Return to Transcripts main page
QUEST MEANS BUSINESS
G-20 Discussions Dominated by Syria; US Markets Rise Despite Syria Concerns; Muted European Markets; Investing in Greece; Australia Decides; Dollar Up; Boeing Bonanza; Ryanair Milestone; Pilotless Plane; In-Flight Nannies
Aired September 5, 2013 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FELICIA TAYLOR, HOST: Tonight, G-20 leaders split over Syria. The conflict overshadows global economic talks
Australians focus on the economy ahead of Saturday's election.
And Mary Poppins at 9,000 meters. Etihad introduced in-flight nannies.
I'm Felicia Taylor, and this is QUEST MEANS BUSINESS.
Good evening. It has been a busy day for global leaders who represent the Group of 20 nations. The summit had been expected to focus on the world economy but is now dominated by the crisis in Syria.
In the past few minutes, we've just seen US president, right here, Obama arriving at the working dinner. These are the latest pictures from St. Petersburg. It is just after 10:00 in the evening, and here's a glimpse of the after-dinner entertainment put on by the host, Russia.
Earlier in the day, we saw President Vladimir Putin welcoming President Barack Obama. There are no plans, by the way, for a one-on-one meeting between the two leaders on the sidelines of the summit.
The Syrian crisis is hanging over the G-20 summit. International leaders are divided over whether to support the US president's plans for a military strike against the Syrian regime. Senior White House correspondent Jim Acosta joins us now from St. Petersburg.
And Jim, as I mentioned, obviously, the focus of this is the world economies and what has hopefully been, in many of those economies, a recovery. But naturally, the tensions that have developed with regards to Syria are going to take center stage.
JIM ACOSTS, SENIOR WHITE HOUSE CORRESPONDENT: That's right, taking center stage, Felicia, but behind closed doors, we did talk to some administration officials earlier today who said that President Obama at this dinner this evening, at the Grand Peterhof Palace here in St. Petersburg, the president will be using that occasion to talk about his case against Syria.
He is saying, according to administration officials, that he has high confidence that Syria's forces used chemical weapons in that August 21st attack in and around Damascus.
But you're right, the video of the leaders walking in that you played just a few moments ago, we should point out, it's just very stunning to watch some of the scenery that is taking place here in St. Petersburg. The Grand Peterhof Palace is just lit up as best as it possibly could.
We are told that the president may have been meeting with other foreign leaders or another foreign leader. As to why he might have been walking in alone, there, that might be the reason why, there, in case our viewers were wondering that.
But in terms of the chill in the dialogue, in the language between the Russians and the Americans, that is very much a subject of discussion in and around the G-20 summit here. Obviously, some sharp words have been exchanged between both Russian president Vladimir Putin, his advisors, and the president of the United States and his advisors.
And we wanted to talk to one of Russia's top spokesmen here at the G- 20 summit earlier today, so we went to a briefing hosted by the Russian press secretary, Dmitry Peskov, and we asked him about the Obama administration's claim that Russia is blocking action at the United Nations, and here's what he had to say.
(BEGIN VIDEO CLIP)
DMITRY PESKOV, RUSSIAN PRESS SECRETARY (through translator): The fact is -- that only body which in international affairs can adopt and make legitimate decisions on using force is the Security Council of the United Nations.
Neither parliament of Russia nor the US Congress and no other legislative body of any other country can make such decisions. They can make decisions and heads of state also can make decisions, but such decisions cannot be considered as legitimate ones in terms of international law.
That deposition, which has been consistently promoted by the president of Russia Putin and this position is a cornerstone of Russian foreign policies.
(END VIDEOTAPE)
ACOSTA: Now, President Obama is also working the phones while he's overseas. We heard from administration officials earlier today that he has been calling members of Congress to continue to make the case that he should get congressional authorization for some kind of military strike on Syria.
No word yet from administration officials as to when President Obama and President Putin will meet here for longer than the 10-second greeting as he arrived here in St. Petersburg earlier today. But just no final word, yet, Felicia, on when that's going to happen. Back to you.
TAYLOR: Yes, Jim, obviously things are still fairly divided in the United States Congress as to whether or not they will support the president if there should be the decision to elicit a military strike, but they're still very -- also divided in terms of the countries that support the United States in this kind of an action. Is this also a stage for the American president to use to drum up support?
ACOSTA: I think it is. I do think that the president wants to show when he gets back to the Congress next week, back to Washington next week, that he has gotten some support out here from these international leaders. This has changed very much from a global financial summit to a summit about what to do about Syria, at least in the eyes of the American officials that are here.
President Obama and his top advisors are all working other officials from other countries behind the scenes nonstop to make this case, and we're going to have to find out just how successful they are at the end of this event tomorrow. But Felicia, no doubt about it, the president is doing all he can at this point to make this case.
TAYLOR: All right, Jim Acosta for us in St. Petersburg. Thank you.
And moving to the American markets where US stocks are attempting to extend this week's rally as investors read over some key employment data. Maribel Aber is at the New York Stock Exchange for us.
And we did get some earlier readings on maybe what could be a hint as to what we're going to see on the Friday jobs report, which of course is a key number with regards to the Federal Reserve.
MARIBEL ABER, CNN BUSINESS CORRESPONDENT: Hi, Felicia. Indeed. As you were saying here earlier, a lot of green this session. I do want to say, we're still, though, off session highs. We saw a lot of investors jumping in yesterday ahead of the Jewish holiday, now a lot of people taking the rest of the week off. We're exercising caution ahead of the big jobs report tomorrow.
Now, as you were saying, let's talk about those key readings. We saw a report from ADP which showed private employers added 176,000 positions last month. That was slightly less than expected but generally in line with what we've seen the rest of the year.
Also learned that jobless claims took a tumble, falling by 9,000 last week. Not giving a huge boost to the market, though. And of course, we can't forget Syria remains an issue as well. Traders have told us that it's not the possibility of a military strike that has investors concerned, but it's the potential ramifications afterwards.
So, we could see this market in a holding pattern at least until we get some concise headlines. And Felicia, as you know, the market really hates uncertainty.
TAYLOR: The market certainly doesn't like uncertainty. That is the verboten word. Let's just talk a few -- for a few minutes about what the number is going to be like tomorrow, the all-important jobs report.
And as a precursor for what the Federal Reserve might do, have you had a sense of anything -- what traders are thinking? Because the number isn't supposed to be that strong, but yet, the unemployment overall rate is expected to drop, which is interesting.
ABER: Well, it's interesting because we're expecting really only a gain of 177,000 positions in government readings tomorrow morning. So, to break that out, it really takes both the public and private sector jobs into account.
Of course, as you mention, it's seen as the definitive economic report on Wall Street, along with GDP. And of course, the last big one before the next Fed meeting in about two weeks. So, I think, really, the big question tomorrow will be what does it mean for the Federal Reserve?
Policymakers, of course, have been throwing this $85 billion into the economy each month, propping it up, but now that the economy is getting better, will the central bank pull back? And if they do, is the economy really strong enough to stand on its own?
Because you talk about what traders think, this could be a case of a good news is bad news or bad news is good news tomorrow. So, if the report is strong, it could mean stimulus is ending. If it's bad, it could mean the free-flow of money continues. But Felicia, how good is good and how bad is bad? And the bottom line is --
(LAUGHTER)
ABER: -- we can't keep the punch bowl out forever, right? But maybe an argument --
TAYLOR: Exactly.
ABER: -- can be made -- right? -- that maybe --
TAYLOR: You've just painted a perfect picture as to why this has all been so confusing to so many people. And frankly, a lot of the traders that I've spoken to have said maybe they're just going to dip their toe into the water, see if the American markets can handle it, whether or not they're -- maybe pull $5 billion off a month, which isn't really that big of a deal necessarily. So, we'll find out.
(LAUGHTER)
TAYLOR: Maribel Aber at the New York Stock Exchange.
Let's turn to the European session, which was fairly muted. Investors took their cues from the ECB president Mario Draghi, who expressed extreme caution about the eurozone's recovery. Both European and UK central banks kept interest rates on hold today. Mario Draghi reiterated his pledge to keep them low for an extended period.
London's FT 100 stock index did lead the gains, however, boosted by a strong performance by the banking sector. Lloyd's closed up nearly 3 percent. Barclay's and RBS added more than 2 percent.
Greek businesses are taking the show on the road. Dozens of firms are in London and nearly a thousand meetings have been scheduled with investors over the next couple of days. I asked the chairman of the Athens Stock Exchange what exactly are the Greek companies offering in terms of sectors and also in industries that people could possibly invest in.
(BEGIN VIDEOTAPE)
SOCRATES LAZARIDIS, CHAIRMAN, ATHENS STOCK EXCHANGE: We are giving them the opportunity to meet with the management team of the 27 companies that you have mentioned, mainly the banking sector this year is covering the interest.
The companies that are going for privatization, like the public park operation, a part that has been privatized. Other companies in the gambling, financial industry, and IT companies.
TAYLOR: You brought up the issue of privatization. That has certainly been one that has been fraught with a lot of criticism that that actually isn't happening fast enough in may of the sectors in Greece.
And what is, in your opinion, happening now that will escalate the pace of that kind of privatization for other industries so that we don't see another situation like we saw in 2012, where you didn't meet the targets?
LAZARIDIS: Well, in terms of privatization, we can say that the most important issue is the demand, and as we are approaching a full confidence for the Greek market and we see the signs with increased interest for this confidence, I believe that we will see also increase demand and we will be able to speed up the privatization process.
TAYLOR: There is certainly concern that there will be a need for another financial bailout. What assurances can you give the global marketplace, the global economies, that that's not going to be necessary?
LAZARIDIS: Well, actually, the issue is if a need for covering a funding gap, this need will -- we'll evaluate it at the -- during the next year. It's too early now to say that this need will appear next year, and there are different ways to cover this funding gap.
So, as I have implied in your question, it is much more important to get and to achieve the confidence for the investment community.
(END VIDEOTAPE)
TAYLOR: It's known as The Lucky Country, but Australia's economic fortunes are in jeopardy. Each one of the men vying to be prime minister claims to have the best plan for growth. Our coverage of the Australian election is just ahead.
(COMMERCIAL BREAK)
TAYLOR: Australians head to the polls in just about 24 hours from now, and the issue of the economy is dominating the final hours of campaigning. Both men vying to become the prime minister concede that the country's resources boom is over, and that is worrying voters, who have been enjoying 22 years of uninterrupted economic growth. Andrew Stevens has more.
(BEGIN VIDEOTAPE)
KEVIN RUDD, PRIME MINISTER OF AUSTRALIA: We would, of course, on our side of politics allow a full conscience vote.
ANDREW STEVENS, CNN INTERNATIONAL CORRESPONDENT (voice-over): Australian leader Kevin Rudd and his opposition counterpart, Tony Abbott, don't agree on much, but they are united when it comes to defining Australia's key election issue: the economy.
RUDD: This election is about the future strength of our economy and how best to secure it.
TONY ABBOT, AUSTRALIAN OPPOSITION LEADER: We will build a stronger economy so that everyone can get ahead.
STEVENS: That may sound surprising. After all, this is the so-called miracle economy, more than 20 years of uninterrupted growth. Not even the global financial crisis could end that run. But the golden days may be drawing to a close.
China's appetite for Australian resources, the very engine of growth, is starting to stall, and with it, the billions of dollars that have underpinned the country's remarkable growth story.
RUDD: We must prepare for this great economic transition to an economy where we don't have to ability to put all our eggs in one basket.
STEVENS: But of the politicians have identified the problem that worries most Australians, a solution is still vague. The prime minister promises new industry and increased productivity. Abbott thinks mining still has a major role to play, but only if he can end controversial Rudd government taxes.
ABBOTT: The mining boom is over. I say, if the mining boom is over, at least in part, it's because Mr. Rudd's government has killed it with things like the carbon tax, with things like the mining tax. We'll abolish the carbon tax, we'll abolish the mining tax.
STEVENS: But the problems run deeper than that. The resources boom has also been covering up a slowing non-mining sector. Strip out mining, and the economy looks a lot weaker. The central bank has cut interest rates to record lows, but that's still not enough to tempt Australians to start spending again.
It's a novel situation for Australia's politicians. For the first time in a generation, they're faced with an economy that's dragging them down rather than lifting them up.
Andrew Stevens, CNN, Hong Kong.
(END VIDEOTAPE)
TAYLOR: A Currency Conundrum for you now. Britain has issued its first coin to feature a line of poetry. The line comes from a poem by Tennyson to mark 100 years since the composer Benjamin Britten's birth. Tonight's question: what line will be minted on the coin?
Is it A, "Forward the Light Brigade"? B, "'Tis better to have loved and lost"? Or C, "Blow, bugle blow, set the wild echos fly"? I'll have the answer a little later in the program.
And the dollar is slightly up against the pound and much stronger against the euro and the yen.
(COMMERCIAL BREAK)
TAYLOR: Boeing expects to triple the size of its fleet in China over the next 20 years. The world's largest plane maker expects China to buy more than 5,500 new jets over the next few decades. Boeing values that at about $780 billion. It says strong economic growth and greater access to air travel will spur traffic to rise by nearly 7 percent each year in China.
In Europe, the budget carrier Ryanair announced its passenger numbers grew by only 1 percent in August year-on-year. But that still means the Irish airline carried 9 million passengers, the first European airline to do so in a single month.
In the future, it's possible some of those passengers will be departing without the pilot. It's not Ryanair's latest money-saving squeeze, but the test project of the British aerospace company BAE Systems. We sent Ayesha Durgahee to board the flight where the pilot was still on the ground.
(BEGIN VIDEOTAPE)
AYESHA DURGAHEE, CNN INTERNATIONAL CORRESPONDENT (voice-over): The final checks before takeoff. A routine walk around the aircraft by the captain. But this is no ordinary flight. This BAE 146 is equipped with technology to allow it to be controlled from the ground.
The BAE Systems test plane here in Preston has so far racked up 480 flight hours. And now, I'm going to be their first passenger. The test engineers start the handover briefing to the ground pilot, Bob Fraser.
BOB FRASER, TEST PILOT, ASTRAEA PROGRAM: All 1.2, they're not to take off.
DUNCAN CASEY, TEST ENGINEER, BAE SYSTEMS: Her position is southwest of Wharton, heading is 250. We've got autopilot mode engaged.
DURGAHEE (on camera): We've successfully climbed to 7,000 feet, and now the pilots at the front of the plane are about to hand over to the ground control station.
FRASER: Ready to take control.
CASEY: Proceed.
FRASER: I have control.
CASEY: You have control.
FASER: On Wharton radar --
UNIDENTIFIED MALE: Request a routine direct moving, climb to flight level 7.
CASEY: Bob is now responsible for navigating the aircraft around this pre-planned route, and what you can hear at the moment is the discussion with air traffic that's exactly the same as which the pilots would be having if they were in charge of the steering of the aircraft.
DURGAHEE (voice-over): These test flights a part of ASTRAEA, BAE Systems' $94 million program. With increased automation in the cockpit, planes could fly longer and further.
LAMBERT DOPPING-HEPENSTAL, DIRECTOR, ASTRAEA PROGRAM: I think it's probably the next major step in aviation. It's a bit like introducing the jet engine. It's not going to replace manned aircraft, I don't think, as passengers, we will do that, because you'll want somebody in -- responsible for the aircraft onboard the aircraft in any case.
DURGAHEE: The technology to bring the flight deck onto the ground could first be adopted for cargo flights and for aircraft during hazardous emergencies, such as wildfires.
The Aerospace Knowledge Transfer Network estimates that the global market for unmanned aircraft-based services could generate $400 billion a year.
DURGAHEE (on camera): Though that felt like any other flight, but now that we're on the ground, time to meet the pilot.
DURGAHEE (voice-over): This is the ground control station, a single room in a brick outhouse on the airfield.
FRASER: Flying an unmanned air vehicle is not as much fun as flying a normal aircraft. However, it has a lot of the similar challenges and the same expertise has to be brought to bear.
DURGAHEE: Bob Fraser has been a pilot for 37 years and flew fighter jets for most of his career. And the team involved with these test flights have a military as well as commercial background. BAE Systems hopes that this technology could be fed back into manned aircraft and the military to make flying even safe.
Ayesha Durgahee, CNN, Preston, England.
(END VIDEOTAPE)
TAYLOR: Pretty remarkable. Etihad Airways isn't doing away with pilots. Instead, it's adding in-flight nannies to its long-haul routes. The airline has teamed up with a prestigious English nanny school to train staff to take care of children mid-flight. Earlier, I spoke with Etihad's vice president of guest services about the onboard babysitters.
(BEGIN VIDEOTAPE)
AUBREY TIEDT, VICE PRESIDENT OF GUEST SERVICES, ETIHAD: The main point of the flying nanny is to give that helping hand to the mothers and fathers out there traveling with younger children. And also, we have a lot of unaccompanied minor children that travel around alone.
So, the nannies identified by their bright orange apron onboard the aircraft. So straightaway there's an identification with the families, with the children especially, with the flying nanny.
TAYLOR: They are going to be all female, right? And they do go through a special training, which is really interesting. This isn't going to be taken lightly.
TIEDT: No, no, of course not. Because you've got to be very careful when you're with children, and you've got to understand them, so that's why choosing the right people to do this. We also linked up with Norland College in the UK, which is a world-renowned -- they train nannies, professional nannies, in childcare and child psychology.
So, they integrated with our enhanced training, and they went through with our crew about identifying behaviors and how to manage those behaviors in different age brackets, as in children are crying, children are cranky, what may be wrong with them, how you turn it around. And this was quite fascinating, and the girls just found it fantastic tool to work with.
TAYLOR: Obviously, Etihad Airways is a state-owned airline. It's not necessarily something that many airlines would be able to do. Approximately how expensive is this for the airline?
TIEDT: Look, it's -- because we have a lot of talent within our cabin crew pool, so therefore, the training is quite minimal because we've taken a lot of our crew who've already got a background with children or have worked with children in the past.
But also, part of being cabin crew is being trained on how to work with people. And what they've trained how to work with people, but to understanding different personalities, different behaviors, and how to manage those behaviors.
But it's -- from a cost perspective, it's quite minimal, because we have, as I said, utilized the talent. We have the in-house training. We've linked up with Norland. And also, all the tools that we're using are available onboard already.
(END VIDEOTAPE)
TAYLOR: And up next, a movie theater premier. IMAX is taking its huge screen experience to London's Leicester Square. We're going to hear from the CEO, Richard Gelfond, when we come back.
(COMMERCIAL BREAK)
TAYLOR: Welcome back. I'm Felicia Taylor. These are the top stories that we're following on CNN.
(BEGIN VIDEO CLIP)
TAYLOR (voice-over): Britain is presenting some very specific evidence against the Syrian government about an alleged chemical attack last month. Prime Minister David Cameron told the BBC that British military scientists have found traces of sarin gas on samples taken from the attack sites near Damascus.
UNIDENTIFIED MALE: Do you now believe there is more evidence than you were able to bring before MPs, before the country when Parliament voted?
DAVID CAMERON, PRIME MINISTER, GREAT BRITAIN: I think the evidence is growing all the time, and we have just been looking at some samples taken from Damascus in the Porton Down Laboratory in Britain, which further shows the use of chemical weapons in that Damascus suburb.
(END VIDEO CLIP)
TAYLOR: Those samples included clothing and hair from a patient who was treated for exposure.
(BEGIN VIDEO CLIP)
TAYLOR (voice-over): The Russian and U.S. presidents shook hands and paused for a quick photo op at the G20 summit in St. Petersburg, Russia, but they're divided on many issues, including the conflict in Syria and the alleged chemical weapons attack there.
Events in Syria are casting a large shadow over what's supposed to be a global economic meeting. The leaders are at a working dinner right now.
And this is the aftermath of a car bomb attack on Egypt's interim interior minister. The blast went off as Mohamed Ibrahim's motorcade made its way through Cairo. Four people were injured in the explosion, but Ibrahim was unhurt. No one has claimed responsibility.
(MUSIC PLAYING)
(END VIDEO CLIP)
TAYLOR: London's Empire Theater in Leicester Square has been hosting red carpet events for 117 years. Louis and Auguste Lumiere presented the first theatrical performances of a project film to a paying U.K. audience back in 1896.
Since then, it has seen Marilyn, numerous Bonds and all kind of stars in between. It's no wonder IMAX has chosen this theater to launch a serious expansion in the U.K. The Acadian (ph) company is set to install one of its giant screens there in the hope of hosting more star-studded premieres.
IMAX chief executive Richard Gelfond told Richard Quest it's been a long time coming.
(BEGIN VIDEOTAPE)
RICHARD GELFOND, CEO, IMAX: IMAX theaters historically haven't been large enough with seating capacity to host a premiere. So we recently announced in the United States the old Grauman's Chinese Theatre, now the TCL Chinese Theatre; we've converted that to IMAX with 1,000 seats and a huge screen.
And as a result, we're going to start to get Hollywood premieres in there and in fact, over the next several months, many will be announced and next week we're going to show the re-release of "The Wizard of Oz" in that theater.
So in Leicester Square, which is well known in the world for premieres, you couldn't premiere a movie in IMAX. Now you can.
RICHARD QUEST, CNN HOST: But here's the point: it's a double-edged - - it's a double strategy, isn't it? Because on the one hand, you do need - - you need heft. You need numbers. You need lots of cinemas, lots of movie theaters in the China, the (inaudible). But you also want those very -- those gold tony ones, such as Grauman's and Leicester Square.
GELFOND: Because it's an iconic location and when a movie opens now in the U.K. --
QUEST: Flagship is the word I was looking for, flagship.
GELFOND: Yes, that -- I'll take that word, good word.
QUEST: Which is your flagship? Which will it be?
GELFOND: Well, I think they'll be different ones in different places. So in Germany, we're at the Potsdamer Platz, which is going to be a flagship.
I think you have to say in the world of movies, you'd have to say more Hollywood, the Chinese Theatre, because that's where movies are made, right? But lots of movies are also premiered in the U.K. Look at the Bond movies and look at many of the other movies. So I think in Europe this will be a flagship location as well.
QUEST: When you and I spoke a few months ago, it had -- it was China and a vast expanse in China.
And now you continue that into the Gulf area.
Why is the Gulf considered to be ripe for IMAX picking?
GELFOND: I think the Gulf, like many areas of the world, has high demographic, separation demographic, where people have the money, want to spend it in a special kind of way. And I think also there's more liberalization of the kinds of film product and the amount of film coming in and expanding population.
So I think if you're in the Gulf and you want to do something really special, you just don't want to go to a regular movie, you want to go to an IMAX movie.
QUEST: Will they welcome the material?
GELFOND: They will, especially in the kind of countries we're talking about --
QUEST: The big blockbuster stuff, yes, which of course is that -- but some of the more racy stuff?
GELFOND: You know, I think in the countries we're talking about they will. I think in more religious societies, I think that will be an issue as we go into them. And we have had conversations going on in those kind of countries --
(CROSSTALK)
GELFOND -- haven't come to fruition yet.
I think if you look at a country like Saudi Arabia, for example, I think maybe more like (inaudible) play the scientific documentary content. But theaters are doing with grand cinema in places like Bahrain and Dubai, they're going to be very open to the blockbuster films. And they're extremely popular in those territories.
(END VIDEOTAPE)
TAYLOR: It's a transatlantic cultural and sporting exchange. Young Americans are following English soccer; Brits are flocking to the NFL in record numbers. And video games may be the reason.
(MUSIC PLAYING)
(COMMERCIAL BREAK)
(MUSIC PLAYING)
(BEGIN VIDEO CLIP)
TAYLOR (voice-over): Now tonight's "Currency Conundrum": I asked you what line of poetry set to music by Benjamin Britten is on a new British coin, the answer is "Blow, bugle, blow, let the wild echoes fly."
Britten will be the first person, other than Queen Elizabeth, to have his full name minted on a coin.
(END VIDEO CLIP)
TAYLOR: Now the football season kicks off in the U.S. tonight. In the U.K., it's already up and running. Obviously we're talking about two different types of football. As Jim Boulden reports, both leagues are gaining more and more fans, however, on the opposite side of the Atlantic, thanks to computer games.
(BEGIN VIDEOTAPE)
JIM BOULDEN, CNN CORRESPONDENT (voice-over): If you play this or this, there's a good chance you also watch the real thing. The National Football League and Europe's various soccer leagues, they're two very different kinds of football, both popular on the console and, of course, the television.
And both apparently finding new TV fans around the world thanks, in part, to the video games.
UCHE NWANERI, JACKSONVILLE JAGUARS: FC Barcelona, like them; Real Madrid, obviously, Cristiano Ronaldo and Lionel Messi, too, you know, with Barcelona.
BOULDEN (voice-over): Uche Nwaneri is a 29-year-old NFL players who's also a big soccer fan.
NWANERI: I play FIFA Daily. I've been playing that more daily now than I've played my Madden. So that should say something about, you know, how much I do enjoy soccer.
BOULDEN (voice-over): Few fans could square supporting both Barcelona and Real Madrid unless they play FIFA Soccer, the world's best selling sports video game.
And this soccer fan also happens to play professional American football. Madden is a name when it comes to American football video games. The NFL credits Madden's game with helping fans in Europe get their head around the league's biggest challenge: complicated rules.
ALISTAIR KIRKWOOD, NFL U.K.: Madden has made it a tremendous inroad in terms of both level of awareness of the sport but also just by playing the game. You probably get to understand how the game actually works quicker than you would by watching on TV.
BOULDEN (voice-over): Kirkwood also says the video game has helped push down the average age of NFL fans in Europe, a boon for advertisers, as the league gears up to stage two regular season games at London's Wembley Stadium this autumn.
KIRKWOOD: They've done things for us which have helped us. So they've been cooperated Wembley into a Madden game, which allows us to kind of feed off that.
UNIDENTIFIED MALE: As the world's most popular game, football, has become part of the culture.
BOULDEN (voice-over): Of course, global range means easy access to the real games through television. U.S. network NBC has paid a quarter billion dollars for three years of rights to what Americans call the EPL, the English Premier League.
ROGER BLITZ, "THE FINANCIAL TIMES": I think to be -- if everything's done superbly well in package the atmosphere and the excitement behind games, the tribalism that I think is far more prevent in Premier League football than you see in other U.S. sports.
UNIDENTIFIED MALE: (Inaudible) at NBC Sports (inaudible) in America.
BOULDEN (voice-over): A serious investment from an American network for the first time is a tangible part of the fuel of English Premier League, as more fans migrate from the console to the television -- Jim Boulden, CNN, London.
(END VIDEOTAPE)
TAYLOR: It was 29 degrees and brilliantly sunny in London today -- lovely, of course, unless you were standing below a particular skyscraper.
It's this building, nicknamed "The Walkie-Talkie" because of its concave shape. The design has an unintended complication: blinding rays of light reflecting off its windows have been blamed for melting parts of cars below it.
Martin Lindsey (ph) says the scorching sun warped panels on his very expensive Jaguar. He says the building's joint developers are paying for the repairs.
Let's bring in an expert. Jenny Harrison is at the CNN International Weather Center.
Jenny, really?
JENNY HARRISON, CNN METEOROLOGIST: Really.
TAYLOR: How does this work?
HARRISON: I know. It's phenomenal.
And you know what I think is phenomenal as well is the fact we had such a hot summer across in the U.K., so you think maybe it should have happened before. But Felicia, there's a reason perhaps that it hasn't.
So there is the building; there's the sun, very big sun, all the sun's rays coming down, hitting that building. Then they're rebounding off the building and coming down onto the ground or whatever is down below.
So that is what happens. And remember, it's really focusing the glare, the heat of the sun in a very, very specified area. There's another image of the car. Of course, the damage, as we know, was done to this particular car.
So why has it happened now? Well, this is possibly why. It's the particular angle of the sun. Now as we're going into this particular time of the year, remember the sun is beginning already to be at a slightly different position in the sky. So it's hitting a different part of the building.
Also you have to bear in mind, this building is not yet completed. So I'm not sure at what stage they were at; perhaps a month or two months ago in terms of glass in this building. So it varies with the time of the day and the date.
As I say, we're now at a different time; we're in September. So the sun is hitting the building at a different time of the day and a different part of the building as well because of the position in the sky. And as we know, it's been hitting this particular parking spot just for a very short specified amount of time and also it's likely to only last for 2-3 weeks.
So this is why it has happened when it has. And also, Felicia, it seems that when this happened to this gentleman's car, a few other people have sort of come out and said, well, guess what; it happened to my van as well. But I think it's the fact this is a very, very nice black Jaguar that obviously he was so very, very upset and quite rightly so.
TAYLOR: I bet he wishes he found a different parking spot.
(CROSSTALK)
HARRISON: A cheaper car, maybe but quite right.
(LAUGHTER).
TAYLOR: That is QUEST MEANS BUSINESS. I'm Felicia Taylor in New York.
MARKETPLACE EUROPE continues on CNN.
(MUSIC PLAYING)
(COMMERCIAL BREAK)
NINA DOS SANTOS, CNN HOST: Hello and welcome to MARKETPLACE EUROPE from Paris. I'm Nina dos Santos. The Eurozone may no longer be locked in a downward spiral, but the recovery so far has proved patchy at best among the member states.
In a bid to instill confidence, the French President Francois Hollande has been quick to trumpet his country's best quarterly performance since he came to power.
In this week's show, we examine the routes that European businesses are taking in pursuit of growth.
(BEGIN VIDEO CLIP)
DOS SANTOS (voice-over): Coming up, the company that's making a splash towards an export-led recovery in Spain. And the CEO of Eurotunnel on track to future expansion.
JACQUES GOUNON, CHAIRMAN AND CEO, EUROTUNNEL: (Inaudible) will come from Germany and Netherlands and will bring an additional 4 million passengers.
(END VIDEO CLIP)
DOS SANTOS: France, Germany and even Portugal enjoyed growth in the second quarter. In neighboring Spain, while the economy may still be stuck in negative territory, it is on the cusp of stabilizing. Six years of recession have forced many Spanish businesses to venture abroad in their search for clients.
As a result, exports are on the way up as Al Goodman now reports from Barcelona.
(BEGIN VIDEOTAPE)
AL GOODMAN, CNN CORRESPONDENT (voice-over): The port of Barcelona, one of the busiest in Spain and all of Europe, but Spain's economic crisis has provoked a big change here.
GOODMAN: This port traditionally handled more imports. But now it's the reverse; more exports, domestic consumption has declined and Spanish companies are having to look abroad.
GOODMAN (voice-over): In fact, a firm called Fluidra (ph) near Barcelona, they make swimming pools and spas and are experts in managing fluids. If they had a sinking feeling in 2009 at the height of the crisis, for the first time ever they lost money.
XAVIER TINTORE, CFO, FLUIDRA: In Q1 2009, the company started reporting sales drops of 30 percent, 40 percent. That's a moment of scare, you know, you really don't know what's going to happen. You really don't know when you're going to hit the bottom.
GOODMAN (voice-over): Xavier Tintore was among the new executives hired to halt the decline even before the crisis, 60 percent of the business was in exports. Now it's risen to 80 percent reaching around the globe.
TINTORE: Today our challenge is the Brazilian market. We got into a market one year ago. We recently acquired a small amount of (inaudible) plan to which we are adding all of our technology and all our knowhow and it's a very impressive market because around 1.2 million pools (ph), which is same size as the Spanish market.
It's a very fragmented market and we really have a very nice opportunity to become market leaders there and really grow and have a nice boost in our international sales.
GOODMAN (voice-over): Whether it's swimming pools, automobiles, pharmaceuticals or olive oil, Spanish exports totaled nearly $300 billion last year, a record. They're due to grow at twice the European Union average this year in a country with 26 percent unemployment. It's one of the few bright spots in Spain's financial crisis.
Tintore says innovation should drive exports, like this new swimming pool manager.
TINTORE: Everything you need to manage a pool and it's --
GOODMAN: Cleanliness, the water -- if the water's too cold, it's too warm, everything is done here.
How do -- ?
(CROSSTALK)
TINTORE: Everything is controlled from here.
GOODMAN: Where?
TINTORE: Either this panel or through your iPad or iPhone.
GOODMAN: Really?
GOODMAN (voice-over): It will soon arrive at Fluidra's logistics center for shipment. Nearly 60,000 Spanish firms are exporting now; 9 percent more than last year.
TINTORE: I see companies being successful who are in international now. (Inaudible) if you had not had this activity prior to the crisis, it's a little bit more risky and you have to learn. And when you go international, you make mistakes and you make good results and some bad. And you make good results on some of the bets.
GOODMAN (voice-over): The crisis has been a real education for Spanish companies, even for long-time exporters like Fluidra.
(END VIDEOTAPE)
DOS SANTOS: Al Goodman on the exporting opportunities for Spain.
Coming up, keeping on the right track: the CEO of Eurotunnel, Jacques Gounon on the regulatory landscape for cross-border trade. That's next.
(MUSIC PLAYING)
(COMMERCIAL BREAK)
(MUSIC PLAYING)
DOS SANTOS: Hello and welcome back to MARKETPLACE EUROPE.
The smooth transportation of people and goods across Europe's borders is key for this region's future growth. Setting up on the Gare du Nord (ph) in the city center, passengers can now reach London (inaudible) in just over two hours' time, all thanks to the Channel Tunnel.
For more than 20 years, Eurotunnel, which built and manages this infrastructure, has provided a vital link between the U.K. and the continent.
(BEGIN VIDEOTAPE)
DOS SANTOS (voice-over): It's the longest undersea tunnel in the world. Since opening in 1994, the Channel Tunnel has been used by over 300 million passengers. The rail shuttle transport system carries 2.5 million cars and 1.5 million trucks every year.
GOUNON: You know that we have two main businesses, one of course is related to the shuttle, which means that we have cars and lorries and our own shuttles, which represents 2/3 of our revenue. And on top of that, we have of course the infrastructure management, the infrastructure being the Channel Tunnel.
We manage it and we have high-speed trains, which are from different companies, going through the tunnel. And this is an additional stream.
Both are working and really (inaudible) very good results this year.
DOS SANTOS: What's quite interesting is that (inaudible) tourist business, but you carry an awful lot of freight as well and heavy goods vehicles.
That's a good barometer of how the economy is doing.
GOUNON: The main hit from the economic crisis has been in 2008, where really we have seen a drop down of the traffic (ph) of the market by something which is some 20 percent down. Now it's up year after year at 3 percent to 4 percent growth rate. And this is good for us, because it gives additional revenue, additional profit and more dynamism.
And so yes, indeed, we believe that we are on the right track in order to improve our traffic, our profitability and of course the fact that our market shares are growing at a higher path than the growth rate of the market itself.
And what is very positive for the future is the fact that for the first time for the past 20 years, we have been successful to get from the states, French and British states, the fact that the new operator, Deutsche Bahn, will come from Germany and Netherlands and will bring an additional 4 million passengers. And based on our toll (ph), it's quite clear that this will be an incredible increase of our revenue and profitability.
DOS SANTOS: Obviously you want more trains from across Europe to be using your services and paying. How difficult was it eventually to get that deal done?
GOUNON: We have negotiated with both states in order to explain that there is available capacity within the tunnel. Then we have the knowledge and the skills in order to manage the different slots between our own shuttles, the Eurostar (ph) slots and the future Deutsche Bahn trains. And that this will be good for customers between continent and Great Britain.
DOS SANTOS: But if you get more competition, will you reduce those prices?
(CROSSTALK)
DOS SANTOS: (Inaudible) able to.
GOUNON: This is not the way it works. We have a small amount which is related to the train (ph) and a significant part of the fee, which is related to the number of passengers, which means that when we are like the Eurostar, at the maximum of your traffic, you pay the cost.
But when you start a new service like Deutsche Bahn that you have of course a few passenger at the beginning of this service. You pay less because this is a way we have said to trigger new traffic and to help new investors, new operators to expand their traffic.
DOS SANTOS: If we take a look at your business model, it's very difficult for you to find growth apart from other trains.
But you have actually bought a ferry company as well.
GOUNON: We believe that there is (inaudible) market for people who want to have a different way across the Channel, perhaps to pay less, of course, to have a different average of their own journey. And we believe that the ferry business is a complement of our main core business.
But I must confess that this is a marginal, additional business, compared to what we are focusing on.
DOS SANTOS: And what is the future for this business? Are you going to have to divest it? The regulators are giving you a hard time?
GOUNON: We are bringing a new offer, a new service, a new competition in an existential world. And it appears that there are some adverse reactions. And it's quite clear that this business is under review by the competition commission on the U.K. side.
The French side said already that's fine and this is good for customers to add new capacity in the ferry market. And the U.K. side, there are still question marks. What is important is to see that with the combined market shares from the tunnel itself and the ferry business, we are operating through a specific entity, (inaudible).
We are below the 50 percent market share on the Detroit (ph) market. So we believe that we are customer-oriented, that we are offering a new service, which is a complementary business from the core business and (inaudible) but it remains significant room for our own competitors.
And once again, we believe -- we definitely believe that competition is good for customer and competition is good for companies like us, because it's a way, I would say, to boost innovation, customer focus, customer experience, which is absolutely key in this specific market.
(END VIDEOTAPE)
DOS SANTOS: Eurotunnel CEO Jacques Gounon.
Well, that wraps it up for this week's MARKETPLACE EUROPE from Paris. Join us again next week if you can. But in the meantime, it's thanks for watching and goodbye.
END
