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QUEST MEANS BUSINESS
Ireland Exits Bailout; Europe in 2014; Big Night for Science; Crisis in Kiev
Aired December 13, 2013 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAGGIE LAKE, CNN CORRESPONDENT: You're watching live coverage there of a shooting incident at a school in Colorado. We will continue to bring you updates as soon as we get them.
Good evening, and welcome to QUEST MEANS BUSINESS. I'm Maggie Lake in New York.
We begin tonight in Ireland. Three years after the country was forced to seek an 85 billion euro international bailout, Ireland will exit the program on Sunday night. Ireland can take pride in becoming the first Eurozone country to come off the financial life support system.
Foreign Minister Michael Noonan says Ireland's troubles are far from over.
(BEGIN VIDEO CLIP)
MICHAEL NOONAN, IRISH FINANCE MINISTER: This isn't the end of the road. This is a very significant milestone on the road and it gives us an opportunity to pause and reflect for a very short period.
Everybody owes a debt of gratitude to all those Irish men and women who made such sacrifices to get us out of the greatest crisis that this country has experienced since the famine. And it wasn't easy for anybody. I would say to them as well that the government is committed now, that this will never happen again.
(END VIDEO CLIP)
LAKE: As Michael Noonan said, the last three years haven't been easy for the Irish. CNN's Jim Boulden met some of the people that have been hit the hardest by the economic crisis. He traveled to Ireland recently and he joins me now live from London.
And, Jim, they have been through an awful lot. It's great that they're exiting. But it's still awfully tough. I mean, it takes an enormous amount of time to yield from something like this, doesn't it?
JIM BOULDEN, CNN CORRESPONDENT: Exactly, and especially because there's going to be another round of austerity in 2014, Maggie.
So people shouldn't get the impression that this is the beginning of the end. I don't think it is. I think we're right in the middle, you know, the cuts are continuing and, of course, Ireland has to pay back this, what, $90 billion that it got in the bailout. So there's a long way to go; a lot has been taken out of the economy.
And last week when we were in Ireland, we met some of the people that are suffering from this, because it is far from clear that what's going well in Dublin is going to help the rest of the country. Take a listen.
BOULDEN (voice-over): Gerry Pearson used to build homes like these. And just like these, Pearson's last efforts were never completed. Six years after he broke ground on four properties.
GERRY PEARSON, FORMER BUILDER: (INAUDIBLE) selling them. So (INAUDIBLE) that was it.
BOULDEN (voice-over): These are known as ghost estates, homes built in rural Ireland, miles from town centers and part of the property bubble that burst in 2008, causing a banking crisis leading to an international bailout.
So while Dublin's economic recovery is well under way, for the rest of Ireland's, it's lagging and undergoing the country's age-old solution to economic woes, emigration.
Pearson's electrician son is going to Canada in February. His daughter has already followed friends and emigrated to Australia.
PEARSON: I think six of them, friends, went to Australia to (INAUDIBLE).
BOULDEN (voice-over): Emigration is one of the safety valves available to the young of Ireland, with youth unemployment nearing 30 percent. Twenty-five-year-old Barry Delaney found work in Australia when the crisis hit. He then returned for a master's degree, but he's off again to London early next year.
BARRY DELANEY, GRADUATE STUDENT: What I don't see as many years ago leaving and never returning --
DELANEY: -- (INAUDIBLE) seeing how my future, if I leave for 2-3 years, I will have the prospects and opportunities to return.
BOULDEN (voice-over): Not that emigration is everyone's solution. While overall unemployment is coming down, it's still north of 12 percent.
IVAN COOPER, THE WHEEL: For people on the ground looking for work, the competition is intense when jobs come up. And when they're available, they're still relatively few. We know that government is reporting up to 1,000 being created a week.
But those jobs, are they going to unemployed people?
BOULDEN (voice-over): Local charities have struggled to fill the gap as the government continues to cut social welfare payments as part of its four-year austerity drive.
COOPER: Charities are facing the perfect storm of increased demand while at the same time trying to deal with the realities of seeing -- giving levels' decrease over that timeframe.
BOULDEN (voice-over): And while Ireland is being hailed for exiting the bailout, it still needs to pay back much of the $92 billion loan from the E.U. and IMF. While the Irish people also have to find ways to rebuild their own balance sheets, with many mortgages still underwater.
FRANK MCDONALD, "THE IRISH TIMES": Well, I think that people feel a bit battered by everything that has happened, obviously. And a lot of people are suffering major levels of personal and financial indebtedness.
BOULDEN (voice-over): And though homelessness rose 20 percent during the crisis, the government says these ghost estates are not the solution. Some have been converted into social housing, but others are now hazards.
NOONAN: There are a lot of houses in rural parts of the country whose construction was driven by tax breaks and that is a very bad policy idea.
BOULDEN (voice-over): Gerry Pearson says he's semi-retired now, and so not looking to restart his building firm. But he is hoping the economy recovers enough so his kids can come home.
PEARSON: I'd like to see (INAUDIBLE) back and settle back in (INAUDIBLE) here at home, you know, but it's looking bleak at the minute.
BOULDEN: Of course, Maggie, it would be a whole lot easier if the rest of Europe would be growing the way it is here in the U.K. That's something Ireland needs, because it's such an export-led economy.
LAKE: Yes, Jim; you know, it's interesting, when you talk about it, their labor flexibility, the ability to leave the country and look for work, it's certainly an asset. But let's face it, it's also brain drain. And when people move, they start families. They put roots down. It's not that easy to flick a switch and immediately come back, as we heard that father talking about.
How does that slow down the recovery if your best and brightest are leaving? That can't help boost your economic growth, either, can it?
BOULDEN: It can't. But the people we knew back in the day that didn't emigrate didn't come back. And as that young man said, Mr. Delaney, he says he will come back.
And I'd say the difference now between when the big tech giants like Dell and Intel and Microsoft and Apple were there, they were just assembling parts; they were just assembling things, and they were then shipped out of the country.
What you get now is indigenous, small companies, these little tech companies, that are surrounding the Twitters and the Facebooks, the Ancestries, the TripAdvisors and Google. And what they're hoping is those little companies that are dotted around the dothans (ph) that are Irish companies that won't leave, they say, will grow.
One or two of those will become very big. That's what they're hoping for. That will keep the kids after they graduate in Dublin and (INAUDIBLE) them not to leave.
LAKE: Absolutely. And Ireland, again, one of the benefits they're known for, their entrepreneurial spirit. And in these down times, sometimes that's when you get the opportunity. Let's hope so.
Jim, great stuff. Thank you so much.
Well, Ireland's exit is a milestone, not only for that country, but for the Eurozone. And there are more milestones ahead for other bailed-out countries.
Spain took 41 billion euros out of a 100-billion euro aid package for its banking sector last year. Spain intends to exit the program in January without drawing anymore funds.
Portugal, meanwhile, received a 78 billion euro bailout in 2011. That program expires in June of next year. The government recently said a bailout exit is not yet on the agenda. Some economists are speculating Portugal might actually have to ask for more financial help.
Cyprus joined the bailout club in March this year. It also enforced strict capital control to prevent a collapse of its financial system. Those controls are expected to be lifted in early 2014, perhaps as soon as January.
Finally, Greece; the country has so far received two bailouts. But it remains deep in recession. Its budget for 2014 will bring more austerity as Greece makes the adjustments demanded by its international creditors. Some Eurozone officials have publicly said that Greece may need a third bailout.
Well, Adolfo Laurenti joins us to talk about what is in store for Europe in 2014. He is deputy chief economist at Mesirow Financial in Chicago.
Adolfo, thank you so much for being with us today. Let's start with Ireland. We talked about the fact that although they're reaching a milestone, there's still work to be done.
But are they an example of the road that these other countries we just went through are going to follow? Or are they the exception?
ADOLFO LAURENTI, DEPUTY CHIEF ECONOMIST, MESIROW FINANCIAL: Well, I think they are. I think that I agree with your overall comments that a battle has been won, but the war goes on. But I think we should not underestimate the success of the Irish economy. We should also learn what will recover there.
I do believe that Ireland can leave the bailout constraint right now because of their early success in doing structural reform. Actually, the reform of their economy predates the financial crisis. That's a big challenge for so many other countries around Europe.
You had mentioned Spain and Greece, Portugal, where structural reform has been delayed, and now it's becoming very difficult to keep this economy afloat with an austerity report from the bailout, at the very same time, some trying to do the very difficult political job of reforming economies that badly need such change.
LAKE: That's right. And to do those two things at the same time, while the people continue to say we can't take anymore, I want to focus on Spain for a moment, because there's such a big economy, so important to Europe. They say that they're going to exit, that they don't need any funds.
Is that a really optimistic? We are looking at a country that still has very high unemployment rates overall. And when you look at youth unemployment, I mean, it's staggering, the numbers.
How can they do that on the path they're on right now?
LAURENTI: You are right. It's shocking and dramatic. I think that for some categories of young people, unemployment is close to 50 percent.
But I have hopes for Spain. I think they have taken a lot of pain and they have done a lot of work to try to reform their economy. I take their progress very seriously and I think that there will be a payoff for the efforts that are being made.
Of all the countries that we have been mentioning, probably Spain is the one that face the biggest challenges but also is the more advanced in terms of reforms, in terms of seeing a light at the end of the tunnels.
I think it's the countries that have not done these reforms are the one that face more challenges and it would be very difficult for them, both in 2014 and forward, honestly.
LAKE: And we know some of those, we've detailed those.
What about the countries we have30n't mentioned? We've been saying that the core growth in the core can -- if that tide can rise, will help lift -- take some of the pressure off the periphery.
But France, considered the core, seems to be going in the wrong direction.
LAURENTI: Not anymore. I think that 2013 was the year in which France left the core of the Eurozone to join the periphery. We have seen the downgrade of their debt. Clearly there is no political will to do the reform that must be taken in order to make the country more competitive.
So France is problematic. It will continue to be problematic going forward until we see changing political attitudes.
And then we are seeing some struggle, even in some country you would have never expected to see on a watch list, like the Netherlands. They also got their government debt downgraded recently.
I think in the case of the Netherlands, the proximity with Germany will help. I have an expectation that Germany will continue to do well, probably not as well as they hope, but clearly to be the driver of growth for the Eurozone next year.
LAKE: It's been a tough road, but hopefully you're right and 2014 is a little bit better. Adolfo Laurenti from Mesirow Financial, thank you so much for joining us and sharing your insights.
LAURENTI: Thank you.
LAKE: Well, stocks edged higher this Friday, Alison Kosik is at the New York Stock Exchange.
Alison, it wasn't by much, but it looks like we did break that losing streak.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Just by a notch, exactly. You know, we did watch stocks, Maggie, today, drift from negative -- or from positive to negative and back and forth several times. You know, there just wasn't a whole lot to trade on today, except the Fed. And what investors think the central bank will do or won't do next week.
And these predictions of when the Fed will taper, they're all over the place. You know, will the Fed start to pull the plug next week or wait until January when its next meeting is at the end of that month, two days before the end of Fed chief Ben Bernanke's term.
So investors are still holding out for a Santa Claus rally, usually happens later in December, so there is still time, especially when you look at history. It shows that the S&P 500 has risen in 24 of the past 30 Decembers.
So it's already been a tough month, Maggie. But hope not totally lost for a positive December -- Maggie.
LAKE: And we've certainly seen them coming in for those IPOs. So there's money out there --
KOSIK: Yes, we have.
LAKE: -- to spend, that's for sure. All right, Alison, thank you so much. Have a great weekend.
Well, investors in New York are also playing the Fed waiting game ahead of next week's very crucial meeting. The main indices closed lower Friday. One stock I want to mention, Peugeot, plunged 12 percent after General Motors sold its 7 percent stake in the company. Peugeot is now going to seek a closer cooperation with China, one of China's companies.
Peugeot is not a component we should mention of the CAC 40.
Well, Facebook's Mark Zuckerberg wants to change the way the world views scientists.
(BEGIN VIDEO CLIP)
MARK ZUCKERBERG, COFOUNDER AND CEO, FACEBOOK: The big goal here is to treat and honor scientists in the way that they should be recognized by society.
LAKE (voice-over): More on Zuckerberg's campaign when we come back.
LAKE: Mark Zuckerberg says the world's top scientists deserve fame and fortune. And some of them got a taste of celebrity on Thursday night at the Breakthrough Awards. It's a sort of Oscars for scientists and it's backed by the Facebook mastermind along with Google cofounder Sergey Brin and some other notable names in tech.
Award winners shared a $21 million prize pot. Dan Simon spoke to Zuckerberg about his hopes for the project.
ZUCKERBERG: The big goal here is to treat and honor scientists in the way that they should be recognized by society.
DAN SIMON, CNN CORRESPONDENT (voice-over): Mark Zuckerberg changed the world with Facebook. Now he wants to change how the world looks at scientists, to make them more revered, like Hollywood celebrities.
SIMON: You think that's an attainable goal, to change the way people look at scientists?
ZUCKERBERG: Absolutely, absolutely. I mean, it used to be the case, back in Albert Einstein's day, that he was really was viewed as part of pop culture and a rock star in his time. And it's really a shame that we've lost that.
SIMON (voice-over): So with stars like Kevin Spacey.
KEVIN SPACEY, ACTOR: It's kind of great to see the geeks and the nerds get a really fantastic night.
SIMON (voice-over): -- and Conan O'Brien.
CONAN O'BRIEN, COMEDIAN: Nerds seem to have the upper hand these days, don't they? When I was a kid, it was jocks.
SIMON (voice-over): -- Zuckerberg helped organize an Oscars-like award show, complete with paparazzi and red carpet.
SPACEY: Good evening, ladies and gentlemen.
SIMON (voice-over): -- to shine the spotlight on some of the world's smartest people.
SIMON: Do you want this to be the most prestigious prize in science?
ZUCKERBERG: I don't know if we think about it in those terms, but we certainly want this to be both a meaningful reward for the scientists and something's that public so that way it can be an aspirational goal to children who are growing and other folks who are thinking of going into science.
SIMON (voice-over): The idea first came from this man, Russian billionaire and technology investor, Yuri Milner.
YURI MILNER, TECHNOLOGY INVESTOR: I used to be a physicist a long time ago and I think that I'm sort of -- had this idea to give back to the people that I belonged one day to.
SIMON (voice-over): He convinced his Silicon Valley friends, including Zuckerberg and Google cofounder Sergey Brin, to fund the event, each winner, seven of them in all, getting $3 million each, making it the most lucrative award of its kind.
For the 29-year-old CEO, science is not that big of a departure from the world of tech.
SIMON: If you were back in your Harvard dorm room today, what would you be working on? The social networks seem to be taken.
ZUCKERBERG: I don't know. That's an interesting question. I think that, for me, my life mission is to help make the world more open and cacton (ph), to give people the power to share.
So there are always more ways to do that. And maybe if I were in college today, I'd just get started doing something else that's connected to that mission, but just at a point that's -- that makes more sense for (INAUDIBLE) with phones.
SIMON: You'd be taking advantage of a growing pop war?
SIMON: One of the winners included a doctor, who came up with new, effective ways to treat cancer. Another is helping the world better understand Parkinson's. Again, each getting $3 million; that's unprecedented. That's nearly three times the size of the Nobel Prize -- Dan Simon, CNN, Mountain View, California.
LAKE: Mark Zuckerberg is taking a stand on government surveillance. Facebook and other Internet giants like Google, Yahoo! and Microsoft, have composed an open letter to President Obama, demanding limitations on the government's authority to collect users' information. It's the tech world's most concerted response yet to claims of NSA spying.
Dan Simon asked Zuckerberg why he signed it.
(BEGIN VIDEO CLIP)
ZUCKERBERG: One of the things that I've said publicly is that I think that the government has really blown it on this. You know, people want the government to help protect us; but we also want the government to be transparent and tell us what they're doing and tell us what data they're collecting.
And I think that they've just completely failed on that front.
And from what I've seen, you know, if they were just a little bit more open about what they were doing, I think that they could created a lot more trust and a better environment for everyone. But I think that they failed at that and I think that they're continuing to, which is why we're continuing to push on it as an industry.
SIMON: Is there a concern that teenagers are going to properties like Instagram or snapshot, a competitor? How do you get teenagers not to, you know, leave Facebook, where their parents are?
ZUCKERBERG: Well, I mean, our focus is helping build products that help everyone share with the people that they want. And what we see is that engagement and sharing has just increased so much over time.
So going back 10 years from when I started the company, the amount of content that people now want to share and have the tools to do that has grown, right? It's photos; it's status updates, major life events with the people who you care about.
And now people have a lot more tools to do it. We never thought that Facebook would be the only way to do it. But what we have seen is that the amount of sharing and the amount of time that people are spending and engaging in Facebook across all demographics that we measure is generally increasing. And we feel really good about that.
SIMON: This was a big milestone. Week for now, you're on the S&P 500. What did it mean to have that happen?
ZUCKERBERG: I don't know. I haven't really thought about that very much.
(END VIDEO CLIP)
LAKE: And he doesn't. He likes to say long-term focus, that's he reminds his investors all the time.
Let's take a look at that Facebook stock. He may not be watching it, but the rest of us are. It closed the week just above $53, up around 3 percent. That is up around 39 percent since the IPO in 2012.
President Yanukovych is taking his first steps toward resolving the political unrest in Ukraine. We'll have a live report from Kiev when we return.
LAKE: Ukranian President Viktor Yanukovych met for roundtable talks with opposition leaders today and offered amnesty to jailed protesters. It is the first major step he had taken to defuse the country's political unrest.
Still, protesters remain defiant in Independence Square. Mass rallies are planned for Sunday and demonstrators are streaming into Kiev to join those who have braved the bitter cold for weeks now.
Nick Paton Walsh is live for us in Kiev, out in the cold himself.
Nick, bring us up to date; we spoke earlier. You mentioned the fact that there are now dueling groups, it would appear, of protesters that seem to be gathering.
What's the very latest?
NICK PATON WALSH, CNN SR. INTL. CORRESPONDENT: Well, certainly we've seen today and yesterday a bid, I think, by the Ukranian government to seem like they're trying to mollify the protesters behind me.
You mentioned yourself the release of some prisoners, an amnesty declared for everybody else arrested during demonstrations, a suggestion from the president that he had three people in mind to perhaps punish or hold responsible for brutality the protesters claim police used against them and there's continued suggestion the talks over the E.U. deal that sparked all this off are still going and might end positively.
But at the end of the day, and it actually has been repeated by opposition leaders themselves, many here see this as rhetorical. They're not entirely trusting that things are actually going to change on the ground, and that means we're still seeing thousands of people out on the street here.
(INAUDIBLE), Maggie, as you mentioned, pro-government demonstrations flooding into the capital and we caught up with the first part of those new protests.
WALSH (voice-over): At the heart of government, the police are gently managing a different protest.
WALSH: Right outside the Ukranian parliament here, there is for the first we've seen since being here a pro-Yanukovych demonstration. They're on stage and, of course, no problem for them gaining access to the closest government buildings here. The police here are laying their own particular row out. But a calmer mood here, almost somber in many ways.
"If we have closer ties to the European Union," this woman says, "our factories in the east will be closed. We'll be penniless."
UNIDENTIFIED FEMALE: (Speaking foreign language).
WALSH: She said that if they join the European Union, she'll become a slave.
WALSH (voice-over): Some worried faces, some bored, some just not wanting to be seen.
Kept buoyant by the loudspeaker, "Europe yes, chaos no. The north invites you," it repeats.
One thing you have to bear in mind here is that even though these protests are right next to some of the most important government buildings in Ukraine, the police are getting involved, in fact walking some of them freely and comfortably among them, very much a sense that, of course, this is sanctioned by the government.
WALSH (voice-over): Just like the opposition, they have tents (ph). And though, again, some really don't want to be filmed, they have one big advantage over the other lot. They have a leader.
"We support the president, his position and are against violence," one leader from the southeast tells me. (INAUDIBLE). Their numbers will grow this weekend.
WALSH: This stage has been swiftly erected outside one of the major theaters here. Now there are police around the theater on that other side, quite a number of buses and further riot police. The concern is this is part of a pro-government demonstration, the real problem being the geography of this.
This is about 200 meters away from the barricades of EuroMaidan, the anti-Yanukovych protest that's been raging there now for weeks. Two protests within shouting distance of each other.
WALSH (voice-over): If tensions escalate, the question will be whose side will these police fall on?
WALSH: And that's the real paradox we're seeing here. We've seen this diplomatic almost outreach from the president, a bit of reconciliation to say the things to the opposition here, the protesters want to hear, but we're not seeing that reflected on the ground. Instead, thousands of pro- government supporters are, it said, flooding into the capital for the weekend.
On the other side, on Sunday, a Ukranian official tells me that U.S. Senator John McCain, a staunch opponent of the Putin administration in Russia, is coming to Kiev and may even address the crowds in EuroMaidan, although his office won't confirm that at this stage.
So really, much being escalated here when, in fact, the rhetoric politically was trying to go in the opposite direction, Maggie.
LAKE: Yes, it's setting up for an incredibly tense weekend, Nick. And you can imagine this is only breeding more distrust among the anti- government protesters.
You mentioned that the government, the pro-government protesters that were bused in have a leader. They seem to have resources that are potentially coming from the government, if not directly, indirectly.
The -- for the anti-government protesters, they also have an incredible infrastructure set up, don't they? If they have no leader, how are they able to be so organized? Where are they getting the funds from?
WALSH: I think many point toward some of the big businessmen here (INAUDIBLE) who may have sympathies towards protesters here, but also private donors, too. It is remarkable, (INAUDIBLE) food kitchen here, the hygiene levels that are being maintained by those preparing food, the stage behind here.
That's no surprise. We saw it in 2004, the pro-government side, too, equality organized. Many argue they have state infrastructure behind them, too. We're even hearing, in fact, early this morning specially chartered trains, perhaps bringing people in from around the country on larger numbers. They're both organized.
But the key difference you mentioned, there's no leader for the lot behind me. The president is the leader. That's perhaps at issue for the pro-government lot to have to contend with, because Yanukovych is now deeply unpopular, I think, amongst many here, because the vacillation between the E.U. and Russia we've seen over the last few weeks.
But the real question is what are the demands that can be met that will send these people home? That's still not clear. Nothing that Yanukovych has said today necessarily translates into sending people home or even beginning to think about it.
And one key demand that he'll probably never meet, the many protesters want to hear back here is that he has resigned from his job. It's still going to be tough weeks ahead here, and a lot more horse trading going on behind the scenes, may not really impact this tense, increasingly tense standoff on the streets.
LAKE: And that standoff also reflecting the economy as well, which is freezing up by the moment.
All right, Nick, thank you so much for that.
Nelson Mandela will be laid to rest this weekend. It will be a time of reflection in South Africa. We'll take a look at Mandela's legacy and the country's economy, when we come back.
LAKE: Welcome back, I'm Maggie Lake. The headlines this hour -- two people have been injured in a shooting Friday at Arapahoe High School in Centennial, Colorado, one of those was seriously hurt. A police official says the gunman shot and killed himself inside the building. It appears he was a student at the school.
At least 17 people were killed in Iraq when a gunman attacked several trucks carrying liquid gas near Baquba. The dead include 15 Iranian gas workers. Seven others were wounded in the ambush. The FBI has arrested a terror suspect for allegedly trying to stage a suicide bombing at the Wichita, Kansas airport. A U.S. attorney says the suspect, an airport employee, wanted to use fake explosives provided to him by an undercover agent. He was arrested while trying to breach a security gate.
Ukraine's president says he'll give amnesty to jailed protesters. Viktor Yanukovych made the offer during roundtable talks with opposition leaders. He says he wants to free all prisoners arrested since anti- government protests broke out three weeks ago. The protesters are angry that the government rejected a free trade agreement with the E.U.
The South African government says 100,000 people filed past the casket of Nelson Mandela over the past three days. Today was the final day for the public to pay their respects. Mandela will be given a state funeral Sunday in his child -- childhood village of Qunu. The body of Nelson Mandela will arrive in its final resting place this weekend. As we mentioned, the anti-apartheid icon wanted to be buried in his ancestral village of Qunu. A big logistical effort is underway in South Africa to honor Mandela's wishes. Nelson Mandela's eldest daughter and one of his granddaughters gave Robyn Curnow an exclusive invitation to the family home there.
ROBYN CURNOW, ANCHOR AND INTERNATIONAL CORRESPONDENT FOR CNN IN JOHANNESBURG, SOUTH AFRICA: Inside Nelson Mandela's rural home, his daughter says they are reminded of him everywhere.
MAKAZIWE MANDELA, NELSON MANDELA'S DAUGHTER: This is Tata's special chair and it would sit like this, you know with the cushion here because he enjoyed looking out in the hills.
CURNOW: It's in these hills that Mandela will be buried.
M. MANDELA: And even when my father was in jail, he had most fondest of memories about Qunu and he really wanted to die here.
CURNOW: She says he was always a country boy at heart and so his official state funeral will be held her in this tent on the farm that he loved.
TUKWINI MANDELA, NELSON MANDELA'S GRANDDAUGHTER: Four thousand people who are eventually going to congregate over there.
CURNOW: A challenge to plan with heads of state, royalty and celebrities all making their way along the back roads to his rural resting place.
T. MANDELA: Look, Robyn, it's been a challenge. It's been a serious challenge. But my grandfather was born here. It's actually a mixture of emotions, you know? Some of us are coming and you know some of us are very teary because, you know, this is where -- this is where my grandfather told us about you know who we were as the Mandelas.
CURNOW: The family says it's a relief to be home. His spirit is now here too they say. He's no longer suffering, no longer in pain.
M. MANDELA: On the last day, they had -- you know, he was on a ventilator. He was not (inaudible), he was no longer breathing for himself. The ventilator had fully taken over. They had pushed it to the limit, and I think he was tired.
CURNOW: But she says he fought until the end, the doctors and nurses helping him in his last battle.
M. MANDELA: I've never seen so much dedication, Robyn, in my life to another human being. I'm sorry. And sad, but I was happy that it happened that way. And that at the end of his life, we were given the opportunity to be with him.
CURNOW: They are with him here too as Mandela's final resting place is being prepared up there on the hill, he makes his final journey home.
M. MANDELA: Look, he loved these hills. He really believed he -- this is where he belonged.
CURNOW: Nearly a century after he played in these fields as a young boy. Robyn Curnow, CNN, Qunu, South Africa.
LAKE: CNN will be covering Nelson Mandela's funeral live on Sunday. It gets underway at 0900 in Qunu, South Africa -- that's 0700 in London and 1500 in Hong Kong. As South Africa's first democratically-elected president, Nelson Mandela welcomed global industry and created a positive investment environment. Yet the country's economic reversal remains unfinished. Nearly a quarter of South Africans are unemployed. Economic equality is still a problem in the country. On average, black households earn only a sixth of their white counterparts. The youth wing of Mandela's party, the ANC, has waged a campaign to nationalize two of the biggest industry -- mining and banking. That's a policy that Mandela rejected in the early 1990s.
Joining me now to talk about Mandela's impact on the national brand of South Africa and its economic future is John Battersby. He's a former journalist and co-author of "Nelson Mandela: A Life in Photographs". John, thank you so much for joining us today. We've been talking a lot about the progress of South Africa and of course Nelson Mandela's legacy, but the reality is this is an economy that's struggling with some very big problems.
JOHN BATTERSBY, CO-AUTHOR, "NELSON MANDELA: A LIFE IN PHOTOGRAPHS": Yes, there are major economic challenges in South Africa and I think those were anticipated given the country's history and given the past. But I think what Nelson Mandela did in his time as president and by the example that he set after he stepped down from the presidency, was to establish a very clear direction of economic policy based on market principles but also at the same time having a degree of state intervention in the economy to assist in the process of equalizing the backlogs of the past, of having economic development which would eventually -- which will eventually -- enable all South Africans to exercise the rights they have been given in the Constitution. To have equality of opportunity and so forth.
But this is not going to happen overnight. We've had 20 years you could say as a democracy, we are 20 years old. We've made considerable progress I think in terms of providing people with the basics of life with water, with sanitation, with basic health care and housing and the challenge continues. But I think the direction is a realistic one.
LAKE: Yes. John, what does this government need to do now to live up to that legacy of Mandela? At some point the ANC and the corruption there add part of the problem now.
BATTERSBY: Well, I think that, you know, the government and the society as a whole needs to pull together to achieve the objectives. There's a -- there's a document in South Africa called the National Development Plan which lays out the route -- the economic roadmap if you like -- for the future which ensures that government efforts will be coordinated and so forth.
In terms of corruption, corruption is a problem that afflicts every society. Yes, South Africa has problems with corruption, but it's very difficult to get away with anything in South Africa. There are mechanisms -- government is at the forefront of trying to deal with the corruption, we have a free and independent media which is writing about corruption every day, so it's one of the challenges we face, but we're dealing with it. It's a rough and robust society, South Africa. It's not -- it's not a pretty place, but it's a very vibrant and challenging place.
LAKE: And, listen, another problem that they are not alone in grappling with is income inequality, we talk about it right here in the United States, but it's an important one. You already have the youth aspect of the ANC saying we should legalize mining and banking. How urgently do they need to address youth unemployment? This is a generation that needs to be onboard if South Africa's going to solve some of these economic problems.
BATTERSBY: It is an urgent problem and it's a pressing problem. We have a dangerously-high percentage of unemployed youth and unemployment in general. And, again, the National Development Plan government is dealing with that. There are a number of government initiatives to create jobs, but also to stimulate the economy. Our current growth rate at around 1 percent is too low in order to absorb the population growing. We are getting increasingly a growing black middle class which is very encouraging for the economy and there are good signs for investors who want to come in retail trade and so on and so forth.
But there's a lot of work to be done in creating jobs in the future. But the point is that Mandela's legacy is to have established the opportunity to create a Constitution which accords these kind of rights to everybody, and now it's a question of the society, it's a combination of government, the private sector, civil society to pull together to implement the opportunity that his legacy and his sacrifice and his life achievements have brought for us.
LAKE: A new chapter in a pivotal time for South Africa. John, thank you for sharing your insight with us.
BATTERSBY: Thank you.
LAKE: John Battersby there for us. "Quest Means Business" will be back in just a moment. Stay with us.
LAKE: Without warning, without fanfare and without precedence, singing superstar Beyonce today surprised her fans by releasing a new album in the dead of night here in the U.S. It is a 14-track self-titled album available only on iTunes, and comes with 17 music videos. Take a look at just one of them.
BEYONCE KNOWLES, SINGER (SINGING): If we love forever, come one baby, won't you hold on to me, hold on to me --
LAKE: Beyonce says she wanted to connect her fans directly with her music. She explained her decision in a video posted on her Facebook page.
Male: People only listen to a few seconds of a song on their iPods, they don't really invest in whole albums. It's all about the single and the (height). It's almost like it's between the music and the artist and the fans.
LAKE: As Beyonce alluded to there, the album can only be downloaded in its entirety with singles only available from next Friday. The move is taking social media by storm. Rapper Snoop Dogg said it all in a tweet. "My girl Beyonce just changed the game!" Samuel Burke is here to take us through the project which is creating massive buzz online. First of all, Samuel, lots to talk about here, but how on earth did she pull this off?
SAMUEL BURKE, BUSINESS CORRESPONDENT: There were only very little hints. We knew that she had filmed some music videos around the world including in Coney Island here in New York, but we had no idea what they were for, and so all of a sudden, mainly on her Instagram and Facebook account, not Twitter, she was posting videos and messages about this album. There's the Instagram video that she posted right there and people raced from Instagram to iTunes to the point that iTunes crashed. But, yes, she pulled off one of the best-kept surprises in recent music history.
LAKE: That is the power of Beyonce to not have anybody leak it, because this wasn't just songs -- her and Jay-Z holed up in the garage, something at home -- this is incredibly elaborate, all these music videos. There had to be millions of people involved in this. And it's unusual to see all these videos come out at once too, right?
BURKE: Yes, usually an artist only releases about five music videos per album. She did 17 videos for this. Imagine if we made you anchor 17 hours of your show on "Quest Means Business."
LAKE: I think they were trying to do that recently, by the way, but -
BURKE: Oh, OK. Yes, and she was able to -- and filming that goes like from Coney Island all the way to Brazil she was filming these music videos. So that must have been a lot of work and involved a lot of people, but she managed to pull it off.
LAKE: She's going to change the game here. She was very direct about that, wasn't she? Trying to connect directly to her fans? I mean, is this a sort of a big message to the record industry?
BURKE: It was interesting, there was a veteran of the industry who said only Jay-Z and Beyonce could pull off this type of surprise album. Only they have the fame at that level worldwide to pull this off. But what could be a game-changer for the rest of the industry is doing these music videos, only making your album available in its entirety for 15.99 in this case -- dollars of course -- instead of making each song available for 99 cents. That might be something that the rest of the industry might start to mimic.
LAKE: So we know -- quickly -- do we know how it's doing yet on iTunes or too soon?
BURKE: I checked right before I came in here, it's not even on the top 100 yet, but of course there wasn't a lot of marketing -
LAKE: Nobody knew --
BURKE: -- leading up to it.
LAKE: -- some people don't
BURKE: -- -- so (inaudible) but -
LAKE: -- even know, so after this news cycle we'll see. It's still risky -- even for like somebody for Beyonce. All right, very interesting, Sam and we got to check it out. Thank you so much.
Well, here's another shocker -- Cairo, a city known more for its brutally hot weather recorded snow for the first time in more than 100 years. Meteorologist Karen Maginnis is at the CNN International Weather Center. What's going on today, Karen? Is this true?
KAREN MAGINNIS, METEOROLOGIST FOR CNN: Yes, another shocker. And, yes, in Cairo there are people who are living right now who have never seen snowfall there because it is so extraordinarily rare, but it's all part of the same weather system that has produced snowfall throughout the Middle East. And our own (Carl Pinhall) said he was driving from Bethlehem to Jerusalem. He said there were whiteout conditions, it was brutal. What you're looking at now are pictures out of the Cairo area. There you can see it's not a lot of snowfall, but significant for this area where temperatures soar well into the 30s for much of the spring and into the summer, and very brutally hot. But, no, not today. And in the forecast we keep the snowfall a little bit longer across sections of the Middle East.
Here's that area of low pressure that is making its way from the Eastern Mediterranean and gradually moving off towards the northeast. Now, the back side of this, that's where you typically see some of your coldest temperatures, and indeed, they'll be five to ten degrees colder than they should be for this time of year. And there you can see the Old City and the Dome of the Rock beautifully and even more snowfall since that particular picture was taken. It did snarl roads and traffic, but a lot of people didn't seem to mind at least in Jerusalem anyway.
And this from our I-reporter, Seth J. Frantzman. He's in Jerusalem -- he sent this picture. He said he was on his way to work, saw this this beautiful scene and thought that he would take a picture of it and send it to us for an I-reporter view. Well, here's the forecast. In Jerusalem, there you can see that temperature holding around on Saturday 4 degrees but we'll see those temperatures gradually rebound each day, and 8 degrees expected high temperature going into Monday. And for Beirut, the average high temperature around 13, but it'll be Sunday or Monday before we start seeing temperatures like that. But for Ankara and Turkey, those temperatures which should average around 7 for a high -- well you'll be below normal there for the next 72 hours.
Well, as we go through time and taking you through Sunday, we've got the high pressure system moving in beyond it, so that snowfall clears up, but it looks like for the overnight hours in some portions of the Middle East you'll still see additional snowfall, and between 30 and about 45 centimeters of snow fell around Jerusalem, if you can picture that. How about the morning low temperatures? Well, in Turkey, Ankara, we saw -14 degrees -- not a wind chill factor, but definitely cold.
Well, if you headed up towards Iceland, the temperature of Reykjavik was 1 degree, that's at 65 degrees north latitude. Well, in Amman, Jordan it was -1 degree -- that was on Friday morning. So a substantial difference in temperatures which you wouldn't normally expect. Well, in Cairo, about 3 centimeters fell -- this was on Friday. Tel Aviv since Wednesday, 117 millimeters -- almost the monthly total in just one day. Back to you, Maggie.
LAKE: That is absolutely extraordinary, and we're getting snow -- I've got my turtleneck on, I am ready. It seems like it's everywhere. Thank you so much. Have a great weekend. Well, Tony Bennett features in Gap's new holiday ad with campaign -- a campaign with some aspiring young musicians. We'll be speaking to the world-renowned singer. The best is yet to come when we come back. Stay with us.
LAKE: Well, we just heard about Beyonce using social media to her advantage -- it's not just for the millennials. Tony Bennett took to Twitter and read it recently while promoting the launch of his musical catalog on the iTunes Music Store. And the new legendary crooner has a new gig -- he's teaming up with the Gap and it's featured in the retailer's holiday ad campaign in a spot that promotes art education in public high schools. I asked the youthful octogenarian about the experience.
TONY BENNETT, SINGER: The students -- I couldn't believe how professional they were. I mean, I was shocked at -- I know how good they are in school in their studying, but then they actually come out and this is probably the first time they performed commercially, and they were just completely professional.
BENNETT (SINGING): The best is yet to come, I say won't that be fine.
LAKE: And the song that you're singing with them, I mean, you know, you have a big catalog -- it could've been any -- the Best is Yet to Come. You know, this is a generation that's facing a kind of uncertain future. Are you optimistic about the future for these kids?
BENNETT: I was born optimistic. I really believe in that. I mean, I'm 87 and I really feel like I'm just starting out. So there's a lot to learn at -- even at 87, so I always stay optimistic about things.
LAKE: And, Seth, is that part of the appeal? Because there's a lot of noise during this -
SETH FARBMAN, GLOBAL CHIEF MARKETING OFFICER, GAP: Yes.
LAKE: -- holiday season, and for a brand to try to break through it. How does this ad campaign fit in to that?
FARBMAN: Well, absolutely. I always say we're an optimistic brand and especially at holidays people want to be reminded of what's really important. And obviously to pair someone like Tony Bennett, who not only is a cultural icon but has given so much for years and years to students. And to bring them together and show what the combination the Best is Yet to Come really means, I think it just elicits an emotion that people want at the holiday, and they need to be reminded that that's what brings us all together. So optimism is at the core of all of it.
LAKE: And in the film that Tony did with the students that were part of Exploring the Arts at the public high school, a lot of those films are posted on YouTube. Talk to me about how important social media is right now?
FARBMAN: Absolutely. It's the combination of traditional media and social media. These films will also be shown in theaters around the world where people are gathering together as families around the holiday time and sharing some time. But, social's really important because that's where people get to share, get to really deeply participate and then follow a deeper story, and what we love about this idea is on its surface, it's Tony Bennett, an amazing song and some amazing kids. But it allows people to explore what makes those kids amazing, what the role of education is in their life and how people who stand up for what's really important can make a difference in people's lives. And without digital, it would simply be 30 seconds or 90 seconds and the end of the story. Now, it's the beginning of the story -- something much deeper and more meaningful.
LAKE: And, (Susan) and Tony, Exploring Arts is dedicated to try to promote arts education in public high school. Why is that so important?
SUSAN BENEDETTO, TONY BENNETT'S WIFE: Well, I mean, we just believe in the transformational power of the arts. When, I mean, it's obvious for the intrinsic value, right? To be moved, to have those powerful experiences that only the arts can provide. Everyone should be -- you know -- have that experience and have that education. On an education level, what's exciting is that when you teach the arts in school -- you know -- it shouldn't be surprising but kids want to come to school, they stay in school, they do better in school, you know. I could go on and on. But it teaches you all those wonderful skills -- creative thinking, persistence, you know, self-confidence, they discover who they are, they become an individual.
LAKE: One last look at U.S. stocks before we go. Up for the day but down on the week. A loss of 1 and a half percent from the Dow. That is the worst percentage performance since August. And that's it for "Quest Means Business." I'm Maggie Lake in New York, thanks for watching. Have a great weekend.