yemen, where thousands of people gathered near Sanaa University to air their grievances on Thursday.
In Jordan, several hundred people took to the rainy streets of Amman on Friday, where they were protesting against the deployment of a new prime minister, the smallest of several demonstrations we've seen in Jordan in recent weeks.
Crews will search the Atlantic a fourth time for answers into the deadly plane crash almost two years ago of the Air France jet. Previous searches for debris from Air France Flight 447 have turned up nothing. The plane disappeared from radar after leaving Rio in May of 2009. The crash killed all 228 people on board.
The U.S. economy added just 36,000 non-farm jobs in January. That was far less than the 149,000 that Wall Street had looked for. The bad weather may have played a role once again. Virtually all the hiring came from the private sector, which added 50,000 staff.
On the other hand, the unemployment rate fell for the second month. It was a sharp drop, 9.4 down to 9 percent.
Meanwhile, in Europe, leaders took a step closer to shoring up the Eurozone's debt crisis. First, German Chancellor Angela Merkel once again called for Egypt's political transition to start now.
(BEGIN VIDEO CLIP)
CHANCELLOR ANGELA MERKEL, GERMANY (through translator): Today, we will talk about how the European Union can be a partner for transition for the orderly, peaceful, democratic transition in Egypt and also in Tunisia.
(END VIDEO CLIP)
QUEST: Earlier, leaders from the 27 members set a March deadline for concrete proposals on how to beef up the Eurozone's bailout fund. Friday's E.U. summit also saw the French president, Nicolas Sarkozy, with Chancellor Merkel pushing to strengthen Europe's competitiveness.
I'm joined now by HSBC's head of global research. Always a treat, even better on a Friday evening.
Thank you for coming, Bronwyn Curtis, welcome.
The strengthening of the bailout fund, we know they've got to do it and they seem to know exactly how to (INAUDIBLE).
BRONWYN CURTIS, HEAD OF GLOBAL RESEARCH, HSBC: I think everyone has accepted that it must be done. They want it to be more flexible. They want it to be bigger. The question is, really, how they're going to do it.
What is it -- what is it going to look like, because the markets are anticipating something really quite positive.
QUEST: It's 440 odd, 700 odd with -- with the IMF and the ECB and everyone (INAUDIBLE).
What's a satisfactory number, do you think, for -- for a fund by that?
It's heading to a trillion euros to start with.
CURTIS: I don't think it's just the size. It's also what sort of debt relief are you going to give countries like Greece?
You know, what is the...
QUEST: Well, now you say debt relief.
Do you mean debt relief from funds that they've borrowed already for bailout or underlying debt, so-called restructuring?
CURTIS: Well, what I mean is what are you going to -- could -- you could do things like let them buy their debt back at a discount now.
CURTIS: You could do something like let investors swap from BRIC bonds into the new bailout funds' bonds. You could get the new bailout fund to buy government bonds. I mean there are a whole lot of things that -- that go together to say is this a package that will work and we won't get another run on those countries.
QUEST: As I look at the yields today, Portugal is -- you know, they're -- they're under -- they're coming back slowly. Spain is not the risk of threat that it was. Nobody is seriously talking about Spain or Italy needing mega bailouts anymore.
So can we say this crisis is over?
If only -- I can see this is a -- the cheeky smile coming -- if only because the Egyptian crisis has taken our eye to -- to another part of the world?
CURTIS: Well, I think that's right. The Egyptian crisis has taken our eye elsewhere. And Europe look all right at the moment. But there are a number of things coming up. The stress tests, we're getting another round of stress tests on the banks in Europe starting this month.
Next month, the ECB -- Trichet yesterday, at the Council meeting, when he did his press conference, he talked about, you know, going back to normalizing liquidity and that sort of thing.
QUEST: Which, of course, is -- is seriously worrying for markets that have been liv -- for banks that have been living on basically cheap -- cheap -- free money, basically.
Finally, you heard me just talk about those U.S. job numbers. The bad weather -- should we just write off this lot of numbers as being an aberration and let's wait and see?
CURTIS: I think we should. I mean there are numbers we can look at. The U.S. economy looks a lot better than it did three months ago. But mostly that's because of the tax cuts that have been put in place.
So I don't think these numbers, with all that bad weather, we can really take all that much notice of.
QUEST: Have a good weekend.
Good to see you. Many thanks, as always.
CURTIS: Thank you, Richard.
QUEST: Now, when we come back in a moment, the actions of a pub landlady in the south of England -- how has that threatened to slash revenues of BSkyB, Rupert Murdoch's satellite broadcaster?
It could revolutionize the way people watch.
A very odd business.
We'll explain in a moment.
QUEST: Now, a moment or two ago, you heard Angela Merkel of Germany talking about Egypt. The British prime minister, David Cameron, at that E.U. summit, has been speaking, giving his reaction to the latest developments in Cairo.
(BEGIN VIDEO CLIP)
DAVID CAMERON, BRITISH PRIME MINISTER: The reality is that Cairo, not Brussels, has rightly been the center of the world's attention today. The protests that we've seen have shown that popular desire for change is unstoppable and that fundamental political change is inevitable. And as much as yesterday's violence and brutality was an unacceptable step back, today's peaceful demonstrations, I hope, have shown that there is a yearning for serious democracy and rights that we take for granted.
(END VIDEO CLIP)
QUEST: That's the British prime minister, David Cameron, in Brussels.
We've been asking, could Egypt's uprising threaten the vital tourism industry, bearing in mind that some 13 million visitors and rising, it is one of the most bright sparks, if you like, in the tourism business.
But the unrest is real. It's a threat to Egypt's economy. It translates into two million jobs every year that are basically dependent on the industry and 11 percent of the country's economic output.
Now, Egyptian President Omar Suleiman just yesterday said a million tourists have already left the country. He puts the damage at possibly up to a billion -- a billion dollars.
The days of unrest are already having an impact on one of tourism's big players, TUI Travel says that QE2 may be hit as a result of what's taken place. It could slice up to maybe $50 million off its QE2 revenues.
And, of course, TUI one of -- if not the largest -- tour companies in Europe; certainly one of the most significant operators down to Egypt, Cairo, Sharm, Hurghada, Alexandria and so -- so on.
So we need to talk about that.
And my next guest will do just that.
Joining me now is Christian Cull, TUI's communications chief, who joins me.
Good evening to you.
CHRISTIAN CULL, COMMUNICATIONS DIRECTOR, TUI: Good evening.
QUEST: Let's first of all talk about how many people you've moved out, what you're telling people they need to do.
CULL: We're telling people that Sharm-El-Sheikh is holiday as normal. We've still got about 9,000 people there. We moved everybody out of Cairo about five days ago. We got people out of Luxor earlier in this week and, indeed, Aswan, as well.
QUEST: So you very quickly moved in to -- to shift the people around, if you like, around the country.
Did you take them out of the country or did you just move them down to Sharm?
CULL: No, no. Most people were really in Sharm anyway. It's a very different part of the world, as you probably know, anyway, from Cairo. It's about eight hours drive away. People to go Sharm to have a very different sort of holiday experience than they do from Cairo.
QUEST: Right. But -- but the people in Cairo, did you take them -- did you -- did you move them to -- out of the country or did you take them elsewhere within the region?
CULL: They went down to Luxor...
QUEST: They went down to Luxor.
CULL: -- (INAUDIBLE) absolutely.
QUEST: All right. Now, you would be the first person to agree, is very difficult to have a -- a holiday, even in -- in the delights of Sharm if -- if the country is -- is in turmoil at the moment?
CULL: I think it's actually worth remembering that Sharm is very much like a separate state. The army aren't allowed there anyway, under the Camp David peace accord. And it's not in their interests to do so. The Egyptians are the first people to say we want people to come still on holiday in Sharm-El-Sheikh. That's why our 9,000 people are out there and don't want to leave.
Two days ago, when we asked our 9,000 how many wanted to come back, one group of three people said, yes, please.
CULL: Yes. Absolutely.
QUEST: It's that...
CULL: It is that safe. That's -- if it wasn't that safe, Richard, we wouldn't be flying people out there. We're still flying people out there.
QUEST: No, no.
CULL: Absolutely. Yes, we still fly out to Sharm-El-Sheikh. Demand has dipped across Egypt. It would be silly not to -- you quite rightly said so, as well. But we're a resilient lot, the British holiday making public. And they're determined to go somewhere. And a lot of them are still going to Sharm-El-Sheikh.
QUEST: Let's talk just -- more -- more generally on this. The -- when this is over, because Thomson, which is the U.K. division of TUI, you're -- as an entity down there, you're -- it's a huge operation.
CULL: That's absolutely right. It's very important for us. The British are about 40 percent of TUI overall. That's Thomson and First Choice. That's -- that's half the U.K. mainstream holiday market between us.
So Sharm is a very important destination for us, yes.
QUEST: And -- and finally, the hit to your own numbers, 50 odd million dollars is what I'm seeing tonight?
CULL: Well, I don't think it's quite as high as that. Twenty million pounds equates to, what, $32 million?
It might be slightly more than that, it might be slightly less. But at the moment, we are focusing on the safety of customers. And, as I say, those who are going elsewhere are still booking with us, as well.
QUEST: Christian, many thanks, indeed for joining us.
CULL: Thank you.
QUEST: All aspects of this coverage tonight.
And that is QUEST MEANS BUSINESS for this week.
I'm Richard Quest in London.
We thank you for your time and attention and for turning to us for your evening dose of business news.
Whatever you're up to in the hours ahead, I do hope it's profitable.
You'll come back on Monday.
MARKETPLACE AFRICA is next.
ROBYN CURNOW, HOST, MARKETPLACE AFRICA: This is MARKETPLACE AFRICA.
I'm Robyn Curnow here in Capetown.
Now, people around the world who have never set foot in Africa are sporting footwear that is made here. Oliberte is an international company that markets casual shoes made in Africa. It's a profit making social enterprise that aims to bring African made goods to the international markets as well as creating jobs back home.
ISHA SESAY, CNN INTERNATIONAL CORRESPONDENT (voice-over): At a trade show in New York City's Fashion District, a new label is making its debut. Made in Africa is not something you hear about very often, but Talk Dehtiar is trying to change that with his shoe business, Oliberte. A native born Canadian, Dehtiar launched his company two years ago with an aim to sell shoes to the fashionista with a conscience.
TAL DEHTIAR, FOUNDER/PRESIDENT, OLIBERTE: For that man or woman between 25 to 45, it says I want to look good, I want quality, but I want to stand for something, as well.
SESAY: Standing for something is Dehtiar's stock in trade. But it hasn't always endeared him to the business community. Last year, he appeared for the second time on the Canadian TV show, "Dragon's Den." He was trying to woo investors to help with marketing costs for his fledgling company. For a second time, he failed to clinch the deal.
(BEGIN VIDEO CLIP, COURTESY CBC)
UNIDENTIFIED MALE: Here you are with half a mil in sales. That's great. But I'm out of sync with you on a huge issue. You're -- you're in a country where your costs are 130 percent more than where you could be in China.
Dehtiar remains clear about his goal.
DEHTIAR: When I want people to think of Africa related to manufacturing footwear, I don't want them looking at it as another low cost producer, oh, it's the next China, cheap labor. If you want to do that, stay in China or stay wherever is low cost. If you want quality footwear, if you want to pay people right, if you want to treat them with respect and use good product, then come to Africa.
DEHTIAR: Dehtiar didn't secure any investors for his company on TV, but in real life, his vision is starting to attract attention. Buyers from popular stores like Urban Outfitters, as well as high end boutiques, are interested in selling their wares.
UNIDENTIFIED FEMALE: Oh, this is fun.
UNIDENTIFIED FEMALE: I mean the shoes just look really good. So people will buy them for fashion and then they'll just so happen to be doing something responsible and I think that's a good thing.
CURNOW: As the company grows, Tal hopes he's helping shore up a much underdeveloped middle class. Currently, Oliberte employs around six workers in Ethiopia, which is famous for its leva (ph). And this year, he hopes to work with some 50 workers in Liberia, a hot spot for rubber.
Although his company can't dictate how much the local factories pay their workers, they claim to work them to do the right thing.
DEHTIAR: We make sure that they pay, at minimum, the minimum wage, with the understanding that as we grow as a company, that they're committed to improving their conditions, whether it's through health insurance programs, now all the factories provide maternity leave programs for all the women.
CURNOW: He's not the only one convinced that providing decent jobs and making high quality footwear can go hand in hand. When New York City shoe store owner David Zaken heard about Oliberte, he immediately put in an order.
DAVID ZAKEN, STORE OWNER, DAVID Z.: In the United States, 87 percent of all footwear are made in China. And when I saw them at the trade show and it's made in Ethiopia, I thought, wow, what a noble, what a great thing to do. And I jumped on it and supported it right away.
CURNOW: Oliberte is growing. The company has gone from selling 200 pairs of shoes in 2009 to a projected 18,000 this year. But whether they can sustain the growth, keep the price point low and continue to employ workers at higher wages than their Chinese counterparts, will ultimately be the test.
For MARKETPLACE AFRICA, I'm Isha Sesay.
(END VIDEO TAPE)
CURNOW: Let's take a look at some more numbers.
Now, when Oliberte launched in 2009, it employed 75 factory workers here in Africa. These days, that number tops 250. And this year, they expect to mfr about 18,000 pairs of shoes and three times as much in 2013.
Innovating the lives of the impoverished is also a hot topic in Johannesburg (UNINTELLIGIBLE). We'll talk to a world famous economist and Nobel laureate, up next in Face Time.
(BEGIN VIDEO CLIP)
JOSEPH STIGLITZ, FORMER WORLD BANK ECONOMIST: There is an enormous amount of dynamism in Africa. And so I think it's a moment of real opportunity.
(END VIDEO CLIP)
CURNOW: Welcome back to MARKETPLACE AFRICA.
Now, South Africa is an emerging market economy. It has vast natural resources, but still many lingering economic challenges. Roughly half of the population still lives below the poverty line.
So, Johannesburg, South Africa was an appropriate place to hold the Global Poverty Summit.
One of the participants was Joseph Stiglitz.
He's a Nobel laureate and a former World Bank economic crisis.
And I sat down with him for a little chat.
CURNOW: I think the question is, look, there's a lot of optimism out there at the moment about Africa.
Is it misguided, perhaps?
STIGLITZ: No, I think, it's actually deserved. I -- you know, I -- I think over the last few years, there have been a lot of changes in economic policies and there was a lag between the changes in policies and it showing up in the data, in the growth.
And now it's showing up. And there -- there is an enormous amount of dynamism in Africa.
And so I think it's a moment of real opportunity.
CURNOW: At the same time, it's obviously quite a critical juncture and people -- people look forward, but at the same time, they're very careful of the mistakes of the past. And I think there's a lot of sense that when we talk about leadership, when we talk about Africa, that -- that African leaders, in a sense, have made terrible choices in the past. And that is, perhaps, one of the reasons why Africa has lagged and is so poor.
Hw -- hw do African leaders really take these -- these chances that are -- that are laid before them now?
STIGLITZ: Well, I think when you say that they've made terrible choices, you know, two factors you have to remember. First, a lot of the advice that was coming from the international institutions was misguided.
CURNOW: And you're very critical of the IMF, aren't you?
STIGLITZ: Exactly. And I think some of their policies were responsible for the weakness that Africa experienced. Yes, they corrected some of the real flawed policies of overvalued exchange rates, countries not living within their budget, so they were doing some good things. But at the -- they then went on and put a lot of other doctrinaire, what I call market fundamentalist ideas, that really had an adverse effect.
CURNOW: If you were an African leader or you were to advise African leaders now, what is the main thing you'd say to them, listen, you've just got to do this?
STIGLITZ: Well, I think one of the things that I would say is there's no magic bullet.
CURNOW: No, there isn't, is there?
STIGLITZ: So there is no single...
CURNOW: Otherwise, there -- you know.
STIGLITZ: Otherwise, it would have happened. But what I -- what I -- you have to have a comprehensive agenda. Education is absolutely essential. But a problem in many countries is you have an educated labor force but no jobs. So that's an example. You have to create a labor force but you also have to create the jobs that -- that provide them opportunity.
Then you have to ask the question, how do we do that?
And there are many ingredients in that. One of the problems is many of the countries had o -- too high exchange rates, particularly a big problem with natural resource rich countries. So you need to make sure your exchange rates (INAUDIBLE).
It was at the heart of part of China and East Asia's development strategy.
Another thing you have to do is make sure that your financial markets are working.
CURNOW: Another issue I think that you're quite passionate about is taxing, governments, particularly here in South Africa and perhaps Nigeria, were two examples, where they're changing legislation around mining so that basically the state earns more from its natural resources.
STIGLITZ: Yes. I mean the basic philosophy here is very simple. The resources that lie underneath a country are -- belong to all of the citizens of the country. They are, you know, the -- the patrimony of -- of the country. And it's absolutely imperative that those resources be used for growth, poverty alleviation.
The irony is that, on average, natural resource rich countries have not grown well and have more poverty.
The best way, and we understand how to do it, when you sell your resources or your -- your contracts, you do it in competitive options -- and the world has gotten more competitive. But quite often, the mining companies, the oil companies don't want competitive options. They want sweet deals.
Now the country's have to deal with the legacy of the past. And there were a lot of sweet deals in the past. But the basic idea is that the rents, as we call it, the rents associated the with natural resources belong to the people. The mining companies, the oil companies deserve a return on their investments. That's true. And they have to be compensated for their risk. We understand that.
The question is, they're getting returns well in excess of that.
(END VIDEO TAPE)
CURNOW: Nobel Prize winning economic crisis there, Joseph Stiglitz.
Now, here's what's trending this week.
CURNOW (voice-over): Kenya is now turning to land, sea and air in its quest for new sources of renewable energy. The Israeli company, SCE Energy says Kenya has approved its plans for a 100 megawatt seaway power plant on the coast. Kenya has already launched geothermal and wind energy projects in an effort to boost its power deficits.
And China may be eyeing another big investment in Africa, this time in Zimbabwe. Zimbabwe's economic planning minister says China is interested in infusing up to $10 billion into the country's mining and agricultural sectors. Isolated by the West, Zimbabwe has increasingly turned to China for economic help, while China has been pushing into Africa in search of natural resources for its growing economy.
(END VIDEO TAPE)
CURNOW: Well, that's it for this week's show.
I'm Robyn Curnow here in Capetown.
Please do go to our Web site, which is CNN.com/marketplaceafrica.
All of our interviews and stories are online.
But until next week, goodbye.