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QUEST MEANS BUSINESS
EU Wants Answers from Apple Over Taxes; Snap to Release Q3 Results Any Minute; Top Tourism Chiefs Make Pitch to the World; Greece Luring Tourists Back to Its Shores; Twitter Doubles 140-Character Tweet Limit. Aired 4-5p ET
Aired November 7, 2017 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] RICHARD QUEST, CNN HOST: -- on the Wall Street. In the last few seconds of trading it looks like the Dow is eking out a very small gain.
And that of course, that would give us a record for the Dow Jones Industrial. Now considering you had all that brass on -- that was a very
wimpy sort of gavel to bring trading to a close. But trading is now over worldwide, and it is today, Tuesday, November the 7th.
Tonight, we talk about Apple, and what's happening to the company and the fortune that lies offshore. And, on tonight program, we'll give you an
update on the earnings that are happening at the moment. We're expecting SNAP to produce earnings any moment now. And the World Travel Market,
travelers across the globe coming to London. We will show you exactly the issues that companies are facing. Now live from London, this is Richard
Quest, QUEST MEANS BUSINESS.
Good evening, the European Commission tonight demanding answers from Apple over the company's tax affairs. New revelations included in the "Paradise
Papers" show that Apple shifted billions of dollars to a tiny the in the English Channel, and it did so to avoid a tax clampdown in Ireland. For two
decades, Apple has stored its overseas profits in Ireland, just off the western coast in North Atlantic the controversial legal loophole allowed
the company to pay well below Ireland's 12.5 percent corporate tax in 2014. Apple sometime paid just 0.005 percent.
The EU in 2015 pressured Ireland to close the loopholes. And in doing so, Apple responded by moving its money to Jersey, just off the south coast --
well, it's between the United Kingdom and France. It's a well-known tax haven. Jersey customarily levies no taxes on foreign company profits.
Apple's mounted a three-part defense today. It says, one, the move didn't save any money. Two, that it was done to prevent the EU from claiming tax
money owed to the United States. And three, it pays all the taxes it owes. The Marietje Schaake is the MEP in the Alliance of Liberals and Democrats
for Europe. She joins us me now. Good to see you. So, we've got the allegation, and you will have seen during the course of your busy day, you
will have seen Apple's response. What do you make of what they claim? One, that they pay all the tax they owe. Two, this wasn't done to avoid tax. And
three, it was done to protect tax moneys that Apple believes probably need to be paid to the U. S. Your view.
MARIETJE SCHAAKE, MEMBER OF EUROPEAN PARLIAMENT: Well, I think even if not all of these matters are strictly illegal, and experts will have to look at
this. There are certainly often unethical. And I think of myself. You know, a politician, we serve the public. We would never get away with not paying
taxes, hiding our money, not serving the public interests. And I believe that more and more customers more and more citizens will demand of these
companies whose products and services they use every day, much more ethical and responsible behavior. To also act in the public interest and not just
siphon its money away through potential legal loopholes. And to the extent there are loopholes, it is our task, as lawmakers, to close them.
QUEST: Well, you -- the problem here is, you attempted to -- or at least the EUC, attempted to close the loophole with Ireland in 2015, and it was
in response to that closure of an existing loophole that they juggled the money and moved it somewhere else.
SCHAAKE: Well, I think there's two things you're talking about. One is fair competition. And to the extent that there are special treatments of certain
companies, the European Commissioner, Margrethe Vestager, has said that these kinds of special deals with companies actually really are state aid.
And there should be compensation and fines to these companies. So that's one aspect that you're talking about. The situation that Apple has found
itself in under scrutiny of the European Commission. But the other question is really how are we in Europe and potentially beyond just the European
Union going to make sure that there is one corporate tax rate? And that there is not a race to the bottom.
[16:05:06] That it's not the big firms with the big teams of lawyers that are going through the small loopholes, while smaller companies can never
compete with this, and while lack of competition also stifles innovation.
QUEST: Are you in favor of a single tax rate, a single corporate tax rate across the EU to prevent tax shopping within the union?
SCHAAKE: Indeed, such common European measures are necessary to provide a level playing field and to avoid this kind of race to the bottom. And
loophole shopping that were seeing today.
QUEST: The reality is, as fast as you close the loophole, they discover another one, and that has been probably the case since Adam and Eve.
SCHAAKE: Sure. And you know, we cannot guarantee everyone's good behavior. But we have to make sure that up to date, 21st century laws are in place.
And I think we actually face another major challenge that goes far beyond just taxation and competition. But really touches the heart of functioning
of the digital economy. And that is how we're going to provide for the proper oversight, scrutiny, rule of law in an online economy.
Because frankly, it is not so easy, even for the European Commissioner, who is very powerful at competition law, to know how algorithms are fairly or
unfairly competing with each other. What kind of selection is made of information and what the impact might be, not only on competition, but
elements of access to information, freedom of expression and the heart of our democracy as we're seeing in the discussion about fake news. So, I
think we should really get to the core of the discussion, which is how we're going to apply democratic oversight, maintain the rule of law in a
hyper-connected digitally advancing world.
QUEST: Marietje Schaake, thank you very much indeed, join us from Brussels tonight. Joining me now from Atlanta, Dan Mulhall is Ireland's Ambassador
to the United States. Ambassador, good evening to you.
Good evening, Richard.
QUEST: What is your reaction to if you like, the "Paradise Papers" and what they say about Apple, and how, having Ireland closed a loophole, the
company merely sort of went on a shopping -- a tax shopping foray and found another jurisdiction. What's your thoughts?
DAN MULHALL, IRISH AMBASSADOR TO THE UNITED STATES: First of all, Apple employs some 6,000 people in Ireland. They have been in Ireland for decades
now. They are one of the leading companies in Ireland. They have a very successful track record with us. They employ large numbers of Irish people
and indeed people from other countries. And they obey our tax laws. And we have a fair and transparent corporate taxation system of 12.5 percent. We
can only tax those things that are done in Ireland. Those valued. The value that is generated. We cannot be responsible for taxing a global company's
global profits. And we believe that aggressive tax planning on the part of multinationals needs to be the subject of a global solution. It can only be
resolved at global level. That's why we truly support the OECD's --
QUEST: Ambassador --
MULHALL: -- best process.
QUEST: I don't think anybody reading the "Paradise Papers" in Apple -- there could be little doubt there was aggressive tax planning in the
extreme, once Apple had decided to leave Ireland. You talk about the company, and Apple in Ireland. But you know as well as I do, sir, there are
two Apples in Ireland -- pardon the pun. On the one hand, you've got the real company with the real employees that makes real things, and does real
business. But then you have the -- or had -- the international part where everything else was booked through Ireland. Now that is now in Jersey,
through aggressive tax planning. Is it that sort of tax planning that you didn't think needs to be regulated? That second bit.
MULHALL: Well, it is not for me or for us to comment on the tax affairs of an individual company. My responsibility is to explain to you Ireland's
position, which is that when we discover that residency rules in Ireland were being used to -- for certain purposes with regard to tax planning, we
changed those rules in 2013 and 2014. We avoided or excluded companies from being stateless for tax purposes, from being registered in Ireland. And
also, we ensured that any company incorporated in Ireland must pay tax in Ireland. So, we have adjusted our tax regime in order to maintain our tax
regime up to the standard of the highest international standards, as part of the global efforts to improve the system of global taxation for
QUEST: I want to talk briefly about Brexit, and the difficulty of constructing an arrangement between the Irish Republic and United Kingdom
over the Northern Ireland or the joint border. You've said before, you can't have a border. It's not practical. It's a 300-mile border. It has no
geographical basis. But you're going to have to. You're going to have the common travel area, but you're going to have this problem of goods crossing
the border. How close do you think you can get to this solution?
[16:10:00] MULHALL: Well, we never wanted to see Brexit happen. We pointed out in advance the difficulties it would create for British Irish relations
and for Ireland. And now we need to minimize the impact of Brexit on our trade with the U.K. and on Northern Ireland in particular. And that means
that we cannot go back to a situation where there's a border in Ireland. And we must find a solution that involves the current invisible border
being maintained for the benefit of all of those who live and work and cross that border on a regular basis every day. And for the goods and
services that move across that border.
QUEST: OK. But how close are you, do you believe. I know you're not in the negotiating room. But as the Irish ambassador to the U.S., you're well-
versed into how close they will be. Those negotiations, one of the stumbling blocks of the first phase of the Brexit negotiations is --
besides the other issues of the Brexit bill, citizens' rights. One of the other ones is the Irish border. Do you believe they are close to finding a
solution to that?
MULHALL: Well, I say there is that no one involved wants to see a border in Ireland. The British government has made it clear they do not want to see a
border in Ireland. We don't want to see one. None of the parties in Northern Ireland would like to see the border in Ireland be changed in any
negative way. And also, our European partners have been very understanding of our situation over the last number of months. So, I am of the view that
given that we have a consensus about this we must find a way of making this work.
Now of course, that can only be done in the detailed negotiations, and to some extent, it will be connected with whatever is agreed for the future
relations between the U.K. in the European Union in general. And we would hope that the U.K. will eventually decide to remain in the customs union.
Because that will make a big difference from the point of view of making it easier to achieve what we want to achieve on the island of Ireland.
QUEST: Of course, whether you can remain in the customs union without being in the single -- these are interesting issues. Ambassador, please do come
back again. We have much more we need to talk about in the future.
MULHALL: Happy to do so.
QUEST: Lovely. Thank you, ambassador. The Irish ambassador to the United States -- former ambassador I should have said also to the United Kingdom.
Saudi Arabia's corruption crackdown continues the country is now freezing the personal bank accounts of those belonging to the Royal Family, and
senior officials who were rounded up over the weekend. The Anti-Corruption Council is stressing that no corporate accounts are affected, recognizing
the importance of multinationals to the Saudi economy. The critics are accusing the Crown Prince of a power grab. Mohammad Bin Salman Al Saud and
rely on some powerful backing. President Donald Trump tweeting he has great confidence in the Saudi Arabian monarchy. So, so far so good. That's a
rather nice place to stay, if that's what you like. It is the Ritz-Carlton hotel in Riyadh. And at least 17 Saudi princes and top government officials
who'd been arrested are being held. Basically, the Ritz-Carlton appears to have become a temporary jail as John Defterios explains.
JOHN DEFTERIOS, CNNMONEY EMERGING MARKETS EDITOR: It's not your typical five-star experience. Unforgettable as it may be. New footage from inside
the Ritz-Carlton hotel in Saudi Arabia's capital, Riyadh shows the dramatic transformation from a favorite haunt of the wealthy into arguably the
world's most luxurious prison. Its gilded ballrooms and grand hallways now home to dozens of princes, billionaire businessmen and former government
ministers, swept up in an intense anti-corruption campaign led by the kingdom's young Crown Prince.
The video shows people, possibly guards, lying on mats with a military style rifle perched up against a wall. It's a far cry from earlier this
year, when the Saudi monarch warmly welcomed U.S. President, Donald Trump, at the palatial retreat. Or for just last month, when along with hundreds
of global business leaders, I attended the so-called Davos in the Desert there, a gathering meant to tell the world the kingdom is open for
business. Robots greeted guests. Saudi cities of the future were born. The money class were impressed. How times have changed. While billionaires
still walk its marbled halls, there are no longer foreign businessmen seeking a deal. But Saudi elite, marooned by a young Crown Prince up ending
traditions all in the name of fighting corruption. John Defterios, CNNMoney, Abu Dhabi Abu.
QUEST: There are 7 million Saudi's visit Bahrain each year. And Bahrain wants to grow that number and is investing billions to make it happen.
[16:15:00] Zayed Ben Rashid Alzayani is Bahrain's minister of industry, commerce and tourism. Now you remember, Bahrain is one of those countries
that is also imposing the embargo against Qatar and also heavily involved in relations with Saudi. He told me the outward trend of tourism from Saudi
Arabia will continue, despite the turmoil.
ZAYED BEN RASHID ALZAYANI, MINISTER OF INDUSTRY AND TOURISM, BAHRAIN: This is a trend that's been growing over years. We're working on making it
easier for Saudis to come to Bahrain to get a lot of the bureaucracy and the malaise we on the causeway, especially where most of the profit comes
through from Saudi Arabia. And I think by doing more and more of that doing more attractive activities for the Saudi market, they will continue --
QUEST: All right, but the situation is deteriorating. Let's take today for example, whereby your government -- or the Bahrain government -- has
advised its citizens to leave Lebanon.
QUEST: Because of the Hariri resignation. Now whether or not you've got one or a thousand citizens there, it doesn't matter in the sense of you are
clearly feeling it's no longer safe for your people in Lebanon.
ALZAYANI: I think it's a precautionary action.
ALZAYANI: Because, first of all, we're not the only ones who have done that. Many other countries have done it before us. To ask their citizens to
leave from Lebanon. It's not the first time it's been done. If you look at the last 10 or 15 years, it's been done at least three or four times, where
all countries asked their citizens to leave Lebanon. Lebanon has its own challenges, and I think it's a volatile situation within Lebanon. And we're
just being on the cautious side not to get any of our citizens to be caught up in case something happens in there.
QUEST: What is it that you need to do more of, do you think?
ALZAYANI: We have a great product. We have a 5,000-year-old history of modern state by any standards. This is what we realized when we launched
our strategy last year at the beginning of 2016. So, we built our strategy on four "A's." The first A was actually awareness. That's what we came out
with our new logo, new brand, "Bahrain Now is Yours." And we looked at the other three A's, which was access, accommodation and attractions. So, we
built our strategy to make Bahrain unique, different from the rest of the region. And exhibiting what is unique about it.
QUEST: But it's getting harder, isn't it? Because your regional neighbors are ramping up Dubai, Abu Dhabi. Even Saudi wants to get into the tourism
business in a bigger way.
ALZAYANI: I think competition is good. It's good for all of us. It makes us always try to be ahead, coming up with new products. The cake is big enough
for everyone to have a decent slice of. And I think what we have seen in our tourism numbers, we've experienced a growth of 14 percent over the last
year. We have experienced a growth in average night stays. We have experienced a growth in the average spent by each visitor that comes to
QUEST: That's the minister talking to me earlier at World Travel Mart. Snap has just reported its results. The shares in the parent company of Snapchat
have been under pressure. Will look at the numbers as we continue. It's QUEST MEANS BUSINESS in London.
[16:20:00] (COMMERCIAL BREAK)
QUEST: So, a fresh record for U.S. stocks, at least for the Dow Jones. It eked out the smallest of gains to close at a new record high. As you can
see, it was up in the morning, and it was down throughout the afternoon, bouncing around a bit. But then right at the end, 8 points to the good.
It's Blue Apron, the shares there, sank more than 20 percent. The meal kit delivery firm says the cost of running its New Jersey production center is
eating away at its profits, literally and figuratively down 20 percent. And Snap shares tumbling in after hours, according to the afterhours trading.
I'm just looking at the screen. It is down almost 20 percent. The results have just been published. They have missed on monthly active users and
revenue. Clare Sebastian is with me with more on Snap's earnings. She's live from New York. How bad were the numbers?
CLARE SEBASTIAN, CNNMONEY CORRESPONDENT: It was pretty bad, Richard. Revenue missed. It was around $207 billion. That was versus $238 expected.
So, a big miss there. But this was really a quarter where it was more about user growth, Richard. And that was pretty bleak there. They only added $4.5
million daily active users. In the previous quarter they had added 7 million. That's only a 3 percent rise. Now, of course, this is a quarter
where user growth matters. But, of course, what also matters is how they can make money off of those users. And this was perhaps ever so slightly
better. Average revenue by user was up 12 percent to $1.17 in this quarter but Richard, this is a company that has had a pretty rough ride since its
IPO in March. The stock prices down around 40 percent, and it looks that to get worse.
QUEST: Now, in the interest of full disclosure, of course regular viewers - - don't you start smirking, Sebastian, when I remind people that my Snap holdings are down now well over 55 percent, since I seem to have managed to
have bought those shares at the absolute all-time high, just two days after the launched. The issue here, Clare, with Snap, is whether there it is a
solution. Is the company salvageable? Or will it eventually get eaten up by a Google or similar, often who have no need for it?
SEBASTIAN: Well, Richard, that is the real question. I've spoken to a couple of investors and people who watch Snap this afternoon and they do
say -- this is of course before the latest earning report -- that they do say that they don't think the story is over yet. There are a couple of
things that people are still watching. Snap Has a developing content strategy that's going on at the moment. They have partnerships with various
media companies, including CNN. They just signed a deal with NBC Universal to set up their own digital content studio. They are looking at perhaps
moving into scripted content as early as the start of next year. So that could be something to watch, whether or not Spectacles is still something
to look at, that is perhaps more in doubt. But, you know, they have to -- they have to win people's kind of trust back, because of this rough run,
since the IPO. And I don't think this earnings report would have helped in the slightest.
QUEST: Clare Sebastian thank you.
And my producer kindly reminds me in my ear that the price is down some 30 to 40 percent since its all-time high.
During the World Travel Market -- since its IPO price, I beg your pardon. It's down more than 50 percent since is high. During the World Travel
Market here in London, travel stocks have been some of the most volatile. For example, Priceline here, the shares plummeted. They're down 13 percent.
They were down because of warnings of tough competition. Trip Adviser was down 20 percent on similar reasons, because of the warning of competition.
And the prospect -- and what analysts are saying is that Priceline and Trip Adviser need to spend more on advertising. They're literally -- their money
has been taken away.
Then you've got this. It's bittersweet sadness. The Boeing 747 had its final flight with United Airlines. It was a flight from San Francisco to
Honolulu, which is in the air as we speak. It ends 47 years that United ran the 747. Incidentally on board that plane, the food -- they made it all
like the original flight from when that happened years ago. Delta's final flight is next month.
British airways, by the way, has given a time line for when it expects to pull out of the 747. Probably not until the mid-19, 20s. And Hong Kong Nice
to defend its title as the world's most visited city, the ninth year in a row, 26 million people in 2017. Asian cities dominate the list, often
because it's easy to cross borders there.
[16:25:00] As tourism in Asia blossoms, it means tougher regional competition for countries like Malaysian. The tourism minister told me
what's good for his neighbors is good for Malaysia.
SERI NAZRI AZIZ, MALAYSIAN TOURISM MINISTER: The competition given by our neighbors, it only helps us to do better. It is a healthy competition and
in fact, last year when we had our ASEAN at 50, we actually worked together. You come to ASEAN, we came together, feel the warmth, come to
ASEAN. And it was very successful. So, to me I think whatever can competitive launch and all that. We only have the region.
QUEST: The country at the moment, obviously, there are political problems, which you don't shy away from, the scandals or whatever. Has that impacted
the tourism industry?
AZIZ: It hasn't. Actually, what really happened was that when we had many - - a lot of demonstrations and Malaysia. Now Malaysia has been thought of as a very despotic country, undemocratic. But, in fact, what really happened
when there were so many scandals, allegations made against our government, in how we addressed this has actually made people realize that, you know,
Malaysia actually is a country where we practice democracy rather than the other way around. Because you know, all over, even CNN, Al Jazeera, during
the big demonstration, they were giving blow-by-blow commentaries. But it shows that we are, you know, at the end of it, you know we are still one
QUEST: So, for 20 years, it's 19 years, to be precise, since Malaysia truly Asia.
AZIZ: Truly Asia, yes.
QUEST: How's that changed?
AZIZ: Before that people always think of Malaysia as a single ethnic country and all of that. But we have shown through Malaysia truly Asia that
we are a country of diverse culture, multilingual, multiracial. And it has actually helped us as a society to become a very moderate people.
QUEST: All right. 20 years since it first came along, Malaysia. You get a chance to sing it. Go on.
AZIZ: Malaysia truly Asian.
QUEST: It's not every day you get a tourism minister to sing. It's not every day. As the world is watching as Donald Trump gets set to make a
major policy speech in South Korea, we'll be on either side of the DMZ in Seoul and Pyongyang, next. As we continue, it's QUEST MEANS BUSINESS.
[16:30:00] (COMMERCIAL BREAK)
QUEST: Hello. I'm Richard Quest. There is more QUEST MEANS BUSINESS in just a moment. I'm joined by Greece's tourism minister as the government denies
it's having a bankruptcy and more austerity. A new cast of characters of Twitter are doubling down on its experiment. As we continue tonight, this
is CNN and, of course, on this network, the facts always come first.
Saudi's Crown Prince is now accusing Iran of supplying rebels in Yemen with missiles. In what he describes as a direct military aggression by the
Iranian regime. It comes after thwarted missile strike on the Riyadh Airport only days ago. Iran's foreign minister calls the Saudi comments
The British foreign secretary is backtracking on remarks he made about a jailed British-Iranian woman. Boris Johnson said she was teaching
journalism in Iran. But she says she was on vacation. Nazanin Zaghari- Ratcliffe is accused of spying. Critics say Johnson's comments could lead to a longer prison sentence.
One of the very last holdout has joined the Paris Climate Accord. Syrian officials made the announcement at the UN Climate Change Conference in
Germany. That makes the United States the only country in the world not signed on to the landmark deal. President Trump has not been invited to the
climate change summit. It's to be hosted in Paris next month.
Donald Trump due to address the Korean National Assembly in the next few hours. In the middle of ten-day five-country tour of Asia. His first as
president. Our correspondents are following every step of the way. Sara Murray as you might expect, is in Seoul with the president. Will Ripley is
the only western journalists currently in Pyongyang. Will, hold your horses we'll be with you in just a moment. We're going to start in Seoul with Sara
Murray. And the day's events so far.
SARA MURRAY, CNN WHITE HOUSE CORRESPONDENT: That's right, Richard. Look, we are expecting the president in the national assembly address to hit the
main him you would anticipate from him. The importance of the alliance between the U.S. and South Korea. As well as putting pressure on China and
Russia to try to isolate North Korea further. But what everyone is going to be watching for is the tone. Do we get this bombastic President Trump that
we're used to seeing in the United States, or do we get a more measured approach, which is what we've seen, frankly, over the last 24 hours?
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: North Korea is a worldwide threat that requires worldwide action.
MURRAY (voice-over): President Trump aiming to send a muscular signal to North Korea
TRUMP: The United States stands prepared to defend itself and its allies, using the full range of our unmatched military capabilities if need be.
MURRAY: Even as the commander-in-chief known for his fiery rhetoric, dialed it back in a visit to the nation with the most at stake.
TRUMP: I really believe that it makes sense for North Korea to come to the table and to make a deal that's good for the people of North Korea and the
people of the world.
MURRAY: Appearing alongside South Korean president, Moon Jae-in after the two men shared tea with their wives and took part in a ceremonial
friendship walk, Trump offered a rosier take on diplomatic efforts.
TRUMP: We sent three of the largest aircraft carriers in the world, and they're right now positioned. We have a nuclear submarine also positioned.
We have many things happening that we hope -- we hope -- in fact, I'll go a step further, we hope to God we never have to use.
MURRAY: For a president who once took to Twitter to suggest his secretary of state was wasting his time trying to negotiate with little rocket man,
it was a sharp change in tone. There was no taunting North Korean leader, Kim Jong-un with disparaging nicknames. No threats of fire and fury. Though
the president did leap at the opportunity to blame his predecessors for the diplomatic conundrum he now faces.
[16:35:00] TRUMP: This is a problem, by the way, that should have been done over the last 25 years, not now. This is not the right time to be
doing it. But that's what I've got. That's what I've got.
MURRAY: But even with his attention trained on international threats, Trump wasn't able to avoid questions about the latest horror at home.
TRUMP: Well, you know, you're bringing up a situation that probably shouldn't be discussed too much right now. We can let a little time go by,
but it's OK if you feel that s an appropriate question.
MURRAY: Trump didn't acknowledge the Air Force's admission that it failed to inform the FBI of the killer's domestic violence conviction, and he
insisted additional gun control measures wouldn't have prevented the mass shooting at a Texas church
TRUMP: There would have been no difference three days ago. And you might not have had that very brave person who happened to have a gun or a rifle
in his truck go out and shoot him and hit him and neutralize him. And I can only say this, if he didn't have a gun, instead of having 26 dead, you
would have had hundreds more dead.
QUEST: So, Sara Murray in Seoul, you've got a busy day ahead. I'll let you get on with your duties. Sara, thank you. We turn immediately to Will
Ripley. You heard Sara's report there. What will they make of the comments, Will, in Pyongyang?
WILL RIPLEY, CNN CORRESPONDENT: Well, you know, obviously, words matter. And the fact that the president hasn't said anything in South Korea to
exacerbate the situation is encouraging. But from the North Korean side, it doesn't erase all of the things that have been said leading up to this. All
of that inflammatory rhetoric that Sara mentioned in her piece, not to mention the fact that North Korea is watching the actions of the U.S.
Military. Trilateral exercises between South Korea and Australia just wrapped up. And they're going to be even larger naval drills, massive
drills really, involving three U.S. aircraft carrier strike groups in the Pacific. That infuriates North Korea because they see these military
exercises as a provocation, a dress rehearsal for potential war with their country. And it's the reason why they feel justified in developing and
testing their own weapons of mass destruction.
QUEST: But, Will, where does this go from North Korea's point of view? I mean, look, what we know and what I heard you say before. They aren't going
to give up the nuclear gains that they made so far. Probably not even for large amounts of money despite what some think. The rhetoric is getting
hotter unseemly. And yet the president says this is all going to work out somehow. Can you see how it works out?
RIPLEY: Well, the North Koreans aren't ruling out diplomacy all together. But they say they have to round off their nuclear program first, which
means additional nuclear tests and missile launches. In the past few months they have threatened everything from an above-ground nuclear detonation,
which would be the first of its kind in nearly 40 years. To launching a salvo missile toward the U.S. territory of Guam. That could have been
posturing. Neither of those things have happened yet. But North Koreans do seem to indicate they have more tests before they're willing to talk.
QUEST: All right. So finally, in a word or two, is it likely that we're going to see any bellicose behavior in the next few days?
RIPLEY: You know I wouldn't place a bet on what North Korea is going to do, because they pride themselves on being unpredictable. And often when we
expect them to launch or to do something provocative they don't. And then they do it at a moment it at a moment when the world is not expecting it.
So, it could happen while President Trump's in the region. It could not. The North Koreans don't want to want to start a war with the United States.
That's not their main objective. Their objective is regime survival.
So, they're going to do a test when they feel they can have the maximum impact with the least amount of risk here in North Korea of igniting
something. They also say they're not afraid of war with the United States, if it were to happen as a result of a series of events, a series of
missteps. And they feel that the United States be would to blame for that.
QUEST: Early morning in Pyongyang. I was going to say, Will Ripley, thank you for getting up early. But I'm guessing you have not been to bed. You
been broadcasting around the clock. So, thank you for staying up late, or getting up early, whichever is easiest.
OK, as we continue tonight on QUEST MEANS BUSINESS, 140 characters. It's been Twitters defining feature. Now the company says doubling the character
limit will get users to tweet more.
[16:40:00] (COMMERCIAL BREAK)
QUEST: 45 minutes ago, a script as long as the one I am reading would not have fit into a single tweet. That is no longer the case Twitter, as you
can see, is doubling their character limit on tweets from 140 to 280. It is a controversial move. Samuel Burke is following the developments.
And I'm following you on Twitter. Now I have so much more to write. Do I have to start reporting now?
QUEST: Just tell me why they're doing it.
SAMUEL BURKE, CNN TECH, TECHNOLOGY AND BUSINESS CORRESPONDENT: They're doing it, because people want more space to write more things. Especially
the most important user on Twitter, the president of the United States of America. He needed a little bit more room. No celebrities have left in
protest. The stock price, let's take a look at it. It's gone up about I think $3 or so since they made this announcement in September. So, look,
what do you have to complain about?
QUEST: I follow Blaise Pascal's quote.
BURKE: Which is?
QUEST: Which is, I would have written a shorter letter, but I did not have the time. Anybody can be verbose and in long-winded and say more, but it --
BURKE: You've accused me of that many times.
QUEST: Frequently. But the point is, it takes a certain skill to a shorter, pithier message is more interesting than somebody rambling twice as long.
BURKE: And to your point, Twitter says that after the novelty wore off for the test group, only about 5 percent of users have gone past the old 140-
character limit, even though they had the 280 characters. It's just an option. That's all when you have that one very important message or if
you're like me, you tweet in English and in Spanish in the same tweet, it's just when you need that space. Twitter still isn't as long as Facebook.
QUEST: All right. So, hang on, hang on. This makes no logical sense at all. Because if you're going to have -- if you're going to just suddenly double
it to 280, just because you think people want to write longer, why 280? Why stop there? Go for 500. Go for a thousand. Go unlimited.
BURKE: Well if the stock price as low as it is for Twitter, they may just try something like that. But 140 was just to keep it shorter than the 160-
character limit for text messages. Because that's what Twitter was designed for originally. So, they're just making it a little bit longer, albeit
QUEST: Let's talk about Twitter. The response, of course, to last week with the president and his attack. They moved quite sharp, and the company was
quite honest about saying we should have done better. We could have done better. We must do better. And they put in new places. But Twitter still is
basically either the president, or it's a news agency of sorts that people use whenever somebody dies, everybody piles in to say, you know, famous
people will comment about it. It hasn't found a home yet for people to comment and chitchat amongst themselves or not to the extent.
[16:45:00] Burke: Or even more seriously, it's become a home for all the reasons it doesn't want to be, maybe being used as foreign agent from
foreign countries in elections, I think at the end of the day, it has this extreme relevancy. But the bottom line is, people invested in Twitter
thinking it was going to be the next Facebook, Twitter is not going to be the next Facebook. 300 million some-odd users, is nowhere close to 2
QUEST: Do not get any ideas about extending your time just because Twitter is --
BURKE: Oh, how did you see that? So ever subtle. You're all the way in London.
QUEST: Grasshopper, you will learn.
BURKE: You can ring my bell.
QUEST: Greece's economy minister issues an angry denial, his company is not on the brink of economic collapse. The tourism minister from Greece about
how he dealt crisis is impacting her sector. QUEST MEANS BUSINESS in London.
QUEST: Greece's finance minister is furious, denying that his country is on the verge
Bankruptcy, he has rejected claims made by the country's budget office that says without substantial debt relief the Greek economy will collapse.
Greek stocks took a tumble. Athens composite falling 1. 7 percent, dragged down by banking stocks. We have the Greek tourism minister in London with
me now we're not going to go into too allegations. But the perception -- let's just talk about the perception of your country at the moment. Is
what? Is that it is in trouble that it is having difficulties? That it is recovering? It's all of those things. And at the same time, isn't it?
ELENA KOUNTOURA, GREEK TOURISM MINISTER: We left the bad days behind us. We recover, and we're going to develop growth. This is important, and tourism
is the driving force for this. Also, you have to know that it is the engine for growth.
Economy, sustainability and it's also the bridge that brings other sectors to grow and to develop. And the economy, the national economy right now, it
depends a lot from tourism. We have 20 percent of our GDP and 1 million direct and indirect jobs.
QUEST: So, with that in mind -- during the crisis, it was interesting to note, yes, prices came down in Greece. But not as much as many people
thought they were going to. For holiday prices. It was a bit of a bargain in some places but not for very long what are we now going to see next
year, do you think, in terms of prices? Are they going back up again? Because one of the big criticisms has always been that Greece has -- it's
not as competitive as it could be on pricing.
KOUNTOURA: No, it's not true. It's very competitive. Actually, we're value for money. We are the only country in the European family that really has
value for money. We have to offer so many choices to all the tourists that they come. Massive tourism, high-end tourism. And we are doing very well in
all of these different target groups.
[16:50:00] QUEST: Are you concerned that although there's no -- that the European Commission, the Cahokia (ph) -- whoever we want to call it -- are
going to want more from the Greek people? That they're going to require more hardship, more austerity, whatever you want to call it.
QUEST: But this idea that the economy is recovering still seems to be predicated based on the idea that there might be more debt relief that is
KOUNTOURA: Listen, I will tell you about tourism, because as I told you, it is the engine that puts other sectors to grow. And for example, more
tourists are coming, more revenues we have increase all the other factors like for example, the sector of real estate. Trade. Energy. Transportation.
Everything grows through tourism. And actually, we are very attractive right now for investments.
And we have more than in tourism, 300 projects, which is a big huge number for four and five-star hotels and resorts, so tourism is the engine that
puts other sectors to grow. I'm very, very optimistic, and it is the right direction.
QUEST: I look forward to meeting you in Greece and we'll go and see it for ourselves with you.
KOUNTOURA: Thank you so much.
QUEST: Minister, thank you very much indeed.
Greece may have been one of the worst performers in Europe, but across the region today in the markets most markets ended the day lower.
London's FTSE failed to manage another record, week sales weighed on the UK retail stocks.
Brazil's tourism chief says the economy is back on its feet. With the new president and major reforms in place the countries looking for more
investment. I asked him how Brazil was managing to get back on track?
VINICIUS LUMMERTZ, PRESIDENT, BRAZILIAN TOURIST BOARD: I think the general economy is getting detached from the political crisis. The political crisis
is over. The actual President Temer had two rounds of tried impeachment and he is cut loose. So, the labor reform went through.
Now we have the social security reform. So hopefully the next president will inherit a country prone for economic growth.
QUEST: So what part do you expect Brazil?
LUMMERTZ: Well, things are changing at the macroeconomic level. Reforms and the macroeconomic reforms include electronic visas to the United States,
Canada, Japan, Australia. There are changes opening up the capital for foreign companies to own -- up to 100 percent in our airliners, so we
expect more competition within the market. And the labor -- and within the tourism law, 136 articles reform to cut red tape and bureaucracy to foster
investment, because Brazil's rate of savings and investment is too low for -- to see in the long run growth more than 2 percent we need investment. We
need for foreign investment; 13.5 savings or investment is not enough.
QUEST: Has corporate Brazil been cleaned up? That's really what people want to know. Or is it business as usual?
LUMMERTZ: Are we talking about public companies, when you talk about public companies, what's going on now, is an option to privatize the whole
electric sector. It is a huge sector of Brazil's economy.
Now, I think what we are convinced now after the labor government is clearly we need less public companies. It's damaging. They are prone to
corruption. I think we need more private sector in Brazil.
QUEST: So, I'm wanting to hear from you an assurance that it's not business as usual. In other words, like it used to be.
LUMMERTZ: I think if you look at your headlines, about what's happening with the offshore crisis around the world in general, I think what's
happening in Brazil gives a hint of what will happen in the world, I think everybody will question what's happening in offshore and illegal business
around the world.
I think we are doing our part. As a young democracy I think very painful. It hurts. But it's been done. It's open to the world. No country has ever
shown its insides as Brazil is showing. And as I told you, the economy is back on its feet and I think the country will develop and tourism will
[16:55:00] QUEST: Brazil's tourism minister, you can download our show as a podcast. It's available from all the major providers. Or you can listen at
CNN.com/podcast. The program has been coming from London. A Profitable Moment for you after the break.
QUEST: Tonight's Profitable Moment. So, Twitter is doubling the number of characters that you can tweet from 140 to 280. And I think that is a
retrograde step. It was Polonius in Hamlet who said brevity is the soul of wit.
And as you heard earlier, Pascal saying, if I had time I would have written you a short letter because we all know, it is much harder to write
something concise, tight, well-structured than to ramble on at long length to bore people into submission.
Think about the Gettysburg address. Merely 272 words that encapsulated all that is about democracy and the right of men. And women. And then, of
course, you have Samuel Beckett with his play 24 seconds, arguably one of the shortest on record.
And Twitter wants to let you ramble on for much longer just because they can. Which is pointing out that I've rambled on more than I should, which
brings us to the close of tonight. Keep it short.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Whatever you're up to in the hours ahead, keep it simple.