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QUEST MEANS BUSINESS
Aussie Treasury Secretary Wayne Swan: Eurozone Needs To 'Get Cracking', Act On The Debt Crisis; Steve Case Says Entrepreneurship Is Key To Job Creation; Interview with Andrei Kostin; iPhone 4S Frenzy; Interview with Ernest Bai Koroma; Interview with Kuseni Dlamini
Aired October 14, 2011 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: The final words of the pilots of Flight 447 and what it tells us about pilots and planes.
Australia's treasury secretary has this message for his European counterpart as they get ready for a G-20.
(BEGIN VIDEO CLIP)
WAYNE SWAN, TREASURY SECRETARY, AUSTRALIA: I think the patience of the rest of the global economy is going to wear very thin if we don't see some action from the Europeans in the next little while.
(END VIDEO CLIP)
QUEST: And the AOL founder Steve Case tells me a bit of entrepreneurial spark that will fire up jobs.
It may be Friday, I'm Richard Quest, and I still mean business.
With these words, "We are going to crash. This can't be true." They were the final words of the man at the controls of a doomed Air France jet moments before it plunged into the sea. A record of the final minutes of Flight Air France 447, what does it tell us? Confusion, disorientation and a lack of coordination in the cockpit during those vital final few moments.
The plane crashed into Atlantic Ocean in June of 2009, with the loss of all 228 people on board. The descent from 11,600 meters took around three and a half minutes. We now know the desperate conversations that took place in the final two minutes as the pilots pulled back on the control column unknowingly causing the plane to stall.
If you join me over at the super screen, we'll put this into a little more perspective for you. We had already known from the investigation and from the reports that had been released so far that at the time of the incident two co-pilots were in the cockpit. The captain was on his rest break. He was called back into the cockpit. It took him some time, but when he does come back, one pilot says, climb, climb, climb. And at this point we know the plane is climbing. The other replies, but I've been pulling on the stick for a while now.
Now the captain, who has returned, says not to climb any further; he says, no, no, no, don't climb. Seconds later the captain appears to give the permission for some maneuvers to be made, and once again we start to see the plane moving around. But it's too late, come on, pull up. But the plane is now just a few thousand meters, and by this stage the plane is once again climbing and falling fast. Or at least the nose is up, but the plane itself is in a stall and it is falling fast.
As one co-pilot realizes the plane is about to crash, he says, damn it, we're going to crash. And then perhaps, an indication, of the total confusion that is taking place, in the cockpit t the moment, the pilot flying actually says, but what's happening? What's going on? And with that the plane falls out of the sky.
The transcripts were published in an unauthorized book by the French aviation writer, Jean-Pierre Otelli. The French investigation agency, the BEA, is yet to put out its final report. But it condemned the disclosure of the transcript, saying it "shows a lack of respect for the memory of the late crew members."
Air France expressed its complete disapproval of the publication. It says, "It's a clear violation of confidentiality and disrespectful to the memories of those who died."
A short while ago I spoke to the author, Jean-Pierre Otelli, and I asked him why he felt it was necessary to release the transcripts.
JEAN-PIERRE OTELLI, AUTHOR, "PILOTING ERROR": Well, I have written five books before about air safety. And my previous books were about pilot's error. In this book I have lots of details about air crashes, and I wanted to be a precise as possible, with the crash of Air France 447. That is the reason. In my books I want everything to be precise, as well as for the DFDR, as well as the CVR. And if you don't put the CVR, if you want to explain a crash without putting the CVR, you cannot-it is impossible to have a real precise explanation of the crash.
QUEST: Right, so when the BEA strongly condemns the disclosure and Air France wants to express its complete disapproval for what you have done, what would you say to them?
OTELLI: I would say that what I have written, it's the truth. And I have explained what happened at-during the night of this night of August. So, you want to know, well, you can read my lines.
QUEST: Where did you get the transcript from?
OTELLI: Oh, well, I will never answer that question, Sir. I'm sorry.
QUEST: That's-OK. The-the-we've had to sort of-from the BEA's interim reports already four minutes of this incident, so we pretty know what took place, don't we, in that cockpit, that night. What we don't know and maybe will never know, is why the pilots reacted as they did.
OTELLI: Well, that is sure. It is very difficult to explain the psychological point of view, the pilot, why did they react in this reaction? But the problem is not, why, but the problem is that they did. It happens. When an aircraft is stalling, well, you have-I'm a flight instructor. When I have students in my plane, and when we make a stall, there is an explanation, a demonstration. You tell them that one day the aircraft is stalling, you must push on the stick. And you must never pull. It is a big mistake.
QUEST: Right. OK, but we've had two examples of pull rather than push, haven't we? We have had this Air France example, and we had the Conklin Buffalo crash example, where an experienced captain.
QUEST: So, are we now-
OTELLI: No, there are other examples, there is the Buffalo example but-
QUEST: Right, but recent, recent I'm talking about. So are we saying that basic flying skills need to be re-taught or re-trenched for pilots?
OTELLI: Yes, I think the real problem now, nowadays, is that the pilots are no longer real pilots. There are no longer really piloting the planes. They have got electronic systems, and they press buttons, and they forgot the basic part of flying. And when the system has got the slightest problem they don't know how to react in front of a basic flying method, you see what I mean?
QUEST: Right, I do. And let's just develop that. Because the BEA has now set up a panel to look into man and machine. And that is where this is heading, isn't it? Because ultimately there is going to have to be a rethink about the way today's modern pilots fly today's state of the art planes.
OTELLI: Yes, and well in fact, I think that now there are things-during the formation of a pilot, formerly, they had to fly about 450 hours. And the instructions were very, very severe about their flying, about their way of flying, of holding the plane. And now we recruit pilots only on their intellectual capacities. And we don't-there aren't any tests about their ability to fly, really, and we think that the way of piloting the plane is to be only able to press buttons. And when there is a problem, well, they don't-they only know, how to press buttons.
QUEST: Jean-Pierre Otelli, the author of the book, talking to me earlier.
When we come back in a moment, Europe versus the rest of the world; it's the Eurozone that has been told to get its act together at the G-20. Australia's Treasury Minister Wayne Swan, after the break.
(DESK BELL CHIMES)
QUEST: G-20 finance ministers have been talking today in Paris about how to fix the European debt crisis and European officials had to come prepared with answers. They faced tough scrutiny from their brethren from outside the zone. Ministers from outside Europe have piled on the pressure, demanding that Europe pulls together to get its house in order.
Emerging markets are growing especially impatient. They are said to be planning a deal to strengthen the IMF, giving it more cash to help stop contagion from Europe. While the Eurozone debt debacle is dominating the proceedings, there are other measures floating around. Including the controversial transaction tax on banks.
Australia's Treasurer Wayne Swan summed up the rest of the world's frustration with European leaders. In Paris for the meeting, he was scathing about Europe's past attempts to fix the crisis, through its limp stress tests. When I spoke to him earlier today he said Europeans wanted to see proper action. And I asked him how worried he was that European contagion could spread around the world.
WAYNE SWAN, TREASURY SECRETARY, AUSTRALIA: Well, I'm hopeful that what we will see in the next few weeks is the announcement of a comprehensive range of measures from the European authorities. They have said they'll do that by the 23rd of October, when their leaders next meet. It is absolutely imperative they do that, because we are facing a serious situation in the global economy.
What we have seen is a very big hit to confidence. We have two of our very big economic engines misfiring. So it is going to be very important to see a comprehensive statement from European leaders by the 23rd of October.
What we can do here at the G-20 is talk to our European colleagues about how important it is for them to act decisively, plus also, get behind them with whatever measures that we can put in place to assist them to resolve their challenges.
QUEST: What would you imagine something like Australia and yourself, or the emerging markets of Asia, might be able to assist in that regard. I mean, you know, short of going and buying Italian and Greek bonds yourself, what else can you do?
SWAN: Well, I think it is important that through the G-20, which has the biggest developed economies, as well as the biggest developing economies. We can come together and make a difference. We did that three years ago, in the middle of the global financial crisis, and we had a dramatic effect. For example, I think there would be a willingness, through the G-20 to support extra resourcing for the IMF, should that be required, in addition to what is happening in Europe. That is just one constructive solution. But the other thing that we have to do is to re-emphasize the need for fundamental structural changes, in both developed and developing economies. And nowhere is that more important than in Europe in the years ahead.
QUEST: Isn't what you just said, crucial because what happens is, you get a crisis, everybody puts out the fire, and then carries on as business as normal. Isn't that the lesson of 2008? The structural changes that you all promised, never happened.
SWAN: No, I don't agree with that. There are big structural changes happening in the financial system. The fact is they'll take some time to put in place and to work. The real challenge in Europe has been that their stress tests, that they put in place, didn't really do the job. And we've seen the sovereign debt crisis, shine a light, if you like, on the value to, if you like, put in place fundamental reforms in the financial system.
What Europe demonstrates is the importance of structural changes. The importance, particularly when it comes to fiscal policy, of good fiscal policy over the years, that can't be put in place overnight. It takes that some time. But what this demonstrates is the importance, over time, of those long-term reforms, in both developed economies as well as developing economies, and that is what the G-20 is all about.
QUEST: And if they do not do those reforms, and they do not get to grips with this crisis, once and for all, the phrase, comprehensive being used by just about everybody. What do you say will happen?
SWAN: Well, I do fear for what could happen if we don't see that fundamental reform. You see, what this is really about is jobs. We want a healthy economy so we can produce the jobs for tomorrow. Jobs give security, they give peace of mind, they are really the basis of a moral society. And if we don't get economic growth to get the jobs, then what we see is the social dislocation that comes from that.
I'm the member of a Labour government. We are absolutely committed to a prosperous economy, good fiscal policy and supporting jobs. And in too many places of the globe, on the globe, we don't see enough jobs. We see very high unemployment. And we see many people not being able to make a contribution to society. What this reform has got to be about for the long-term, is to creation of jobs, good jobs, more jobs, and jobs that bring dignity and worth to human beings.
QUEST: But finally, Mr. Swan-and forgive my, I won't say cynicism, but perhaps my jaundiced view. Why do you think-or why should we have hope that the G-20, the Europeans will deal with this now. This crisis has slowly got worse over the last 18 months to two years. So why do you think it should get-why now, Mr. Swan?
SWAN: Because it has been going on for 18 months. That is 18 months too long. What we have got to get is some action. People don't want half measures. They don't want blame shifting. They want action. And I believe that is the case within European democratic society, as well as around the world.
Essentially, what a finance minister said to European finance ministers in Washington, two weeks ago, is get on with it and get cracking. And I think the patience of the rest of the global economies is going to wear very thin if we don't see some action from the Europeans in the next little while. I'm encouraged by what I've heard so far. But what we want to see is action, there is a time frame for it. They have got to get it going.
QUEST: Get on with it. Get cracking, says Australian's Treasurer Wayne Swann, in a blunt assessment of the situation.
European markets roll with the punches to finish the day and the week slightly positive. We are seeing a quiet little rally going on at the moment. Don't get too excited. It was only a little rally. Less than 1 percent up, each of the big three finished the week up. Over the course of the week it was a gain of 3 to 5 percent. Mining and energy stocks in London rose on news that Chinese inflation had dipped. Tech stocks did well after good results from SAP and Google.
Banking shares did not get the memo. Soc Gen, Credit Agricole, and Paribas finished at the bottom of the table on the CAC 40 after appearing on a list of 13 banks, put on a downgrade watch by Fitch.
A positive report on U.S. consumer spending helped boost those European numbers.
(DESK BELL CHIMES)
Have a look at that: 108, over 11,000. It is doing wonders for the Big Board. It is amazing the U.S. consumer, two-thirds of the U.S. economy, so when you get that sort of good news, then the market roars up.
As we heard from Wayne Swan, the sign of a healthy economy is jobs. AOL founder Steve Case is on President Obama's advisory jobs council. And after the break he'll tell us the creation of entrepreneurs creates jobs.
QUEST: The political debate of the moment, in the United States, it is very simple; with unemployment over 9 percent, how to get America back to work. The founder of AOL said today, encouraging entrepreneurship is the only way to deal with America's unemployment crisis. Steve Case is a member of President Obama's Council on Jobs and Competitiveness. Now, Case said that there is no plan B for getting America back to work. When he joined me from Washington, I asked Steve Case, frankly, hasn't America lost its entrepreneurial spirit?
STEVE CASE, FOUNDER, AOL: I wouldn't say entrepreneurial spirit has been lost. I think it has been a key part of the secret sauce that has made America great, and frankly, the envy of the world. The whole culture around taking risk and innovation and entrepreneurship, you know, most manifested by Silicon Valley. But Silicon Valley just isn't a place, it is also an idea. And I think that it is something that all around the world people are excited by.
So, I don't think we have lost that spirit. But we have lost some of the incentives, and we have made people much more nervous. Start ups are down 23 percent in the United States, as a result we have lost 2 million jobs we otherwise would have had. So, part of what our Jobs Council recommended was a road map around entrepreneurship to get America moving, particularly focused on unleashing the next wave great American entrepreneurs.
QUEST: Isn't it very difficult to actually get rid of those roadblocks, because invariably you are talking about the minutia of regulations, of legislation, litigation, all the things that get in the way of anyone with a good idea.
CASE: Yes, there are a lot of pieces to this. But we have looked at this over the last few months, and had outside experts, McKenzie (ph) and others, helping us analyze a variety of different options. We have outlined some specific steps the administration can take, the White House can take. Some things the private sector just needs to do, but also things that Congress need to do. And we need to build bi-partisan support for them.
I'll give you three that Congress needs to do. One is win the global battle of talent. Take a fresh look at our high skilled worker policies. Right now we bring people here to educate them and kick them out of this country and essentially force them to compete with us. Which is crazy, so we are proposing stapling a green card to every one of those Ph.D.s.
We need to make it easier to access capital, create some incentives around capital access. Make it easier for angel crowd funding of things. Make it, you know, create incentives around growth capital in terms of the capital gains.
And also make it easier for companies to go public. We made some changes recently with Sarbanes-Oxley that made it more costly for companies to go public. As a result young companies are going public later, or not at all. They are often getting sold instead. And that is a problem, because 90 percent of job creation happens after companies go public.
So those are things, in terms of talent, access to give incentives around capital, IPOs, that the Congress can do, quite quickly. And we hope they will move quite quickly. There is a lot of partisanship, as you well know, here in D.C. and it is really unfortunate. But right now, given the need to focus on the jobs, given the need to focus on the economy, and given the recognition the entrepreneurship aspect is critical. I really think it is time to come together, in a bi-partisan way, to pass an entrepreneurship act, that really will make this next wave of entrepreneurship possible.
QUEST: How can you be so optimistic? Having just been on this task force, and waded through the minutia of this. You are positively fizzing with excitement over all of this. And I'm just wondering how you managed not to be beaten back?
CASE: Well, I guess that is one of the things that, entrepreneurs are always optimists. They always believe that anything is possible. They always want to change the world. And we also want to change the policy here in Washington to make it possible for the next generation of entrepreneurs to change the world.
And I'm not naive about the challenges. I've talked to people on both sides, including this week, and this includes a meeting with the president on Tuesday. I met with Eric Cantor, the majority leader on Wednesday, and others as well. So, recognize really that it is going to require bi- partisan support. That is not going to be easy to forge, because the sides are clearly focused in their own camps, on their own issues, which I think is unfortunate.
But it is time to come together. Entrepreneurs need it. Our economy needs it. People unemployed need it. And the secret really is focusing on entrepreneurship. And that is, as I mentioned before, the real job creator for our nation.
Historically, it is been, we have been built by entrepreneurs. You know, 40 million jobs in the last 30 years have been created by high growth entrepreneurial companies, really all the net job creation in the nation. So we need to get back to making that the major focus for our policymakers here in D.C.
QUEST: Steve Case, who is one of the people we often hear from in our "Tweets from the Top". Tonight, though, we are going to start with AOL editor, Ariana Huffington, who has been Tweeting away.
Arianna says: "In Istanbul, 12:50 a.m., and still on my BlackBerry. Now I sort of wish there was another BlackBerry outage so I could go to sleep."
Switch it off, Arianna. Switch it off. There is an off switch on the BlackBerry.
Steve Forbes is Tweeting: The Occupy Wall Street brigade, "don't seem to understand that if Wall Street goes, New York City will be in dire straits."
Wait a second, Mr. Forbes, economist Joseph Stiglitz, Tweets: "1 percent of the people take nearly a quarter of the nation's income, an inequality even the wealthy will come to regret."
"Tweets From the Top" that you can follow, sometimes, joining us in, sometimes reading what I Tweet. You can follow my Tweets @RichardQuest.
When we come back, in a moment, it is a case of black gold, which might become a lead weight around Russia's neck. The chairman of Russia's BTB Bank reveals his worries about the country's oil dependency.
QUEST: Hello, I'm Richard Quest. More QUEST MEANS BUSINESS in a moment, but this is CNN and on this network the news always comes first.
The Italian prime minister, Silvio Berlusconi, has won a crucial confidence vote in the Italian parliament. The final tally in his favor was 316 to 301. The result is not likely to reassure financial markets or put an end to growing calls for Berlusconi to resign.
Syrian human rights groups say at least 12 demonstrators were killed today when security forces opened fire in several cities. This video posted online appears to show an anti-government rally in Daraa. CNN is not allowed to report from inside the country and we cannot confirm the reports. The U.N. now says more than 3,000 people have died during the seven month long conflict.
Residents of Bangkok in Thailand are scrambling to get to higher ground and protect their property to avoid devastating floodwaters that are headed their way. Monsoon floods left more than 280 people dead across the country.
Officials in Greece warned today that they could contract with private haulers to remove uncollected rubbish piling up in the streets. Refuse collectors have been on strike against austerity measures for two weeks and there's no end in sight. Public transport workers and taxi drivers also went on strike today.
Oil prices are headed higher as traders take par from the latest numbers from the United States. NYMEX crude has made big strides. It's up $2.50 at that moment. U.S. retail sales figures helped boost confidence. And, of course, if people are spending, then investment goes into industry, industry tools up, there will be more manufacturing, oil prices go up.
Investors are also counting on European finance ministers to come up with the goods this weekend.
Russia is the world's second biggest oil producer. Not surprisingly, it's now trying to diversify its energy-driven economy to guard against shocks in oil and gas prices.
Bluntly put, it has become too dependent on oil revenues.
Last month, I was in Moscow and met the chairman of VTB Bank, Andrey Kostin.
From his vantage point in the capital's growing business district, at the very top of one of the skyscrapers, we talked about his concern that Russia is too dependent on oil.
QUEST: Russia had a particularly difficult 2008. So much is still predicted and relying on oil and the price of oil.
Do you worry that the -- this economy is -- is seriously unbalanced?
ANDREY KOSTIN, CAPITOL HILL, VTB BANK: Yes, we do, very much so. And I do, of course. And I think everybody understands in Russia. And, yes, we enjoy now a relatively good time because of the very high oil price, again. But we are still there, we are now looking at the markets and if the financial volatility of (INAUDIBLE) on the stock markets affect the commodity prices, we'll be very much affected, that's true.
QUEST: And yet, of course, Russia is one of the least affected markets at the moment.
Does that show a strength in Russia or should that be a worry that there is a fall that could hit Russia?
KOSTIN: Oh, I think the -- the major problem for Russia with restructuring the economy and -- and changing the -- the imbalance between oil commodity and -- and other parts of the industry,
I think that that's -- that's the key issue.
Unfortunately, it's all interrelated, because if you experience a problem on the stock markets, on financial markets, you can't get much investments. And when people are not sure about the future of the international economy, they are not investing in investment projects, for example, or investing in new production or investing in new technologies.
On the right, you see the golden church and green roofs.
QUEST: Oh, yes, yes, yes, yes, yes, yes.
KOSTIN: That's the Kremlin.
KOSTIN: The Russian government will either to have a massive privatization and extending the income from privatization in the infrastructure and other development projects. But unfortunately, again, the market doesn't help very much.
QUEST: Let's talk about that privatization, because I -- and I know that you have to be a little bit careful, because I think a tranche of your own bank is going to be--
KOSTIN: Well, we -- we were successful. I mean that's the story for VTB. We are the only--
KOSTIN: -- Russian institution, actually. We sold the 10 percent--
KOSTIN: -- of our stake in February. And no other state-owned companies managed to do it. And--
QUEST: Is this -- is this too ambitious in this particular market for the government to be privatizing or continuing to privatize or is it a necessity?
KOSTIN: Well, I mean, the government put forward a program and now they've just recently said that that's a question of (INAUDIBLE) opportunities. So I mean the -- some of the leading companies like Zwer Bank (ph) or Russian leading shipping company (INAUDIBLE), they are ready for privatization. But they will now wait and see when this window opens.
So I think that that's the only approach under the circumstances, because the market will -- will not accept or will not digest the big privatization of Russian assets, as maybe any other assets you see that it's a very -- the markets get very frightened. And it has nothing to do with the -- what I've found, particularly over the last few years, it has nothing to do with your performance. You can double your price -- you can double your income, you can double your profits, and still if the news from America are not very good, the markets in Russia will be down rather than up for your stocks.
(END VIDEO TAPE)
QUEST: Andrey Kostin, the chairman of VTB Bank, with an extraordinary -- extraordinarily good view from the top of their office building.
It's a case of build it and they will come.
Well, it could only be an Apple product and all this hoopla which has the customers lining around the block once again. It's the launch of the iPhone 4S, after the break.
QUEST: Christmas came early for Apple fans and customers this morning. The new iPhone 4S went on sale across the world today. Predictably enough, they were cueing around in droves.
Maggie Lake is outside an Apple store in the Big Apple -- Maggie, I -- I just know that you will -- will have been beside yourself with glee on this auspicious occasion in -- in broadcasting.
MAGGIE LAKE, CNN BUSINESS CORRESPONDENT: Yes, especially because I had to get up at 4:00 to cover it. Richard, we have been here all day and there were big crowds early on. I have to say, physically here at this store, it's the only one I've been at all day, not the kind of gargantuan crowds that we've seen. But we know a lot of those orders happen online, those pre-orders.
But take a look. Would have people cueing up here at this store. These are the people waiting outside. There is a whole bunch more inside. They snake up to the upstairs. So it is chock a block in there. And it has been like that all day for people coming out to get the latest version.
Some of them are doing the small hop-up from the -- from the previous 4G. Others have been waiting and some have older models, so they really want to get their hands on this and check out the virtual -- the -- the virtual assistant Siri, which has been getting a lot of buzz, and some of the other features.
But, Richard, an interesting thing happened while we were here. Of course, it's not just about the actual I -- iPhone, the latest version of the iPhone. But it's about this sort of broader Apple economy, this -- the businesses that revolve around Apple products.
And we can tell you what one entrepreneur who was here today, trying to get his foothold in that burgeoning market.
Have a listen.
JOHN VONS, FOUNDER, YOFO: For 20 -- 20 years I was an architect. And then through -- when the economy dropped in 2008, my office laid off a lot of people. And I've been out of work for three-and-a-half years.
LAKE: That's rough, to be out of work that long.
VONS: Sure. I had to reinvent myself. You know, I figured architecture is not going to -- the profession is not going to come back for a while.
VONS: So I just kind of came up with this invention and figured it was, you know, following Apple as a precedent is a good -- a good inspiration--
VONS: -- to create a new business.
(END VIDEO TAPE)
LAKE: An interesting story, Richard, in this tough economy, you know, latching onto sort of the creativity and popularity of Apple products and iPhones. We'll see if it's successful.
Meanwhile, of course, we already know this is the most successful launch of the phone so far. They're expected, by the end of this weekend, to sell somewhere between three million and four million, if estimates are on track -- Richard.
QUEST: And have people quite forgiven Tim Cook for not making an iPhone 5 but sort of doing a halfway house? LAKE: You know, this is the funny thing about Apple, right. All the tech analysts and the pundits and the experts came out and said, what? It's not a 5?
And this is -- this is nothing to shake a stick at. Customers don't agree. You know, tsars Steve Jobs never really listened to all the pundits and did what he thought he should do. These people seem excited about what they're getting their hands on. They're interested in checking out this new version.
Remember, some of these aren't jumping from the 4G. Some of these still have the 3 in some of the earlier versions.
QUEST: Yes, yes, yes, yes.
LAKE: So for them, it is going to be a big change. Not everybody is like you, Richard.
QUEST: Oh. Oh, I don't know what you're suggesting. Never spent a penny if a hapney (ph) will do.
Maggie Lake, have a good -- I was going to say something -- I was going to say something sympathetic since you've been there since 4:00 this morning, but you've got another five hours to go.
Maggie Lake is in New York for us tonight.
So what do you do with your old iPhone?
Some companies are buying them for nearly $300. I've posted an article on this very point on your dead iPhone being literally a gold mine -- literally, it's at Facebook/quest. the weather forecast now and we turn -- there you are. And we turn our attention to weather forecaster, Pedram is at the World Weather Center.
For us this evening -- good evening.
PEDRAM JAVAHERI, CNN METEOROLOGIST: Good evening, Richard.
Yes, let's talk about what's happening across Europe. Of course, we've been leading up to very nice conditions expected to occur this weekend. And high pressure already doing its job. So I think one of those weekends to remember for the beginning here of the first couple of weeks of autumn. But a few storms to the south here. So for business travelers heading out there toward portions of Italy on into the beginning of next week there are going to see some isolated storms in that area. But across Western Europe, London, yes, a snapshot right here. Enjoy it across St. James Park. You're going to see those sunny skies, a few clouds possibly on Sunday.
But once again, looking like a nice cod period of above five or so degrees above average.
To the south again, being the area of concern here, where we're going to have a few thunderstorms popping up on into Saturday morning. Some isolated flash flooding possible anywhere from, say, Southern Italy on into Albania and work your way toward portions of Greece and the Greek Islands there.
But Istanbul and areas to the east there, that's where you're going to find some of the delays, about 45 to 60 minutes. Istanbul, you're going to see up to an hour-and-a-half possible, with the heaviest rainfall being consigned to the south.
But as high pressure builds to the north, we're going to get very close here to some of the warmest temperatures we've seen in about a two-and-a- half or so week period. So we'll call it sunny skies and temps into the upper teens, lower 20s in a few spots. And that pattern is going to continue, Richard, for on into the beginning portions of next week.
And I wanted to show you the high temperatures for the next couple of days. Getting up to 30 in Madrid. So one of those places still hanging onto the warm temperatures.
But London, once again, warmer than Paris, getting up to 17 degrees and temperatures across portions of Berlin also on the mild side at 12. So hopefully, you'll have a chance to get out there and enjoy your weekend -- Richard.
QUEST: Pedram, we thank you for that.
QUEST: And that is QUEST MEANS BUSINESS for tonight and for this week.
I'm Richard Quest in London.
Well, I'm going to be off for the next few weeks, taking some long leave. You know these corporations -- use it or lose it. So I'm going to use it.
Whatever you're up to in the weeks I'm away, I hope it's profitable.
"MARKETPLACE AFRICA" next.
ROBYN CURNOW, HOST: Hello, you're watching MARKETPLACE AFRICA.
I'm Robyn Curnow in Cape Town.
With its iconic mountain and beautiful beaches, tourism has helped to sustain the economy of this city.
Tourism in Sierra Leone, though, might be a tougher sell. Its image tarnished by years of civil war, Sierra Leone, though, is now looking to bounce back.
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CURNOW (voice-over): After a decade long civil war, Sierra Leone is ready to get back to business. The country is rich in resources, but still one of the poorest in the world. So the government has undertaken key reforms, reducing the hurdles for business.
Government says improving the country's weak infrastructure has been key to development.
Sierra Leone is one of the least electrified countries in sub-Saharan Africa, but leaders hope that will change with the expansion of the Bumbuna hydroelectric project. The government is working with the American company, Jewel Africa (ph), to increase power capacity at the facility.
Our Elise Labott sat down with President Ernst Bai Koroma to discuss the Bumbuna project and other development strategies aimed at bringing in more investors.
ERNEST BAI KOROMA, SIERRA LEONEAN PRESIDENT: But we have to position the private sector in the forefront of economic development. And therefore, considering where we are coming from, we took it as a -- a -- a priority that we should be a government that will embark on great reforms, reforms that will be attractive to the investor.
ELISE LABOTT, CNN SENIOR U.S. STATE DEPARTMENT PRODUCER: Africa is so rich in -- in minerals and Sierra Leone in particular, and there has been decades, throughout the continent, of mismanagement. And how -- how do you escape that narrative?
BAI KOROMA: Because of the expectation and the focus of democratization, transparency and accountability and the awareness and the expectations of the people and the demand of those of us in leadership to respond to the needs of the people, we have to ensure that we -- our policies and our programs reflect that and the people become the greater beneficiaries. And it has happened in the past.
LABOTT: You know, in may post-conflict fragile states, the key challenge is infrastructure and -- and making sure that the infrastructure is able to manage rebuilding of the whole country and the whole society.
Talk about your infrastructure and whether it's able sufficiently to manage your growth right now.
BAI KOROMA: We quickly agreed on prioritizing our development agenda. And we call it in Sierra Leone the agenda for change. In that agenda, we have energy, agricultural infrastructure, health and education, as the key sectors that should be given a priority and attention and the sectors that will impact on the overall--
LABOTT: And you've quintupled your spending in some areas, right?
BAI KOROMA: Oh, yes, but because we believe there is a need for it. We believe that because of our agricultural potential, if we enhance our agricultural productivity, we will not only be addressing the issues of food safety, but we will be addressing the issues of employment creation and also poverty reduction.
LABOTT: Sierra Leone right now is one of the least electrified countries in sub-Saharan Africa.
But now you have this Bumbuna hydroelectric project.
What are the immediate benefits for the economy and for the people of Sierra Leone?
BAI KOROMA: We inherited a very difficult situation in the energy sector. It was a sector that had less than 10 percent, 10 megawatts of energy provision for the whole country. And that is why we, as a government, worked on the completion of the Kunguna Hydroelectric Project. It is a project that has been under construction for well over 30 years. And people are realizing the benefits. Some of them have increased in domestic and economic activities because of a constant in energy generation. And they know that at the end of the day, if I pay my bills, I will continue to enjoy the supply. And if I enjoy the supply, I will be able to provide the services that will provide me an income.
So I think it is a win-win situation. I mean they have not been expecting that in the past because the cost was astronomical. But with this--
LABOTT: It could be more cost-effective now.
BAI KOROMA: Yes. And I believe that if we continue to reach out, to spread out the provision of energy, to ensure that not only the domestic suppliers benefit -- I mean they do -- the domestic consumers benefit, but also the institutions and other agencies benefit. You've been 10 years since the war. Look ahead the next 10 years.
Where do you see Sierra Leone?
LABOTT: Sierra Leone would have developed their democratic values to the point wherein it will no longer be considered as a fragile state. With all of the opportunities that are now unveiling themselves in the minerals sector, the agricultural sector, the tourism, we should be able to transform ourselves to a middle level country.
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CURNOW: Head over to our Facebook page and join the conversation about Sierra Leone. Let us know your thoughts on the country's future.
Now, to the future of Africa as a whole, our next guest explains why the continent is an essential market, but cautions it's still key.
CURNOW: You'll find visits from all over the world here in Cape Town, many African travelers, too, with many, many to spend. The amount of disposable income on the African continent is growing. And that's made Southern Africa's largest financial services company sit up and take notice.
Old Mutual says more and more Africans are going to need help planning for their financial future, managing their money.
Well, Nkepile Mabuse now sits down with the CEO, Kuseni Dlamini.
NKEPILE MABUSE, CNN CORRESPONDENT: Take me through what your strategy is in Africa.
Have you looked at countries that, for example, have a high GDP per capita as opposed to countries that -- that have huge volumes, like Nigeria, 150 million people?
KUSENI DLAMINI, CEO, OLD MUTUAL SA AND EMERGING MARKETS:
We do look at GDP per capita rates in the different markets where we invest. And we look at countries in terms of a set of criteria which includes that.
But is it not just that that we look at. We also look at the long-term prospects that a country presents to us.
Our forecast now is consolidating in the countries where we are, building state in the countries where we are, while, at the same time, actively looking at other markets where we need to expand.
MABUSE: More and more people are starting to realize that Africa is not a country, but a continent. It's extremely diverse.
Do you think Old Mutual has what it takes to adapt to this diversity?
DLAMINI: Well, our approach is really based on understanding the specifics of each market and looking at whether our core competencies can be projected in order to create value in that market. And at the same time, having said that, we keep countries as countries, but also African countries are small in terms of population size. We also have the regional outlook.
MABUSE: Let's just take a little bit about where we are right now in South Africa. There's huge unemployment here, huge inequality. Some people are worried that the debate around nationalization is actually putting off investors. And, of course, you, as businesspeople, wanting to make money, those things are obviously affecting you, aren't they?
DLAMINI: Absolutely. Unemployment is (INAUDIBLE) to the leadership of this country on both fronts of business and government. I -- I believe that we need to really elevate the unemployment challenge, especially if unemployment is a national (INAUDIBLE) strategic priority. We need to make sure that we incentivize companies to create jobs, we incentivize companies to invest, because in the long run, it is companies that create jobs. But if our companies to create jobs, they need an enabling environment to invest their shareholders' money on a sustainable basis.
MABUSE: Zimbabwe is an interesting market. You've been there for over 100 years, as I understand it.
MABUSE: Why has the Zimbabwe remained so important to Old Mutual?
DLAMINI: Zimbabwe has been a very important part of our business. At -- at a certain stage, it used to account for 10 percent of our profits. But as we know with the meltdown that happened in this country, our business was destroyed. But we are hopeful that the global political aggregate will unleash a dispensation that will make it conducive for business to drive again in Zimbabwe.
MABUSE: You've been here really criticized for -- for your indirect investment in the Marange diamond fields, where human rights organizations have documented serious atrocities occurring there. But you refuse to divest.
DLAMINI: We were not, as Old Mutual, part of the decision to go and reverse the Marange diamonds. We found ourselves having invested in a company that later on decided to go and invest in another asset. And we are very--
MABUSE: And when you realized that that was happening--
DLAMINI: -- small minority shareholder in -- in that business.
When you realized that this has happened, we initiated a review and we are reviewing our investment.
MABUSE: When are you going to reach a decision?
DLAMINI: Yes, we -- we are in the process of reviewing that investment and that's all I can say at the moment. We are very committed to ethical principles. We are very committed to responsible investments. And we always assess our investments on that basis.
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CURNOW: Kuseni Dlamini there of Old Mutual.
Don't forget to go online at CNN.com/marketplaceafrica. All of our old interviews and stories, as well as other business news from Africa are there. And, of course, links to our Facebook and Twitter pages, as well.
I'm Robyn Curnow here in Cape Town.