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Pro-Russia Separatists Continue Occupying Government Buildings in Eastern Ukraine; Aid and Sanctions; Russian Markets, Currency Down; Ukrainian Government's Game Plan; World Trade Organization on Ukraine; Reflex Rally on Wall Street; Market Volatility; Guinea Ebola Outbreak

Aired April 14, 2014 - 16:00   ET



PAULA NEWTON, HOST: And the day on Wall Street wrapping up, a much better day than most people expected, CitiGroup results and retail sales helping out, but a lot of volatility to come. We'll have more on that later. It's Monday, the 14th of April.

Ukraine vows new military action against separatists when they seized more buildings in the east.

The head of the World Trade Organization meantime tells CNN it can act as a forum for disputes if necessary.

And would you use Facebook to transfer money? We find out what it's up to.

I'm Paula Newton and this is QUEST MEANS BUSINESS.

Good evening. Tonight, pro-Russian protesters are defying demands from Kiev to cease and desist. Unrest is growing in the east of the country where pro-Russian demonstrators have now taken control of government buildings in at least ten different cities.

The Ukrainian government, meantime, set Monday as the deadline for those pro-Russian activists to step aside, and yet demonstrators forced police officers out of their headquarters in the city of Horlivka. Ukrainian officials say they are still hoping for a political solution to all this.

And meantime, Ukraine's central bank has taken drastic measures to prop up its economy. On Monday, it raised the benchmark rate to 9.5 percent. That's up dramatically from 6.5 percent. We're going to go straight to Nick Paton Walsh, who's live for us in Donetsk, Ukraine.

Nick, what a day here. When we summarize everything that's going on, Ukraine putting a deadline of today, that came and went, they didn't do anything about those pro-Russian protesters. You have now the country saying -- looking to the UN, and something that's unbelievable to many people, saying yes, we welcome UN peacekeepers if they could come here.

Is it looking more and more like Ukraine really is out of its depth here, no longer having the tools available to deal with this crisis in the east?

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: We've seen the Kiev government's position get increasingly messy today. And that's, really, I think, because they're in an extraordinarily difficult position.

It's not simply asking for UN peacekeepers, it's saying UN peacekeepers, quote interim president Oleksandr Turchynov, might take part in an "anti-terror operation" here, and of course, that's nothing that you get through the UN Security Council, and nothing UN members would ascribe to, putting themselves in such an active situation.

But it does suggest the depth of problem, really, that Ukraine is in here. And the bind is pretty simple. If you use substantial force against the pro-Russian protesters here -- and the Ukrainian army, while not the greatest fighting force in the world, would probably en masse be able to make some dent in the pro-Russian protests and militants taking over nearly ten, possibly more towns in simply the past few days, certainly the key buildings in those towns.

If you use force, then Moscow has made it clear, those 40,000 troops it has massed on the upper side of the border, may well intervene if they continue the rights of their compatriots, as they refer to the pro-Russian protesters, as being abused.

That's an extraordinarily tough call for them, first of all because most of these politicians are new in power and they're in the middle of, really, a presidential electoral race, which is due to happen in late May, the election. So, of course, nobody wants to have started a war when they're trying to seek power.

Extraordinarily difficult decisions, and today, I think, the depth, possibly, of the confusion expanded when we saw that deadline pass. No counter-terror operation happening in any substantial way at all.

And then, the interim president suggesting hey, maybe I'm open to the possibility of a referendum to the fate of eastern Ukraine, suggesting it may even happen on the same day as those presidential elections.

Imagine asking voters to vote for who you want to vote to be president, but also, on the same paper, perhaps indicate what kind of country, what size of country you might want them to be president of. Very difficult times here. I'm sure nobody envying the position the Ukrainian government's in, but we're seeing no firm stance at this point. Paula?

NEWTON: And in terms of what they seem to be doing, Ukraine offering concessions. At the same time, Nick, if we talk about who's involved on the ground here and whether or not they're just pro-Russian demonstrators or whether or not it's actually Russia orchestrating this, in terms of real proof, Samantha Power, the US ambassador to the UN, seemed to suggest that it could happen no other way.

And she pointed to these towns, these cities, that are now being held -- their administrations being held by these pro-Russian demonstrators, that it's a clear link. That basically if they took over these areas, they'd be completely cut off from the West, completely cut off from the capital, Kiev.

Have you seen any more concrete proof in the last few hours that they are being completely orchestrated by Russia or that these are Russian sympathizers, which is a completely different thing?

WALSH: It's extraordinarily complex to claim on the ground there's direct proof of Russia's involvement. I think the issue really is here we're seeing a different type of force on the ground than we saw in the Crimean peninsula, where it was much more obviously Russian troops, simply with their insignia missing, often in vehicles, in fact, marked with Russian license plates.

Here, they are in similar uniforms, but their of a different age range, often the pro-Russian militants you see, there are much less of them, too, and they're backed up by pro-Russian protesters. Hard to tell from the accents of these people whether they are, in fact, Russian or simply ethnic Russians from Ukraine, a very fine distinction in the kind of accent you're looking for.

And many Russians, too, of course, move back and forth across this border as well normally, regardless of this crisis. It's hard to draw those conclusions from what's happening on the ground. Perhaps the US government knows something it's not publicly sharing.

But you've got to also ask yourself, this is very coordinated, very organized, it's very-well resourced. They're turning up in places and, say, literally 24 hours later, protesters turning up, lots of tires, even a pop song saying "Putin will save us from fascism" emerging out of nowhere at one demonstration.

It's well-organized, it's well-resourced, and the question you really have to ask is, who's able to do that? These local activists at the regional administration behind me, it's most likely not them. And the finger, I think, pointing -- certainly in Washington and in the West -- at the Kremlin. Paula?

NEWTON: OK, Nick Paton Walsh for us tonight in eastern Ukraine. Appreciate that, Nick. Now, as tensions increase, the West is rushing to bolster Ukraine's economy and put pressure on Russia's. EU foreign ministers met in Luxembourg to discuss the situation.

Now, they approved more than a billion dollars in aid to Ukraine. They also temporarily cut the duty on Ukraine imports. EU leaders may hold an emergency summit next week to impose further sanctions against Russia if there is no breakthrough at Thursday's talks.

Now, in Washington, treasury secretary Jack Lew threatened additional sanctions against Russia. Lew today signed a loan guarantee for Ukraine of a billion dollars. Lew says if Russia continues to escalate the situation in Ukraine, there will be more consequences.


JACK LEW, US TREASURY SECRETARY: Working with our allies, we're fully prepared to impose additional significant sanctions on Russia as it continues to escalate the situation in Ukraine, including, apparently, through support to a concerted campaign by armed militants in east Ukraine.


NEWTON: And in Moscow today, Russia's main stock market index dipped by nearly 2 percent before recovering ever so slightly. Now, the Russian MICEX is down more than 10 percent since the start of the year. The ruble, meantime, fell versus the dollar by 0.7 percent on Monday.

Ukraine's ambassador to the United Nations, Yuriy Sergeyev, now joins me live from the United Nations. Thanks for joining me, sir. I really want to hear from you the next game plan for your government and Ukraine.

Suggesting that peacekeepers could help you out in the eastern part while, perhaps, would be ideal in your situation, it's probably completely unrealistic. What will your government do to make sure that those pro- Russian demonstrators don't lead to, basically, another walkover by Russia in part of the country?

YURIY SERGEYEV, UKRAINIAN AMBASSADOR TO THE UNITED NATIONS: Thank you. So, there are several approaches of the government. The first and very important to demonstrate inclusiveness to all and each of the regions, to all and each of the cities on our eastern side of Ukraine.

The prime minister personally visited all these regions last week and demonstrated the readiness of the government to speak on the referendum on the changes in the constitution on language and other issues.

So, this approach is absolutely reasonable and -- these approaches are more valid and more appropriate in that situation because the dialogue with the public is very important. Not all of them, they are separatists who are protesting on the streets. They are normal citizens who are demanding -- what they are demanding is to have a better life.

The second part of the governmental approach is how to cope with the huge terrorist operations organized in many cities and orchestrated by the Russian Federation. Yesterday in the Security Council, I presented the evidences that the Russian special troops were --

NEWTON: OK, I'm just going to stop you there. You said presented proof. Tell me concretely how you know that it is Russia -- or Russia orchestrated this.

SERGEYEV: OK. So, we have the proof, which we got from the arrests and detention of Russian agents in different cities. And if we explain the plans, I gave the names, I gave the dates and the places where they were detained and what they stated. They stated the goals and their targets.

So, the goals were to organize bigger groups of the terrorists based on the radicals and aggressive Ukrainian separatists, and then to seize the premises of the police and the secret services buildings, and to have -- to get the weapons in there and to keep with the weaponry these people and to go ahead to seize the administrative buildings.

They are realizing that this strategy in the eastern part of Ukraine. So, we got them, and today, our secret service made it public the radio communications and the radio talks between the Russian officers and the separatist groups.

So, now it has become evident that -- how all these operated. The small and medium-size of the groups of Ukrainian separatists, they are led by the officers from the Russian secret services and the --


NEWTON: OK, so you're --

SERGEYEV: -- military --

NEWTON: OK, so I understand you're saying that you have proof now. But given all of this, and quite frankly, the more compromised position that your government is in, can you guarantee me that you will be able to hang on to eastern Ukraine?

SERGEYEV: So, today's address of the interim president to Ban Ki-moon to assist with the peacekeepers, I accept as the broader address to the world community to help us to realize our right for self-defense and to join the international joint anti-terrorist campaign.

So, what we have for the time being, we have strong political and moral support, and we got the economic and financial support for the partners, including United States. We have -- we got the confirmation of the readiness of the European Union and NATO to assist us with the military equipment and further.

So, today we observe the presence of the NATO navies in the Black Sea, which is very important, and -- as well as the NATO forces in the eastern - - western part -- eastern part of Europe in our neighboring countries.

So, these gives a strong message to Russia to stop. So, all together, it is a good argument for Russia to stop and not to escalate.

NEWTON: Yes, we will see if that actually works out the way you believe it will, or the way you hope it will. Thank you so much for your time this evening. Appreciate it.

SERGEYEV: Thank you.

NEWTON: Now, the World Trade Organization has raised its forecast for growth in global trader. Earlier, I spoke to Roberto Azevedo, general- director of the WTO. I asked him about the latest report. But first, I wanted to know what the crisis in Ukraine could mean for trading relationships in the region.


ROBERTO AZEVEDO, DIRECTOR-GENERAL, WORLD TRADE ORGANIZATION: If you look at the trade between the EU and Russia or Ukraine and those partners, the numbers themselves wouldn't justify a tremendous impact on the global numbers.

The problem is more about subsequent actions that may be taken and things of the kind. What we hope is as far as trade is concerned that we can try to help in the WTO with a forum for conversations, a forum for consultations. Even disputes, if that is the case, as long as we keep them at the technical, legal level, that's OK. Let's hope that we can avoid the worst-case scenarios.

NEWTON: But an escalation in tensions followed by sanctions. You worked so hard to get Russia in the WTO. Do you see it as unraveling and really setting those trade relationships back quite a bit?

AZEVEDO: From my perspective, the best that I can hope for is that these things will be overcome with conversations, with good politics, and that we in the WTO can help, to the extent possible, providing a forum for conversations and discussions that will lead to a good solution for everyone involved.

NEWTON: Can you frame for me the risk to the global trade environment if those kinds of tensions in Europe escalate even further, especially when it comes to those sanctions?

AZEVEDO: It is, in terms of global trade flows, I don't expect that, for example, the situation of the emerging economies, what they have been doing in terms of economic policies, growth prospects, I hope that they will not be affected.

There are many areas of the world and in terms of economic growth that the GDP growth numbers, for example, will not change -- because of that.

However, I have said before, it's very difficult to predict. If it remains contained in that area, in that kind of environment, the numbers should not be affected very significantly.

NEWTON: The report itself is actually quite positive. You think for the first time in a few years, there is potential to see quite an uptick in trade?

AZEVEDO: It is positive, but it's still below the average 20-year trend or something like that. But I agree, it is a better number. The numbers are looking better. In terms of trade expansion, we're coming from a very sluggish 2 percent, where we were in 2012 and 2013, and we're going up to 4.7 percent in 2014, 5.3 percent in 2015. So it looks -- it's an improvement. But it's still below the 5.5 20-year average.


NEWTON: So, the WTO, there, striking a positive note. But investors, meantime, have been strapped in for a wild ride these past few days. Things are on the up, and Citi takes the crown. We'll explain why in a moment.


NEWTON: The markets have been on a bone-rattling roller coaster ride over the last few days. Now the Dow is finally pointing in an upward direction. As you can see, that is not a bad gain at all for today. That's the way it went. And Alison Kosik was viewing it all for us here at the New York Stock Exchange.

Alison, I was kind of surprised despite the Citi numbers, those were good, retail sales, unexpectedly strong. What kind of momentum, though? That's quite a bit of momentum the market had on it today. What was going on there?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: And those good numbers were really what the market needed for what some are calling this reflex rally. Those positive retail sales numbers from March, those are good because they show Americans hit the stores more than expected last month.

And then, you said it, the other part was upbeat earnings from CitiGroup. Remember, last week's earnings, they were mixed. We had JPMorgan missing and we had Wells Fargo impressing. So, then, we have CitiGroup impressing the Street as well, so those mixed earnings, now, turning the tide toward the positive side. So you saw that sort of positivity playing out in the market today. Paula?

NEWTON: Alison, a reflex rally? I don't think I've heard that expression before. I don't know, whoever coined that, hopefully, is making more money. Thanks, Alison, I appreciate that.

KOSIK: Sure.

NEWTON: Now, to give you a sense of the sort of volatility we've been looking at, this is the Dow over the last four days, just to illustrate the dramatic rises and falls and to tell you not without much rationale, either.

Today, it close up six tenths of one percent. The Dow, though, is down nearly 3 percent year-to-date. That is not a good reading wee into the second quarter, here, and we've been warned to expect more of this through the earnings season.

Now, Jens Nordvig joins us to kind of drill down on this volatility. Thanks so much for being here, I appreciate it. No one is more shocked than I -- we'll call it a reflex rally -- but that this actually happened today.

We were just talking on Wednesday -- I'm mean, sorry, on Friday -- about people saying, look, where does this market have to go? We're not expecting much from earnings. The recovery in the United States remains tepid. What is at play here, in terms of market fundamentals?

JENS NORDVIG, HEAD OF FIXED INCOME RESEARCH, NORUMA: Well, I think we've had these serious concerns about whether growth momentum is fading. A lot of weak data during the first quarter. So, I think retail sales is one of the most important data points in the next several weeks, and it came out much stronger than expected.

So, I think that's a very, very important reading. We're looking at potentially getting to a 3 percent growth rate pretty soon, and I think that's going to be very comforting for the market, opposed to the alternative.

NEWTON: As opposed to the alternative, definitely. And in terms of things like the Fed and what it's doing, we had a lot of jitters with that. Are we really factoring that out here, now? Do you think that a lot of the volatility that people had been predicting is gone now?

NORDVIG: I think a lot of people read the minutes from last week, where we got the details of what the Fed is thinking, and they're sort of going a little bit back to basics. There's not going to be anything urgent from the Fed in terms of tightening. That's giving the market comfort.

If we can stay in a range, in terms of the bond yield, I think the equity market will do better, unless we have some geopolitical shockwaves around the world or from China.

NEWTON: And let's talk about that. Quickly, on Ukraine, something like that, can that really rattle investors in a broad sense, even though if you look at the economics of it, perhaps it doesn't represent a huge swathe of the global economy?

NORDVIG: Yes, I think we've seen earlier in the year that obviously the shock effect is very, very unnerving for the market. Now, we've almost gotten used to these terrible pictures from Ukraine from a market perspective.

The real important issue is whether sanctions spill over into energy issues for Europe. If there's a question --


NEWTON: But they have to. Is there any way that they're not going to?

NORDVIG: Well, so I think so far, actually, the sanctions have been on a nature where they've tried to sort of shield the European economy, not really bring those tensions into the fore. So, if they can avoid that, I think the spillover to March will be limited. But as soon as the gas supplies to Europe are in question, we're going to have much more dramatic impact.

NEWTON: You've been doing quite a lot of work on emerging markets. I want to talk to you about the volatility there and the risk there. You say that there is, potentially, because of that emerging market debt, a lot of risk there still in those markets.

NORDVIG: Well, so, there's certainly a lot of risk in emerging markets. The question is whether it's priced. So, we've been through a year of emerging market volatility, some emerging market currencies have depreciated 30 percent. So the question now is whether it's sort of already in asset prices and we can start to trade valuation.

I think if we have that environment I'm describing, with 3 percent US growth, not a lot of tightening signals from the Fed, emerging markets will hold up. But if we have a dramatic tightening signal from the Fed, it's a totally different game.

NEWTON: And in terms of spillover effect, though, we've got China GDP coming out on Wednesday. How significant is that number going to be?

NORDVIG: That's a very important number because obviously there's a lot of fears, similar to what we had fears about the US growth, there's a lot of fears about dramatic slowdown in China. And if we can avoid that, I think it will calm the market.

There's one other data point I want to point to, is their reserves. Their reserves numbers are going to come out this week, and that might signal a huge spike in intervention, because they try to generate a new regime on the currency. Watch that, too.

NEWTON: OK, thanks for being here. I do have a little bit of whiplash from all of this, but we'll see where the week goes and how that plays out. Appreciate your time. Thanks.

The deadly Ebola virus has spread into Guinea's capital city. Now, health officials worry it could spread further. Our exclusive report right after the break.


NEWTON: One of the deadliest diseases known to man has spread to Guinea's capital city of Conakry. In the past, the Ebola virus rarely made it out of remote, forested areas in Africa, but now some health experts worry the virus could go global. CNN chief medical correspondent Dr. Sanjay Gupta reports from the capital.


SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT (voice-over): A simple blue box, potentially carrying one of the most dangerous pathogens in the world, on its way to be tested. In less than four hours, we'll find out whether it contains the Ebola virus. The fate of three patients depends on what's inside.

Simply getting the blood samples is a life-threatening job. One of these workers told us he has a nine-month-old baby at home. They'll do everything they can to protect themselves. Three pairs of gloves, booties, and layer after layer of gowns. They go in to see the patients, every single inch of their body covered, impermeable suits -- nothing in, nothing out.

You see, even a drop of the Ebola virus that gets through a break in your skin, can infect you. And we all have breaks in our skin.

GUPTA (on camera): Just as the painstaking detail and process you have to go through to be able to interact with these patients with Ebola, this is as close as we can get. They're decontaminating themselves, but they've taken the blood samples and put them in this blue ice chest over here. And it's highly suspicious that contains Ebola.

GUPTA (voice-over): WHO lab technicians suit up next. They've just been hand delivered the blue boxes. Now it's their job to test the sample for the deadly virus. They're going to have the results just two hours from now.

But a few years ago, being able to test for Ebola on its own turf was impossible. Precious blood samples had to be taken out of remote forested areas in central Africa and flown to the CDC in Atlanta, or the WHO in Geneva. Pilots would sometimes refuse to fly the dangerous pathogens. And even if they did, it could take days or weeks to get the results. 8:00 PM, we get the call.

UNIDENTIFIED MALE: So, two of these are positive.

GUPTA (on camera): So, two of the three patients now have confirmed Ebola.


GUPTA (voice-over): Dr. Sanjay Gupta, CNN, Conakry, Guinea.


NEWTON: The French government is struggling to balance deficit reduction and economic growth. An exclusive interview with the country's finance minister, that's up next.


NEWTON: Welcome back, I'm Paula Newton. These are the top news headlines we're following this hour. Seventy-one people have been killed and more than a hundred injured after an explosion tore through a crowded bus station on the outskirts of the Nigerian capital Abuja. Reports indicate the blast came from a parked vehicle. Now, the explosion happened just before 7:00 AM local time during the early morning rush hour.

Pro-Russian demonstrators have taken control of government buildings in at least ten different cities in eastern Ukraine. Protesters forced police officers out of their headquarters in the city of Horlivka. Ukrainian officials say they are still hoping for a political solution.

Oscar Pistorius broke down in court on Monday on the fourth day of cross-examination. Pistorius said he blames himself for taking girlfriend Reeva Steenkamp's life, but said he did not intentionally fire at her. Prosecutor Gerrie Nel accused Pistorius of, quote, "tailoring" his evidence.

A robotic submarine has been deployed, now, in the search for missing Flight 370. An Australian search vessel has sent the Blue Fin 21 to scan the Indian Ocean floor. Ships have failed so far to detect any possible pings from the jet's black boxes over the last six days. They had previously heard four pings.

France's new prime minister says his country will bring down the deficit without further delay. Manuel Valls says France will hit the E.U.'s target of 3 percent of GDP by the end of 2015, down from about 4 percent last year. Now, it's still two years after the original deadline. Incoming finance minister Michel Sapin has faced criticism after he suggested that France might ask for yet more time to get that deficit down. Now, the prime minister says hitting the target though is now a matter of national pride.

MANUEL VALLS, FRENCH PRIME MINISTER, VIA TRANSLATOR: France is a country which sticks to its commitments, and as finance minister, Michel Sapin confirmed today, we will respect all commitments because France's word and France's credibility are at stake here. Nobody can question France's credibility.

NEWTON: Now, even as he promises deficit reduction, Valls says the government must focus on nurturing economic growth. He was appointed after discontented French voters inflicted a heavy blow on the ruling Socialist Party in local elections. The new prime minister told the French Parliament that austerity measures would threaten France's fragile recovery. Now, the French economy grew at rate of just 0.3 percent in the fourth quarter of last year. The new government hopes its so-called pro- business initiatives will get it moving again. Now it's planning tax cuts and reductions in red tape which it hopes will spur businesses to hire. French unemployment though remains stubbornly high -- 10.2 percent. The man who must fix those problems is the new finance minister, Michel Sapin. He laid out his plans to our Nina dos Santos.


MICHEL SAPIN, FRENCH FINANCE MINISTER, VIA TRANSLATOR: A new moment, a new era. We had to get France back afloat with a strong future budgetarily. With the rise in unemployment, negative growth, we had to get it back afloat. Now we need to accelerate. The politics of today is to accelerate. Accelerate to find growth, accelerate to lower unemployment, accelerate in terms of structural reform, profound reforms that will allow French businesses to be more competitive, more efficient and bring more to our country.

NINA DOS SANTOS, NINA DOS SANTOS, NEWS ANCHOR AND CORRESPONDENT BASED IN LONDON FOR CNN INTERNATIONAL: Reducing business charges is one thing, but the reality is is that France still has 75 percent income tax which just kills aspirations some people might say. Are you seeing heads of enterprises and business chiefs leaving France because taxes are just still too high?

SAPIN, VIA TRANSLATOR: (Inaudible) 2010 so with the preceding president and preceding government arriving in power to get the boat afloat, we had to increase taxes. Our view is that we raised them too much. Globally, the right and the left today, there is no question of raising taxes. It's a question of lowering them, especially where businesses are concerned -- to really lower them. That is our principal message. It's through businesses that we will regain growth, ramp up hiring. It will help us escape the difficulties of the moment. I know that 75 percent tax is often commented by people outside the country. I don't think it is leading to business chiefs fleeing, and it's not the 75 percent tax. It's when you are above a certain level that you might be taxed 75 percent. It's not 75 percent on all earnings, it's also temporary.

DOS SANTOS: Would you ever reduce that 75 percent tax?

SAPIN, VIA TRANSLATOR: It's not something we will do immediately. What is important today is to lessen the 20 billion plus 10 billion and another 10 billion which amounts to almost 40 billion in tax reductions on businesses. That is our priority today.

DOS SANTOS: There's been a lot of consternation and questions about whether France is going to manage to reduce its deficit -- budget deficit - - to 3 percent in accordance to E.U. rules. You've now said that you're going to manage to keep it within 3 percent and it's now 4.3 percent. How are you managing to do that?

SAPIN, VIA TRANSLATOR: France is a great country of Europe. It has built Europe since the beginning. In the first preoccupation that we will voluntarily do to fix things together, is to respect the rules. We cannot have the same money and not have the same rules. You can't have countries that are making efforts to be in this money, real efforts to enter the Euro and others that don't care about the rules. We share the same concerns, we are all on the same page. But this issue of reaching less than 3 percent is very important. It's because it's necessary to stabilize the debt and then lower the debt in French finances. So we must meet this target of 3 percent.

DOS SANTOS: But that doesn't answer the question of whether you're going to reach it this year. Will you reach 3 percent this year?

SAPIN, VIA TRANSLATOR: Three percent is not for 2014, it is for 2015 they're asking to be under 3 percent. We subscribe to this objective. We are in this objective, but I cannot at this stage be more precise because we are in the process of working at the heart of the French government on the rhythm of how we lower costs for businesses, on the rhythm of how we lower public spending.

DOS SANTOS: So, any -- yes or no -- can you say 2015, 3 percent France will have reached that deficit target?

SAPIN, VIA TRANSLATOR: I won't say yes or no. We are working on it. It's a delicate subject. It's a thing that we will strive for. You spoke to me about Christine Lagarde, about Mario Draghi. I can tell you about my colleagues, the other finance ministers. We are working together to define the paths. The most pertinent paths to respect the rules of Europe, the solidarity of Europe that permits France to be on the path to growth. Europe needs a France that is growing.


NEWTON: Now, some news just in to CNN. President Obama and President Putin have apparently held talks today about the crisis in Ukraine. It's the first time the two leaders have spoken since March 28th, and that means since those new developments in Eastern Ukraine. That's according to the National Security Agency. We'll give you more information when we have it. Now, rumors and speculation about Facebook's next ambitious project. If the reports are to be believed, the social networking site could be about to take on the mobile money sector.


NEWTON: Facebook is so far keeping quiet over media reports that it's about to launch a mobile payment service. Now, the "Financial Times" says Facebook is close to obtaining approval from the Central Bank of Ireland to allow users to store money that's paid for products and exchange cash with friends. Now it's a sector which is growing fast and Bianca Bosker, executive tech director at "The Huffington Post" joins me now. Bianca, in terms of talking about why they're doing this -- I should point out that they're going to the Bank of England but that means that they can operate all through Europe -- quite a platform. We're so used to asking this question about Facebook does and why, but why? Why mobile payments?

BIANCA BOSKER, EXECUTIVE TECH DIRECTOR, "HUFFINGTON POST": Right, so there's a number of different reasons. I mean, first since Facebook still makes that 90 percent of its revenues from advertising, so it's getting brands to pay Facebook. I think now it's looking for other ways to get us to pay Facebook. You know, they're looking for -- they've been looking all along for these very different business opportunities. You know, they rolled out Facebook Gifts which was a way to actually send presents over Facebook. They'd show up at your doorstep. That wasn't so successful. You know, they also let you buy virtual goods and games. That's been OK, but declining. So I think Facebook has you know a billion users. How can they get a little bit of money from us? This is one way to do it. Another way, another reason they might be exploring this is to get a foothold in emerging markets. So this idea of being able to store and send money digitally using Facebook could be something that helps Facebook really getting in among people in the emerging markets.

NEWTON: In terms, though, of what it means for Facebook going forward, you know there's been a lot of talk about virtual currencies. I mean Bitcoin is just the most prominent one. Do you think though it could open up an entire new realm about the way we think about Facebook -- what it is, what it means to its users?

BOSKER: Yes, absolutely. I mean, I think it's -- Facebook wants to be more than a social network, right? It's not just a place to have conversations, it's a place to do business. And that's not just for the advertisers that we're used to seeing advertise on the platform, that could mean transactions shopping for any of its users. So it is, I mean, again, it's Facebook's thinking about itself. Not just as a kind of fun site that you might go on, but really as a utility, as this place on the internet that delivers all kinds of different services. Basically, you know, think about any type of interaction that you would have with a friend. I think Facebook wants to do all of that, right? Whether it's messaging, exchanging photos, exchanging cash, you name it. So I think that, yes, it's also I think just realizing I mean you know with the rise of Bitcoin, but there is demand for changing money internationally over the web, in a really simple, seamless way. And trying to meet that demand.

NEWTON: Now we move on to another company, Bianca, that wants to be all things to all people. I mean, Google has bought a drone company that previous was thought to be on Facebook's shopping list. Now, they already bought their drone company. It's buying Titan Aerospace in order to improve internet access, you know, in some of the most remote parts of the world. That's according to reports in the "Wall Street Journal." You know, as we just discussed, Facebook had already bought that. What's that play here though in terms of Google -- you know, what are they trying to do and is it realistic? A lot of people are wondering if these are just developmental projects, they have a lot of cash on hand, they could do what they want, even if it's pie in the sky.

BOSKER: Right, well drones are the must-have accessory this season it seems.


BOSKER: But yes, there's cut (ph) three different key areas that Google might be using this Titan Aerospace -- you know, solar-powered drones to do. So, they are intended to basically create these high- altitude solar-powered drones that can fly for long periods of time. One key effort would be to use those drones as part of Project Loon with -- I'm not making this name up. One of Google's efforts to basically use airborne devices to bring internet to countries that still are not online. So, again, it's this theme that we're seeing of really -- let's bring these other millions of consumers online. You know, we've got -- we're pretty saturated -- Google and Facebook are pretty saturated in the United States and Europe. So they're looking for the next frontier, the next, you know, couple hundred million users that they can get on their services. Also mapping -- these drones could take real time, high-resolution images that could then be used for services like Google Maps or Google Earth, and finally there's some talk of perhaps using these drones for another one of Google's acquisitions which would be to use these airborne wind-powered generating devices basically. So a different kind of energy source.

NEWTON: Yes, it still sounds way too out there for me. If they could bring the groceries to my back door, I will be happy with that.


NEWTON: Thanks, Bianca, appreciate your update on that.


NEWTON: Now internet companies are frantically trying to expand their mobile presence. Alibaba reached a deal at the end of last month to invest more than $200 million in Tango, a free calls and messaging app. Tango's founder and chief technology officer Eric Setton joins me now. Eric, I'm going to call you the Billion Dollar Man because that's what they say -- your company -- your, little, tiny company is worth now because of Alibaba's investment. What do you believe it can do for a company like that? Why do you think they were so interested in having Tango onboard?

ERIC SETTON, FOUNDER AND CHIEF TECHNOLOGY OFFICER, TANGO: Well, look, the mobile messaging space is really one of the most vibrant in mobile today. There's been the Viber acquisition by the Japanese giant Rakuten, the $19 billion acquisition of WhatsApp with Facebook. So definitely mobile messaging is where it's happening today. For Alibaba, being able to be present in this space with this partnership with Tango, we have a large presence of 200 million members, particularly in North America.

NEWTON: Are those active monthly users? What are your active monthly users?

SETTON: We have 70 million people that use the service on a monthly basis, and we've registered over 200 million members in the last three years.

NEWTON: Are you profitable right now?

SETTON: Not yet. We make our money through a mobile game offering, they're doing extremely well. And we're also building up a mobile advertisement practice, and these two are the main revenue streams in the company today.

NEWTON: You know, the $19 billion that Facebook paid for WhatsApp was absolutely eye-watering. I'm not suggesting that your valuation was anywhere in there, but this is a zero-sum game, Eric. There are going to be losers here. What are you offering in this sphere that means that you guys will be ahead of the fray here?

SETTON: Well, you know, I think it's very important to have a different shaded (ph) offering in a market where you have maybe 100 different players. We're part of the largest ones out there with 200 million members. And we offer free communication, but also a service where people can enjoy themselves and have fun -- by playing games together, by sharing music. Our strategy is actually very similar to that that has been employed in Korea, and Japan has won over the market. We're the only ones that offer that strategy for the Western countries -- in particular North America where we have such a strong presence. And I think that that's one of the things that is the most valuable about Tango.

NEWTON: Now, some of what makes those companies profitable though are, you know, really specific to consumers in those markets. If you take Japan, they're making a lot of money on these so-called digital stickers and things like that. You're putting all your money on gaming. That's the way you're going to make the money. The rest of the stuff is a free add-on just to attract people, right?

SETTON: So we -- objective is actually to give communication out for free and to attract a lot of people to using the service with their friends and family members, and then to monetize by distributing content. It can be music, it can be the games and you know the partnerships we have today with ZiNG, with Spotify are ready mobilers (ph). because it's much more fun to enjoy this content when you're doing it with your friends and your family members. And so we have the ability of subsidizing this free communication to everybody by actually making our money on the content side.

NEWTON: We'll see how it works out for you. I must say, a lot of players in the market, and we'll continue to follow your progress in it. Thanks so much, Eric, I appreciate you being -- .

SETTON: Thank you.

NEWTON: Now time for an update on the world weather forecast. Tom Sater's at the CNN International Weather Center. I can only tell you what the weather's doing here, and it is --


NEWTON: -- quite fine, and apparently there was some stormy skies on the way for New York. You know, I cannot tell you how many people I speak to, Tom, around the world that say 'spring, finally arrives already.'

SATER: Yes. You know, this is -- April's a fickle month, Paula. In fact in some cases, snow's falling in the U.S., we've got snow showers in parts of Europe as the temperature drops. So, yes, finally we're warming up. I've got some good pictures to show you. It's warming up nice in Southern Portugal into Spain, but this patchy cloud cover is sliding across Germany now. That's a batch of colder air. Right now it's about 8 degrees cooler in Berlin than it should be at 5. That cold air is going to continue to kind of slide across areas from the Czech Republic of Tor (ph) Lithuania which, by the way, a beautiful picture here to show you. As the cherry trees in full blossom here, reaching their peak, although the temperature's going to cool down a little bit, I think you'll be able to enjoy this for a little while. Temperatures should get back to near average.

Reports of Warsaw up to 13 by Thursday, your average high. Berlin, you're up to 15 by Thursday as well. We do have an area of low pressure though. Little concerned about down in the southeast we had a few reports of funnel clouds over the weekend, mainly on Sunday in Italy. This area of low pressure I think could really produce some storminess, but here's the patchiness. This is the cold air, even some snow showers at higher elevations could be found even near Sarajevo as well as that area of low pressure really starts to kick in. You'll find the buoyancy in the atmosphere just right for maybe some severe weather, and that could bring us some strong wind gusts, maybe some damaging winds in this area here. In fact, in the next 48 hours the winds actually increase around that area of low pressure. We see Belgrade 59, Budapest 57 kilometer per hour winds. With that, Munich, could there be a snow shower in your forecast? Overnight tonight you get down close to freezing. Don't be surprised to see a little bit of snow. Vienna mainly for winds I think 30 to 35-minute delays.

In the U.S., it's severe weather -- actually it's a cornucopia of weather as they have snowfall in the front range of the Rockies, 20/25 centimeters as the temperature dropped in Denver 26 degrees in the last 24 hours. Now we're finding the cold air into the South. Fueling thunderstorms, a few tornados are possible just like we had yesterday. This is the threat zone along the Gulf Coast -- look for this little tornado symbol here. Texas, couple of them there, Oklahoma yesterday, Arkansas, two in Iowa, one injury, some damage to some outbuildings, but as we watch the back edge, snowfall all the way down to the Blue Ridge, and then again another batch of snow falls in the Great Lakes.

A total lunar eclipse, the first one of 2014 in the next 12 to 24 hours here. This is the area that has the best visibility as far as getting the ability to see the total eclipse. Unfortunately in North America we've got cloud cover that's heading up to New York for Paula, so if you're up about 2:30 or 3:30 in the morning, maybe, just maybe you'll be able to see it. But it's going to be the blood moon for areas of French Polynesia over toward New Zealand. Maybe, just maybe if you don't have the partial eclipse, you'll see the total lunar eclipse and as the moon passes in the shadow, it turns a blood red. So this could be very interesting for those that have the chance to see it, Paula. That does mean the East Coast of the U.S., but weather-permitting, well, makes it a little bleak. We'll share the pictures tomorrow.

NEWTON: Yes, if you do get up, it is well worth it. I've done it as a child, but not tonight, Tom.


NEWTON: But we'll see how many people going to give you on it. Appreciate it.

SATER: Right.

NEWTON: Thanks. Now, next month delegates at the second annual Forbes Women's Summit will set out to redefine what it means to be powerful. Meet the woman leading that ambitious charge. That's up next.


NEWTON: Tory Burch, Carly Fiorina, Felicity Huffman, Jessica Simpson. They're just some of the 250 leaders who will come together for the second annual Forbes Women's Summit -- that's next month. And their goal is to redefine power. The woman in charge -- ForbesWoman president Moira Forbes, she joins me right now. You know, for someone like me I tend to get my back up immediately. I just think why do we need a women's summit? What do you think? Why are you doing this at all?

MOIRA FORBES, PUBLISHER, FORBESWOMAN: Well, first of all, I think it's so important whenever we can to bring together dynamic minds on issues that matter most in the world. Not necessarily women's issues but global issues. And so often when you look at these gatherings that are talking about global issues -- what's missing? It's that expansive dialogue that includes women. So it's creating a network of mind -- likeminded peers and bringing diverse thinking together to forge new partnerships and find solutions on critical issues. Not just about being women, it's about the dynamic thinkers that often aren't part of the conversation.

NEWTON: OK, but it is a women's conference. Do you find that sometimes that just cocoons you and automatically puts us back a few steps even?

FORBES: I think the fact that we're having this conversation and we're having these gatherings is positive. I know having done this for many, many years now, that these gatherings spark new ideas. They're catalysts for new thinking. Yes, do we need to bring men and women together in one room equally? Of course, and we're doing that as well. But this is a network of peers from very different generations, very different industries, who share a common mission and it's important to have that live dialogue.

NEWTON: I want you to listen very quickly to the former CEO of GM introduce the new CEO who happens to be a woman. Take a look.


DAN AKERSON, FORMER CHAIRMAN AND CEO, GM: We have a new CEO who happens to be a woman, a car gal. I think that's really good.



NEWTON: "Car gal." I mean, I know he meant well and believe me I'm not suggesting that he in any way, shape or form should be singled out for this. I think though would he ever had said that if it applied to race or religion? You and I both know he would've never said that. What does this tell us about what's going on in the workplace?

FORBES: First, you pointed it out. Women are still in unique positions when they ascend to those levels of power. And often we may hear those comments -- "the car gal," and is it necessarily where we want to be? No. But progress is happening. The fact that they were having that conversation, the fact that a woman ascended to the position regardless of that comment is important. We still have a long way to go. We've made progress, so let's not get mired down in these types of comments and take a step back and say 'Where do we need to go to move this conversation forward?'

NEWTON: I'm going to put you on the spot here because we don't have a lot of time. One thing still holding women back in business specifically?

FORBES: I think in business specifically the biggest thing holding women back is the opportunity to navigate their careers and entrepreneurial ways. Even in corporations, maddishly (ph) being beholden to traditional work schedules, traditional policies -- how do we still leverage their talent, recognizing that we may need to navigate times, how they work, where they work in very different ways.

NEWTON: Yes, and that's a lot of discussion --


NEWTON: -- a lot of women are having in many office places around the world. Appreciate your time. Thanks so much.

FORBES: Thank you.

NEWTON: And we'll be back right after this short break.


NEWTON: Now, the broader markets in Europe -- they rose on Monday. An air of caution amid the threats of the U.S. and European sanctions on Russia. One silver lining though. Mining shares moved higher as fears of conflict lifted metal prices for the day. Now, Europe's second largest carmaker has announced a major restructuring plan, and it's about time. Peugeot new CEO Carlos Tavares unveiled the plan called "Back in the race" on Monday. Now, under the plan, Peugeot will cut costs and drop half of its product lines. The reorganization comes after the company agreed to a rescue deal earlier this year. Now, the French government and China's Dongfeng Motor Group both took stakes in the company.