Return to Transcripts main page
QUEST MEANS BUSINESS
Brazil's E-Mail Overtime; Interview with Thorsten Heins; Interview with Carl Elsener; Interview with Klaus Schwab; IMF Chief Warns of 1930s- Style Depression; Greek Debt Deal Negotiations Continue; European Markets Gain; Early Gains in US Lost; Occupy Davos Protesters Sleeping in Igloos; Security High for World Economic Forum; WEF Founder Klaus Schwab; US and EU Approve Sanctions on Iran; Oil Prices Rising; Saudi Perspective on Iranian Sanctions; Future Cities: Doha Uses Sport to Aid Economic Development
Aired January 23, 2012 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: Tonight, the head of the IMF, Christine Lagarde, warns of a 1930s-style depression.
(BEGIN VIDEO CLIP)
CHRISTINE LAGARDE, MANAGING DIRECTOR, INTERNATIONAL MONETARY FUND: Easily, easily, slide into what we call a 1930s moment.
(END VIDEO CLIP)
QUEST: Past its peak. The head of the World Economic Forum says capitalism is outdated.
And management in motion. We speak to the new head of RIM BlackBerry.
I'm Richard Quest in the snows of Davos, where I mean business.
Good evening and welcome to snowy Davos. They've had more snow here this year so far than they get all season, and we're expecting globs of it tonight to fall on the trees. All this week we are in Switzerland for the gathering, the biggest gathering at the start of the year in the business calendar.
The World Economic Forum begins on Wednesday, and the formal title is "Great Transformation" in the midst of this economic crisis. And tonight, the risks are clear. The head of the IMF, Christine Lagarde, has warned of a 1930s moment on the horizon.
She says if policy-makers don't take decisive action, we're at risk of another Great Depression. The old wounds have been allowed to fester, says Madame Lagarde. Diana Magnay is in Berlin where the managing director was speaking. Di's with me this evening.
It's fairly dramatic language. How did she mean it?
DIANA MAGNAY, CNN INTERNATIONAL CORRESPONDENT: It is fairly dramatic language, and I think it was a call to action, especially to the Germans who, with the strongest economy in Europe, are the ones who she was basically calling on to assume the leadership role, an implication that they weren't doing as much as they could.
And also, a call really to all world leaders. She said we have to see some collective action by all. The world knows what it needs to do. It has to go about doing it. Otherwise, as you say, a 1930s depression, a downward spiral.
We're hearing from the IMF tomorrow that global growth forecast. She said already that it will be lower growth across the board, not just in the eurozone, but across the emerging markets, across the whole world.
And it is at that point the policy-makers must in 2012 try and get together a year of healing, she said, to make sure that a 1930s-style depression doesn't happen. Let's just take a look to how -- a listen to how she formulated it.
(BEGIN VIDEO CLIP)
LAGARDE: We could easily, easily slide into what we call a 1930s moment, a moment where trust and cooperation break down and countries turn inward. A moment ultimately leading to a downward spiral that could very much engulf the entire world.
(END VIDEO CLIP)
MAGNAY: She did say that she believed there was hope, that she was confident that political leaders could get together, and she outlined a series of measures, Richard, which she felt were the appropriate ones, to try and get the eurozone out of this crisis, the eurozone being the biggest problem to global growth going forward.
One of those is to try and stimulate growth within the eurozone, rather than just putting through incredibly punitive austerity measures in every single country. She said those countries that are able to have some sort of fiscal space right now should make use of that. We don't have to be austere across the board, we have to put in measures for growth.
She also said we need a much stronger firewall. The stability mechanism to save countries like Italy and Spain is not enough. Let's just have a listen to that.
(BEGIN VIDEO CLIP)
LAGARDE: We feel that a stronger firewall is needed. Why? Because without it, countries like Italy and Spain, for instance, that are fundamentally -- fundamentally able to repay their debt, could potentially be forced into a solvency crisis but abnormal financing cost.
(END VIDEO CLIP)
MAGNAY: Now, how she wants to strengthen that firewall, she said transfer the funds that are still in the ESFS into the ESM, the permanent mechanism that's meant to be due -- or coming into force in June.
She also said, Richard, we want to see closer integration across the eurozone. We want to see more risk sharing by governments. And she said you can do that in form of a euro bond, you can do that by some kind of debt relief organization, but we need to see more attempts to look after the weak in this region of Europe, which is so disparate and yet, which represents such a problem to global growth,. Richard.
QUEST: Diana Magnay, who is in Berlin for us tonight.
Greece remains at the epicenter of this crisis, and now reports say it may not make a final offer to its private sector creditors for another three weeks. According to a finance ministry official quoted by Reuters, negotiations could go on until February the 13th. Creditors say their best offer is already on the table and they can't afford to give up any more ground.
Meanwhile, ECOFIN, that is European finance ministers, are meeting in Brussels, and Greece will be high on their agenda.
Traders seem optimistic that there'll be a deal. They made a beeline for banking shares, pushing all the major European markets higher. UniCredit was up more than 10 percent in Italy. The French bank, Soc Gen and Credit Agricole gained 8 percent and 4 percent respectively. The best gains were in London, where energy stock got a boost.
On Wall Street, the Dow is fairly flat. There were decent gains at the open, as you can see from the big board. Whatever big gains there have been have evaporated completely. The down is down the best part of 19 points. And in fact, the Dow is flirting with 12,700.
The first protesters already making their mark here. Occupy Davos has arrived. Now, unlike other places, New York, Wall Street, London, Berlin, Frankfurt, Sydney, here there are no tents. It is igloos. Protesters are somehow planning to sleep in them outside the main congress center.
As you can imagine, bearing in mind the weather that we are experiencing here, it's all going to be rather unpleasant since now it's snowing rather harsh.
Security around the resort is understandably high. There'll be 4,000 Swiss police and troops monitoring the area this week.
The man running the whole event here, the leader, the founder, is the German economist Professor Klaus Schwab. Now, as we look and discuss how the financial crisis is being handled, it is worth us pausing and remembering exactly this time last year, Professor Schwab told me that 2011 would be a crucial year.
(BEGIN VIDEO CLIP)
KLAUS SCHWAB, EXECUTIVE CHAIRMAN, WORLD ECONOMIC FORUM: 2011 will be critical because, until now, for the G20 and for the political leaders, it was easy to work together when you stand with your back to the wall or at the cliff.
But now, you have to construct the world of tomorrow and at the same time having the burden of your past errors on your back.
(END VIDEO CLIP)
QUEST: -- to play people's words back to them 12 months later, but the situation is so serious. And now, Professor Schwab says we're in danger of getting burned out.
In the light of Christine Lagarde's warnings today, there was only one question to begin our discussion. How disappointed was he with the way 2011 actually panned out?
SCHWAB: Certainly I'm disappointed, because we were hopeful, said we would come out of 2011 and see where we go again. That's not the case.
QUEST: Right, but are you disappointed with the way they handled the year, the way policy-makers dealt with the financial crisis?
SCHWAB: What irritated me is a lack or an increasing lack of willingness to deal with global issues, always regional issues, if you talk about Europe.
QUEST: Why do you believe they can't solve these fundamental issues, which frankly haven't changed since 2009?
SCHWAB: When you have to solve issues on a European basis or on a global basis, there are countries who have to make certain sacrifices.
And what we have seen with the lengths of sacrifices, the populations have become much more egoistic, there's banker mentality, now, which makes it very difficult for leaders to make the necessary concessions to solve European or global issues.
QUEST: You talk about burnout. Burnout on top of what we've already had so far is a very dangerous scenario, isn't it?
SCHWAB: The burnout comes from a feeling -- and I'm not speaking about politicians, I speak mainly about populations, and voters, of course. The burnout comes from a feeling we cannot cope anymore with it. It's just too much.
And that, of course, leads afterwards to a downward spiral, in a feeling of despair, of let's say lack of hope, of being very pessimistic about the future. And we have to break through this syndrome.
QUEST: Now, I've known you a few years, Klaus, and I know that you do welcome the protesters, who also come to Davos, because they have a point of view that needs to be heard. That's correct, isn't it?
SCHWAB: No, they don't have a point of view. They criticize, but what we need are constructive points of view, and I haven't heard yet a constructive point of view of the protesters.
QUEST: So, you don't welcome Occupy Davos outside in their igloos?
SCHWAB: I welcome if they are coming here and make -- and they would be very welcome if they come here open for dialogue and coming with very constructive proposals.
QUEST: Would you favor a Davos -- a World Economic Forum of the future that is less dealing with the immediate fires of today but does allow for greater prospect and great thought of tomorrow?
SCHWAB: We have chosen as a title "The Great Transformation" to address exactly the fundamental changes which are happening in the world and to force people to look for new models in decision making.
QUEST: Capitalist models?
SCHWAB: You see, here's just the point. We argue in terms of capitalism, but capitalism, in my opinion, is outdated. Capitalism was born when capital was the most important resource. Today, it's talents which is the most important.
QUEST: You wouldn't argue against a market-based economy, though, would you?
SCHWAB: No, I'm fully in favor of a market-based economy, but a market-based economy which serves the public interest.
QUEST: Finally, I'm going to come back to the leaders and how they have handled the crisis. If you had one message for the leaders, now, to actually get on with it and sort the mess out, what would it be?
SCHWAB: It has to be a threefold message. Develop a longer-term vision. We have a vision gap at the moment. Close the values gap. We have to base our visions and our action more on values again. And finally, develop the solutions for the problems of today.
QUEST: The head of the World Economic Forum, the founder, Klaus Schwab, and it's not every day that somebody tells you that capitalism is outdated., but that's what they'll be discussing here at the WEF this week.
When we come back and in this program, research in motion. The owners of BlackBerry have a new man at the top of the company. Thorsten Heins takes over, and we'll talk to him in this hour.
QUEST: The United States has joined the European Union in its efforts to contain Iran's nuclear ambitions. Tonight, the US Treasury announced sanctions on Iran's third-largest bank, Tejarat, and its affiliate, State Capital Bank. It'll limit Iran's ability to make international transactions, it will isolate the regime further.
Earlier on Monday, EU ministers approved a new embargo banning the import of Iranian crude oil and petroleum products. They'll kick in on July the 1st. The EU's foreign policy chief, Baroness Catherine Ashton, says the strategy is meant to encourage Iran to reengage with negotiations.
(BEGIN VIDEO CLIP)
CATHERINE ASHTON, EU FOREIGN POLICY CHIEF: We've added additional restrictive measures in the energy sector, including a phased embargo on Iranian crude oil imports to the EU and in the financial sector, including against the Central Bank of Iran, while ensuring that legitimate trade can continue under strict conditions. And the decisions and detail, you'll see, will be published in the official journal tomorrow.
I want to stress, however, that sanctions are not an end in themselves. I've often talked about this being part of a twin-track approach, that the purpose of sanctions is to put pressure on Iran to come back to the negotiating table.
(END VIDEO CLIP)
QUEST: Iran exports more than two million barrels of oil a day, and there are concerns over that supply drying up, and understandably, that pushes oil prices higher.
In fact, the worries over Iran and the Straits of Hormuz has pushed the price of Brent above $110 a barrel, a gain of one percent. NYMEX light crude also now towards the $100 a barrel mark.
CNN's John Defterios is at the Global Competitiveness Forum, which takes place at this time of the year in Saudi Arabia. It is the Davos of the Middle East, if you like. It always precedes the actual Davos here in Switzerland. John Defterios now reviews the Saudi view on the Iranian sanctions.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Saudi Arabia, with the largest oil reserves in the world, has clearly defined its role when it comes to sanctions against Iranian oil. In the past week, the kingdom has offered to put another 2.5 million barrels a day of oil on the market if needed.
The prominent Saudi businessman, Prince Al-Waleed bin Talal said it is the correct signal to be sending.
PRINCE AL-WALEED BIN TALAL, CHAIRMAN, KINGDOM HOLDING: It's not only wise, this is a very political and subject -- freeze from our oil minister, who reflect, certainly, the views of King Abdullah.
For Saudi to come public and say we will flush as much oil as needed to compensate for any potential loss of Iranian oil, that's a big message to Iran that don't keep threatening the world economies with the cause of Hormuz, because we will, if push comes to shove and we have to raise our oil production, we'll compensate for what you have.
DEFTERIOS: Iran has asked for Saudi Arabia to rethink that strategy, but the six members of the Gulf Cooperation Council, including Saudi Arabia, have asked Iran to stop meddling in internal affairs.
The tone has changed since the release of the IAEA report on Iran back in November. The former head of Saudi intelligence, Prince Turki Al-Faisal said that Saudi Arabia supports UN sanctions, not unilateral sanctions, but wants the Security Council to move with more urgency.
PRINCE TURKI AL-FAISAL, SAUDI ARABIA: China and Russia, as well as the other members of the Security Council, have a responsibility to the interests of the world community. That's why they enjoy veto power. Issues like Iran require immediate attention.
DEFTERIOS: Half of Saudi Arabia's production of nearly 10 million barrels a day goes through the Strait of Hormuz, but Prince Al-Waleed and others here at the kingdom say it's not possible for Iran to block the strait. In fact, they would suggest it would be geopolitical suicide.
John Defterios, CNN, Riyadh, Saudi Arabia.
QUEST: Now, as we continue our Davos coverage and, indeed, QUEST MEANS BUSINESS tonight, which all this week is coming from the World Economic Forum, when we come back, how heavy investment in sport could help one country in particular and one big player on the global stage. In a moment.
QUEST: Now, look at that snow. It is cold here in Davos. The temperatures are struggling to rise just above zero. It's hardly surprising, we are, indeed, up the Swiss Alps.
Now, in balmy Doha, here today, there was a high of 18 degrees. In our third feature on Qatar's capital, we're going to take you from the snow to the sand. In this case, the huge investment that's being made to create a world-class city for all athletes, from young enthusiasts to seasoned Olympians. I went to find out how sport is playing a very big part in putting Qatar onto the world stage.
UNIDENTIFIED MALE: Qatar!
QUEST (voice-over): Ten years from now, Qatar will make history as the first Middle Eastern country to host the football World Cup. For Qatar's emir, His Highness Sheikh Hamad bin Khalifa Al Thani, and his wife, Sheikha Mozah, this is the greatest reward so far for a heavy investment in sport.
HASSAN AL-THAWADI, SECRETARY GENERAL, SUPREME COUNCIL FOR WORLD CUP 2022: It's our responsibility to make sure that when we look back 50 years from now, we see the World Cup as being a very, very important step towards the development that is occurring in this region right now, to accelerate commitments to development that are already in place.
And we're hoping as well the biggest impact will be that the average individual from the East or the West will look at the Middle East and be able to understand the culture a lot more.
QUEST: If the World Cup wasn't enough, Doha's also bidding for the Olympics in 2020.
HIS EXCELLENCY SHEIKH SAOUD AL THANI, SECRETARY GENERAL, QATAR OLYMPIC COMMITTEE: Now you see, they made the decision in 2016 to go to Rio, a new region, so now, the only region which still did not have the Olympics is this region, the Middle East. That's why we say it is the right time now to come to Qatar in 2020.
QUEST (on camera): There is deep strategy behind all of this. Doha is creating world-class sporting venues and has already claimed a portfolio of international events. Here, they're preparing for the Arab Games.
QUEST (voice-over): With sport part of the national vision, there's no expense spared when it comes to putting on a show at the Gharafa Stadium. The Opening Ceremony of the Arab Games at the end of last year welcomed 21 nations in style. And yes, it was another sporting first for Qatar.
And for FIFA's World Cup, nine new stadia are in the pipeline. In a city already feeling the pressures of construction, preparations for the World Cup will add to the frenzy.
SHEIKH SAOUD: By 2022, you will see a new Doha, a new Qatar. And that's the interesting part. Qatar has been developing over the past 10, 15, 20 years at a very, very rapid pace, and so I can only imagine what it would be in 2022.
QUEST: The single biggest unresolved issue for Doha's World Cup is summer temperatures, which will be unsuitable for football for players and spectators alike. Despite a commitment to air conditioning technology, the summer versus winter debate rages on.
THAWADI: Our bid was a summer bid. In the end, we have cooling technologies that are established, that are developed that will have legacy impact and legacy benefits post the World Cup, as well, not just for Qatar, but also for other countries that face similar environments as Qatar. In the end, it's the football community's consensus.
QUEST: Qatar's World Cup is a decade away. For now, the foundation of the nation's sporting ambition is the Aspire Zone. For Qatar, it's a place of sporting excellence, somewhere to nurture local talent. The Khalifa Stadium is just part of this state-of-the-art complex.
QUEST (on camera): The motto here is "Aspire today, inspire tomorrow." With facilities like these, they're well on their way.
SHEIKH SAOUD: If you look to our strategy, to our strategy sport, Qatar Olympic Committee, it had fallen into two categories. One of them is for the elite school, which Aspire plays a major role to make sure that we provide the best facility, best environment, and best training and all that will have an athlete on the Olympic level or the world championship level.
But on the other hand, which is the second part of our strategy, which is sports for all or sports for our society, especially for young people
QUEST (voice-over): Qataris suffer from some of the world's highest rates of diabetes and obesity, not helped by their high per capita wealth, privilege, and rich standard of living.
Aspetar is the Gulf's first specialized hospital for sports, science, medicine, and research. Its chairman is Dr. Mohammed Al Maadheed, a driving force in Qatar's national health strategy.
MOHAMMED AL MAADHEED, DIRECTOR GENERAL, ASPETAR: We need to create an environment within the city, within the desert, within the rural areas, within the house -- homes, working places, schools, everywhere, that caters and makes you and makes me, like this Aspire Zone, if you see it, to ask yourself, why don't you come and have a walk here? Why don't you come and have a job with your family or something like this.
This is what we want to create, and then changing the attitudes of people towards this and understanding that if you want to live a happier life and much longer life, you need to change their lifestyle.
QUEST (on camera): Qatar's sport policy has many potential barometers of success. Even if the country doesn't reach the top of the sporting league, for the young who live here, they've been introduced to a healthier way of life.
QUEST: By jingo, I can tell you, if you went from those temperatures to these, you'd soon know about it in an instant.
Talking of instants, when we come back in a moment, shareholders have sent an instant message to BlackBerry's new chief executive. The new man is there, he'd better turn things around fast. QUEST MEANS BUSINESS, we're live in Davos tonight.
QUEST: Hello, I'm Richard Quest, live from Davos.
More QUEST MEANS BUSINESS in a moment.
First, this is CNN. And on this network, the news always comes first.
And that's with Fionnuala Sweeney at the CNN Center -- good evening, Finn.
FIONNUALA SWEENEY, CNN ANCHOR: Hello there, Richard.
Well, the European Union is hitting Iran with new sanctions over its nuclear program. They include an oil embargo that's set to take effect in July. The sanctions also freeze the Iranian Central Bank's assets in EU countries. Iran's deputy foreign minister says such efforts have been ineffective in the past and will fail once again.
More than 10 months into Syria's uprising and crackdown, opposition activists report another 23 deaths. They say most of today's violence happened in the flashpoint cities of Idlib, Daraa and Homs. Meantime, the EU is imposing new sanctions on 22 Syrian officials.
An earthquake has struck Chile. The U.S. Geological Survey says the magnitude 6.2 quake hit near Concepcion. The epicenter of the quake is about 50 kilometers north of the city, a few hundred kilometers south of Santiago. So far, no reports of damage.
Egypt's parliament opened today for the first time since the fall of former president, Hosni Mubarak. The newly sworn in lower house is dominated by Islamists, who won about 70 percent of the seats. Election for the upper house will wrap up next month.
And the French Senate is set to vote on the so-called Armenian Genocide Bill. Lawmakers have turned down a motion to drop it. The measure makes it illegal to deny there was genocide against Armenians by Ottoman Turks in 1915. Turkey has threatened permanent sanctions against France if lawmakers approve it.
And those are the headlines.
Back to QUEST MEANS BUSINESS live from Davos -- Richard.
QUEST: Transformation is the theme of this year's Davos. And it is transformation that Research in Motion shareholders are hoping for. The BlackBerry maker has a new chief executive.
Thorsten takes over from rim's founder, Mike Lazaridis, and the former co-chief executive, Jim Balsillie. They will both remain on the board, but Thorsten Heins becomes the new driver of the company. Shareholders are desperate for Heins to turn the company's fortunes around. RIM's share price has fallen 70 to percent -- 72 percent, just to make sure you heard the first time, as rival smartphone makers encroach on the once turf and dominated by the BlackBerry.
Now, he's the sad part. RIM's shares were down another 6 percent at the moment, less than $16 a share -- $16. At their peak, RIM was worth more than $147. That was back in 2008.
We have, indeed, been promised an interview which, hopefully, we will bring to you in the course of this hour. But torn -- Thorsten Heins apparently is running late in New York. We look forward to speaking to him before the top of the hour.
There may be a new team in charge at RIM, the makers of BlackBerry. The legacy of their founders continues in the handheld devices that we use with their ever flashing lights signifying a new e-mail and the ping. Many of us feel we are slaves to our phones, our BlackBerrys, our iPhones.
In Brazil, they're taking action to try to stop phones from taking over people's lives, as Shasta Darlington reports.
It's a new law which could make answering the phone an expensive business.
SHASTA DARLINGTON, CNN INTERNATIONAL CORRESPONDENT (voice-over): Not the sound most people want to hear in the middle of dinner -- a phone call or e-mail from the office.
UNIDENTIFIED FEMALE: Hello?
DARLINGTON: But in Brazil, employees might now be a little more likely to respond. A new law says work e-mails and calls make Brazilians eligible for overtime.
Labor lawyer Rodrigo Zacchi says the law is a response to reality. "It's technological slavery," he says. "Virtually 24 hours a day, employees are connected to their phone or e-mail, always at the disposition of their employer."
We went out and talked to people on their lunch break. This telecom worker says it's necessary. "We have a set number of hours that we're contracted for," he says, "but we end up on call 24 hours a day."
Others are critical. "I think it's going to be hard because it's kind of expected," she says. "A lot of times the company gives you a phone exactly so you can answer an e-mail, even on a weekend." Yet another headache for companies in Brazil that already complain they pay hefty retirement compensation and other worker benefits, as they increasingly compete with cheap imports.
Many workers are concerned that companies will take preventative action.
UNIDENTIFIED FEMALE: From what I hear from friends in other offices is that there is attempts to shut down the servers so people don't even have access to their e-mails after hours to ensure that they will not have to pay overtime in those situations.
DARLINGTON: Experts say it's still not clear how the law will be enforced. The Supreme Labor Court takes up the issue next month.
For the most part, they don't expect companies to voluntarily start counting up all those hours spent answering e-mails after work.
(on camera): In the meantime, lawyers say all those phone bills and e-mails will definitely come in handy if you get laid off and want to go after your bosses for extra compensation.
Shasta Darlington, CNN, Sao Paulo.
QUEST: Now, the new chief executive of Research in Motion, Thorsten Heins, joins me on the phone.
He's in Waterloo in Ontario, Canada.
First of all, Mr. Heins, can you hear me?
Just let's check that we can talk to each other.
Good evening, sir.
Can you hear me?
THORSTEN HEINS, CEO, RESEARCH IN MOTION: Good evening.
I can hear you really -- really well.
Mr. Heins, so you're now going to be the new man at the helm. And the core question everyone really wants to know is, what are you going to do to reinvigorate Research in Motion, BlackBerry and help put it back into competition in smartphones?
HEINS: Yes, Richard, you're right, I
Hear this question quite a bit throughout the day. And let me tell you what we will be doing and what we actually started doing 18 months ago. You know, we have built the BlackBerry 7 portfolio that is out there and is globally very, very successful. We ran home $5.2 billion in revenue last quarter, profitable. We increased our cash position up to $1.5 billion in cash. And we have grown year over year 54 percent in our business.
So there is a -- a strong uptake for BlackBerry in the rest of the world. And there is challenges that we face in North America and in the US.
So what we will be doing is we are building a new platform...
HEINS: -- as we speak, the BlackBerry 10 platform. And later this year, you will see the BlackBerry smartphones based on the BlackBerry 10 platform...
QUEST: All right...
HEINS: -- hitting the market.
QUEST: So the market, the -- the stock market, that is, still is seeking some form of alliance, association, with another company.
Now, I know you've said you're not completely against that. But you've not ruled it out. But you're not making it a priority. Perhaps you should make it a priority, the market is saying.
HEINS: What I make as my priority for Research in Motion, Richard, is to continue to build on the integrated value proposition. If you look into the market, there's not many companies out there that own a data network, their own services and the devices on top of this and compare this, please, with other companies that are device only players and start to enter even smartphones in a cutthroat price and cost competition.
QUEST: So you would agree that mistakes have been made. And I suppose the core question -- because, obviously, now, Nokia has new management, iPhone has new management at the top. Now BlackBerry has new management at the top.
Does the competition become more brutal in the months and years ahead, do you think?
HEINS: This is a very, very competitive market already, Richard. And it shows in Yes (ph) the Mode because Yes (ph) is the market that moved to LDE fast and very, very decisively. It's a hugely growing market, with a 26 percent annual growth rate. And there's a lot of players that want to succeed in this market.
So, yes, it is a very, very competitive market and you have to be top notch in your technology, in your service offerings to -- and in your industrial design in order to compete in this market. It is competitive.
But I think we are prepared...
HEINS: -- to compete in this market.
QUEST: -- well, related to that question, Mr. Heins, which is your priority, to get the share price back up or to get market share, to hold market share and get that back up?
If you have to -- if you have to play one off against the other, which will it be?
HEINS: My priority absolutely is to get the value of Research in Motion up and create long-term value for its shareholders.
QUEST: Thorsten Heins, many thanks, indeed.
You couldn't have been clearer.
We're grateful to you for giving us time on what we know is a busy day.
Thank you for talking to us on QUEST MEANS BUSINESS.
HEINS: Thank you very much.
QUEST: Now, just before we were talking to Mr. -- thank you, sir.
Now, just before we were talking to Mr. Heins in Ontario, we were talk -- hearing about how some companies may be forced in Brazil to pay over time if companies -- if employees answer phones, deal with e-mails and all that sort of thing.
Times are hard here at Davos, so I've confiscated the -- I've confiscated the BlackBerrys and the phones from this lot behind us. They will continue their hard work as they continue their duties. That's Gayle (ph). She's in charge. Well, she likes to think so.
But anyway, let me know whether or not you think you will be -- like to have some over time if you are working extra. The e-mail address and the Twitter address, should you get more money -- should you get more money if you answer these out of hours?
When we come back in a moment, one of the most iconic pieces of Swiss innovation since the cuckoo clock. No, it's not chocolate, it's the Swiss Army knife.
QUEST MEANS BUSINESS.
We're back in a moment.
QUEST: This bears the Swiss flag with pride. After chocolate and maybe the cuckoo clock, the Swiss Army knife is one of the most famous things to have come from this country. It's a standard. It's a tradition.
Now, the list of things this can do is really getting greater and greater all the time. Besides cutting and screwdrivering and all other things like toothpicks, now it's getting a USB port, as well.
I asked the chief exec of the manufacturers, Victorinox, if that was how the Swiss Army knife was now moving into the 21st century.
QUEST (voice-over): For more than 100 years, this has been the little knife that can.
CARL ELSENER, CEO, VICTORINOX: This is the can opener with a small screwdriver. The large screwdriver is a cast leaflet. The corkscrew, a ream to drill a hole and a small blade and a large blade.
When I look back in our history, the vision of my great grandfather was to supply the Swiss Army with this ultra knife. Today, our vision is to build a global brand that everything we do is inspired by the ingenuity of the original Swiss Army knife.
Over the 125 past years, the company has transformed to a global brand that everything we do is inspired by the ingenuity of this little red knife.
QUEST: The original Swiss Army knife has changed. It's transformed.
(on camera): Now show me the transformation from that one.
QUEST: Open everything...
QUEST: -- on that one.
ELSENER: OK. Magnifying glass and the tweezers. We have the (INAUDIBLE), a pin.
QUEST: Which is the most useless thing in that knife -- in that knife, do you think?
ELSENER: I think there is really no useless thing because of our company, the functionality is a brand value. And we don't want just to add a gadget. We really want to offer the customers functionality.
QUEST: So now we come to the most modern iteration of your knife, don't we?
ELSENER: Yes. Yes. This is the Victorinox flash product. Here we have taken the most useful features of the classic client and we have added the USB memory stick.
QUEST: How much of a debate was there within Victorinox about whether this was the right transformation to make for the company?
ELSENER: The -- the people who are important on the sales and marketing side, most of them immediately have seen, oh, this is really a product which can be in -- integrated in the Swiss Army knife and really combines modern technology with the tradition of our company.
QUEST: Are you optimistic?
Do you think that the European crisis is getting worse before it gets better?
ELSENER: This is very difficult. I don't have the crystal ball.
QUEST: On the one hand, are we getting better?
Are we ahead of the curve?
Or, on the other hand, are we behind the curve?
Which one are you going to put your euro in, ahead of the curve, behind the curve.
ELSENER: I personally feel at the moment, we are on top of the curve.
ELSENER: You're in the middle?
QUEST: I'm Swiss.
(END VIDEO TAPE)
QUEST: Now, that traders' economics phrase, being ahead of the curve or behind the curve, is going to be an important part of this week's forum. And we will be asking that question throughout the week.
In fact, we've let the super screen in London, all that modern technology, we have the Swiss screen here in Davos.
So we have the curve. And we will be asking where are we on the curve?
So our first person has said quite clearly that he believes we are on the top of the curve. So we'll put him there. As the week moves on, we will find where everybody else believes we are on the curve.
And, incidentally, all those euros and Swiss francs that we get, we will be giving to the Mountain Rescue Charity.
So, now the next person to answer the question, where are we on the curve, ahead of it or behind it, Klaus Schwab.
QUEST: Dr. Schwab, this year, we are asking everyone, are we ahead of the curve in the crisis or behind the curve, in other words, things are going to get worse?
What do you think?
You get -- you have to -- you have to pay one Swiss franc for each answer.
KLAUS SCHWAB, EXECUTIVE CHAIRMAN, WORLD ECONOMIC FORUM: The business community is ahead of the curve. I think there's a lot of confidence now that we have overcome the worst.
But the political community is still very concerned, because they feel that the real issues are not yet completely under control.
QUEST: If that's right, then we could get worse before we get better again?
SCHWAB: It could be. It could be. I mean there are many reasons. We -- we still have to do a lot to dev -- deleveraging the world. We have to do a lot in order to create a true fiscal union in Europe and so on and so on.
QUEST: Two Swiss francs, please.
You had two gos at this. You had two gos -- you had an -- you had ahead and behind the curve.
SCHWAB: Here, my last two francs.
QUEST: The last two Swiss francs of Klaus Schwab. Let's put his things -- where are we?
He said that business leaders are ahead of the curve, politicians are behind the curve. As the week moves on, you will see where people think we are. And I promise you, I might make the pic -- the diagram look a little pretty by tomorrow. But not too pretty.
We'll have a check on the weather forecast next. And I can tell you the weather in Davos, snow, coming up next.
QUEST: Well, we brought our own snowman, or at least we made him. There is simply so much snow here, you can't believe it. Great for the skiers, not necessarily so for the summiteers.
Jennifer Delgado at the CNN World Weather Center.
I mean the sheer amount that they've got...
JENNIFER DELGADO, ATS METEOROLOGIST: Right.
QUEST: Are we in for more?
DELGADO: Oh, you're in for more, absolutely. And, hopefully, you dressed appropriately and you have some boots that are quite tall, because that snow is going to get deeper. And, you know, they were saying how much snow they've been seeing this year. And, in fact, the protesters say there's so much snow, they can build igloos out there, Richard.
So if you're looking for a little bit of warmth, you do know these igloos do provide a good amount of body warmth. And so plentiful amounts of snow out there. You'll have a lot to work with.
Now, as we talk more about the snow and the depth there, notice for the upper areas, we're talking 238 centimeters. That is the current condition for the lower 143. Look what the average is, 147 for the lower parts of the mountains. We're talking 63, so well above average. And the last 24 hours, we've actually picked up 21 centimeters there.
Now, to give you a better idea, again, we're going to show you the lower depths of the mountains, as well as the higher caps. And notice, typically, we see the upper ones peaking right around April with, roughly, say about 210 centimeters. now, let me show you what's happening now, with current levels, with the snow. And for the lower depths, notice roughly about 140 centimeters. Notice where we should see the higher amounts coming roughly around February and March. It's blown through. And for the current level, well above where it should be, say, for average when it typically peaks.
So, Richard, you're not imagining things. The snow is quite heavy and it's the most we've seen since the records have been taken for the last 20 years. I know it did start back in 1971 and the form founder says he hasn't seen this much snow either.
The current temperature right now, minus three degrees, wind chill minus six. So that's why Richard is shivering out there.
Winds northeast, so that makes it feel even cooler. And as I said, more snow is on the way.
Richard, as we go through Tuesday, as well as into Wednesday, that snowfall could potentially bring about another, oh, 15 to 25 centimeters, depending if you're in the higher or lower elevations.
So here's your forecast, Richard. Notice those temperatures into Wednesday, oh, dropping down to minus 12 degrees. So you're not even anywhere close to how much cooler it's going to be.
Are you miserable now or are you happy?
QUEST: All right, now, you -- you asked me, did I have a pair of sensible shoes...
DELGADO: Right. Indeed.
QUEST: -- and boots?
The answer is most definitely, absolutely. And they have thermals on and everything else...
DELGADO: Oh, yes.
QUEST: But I've got these, which will keep me nice and warm now...
DELGADO: You need to see about getting those a little bit higher up...
DELGADO: -- maybe like mine, knee high.
QUEST: Hey, hey, there will be no -- the -- do leave my boots alone.
QUEST: When we come back in just a moment, it is A Profitable Moment which looks at what's happening in the global economy.
QUEST MEANS BUSINESS.
We're live in Davos.
QUEST: Tonight's Profitable Moment.
How worried should we be by the warning from Christine Lagarde of the IMF about a potential 1930s-style depression?
Very worried for one simple reason. The history of this crisis and the way it's been handled doesn't give confidence that the worst won't be visited upon us. Klaus Schwab told us tonight he's disappointed by the progress made last year. He fears burnout in society by people simply too exhausted to do anything more.
Well, the problems we now face are so complicated, the solutions are getting harder, are getting nastier and they're getting more difficult to take. And that is what both these leaders are warning about.
The fact is, Davos always has energy and it always has purpose. But if those coming here are not prepared to grasp the nettle now, frankly, this will turn into the do little Davos. I hope that's not the case for all our sakes.
And that is QUEST MEANS BUSINESS for tonight.
I'm Richard Quest in Davos.
Whatever you're up to in the hours ahead, I hope it's profitable.
This is CNN.