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Domino Effect of Huge Traffic Jam in Suez Canal; Lessons Learned for Huge Ships; E.U. Lagging in Vaccine Distribution; Brazil Health System on its Breaking Point; Bad Leadership Has Consequences; Biden Warns Of Response If North Korean Missile Tests Escalates; U.S.- China Relations As President Biden Laid Out His Views On China; Xinjiang Forced Labor Allegations; Myanmar's Military's Extensive Business Ties; Crisis In Myanmar, Top General Is Chairman Of Major Conglomerate; Military Crackdown On Protesters Grows Bloodier Each Week; Critics Are Picking Apart On The Royal Inconsistencies. Aired 3- 4a ET

Aired March 26, 2021 - 03:00   ET





JOE BIDEN, PRESIDENT OF THE UNITED STATES OF AMERICA: -- doesn't have a Democratic or small D bone in his body.


MICHAEL HOLMES, CNN ANCHOR (on camera): Joe Biden on President Xi during his first press conference as President of the United States. His warning about competition with China.

And just how does Myanmar's military have the resources to topple a government and maintain control. Our team here at CNN followed the money, and look at what we found.

And we're learning more about how to fix the multi-million-dollar dilemma in the Suez Canal. John Defterios standing with the latest.

And welcome to our viewers joining us from all around the world. I appreciate your company. I'm Michael Holmes. And this is CNN Newsroom.

At this hour, crews are still scrambling to find a way to free a massive container ship clogging the Suez Canal, one of the world's most important trade routes. After failed attempts to free the Ever Given, just look at the size of that ship, dredgers are working to remove up to 22,000 cubic meters of sand from around it.

To put that in perspective, that's enough sand to fill eight Olympic size swimming pools. Meanwhile, the global economic impact is growing by the hour as maritime traffic remains at a standstill. Thirty percent of the world shipping container volume moves through the canal every day, and dozens of oil tankers and other ships are part of the mounting backlog for vessels waiting to pass.

CNN's John Defterios tracking development for us from Abu Dhabi. I can't get over the fact the ship is as long as the Empire State Building as stall. Are we getting clarity from officials on just what's needed to refloat the Ever Given?

JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Yes. I think this Suez Canal authorities are trying to give us a sense of the task at hand. Michael, you threw out that number, there is extraordinary 20,000 square, cubic meters, rather. It's just enormous in terms of the tasks. They are trying to go 12 to 16 meters deep around the bow of the Ever Given to just to give it a chance to refloat.

Extraordinarily challenge, and as you suggested here, 30 percent of the container traffic passes through the artery every day. There's about $10 billion of goods that kind of locked up right now that can't be freed. And better than 13 million barrels of oil. And we're starting to see oil prices go up again.

Now there's also another hook. Shipping sources were telling me that there is a seasonal high tide taking place Sunday and Monday that could also assist in this effort. And people are getting very worried about the -- some 200 ships that are backlog there in the canal right now. Let's take a look.


DEFTERIOS (voice over): A traffic jam like no other in the world of trade. At least 160 ships are waiting to transit through the Suez Canal after efforts to dislodge the giant vessel wedge across it failed. Attempts were made to free the 224,000,000 ton Ever Given using eight tugboats and dredging the surrounding mud and sand. But so far, the vessel won't budge.

Canal authorities suspended traffic through the vital waterway Thursday when it became clear the rescue plan wasn't going to be quick or easy. A team of Dutch and Japanese salvage experts were drafted in to help, and expressed caution over the time it could take.

PETER BERDOWSKI, CEO, BOSKALIS (through translator): It can be days to weeks depending on what you come across. You have to realize that the equipment you need is of course not necessarily around the corner.

DEFTERIOS: Around 12 percent of the world trade volume passes through the canal normally, and it usually handles the equivalent of $10 billion dollars a day in cargo. Industry experts are concern if the situation is not resolved soon there could be a big impact on the oil market. Shipping and container rates leading to a rise in the cost of goods we all depend on.

The Ever Given first became stuck on Tuesday after being caught in high winds and a ferocious sandstorm which cause low visibility and poor navigation. Its owner, Japanese shipping company, Shoei Kisen Kaisha is bracing itself for lawsuits from affected parties. But says their main focus at this critical juncture is refloating the ship.


HOLMES (on camera): And so, how might, forgive the pun, untied shift in the global shipping market and the oil market importantly if they don't fix this within the next week?


DEFTERIOS: Yes. This is almost that window of opportunity here, Michael, where people are pretty calm about the situation because it is day four of the debacle, if you will. We're seeing that oil prices are going back up again, one and a half to nearly 2 percent depending on the benchmark.

And the shipping sources also suggested that if you don't have a solution by next Tuesday, and marking one weekend, the shipping rates will go up, the container cost as well. Oil prices which were almost $70 a barrel three weeks ago could start to skyrocket.

And I spoke to an attorney who is working in this area and he says we are already seeing the lawsuits start to stack up and the claims going against the ship owners and others. Who is responsible? That it is a shallow waterway there at the canal, at the south end of it. And it's not wide enough, perhaps as we're finding out here for a ship of this capacity. What happened with the pilots? These are the questions that are already being asked in the legal community.

HOLMES: Yes. We have to look at how the whole thing runs. John Defterios in Abu Dhabi, as always, I appreciate it, John.

Joining me now via Skype from Oxnard, California, Captain James Staples with OceanRiver Maritime Consultants. Captain, good to see you.

I mean, what a traffic jam. The ship is almost as long as the Empire State Building as tall. So, for people to get a sense of how big it is. Just how difficult is an operation like this from a technical point of view?

JAMES STAPLES, CAPTAIN, OCEANRIVER LLC MARITIME CONSULTANTS: Well, actually, it's probably the first time they've had a vessel this size go aground in the canal. Or notice or as mariners know it the ditch. And this is going to be a very difficult situation depending on how hard aground she is. Probably about 20 to 30 percent of that vessel is aground or in either end of the vessel.

So, we have the center of the vessel which is probably still floating on the edge of the vessel, she's hard aground. So that's going to make it very difficult because of stress is being put on the ship at the time right now. They're going to have to be very, very careful on how they remove any product whether it's ballast or oil or cargo off that vessel. It's going to be a very difficult situation ahead of them what they're looking at.

HOLMES: Yes, that is a good point. When you say stresses, you mean stresses on the actual structure of the ship because it is aground? STAPLES: Yes, absolutely. She could be twisted, she could be racked,

the buoyancy isn't what it should be as she's floating in the river by the -- in the canal by itself. She is aground on either end, so you can imagine, you know, a piece of wood that's on both ends is on solid ground, and then in the center of it there's nothing there with all of that weight pushing down on that vessel. You're going to have a lot of stress that could cause cracking, it can cause all sorts of damage to the vessel internal --

HOLMES: Yes, yes. Good point. I'm curious, as a seaman of your experience, I mean, does a show a weakness for the Suez Canal? I mean, one ship shutting down much of the global shipping trade. Does it show a need for changes and how things are done? Perhaps even how the canal is designed and run?

STAPLES: Well, I would say what they probably should do with vessels these sizes they should have an escort that trails behind the vessel and is tied (Ph) with the line so that the tugboat can actually help steer the vessel if they had to lose any type of steerage on board the ship. If they lose the engine where they can't steer or if they lose the steering completely when the vessel via the tugboat and the steering can actually move the steering of the vessel and probably keep it from getting stuck like this as she is in this type of kind of looks like about 45, 50-degree angle, which is completely blocking the canal.

And the tug would have been able to maybe gently take her alongside the canal and she could've sat there until they found what was wrong with the vessel, and not have to worry about the ship going aground.

So, it's probably a procedural change they'll have to make with the canal, such is they do with these auto lodge crude oil carriers, they always carry with them an escort tugboat.

HOLMES: Right.

STAPLES: And they probably put that on the stern of the vessel because that's the greatest distance from the pivot point.

HOLMES: I'm curious, you spend a lot of time and see yourself. What about this option of taking the long way around? I mean, ships that decide to divert their journey around Cape Horn, I was reading, it's an extra 3,800 miles, 12 days extra sailing. I mean, is that an option economically?

STAPLES: Well, right now, it's an option they are going to have to do until they get this vessel free. It could be a couple weeks as long as she is stuck in the canal. But economically, yes, a lot much more expensive when you talk about fuel consumption, and also the wear and tear on the crew. They would in a sea that length of time.


And getting stores and getting all different type of priorities for the vessel that they may need when it comes to emergency equipment or anything that has to be repaired on the vessel. So, it's a lot more expensive to go around the long way, absolutely.

But I think a simple situation like in any escort tug would've helped greatly and, probably, probably, would have prevented this accident.

HOLMES: Yes. A lot of people waiting for stuff on containers could be waiting a lot longer. Captain James Staples, great to talk to you. Thanks so much. It was fascinating.

STAPLES: A real pleasure. Pleasure talking to you, Michael.

HOLMES: Thanks, Capt.

Now we are following new developments in Ethiopia's Tigray region. The country's prime minister announcing just a few hours ago that neighboring Eritrea has agreed to withdraw its troops from Tigray. He says the forces crossed the border after Tigray and rebels launched attacks back in November. The Eritreans have since faced allegations of abuse.

The decision comes after intense pressure from the U.S. and other nations to address the deadly crisis in the region.

European leaders are getting ready to talk about vaccine exports and whether to tighten restrictions. Could the U.K. end up with fewer doses? We're live in London with that and the other top European headlines.

And then later, some big-name western brands are facing a boycott in China because they spoke out about how some Chinese cotton is produced. We'll explain why that's made China pretty angry.


HOLMES (on camera): France is expanding its strictest coronavirus lockdown measures, a total of 19 regions now under the toughest restrictions. Nonessential stores are closed, movements limited to a 10-kilometer radius. This coming as E.U. leaders fed up with the sluggish vaccine rollout get ready to me next hour to discuss restricting vaccine exports.

The block has been warning that it may ban vaccine makers, meaning the drug giant AstraZeneca from shipping doses abroad until they make good on their local commitments. The E.U. Commission president says Europeans deserve a fair share.


URSULA VON DER LEYEN, PRESIDENT, EUROPEAN COMMISSION: Companies have to honor their contract to the European Union before they export to other regions in the world. And this is of course the case with AstraZeneca. I think it is clear for the company that, first of all, the company has to catch up, has to honor the contract it has with the European member states before it can engage again in exporting, in exporting vaccines.


HOLMES: And right there you can see the huge disparity between the number of people vaccinated in the U.K, which is in yellow, and the E.U. in read.


The European Union block has sent 77 million doses to the U.K. and many other countries and has administered just 62 million shots.

Nic Robertson and Scott McLean are in London with more now on the situation across Europe. First to you, Nic. I mean, OK, so what can we expect from this E.U. leaders' summit?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Well, so far, they haven't agreed to go to the next level, which is this proportionality level which is, if another country has more vaccines than you outside of a European Union, then they should wait while the European Union catches up a little.

And the other -- and the other issue that they've been saying that would lay to do is if that other country isn't exporting vaccine or vaccine components to the E.U., then the E.U. shouldn't do, you know, shouldn't reciprocate an export to them. The reciprocity issue how they call it.

There is an agreement to go forward with those two proposals, but as you heard from Ursula von Leyen, this huge pressure on European leaders, this is a massive issue for them. The pharmaceutical companies within the E.U. have exported almost as much vaccine as they have kept for themselves. And that looked terrible for the population in the E.U., a population of about 440 million people now.

You've seen the figures there with the disparity between the U.K. and the E.U. So, there is massive pressure at the E.U. level, as well as the national leaders below that to get the act together.

So, in a way, at the moment, where discussions are at in Brussels yesterday, which was divisive, it was long, there wasn't agreement. Countries like Belgium and the Netherlands who are big pharmaceutical producers are not in favor of these tougher restrictive measures. They think that they could backfire over the long run.

So, at the moment, it looks like the U.K. may be is going to get through this less badly affected than how they had feared.

HOLMES: Yes. And of course, Boris Johnson doesn't want blockades. But you've touch on this, and it's interesting. How crucial is this debate on vaccine exports and how united is Europe on the issue? You say there is disagreement, is that a problem?

ROBERTSON: There's even disagreement within the E.U. about how to allocate the vaccines within the European Union that they already have. For example, the Austrian prime minister was pushing strongly to get more vaccines to Austria. Pfizer -- the BioNTech-Pfizer vaccine to Austria and to some other eastern European nations. There was pushback from others to saying, look, you know, Austria is

not faring so badly compared to some other E.U. nations. And so, there are tensions over the internal distribution. On the externalize issue, that's one place where the nations can come together.

But that disparity over, you know, again, the countries in the sort of northwest of Europe that are big vaccine producers and develop a lot of their GDP through the pharma industry, stand to lose if there are repercussions from putting blockades on.

Blockades against the United Kingdom, for example, because of the supply chains. The supply chains are complex. So, components for vaccines that are manufactured in Europe, some of those components come from the U.K. So a blockade could be self-harming for the E.U. So that is sort of the bigger picture.

Boris Johnson, you know, sees this again in the broader terms, frames it as, you know, any country that puts controls, export controls on what pharma companies or others are doing within their borders is going to have a negative impact in the future. Because companies they're going to say, why should we invest in a country that may one day put export bans on what we are trying to export on a product? On our profits?

So, there is a lot at work here, but the fundamental, the fundamental is this huge underlying pressure. The figures just tell you, the U.K. is doing better, the E.U. is doing bad, European Union leaders are looking bad because the public within the E.U. feel that they are being shortchanged. And that's what the leadership is trying to address.

And it's very difficult to turn this around quickly, but they do anticipate by the middle of the July that there may be some balancing up here.

HOLMES: Yes. Well, the numbers don't lie. Nic Robertson, always good to see you, my friend. Thanks for that. Let's turn now to Scott McLain who has more on the measures Europe is taking to tackle the ongoing spread.

I mean, you know, you got the U.K. debating how best to safely reopen, and yet you go to country like France pretty much shutting down again.


SCOTT MCLEAN, CNN INTERNATIONAL CORRESPONDENT: Yes. You can certainly understand why French President Emmanuel Macron is in favor of the restrictions that Nic was talking about there on vaccine exports because of the situation in his country.

Over the last two months or so, France and the U.K., have been going in completely opposite directions. And I have a graphic here that illustrates the point. The U.K. has seen a steady decline, France is seeing a pretty steady rise, and it doesn't have the number of vaccine doses to really do very much about this third wave. And the reason why is, well, it's the vaccine doses, the number of

vaccines that they are being able to put in arms. The U.K., you can see from a graphic here, is putting about 600,000 in arms every single day. On average right now, France is only doing about one-third of that and they have almost identical population.

So, France is now going into lock -- putting more regions into sort of lockdown light, where they are shutting down essential businesses but leaving schools open. And across the country they are now barring any kind of outdoor social gatherings of more than six people.

The U.K. on the other hand, it's the complete -- complete reverse. The U.K. you have not been able to socialize with people even outdoors, really for the past two months with some limited exceptions. Now they are starting to be more lenient beginning on Monday, two weeks after that they are going to be opening pubs, at least the outdoor patio portion of pubs with an eye towards, you know, even further loosening of restrictions in May and then, again, in June.

The U.K. right now has the, what seems like the luxury of debating how safely to best those pubs. So, Prime Minister Boris Johnson has not ruled out the possibility of a vaccine certificate in order for people to even be allowed entry into different establishments.

You have to prove, presumably if this were to go ahead, and now decisions have been made, but you have to prove that you've either been infected with the virus in the past, and presumably you have antibodies, you had a negative test, or obviously you've been vaccinated which more than half the country has been. But even the prime minister acknowledges that there are a lot of critics of this plan, and there are a lot of issues to go along with it. Listen.


BORIS JOHNSON, BRITISH PRIME MINISTER: You might only be able to implement before going vaccination passports, even if you want to such a thing in the context of, you know, when perhaps, everybody had been offered a vaccine. So, you know, there are complexities, moral complexities, ethical problems that need to be addressed.


MCLEAN: So, if the prime minister were to go that route, and wait until everybody has had the opportunity to be vaccinated before putting anything like this in place, that would be the end of July. That's the government's timeline right now. That they have so far been sticking to.

But the government's time line for fully reopening the economy without any restrictions is June 21st, which is why you can understand some hesitancy or some criticism from pub owners who don't really want to have any sort of lingering restrictions once most of the population is already been vaccinated, Michael.

HOLMES: All right. Scott McLean there in London for us. Thanks, Scott. Now all of this coming as Brazil reports an alarming new record for

COVID cases.

Matt Rivers from Sau Paulo with the details.

MATT RIVERS, CNN CORRESPONDENT: Well, unfortunately, another record setting day here in Brazil on Thursday. With health officials announcing that for the first time since this pandemic began more than 100,000 coronavirus cases were recorded here in a single day. Officials also announcing a pretty high death toll, nearly 2,800 deaths recorded on Thursday alone from coronavirus.

Meanwhile, we're hearing from the association of private hospitals here in Brazil, they say that in the next three to four days they will run out of anesthetics used to treat COVID-19 patients if they don't receive some kind of governmental assistance.

And beyond Brazil's borders, there are also regional concerns about what is going on here being exported elsewhere. Talking specifically about the P1 variant of COVID-19. It's a variant that originated here in Brazil. We heard from health officials in Peru on Thursday, they are saying that in the capital city of Lima, nearly 40 percent of recent COVID-19 cases correspond with the more transmissible P1 variant.

Matt Rivers, CNN, in Sau Paulo, Brazil.

HOLMES: Dr. Miguel Nicolelis joins me now from Sau Paulo. He is a professor of neurobiology at Duke University but has been in Brazil throughout this pandemic.

Good to see you. And doctor, another case record on Thursday. Last time we spoke nearly three weeks ago you said Brazil was seeing, quote, "the largest human crisis in Brazilian history." Has anything meaningfully changed since then?


MIGUEL NICOLELIS, PROFESSOR OF NEUROBIOLOGY, DUKE UNIVERSITY: Well, if anything it has only got worse, unfortunately. We are seeing what you just mentioned right now. Tonight, we have found out that not every single case has been reported in the official numbers. In fact, the number of deaths today is probably much higher because of a problem in the ministry of health notification system.

So, we crossed the 100,000 cases, and very likely tomorrow we may have a record in the number of deaths in Brazil.

HOLMES: That is incredibly worrying especially the misreporting of numbers. I mean, what then overall is the state of the country's health infrastructure today? I mean, ICUs were at a breaking point last time we spoke.

NICOLELIS: Yes. Last time we spoke we had already reached collapsed level on the hospital and the health system. But now the collapse is evolving very quickly for a tremendous nationwide shortage of basic medicines. You know, drugs you need to use in the ICUs to intubate patients, to sedate patients, to get them relaxed.

So, we are seeing the national supply of these medicines, basically, running down to about a week or 10 days right now. And this has been a, it never happened in Brazilian history, I can tell you for sure about that. But the alarm was given to the entire country on Monday that we may have supplies for 7 to 10 days.

HOLMES: Wow. You know, the other thing you mentioned last time, you know, part of the problem is that it has been so political and not in a good way. You said last time that President Bolsonaro was culpable, responsible for many of the deaths in Brazil's history, his own actions.

Since then there has been a new health minister put in place, the government is forming a new COVID crisis committee. Will those things make a difference in terms of the urgent needs?

NICOLELIS: Unfortunately, it doesn't look like. Because all these actions that took place this week seem to be leading to the same source of the problem, which is, the president is not going to relinquish the control, either the new minister of health, nor the committee that he just has put in place.

And to give you an idea how strange this committee is, he didn't call for any kind of scientific advisory board to join the committee. So, we are all asking ourselves, how can you run a national task force without scientists taking their places in this committee? So, I suspect that using good American language, this is all phony.

HOLMES: OK. Then so, you know, you've been there throughout. As I said, you've been raising the alarm throughout. What has to happen to turn this around? Because what happens in Brazil is a tragedy. But also, what happens in Brazil could impact the rest of the world in terms of spreading a variant.

NICOLELIS: Absolutely. We have just realized that in the Fiocruz Foundation, a group of scientists that the Fiocruz Foundation in Rio has already discovered other variants that have emerged in Brazil in addition to the P1 variant. This was announced this week. So, it's obvious to me and to all scientists in Brazil, that Brazil has become an international threat at this moment.

So, we need of course a national lockdown. We need to basically disrupt the flow of people through the roads and the airspace. And we need to increase the vaccination campaign about 10-fold. You know, we had days in which only 200,000 Brazilians who were vaccinated in 24 hours. We need to reach this, to increase this number all the way to about three to three million. Which can be done. Brazil has done that easily several times in the past decade.

But we don't have enough vaccines and within the replacement of the previous minister of health who was total incompetent we now have no information whatsoever what is going to happen in terms of procuring new vaccines. Because Brazil needs now tens of millions of doses.

HOLMES: A dire situation, as you have been warning for months and months now. I got to leave it there. Dr. Miguel Nicolelis, thank you so much. I really appreciate the work you're doing.

NICOLELIS: Thank you. I appreciate the invitation. Thank you.

HOLMES: We'll pause for a quick break now. When we come back, the U.S. president issues a stern warning and a choice to North Korea after its latest missile test. What if Joe Biden is vow -- Joe Biden wowing if the test continues, why he says there is also another path for Pyongyang.




HOLMES: And welcome back to our viewers all around the world, I am Michael Holmes, you are watching CNN Newsroom.

Now Joe Biden, used the first news conference of his presidency to put North Korea on notice that the U.S. would respond, if the missile test continued. He told reporters, that Wednesday launch of two ballistic missiles violated U.S., and U.N. Security Council resolutions. The president did not explained what the U.S. might do about further provocation from North Korea.

But, the U.N. Security Council's sanctions committee will be meeting in the hours ahead at the U.S. administration's request. Now the president also left diplomacy on the table. Mr. Biden said Washington is willing to talk with Pyongyang if the goal is denuclearization, which North Korea has long resisted of course. And South Korea's president is saying his country, the U.S., and the north, should resume talks.

We get more now from CNN's Brian Todd.


BRIAN TODD, CNN CORRESPONDENT (voice over): A warning from President Biden, to North Korea's 37-year-old dictator who just launched two sets of missiles within a few days. The latest, a test firing of ballistic missiles, nearly 300 miles into the sea.

JOE BIDEN, PRESIDENT OF THE UNITED STATES OF AMERICA: There will be responses if they choose to escalate. We will respond accordingly. But, I am also prepared for some form of diplomacy. But, it has to be conditioned upon the end result of denuclearization.

TODD: But analysts tell us, denuclearization is not in Kim Jong-un's playbook.

SUE TERRY, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: What we want to talk about is potential interim freeze, potentially, capping the program. And that is the maximum that they will go. They have said, multiple times that they are not interested in continuing talks.

TODD: The president was also asked about the broader North Korean threat.

UNKNOWN: Former President Obama warned the incoming President Trump that North Korea was the top foreign policy issue that he was watching. Is that how you assess the crisis in North Korea?


TODD: Experts say, these missile launches are classic moves from the Kim regime. That the North Koreans love to greet new American presidents which shows of force. Part intimidation, part bluster, it is a dodge and weave, with specific goals in mind.

MICHAEL GREEN, FORMER U.S. NATIONAL SECURITY COUNCIL OFFICIAL FOR ASIA: Kim is sending a message that Joe Biden cannot ignore him. That Biden has to come back to the negotiating table. And, from Kim Jong- un's perspective, he would like for Joe Biden to offer what Donald Trump appeared to be offering, which is a big deal.

TODD: But, a big deal never came to pass between Kim, and President Trump. Despite the fanfare of two summits and a high-profile meeting at the demilitarized zone in 2019. The first time a sitting U.S. president set foot on North Korean soil.



TODD: There was correspondents which included what Trump termed, love letters between the two leaders.

TRUMP: We met, and we liked each other from day one.

TODD: Kim did draw down his missile tests for an extended period as he kept trying to leverage his relationship with Trump for concessions. But, analysts say, while Kim was courting Donald Trump, he continued to modernize his nuclear warheads and missile arsenal.

GREEN: They've been clearly perfecting weapons capable of hitting U.S. allies and U.S. bases in the Pacific.

TODD: Last October, Kim displayed his biggest missile yet, called, Hwasong 15, rumbling it through the streets of Pyongyang on a mobile launch platform. Expert say the red line to watch out for is if Kim Jong-un decides to test another long-range missile capable of hitting the continental U.S. Specifically, a missile that can reenter the earth's atmosphere, without burning up.

GREEN: I think what you are seeing here is North Korea ratcheting up the pressure to indicate that that could be coming, if the Biden administration doesn't talk to them.

TODD: Experts say Kim Jong-un has another move that he can leverage against President Biden. They say Kim knows just how bad America's relationship with China is right now and it is eager to play the two superpowers off against each other, to try to win more concessions. Brian Todd, CNN, Washington.


HOLMES (on camera): Now besides labeling North Korea his top foreign policy concern, President Biden also laid out his views on China going forward. During his news conference, Mr. Biden said he spoke candidly with Chinese President, Xi Jinping soon after his inauguration.


BIDEN: I spent hours, upon hours with him, alone, with an interpreter. My interpreter, and his. Going into great detail, he's very, very straightforward. He doesn't have a Democratic, with a small d bone in his body.

I made clear to him, again, what I have told him in person on several occasions. We are not looking for confrontation, although, we know there will be steep, steep competition. Two, that we will have strong competition, but we will insist that China play by international rules.


HOLMES (on camera): Meanwhile, China has announced new sanctions on several individuals and entities in the United Kingdom. Now they come after the U.K. joined the U.S., Canada, and the E.U., to sanction Chinese officials. They charge Uyghur Muslims, and other ethnic minorities of being repressed in the western province of Xinjiang.

This, of course, a boycott peruse in China against several popular western brands. Some pretty big names, including H&M, and Nike have expressed concerns about claims of forced labor in Xinjiang cotton production. They are now facing a firestorm on Chinese social media. Beijing, dismissing the allegations.


HUA CHUNYING, FOREIGN MINISTRY SPOKESPERSON (through translator): Allegations of forced labor in Xinjiang is malicious lies, fabricated by anti China forces, to smear China, and (inaudible) Xinjiang security, and stability and contained China's departments.


HOLMES (on camera): Let's bring in now Kristie Lu Stout, standing by, in Hong Kong, with the very latest. I mean, a huge backlash against these western brands. And the interesting thing, came from one social media post.

KRISTIE LU STOUT, CNN CORRESPONDENT (on camera): Yes. It all started when the communist youth league, this is the youth movement of the ruling Chinese Communist Party, dug up an old statement from H&M and posted on Weibo, a social media platform in China, in this statement, H&M said that it is expressing, quote, deep concern, over reports of these forced labor in the production of cotton, in Xinjiang. So, this was posted online on Weibo earlier this week. It went viral.

And it unleashed this torrent of criticism and fury directed at the world's second largest clothing retailer, H&M, along with this now viral hashtag, I support Xinjiang cotton, which is now been seen a total of 4.8 billion times in China.

This is huge. And H&M is getting hit really hard. We have learned that H&M has been pulled off of major e-commerce platforms in China, there are reports that it has been scrubbed from online maps in China, including ride hailing services. Celebrities have cut links with H&M. H&M says it remains committed to the China market, and it's not just this retailer, it's also Nike, Adidas, and many others. I want you to listen to these angry, Chinese consumers in Beijing who -- and you can hear it, they fully support this boycott. Take a listen.


UNKNOWN: We should boycott them and let them know that China is not a country to be trifled with.


UNKNOWN: I will resist any brand that has any bad comments about our motherland.

UNKNOWN: This is our country, they should get out of China. We can choose not to use it, not to wear it. It is just not necessary for us.

UNKNOWN: I think you should respect our country. They won't have a future, here if they try to smear China.


LU STOUT (on camera): Now Xinjiang, of course, has been a major point of friction between China and western powers. We know, in December, that was when the U.S. government blocked all imports of Xinjiang cotton, over concerns and reports of the use of force labor there. In the past week. You have the E.U., the U.S., the U.K., all slopping sanctions on Chinese officials, accused of alleged rights abuses in Xinjiang, and China has retaliated announcing a slapping sanctions on not just E.U., but also, U.K. entities, and individuals. And accusing them of maliciously spreading lies and disinformation. Back to you.

HOLMES: While these western brands are being targeted and boycotted. Presumably, local brands benefit.

LU STOUT: Local brands are doing very well. You know as Chinese consumers, as you heard just then, are saying that they do not want to purchase or buy an H&M product or Adidas or Nike anymore because they are smearing the motherland. They are going towards local alternatives, domestic alternatives, like (inaudible) or Ankara which is a Chinese company that owns FILA and it operates FILA in the brand in greater China as a result, we've seen the share prices in this companies like leading Anka's surge in the last couple of days.

But we have also seen some pretty interesting comments on international retailers, who choose to continue to source cotton from Xinjiang. Like the Japanese retailer, Muji, it is still sourcing cotton from Xinjiang, and as one netizen observed, he said they praise Muji for its quote, survival instincts. To be able to continue to maintain operations, and a sales relationship in China. Michael?

HOLMES: Kristie, thank you. Kristie Lu Stout, in Hong Kong, with the latest there for us.

Now we're going to take a quick break, when we come back, as Myanmar's military kills unarmed protesters, a U.N. expert says that it is important for the world to hit the generals where it hurts, in their enormous moneymaking scheme. We will have that, when we come back.


HOLMES: Welcome back. The U.S., and the U.K. are targeting some of the Myanmar Junta's biggest income sources. The countries announcing sanctions on two of the holding companies controlled by Myanmar's military. This is what human rights experts have been asking for, as the military is deeply, embedded in the country's economic system.

Ivan Watson, explains how.


IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): The military in Myanmar is responsible for much more than the February 1st coup and ensuing crackdown against protesters.


CHRIS SIDOTI, U.N. INDEPENDENT INTERNATIONAL FACT-FINDING MISSION ON MYANMAR: The military has (inaudible), you know, (inaudible) every part of the Myanmar economy.

WATSON: Chris Sidoti was a member of United Nations Fact-Finding Mission, which published the 2019 report on the economic interests of the Myanmar military. It concluded that the same generals who have been accused by the U.N. of committing human rights abuses against ethnic groups, like the Rohingya, or also in charge of two of the biggest conglomerates in the country. Myanmar Economic Holdings Limited, and Myanmar Economic Corporation.

UNKNOWN: Today, MEC is one of Myanmar's leading conglomerates.

WATSON: their portfolios include banks, oil and gas extraction, mining, ports, hotels, telecommunications, breweries, and even a golf resort. A separate 2020 report by Amnesty International, expose the unique relationship between individual combat divisions, and the conglomerate MEHL.

MONTSE FERRER, AMNESTY INTERNATIONAL RESEARCHER: Almost every single top officer of the military, holds shares in this large business conglomerate that is collecting profits and dividends.

WATSON: At the top of the pyramid, this man. (Inaudible), the commander-in-chief of Myanmar's Armed Forces. He declared himself ruler of the country during the coup of February 1st. But the U.N. report also identifies him as chairman of the patron group. Part of the MEHL's corporate leadership. He, is essentially, a business mogul in an army general's uniform.

That unusual position, highlighted at the 2018 launch ceremony for MyTel, a cell phone company, joint venture between a Myanmar military owned conglomerate, and a telecommunications company owned by the Vietnamese military. (Inaudible) online, shared the stage with Vietnamese top brass. At a press conference weeks after the coup, a military spokesman seem to anticipate the hunter would face international criticism. He said, sanctions are expected, and they've come from mainly, western governments.

BIDEN: We are doing an executive order to enable us to immediately sanction military leaders who directed the coup, their business interest, as well as close family members.

WATSON: The treasury department targeted two adult children of Myanmar's top general, accusing them of benefiting, quote, from their father's position and malign influence. Washington, also sanctioned the adult children's companies, including a restaurant, a media production company, and chain of gyms called Ever Fit.

Despite the sanctions, I can still access an app from Ever Fit on my iPhone's app store. I can also download another app, called the OCCDS, and that's stand for the Office of Commander in chief of the Defense Services. It is basically a public relations media platform for (inaudible) online the military dictator of Myanmar.

On the bloody streets of Myanmar cities, and towns, the death toll continues to grow. The military seeks to crush the popular uprising against the coup. The struggle over the future of democracy in Myanmar, is also a battle over who will control the country's economy. Ivan Watson, CNN, Hong Kong.


HOLMES (on camera): Now as the violence in Myanmar intensifies, we are learning more about the heartbreaking losses individual people are enduring. The youngest known victim of the military violence was just six years old. A girl. CNN spoke with her grieving family. Here is Paula Hancocks.


PAULA HANCOCKS, CNN CORRESPONDENT (voice over): (Inaudible) was six years old. Shot dead by Myanmar security forces, as she was in her father's arm. Laid to rest Wednesday, her father, relives the moment she died. The family has asked us to hide their identities for fear of retribution from the military.

He says, they entered the house by breaking the doors down, which we have blocked with bicycles. They asked, is anyone else in the house, and fired a gunshot while saying, don't lie to us old man. They shot her, as she leaned towards my chest. I ran, carrying her, and could not even look at them. He took her to the local emergency clinic, but the doctor said, it was already too late. They are hiding his identity, as he fears repercussions from the military.

The oldest I've seen killed so far, is 58 years old, he tells me. The youngest, until now, was 13. Now, they're shooting randomly in neighborhoods. It is not even safe at home behind a locked door. The family tells us they have difficulty burying (Inaudible), according to the Muslim tradition of cleaning her body, and burying her, as soon as possible. As the dead not tell anyone in case the military will try to take her body. It's a fear we've heard from several doctors and (inaudible) families.

When we got to the cemetery, her sister says, a few people were there, so we have to hide her body. We had to wait until they were gone, and only when no one was around, could we bury her.


The families is now in hiding, saying that they heard police are waiting at their home. The older brother was also arrested, they feared for his safety. The military has not responded to our request for comment.

Why did they have to shoot her dead, her sister asks? What's in that she had committed? What's in have we committed? What can a child do?

(Inaudible) death has comes as a shock, even in amidst of a relentless stream of deaths and arrest in Myanmar.

MARC RUBIN, REGIONAL EMERGENCY ADVISER, UNICEF: The youngest child to have been killed, even more so, as she was killed in her own home. She was sitting on the lap of her father, which means there is no safe place anymore for children.

HANCOCKS: (Inaudible) is gone, her older brother arrested, her entire family too scared to go home. One family's tragedy in Myanmar that still has an uncertain ending. Paula Hancocks, CNN, Seoul.



HOLMES (on camera): The Duke and Duchess of Sussex grab headlines, of course, where a couple of weeks ago, with their surprising interview with Oprah Winfrey and the claims they made in it. But now, critics are picking apart the royal couple story. As Max Foster reports, they say it was full of in consistencies.


MAX FOSTER, CNN ROYAL CORRESPONDENT (voice over): Whether or not you are team Sussex, it is hard to argue against the profound issue raised by the Oprah Winfrey interview. Especially around suicide prevention and confronting racism. Wherever it may live.

But, critics of the couple are pointing to in consistencies in the tell-all interview. Starting, with their choice of platform. A major U.S. Network, with the most established interview were on the planet, when the previously pledged to engage with grassroots media organizations, and young, up incoming journalists. Then, there was this line --

MEGHAN MARKLE, DUCHESS OF SUSSEX: I've never looked up my husband online.

FOSTER: Twitter blew up with genuine disbelief, especially in light with what former best friend (Inaudible) told the Daily Mail. She was always fascinated by the royal family. She wants to be Princess Diana 2.0.

OPRAH WINFREY, OPRAH SHOW HOST: But you are certainly aware of the royals.

MARKLE: Of course.

FOSTER: And what about critic's claims that Meghan lied about when they were married?

MARKLE: You know, three days before our wedding, we got married.

No one knows that, the vows that we have framed in our room, just the two of us in our backyard with Archbishop Canterbury?

FOSTER: The Sun getting hold of a copy of the marriage license, showing the legally-binding wedding was in the church, not the backyard. A spokesperson clarified, the couple exchanged personal vows a few days before their official/legal wedding on May the 19th. The couple are known for their distrust in the tabloid media, and they voice their frustration with how the palace tries to apiece certain titles.

MARKLE: I think there is a reason that these tabloids have holiday parties at the palace. They are hosted by the palace. The tabloids are. You know, there is a construct that is at play there.

FOSTER: But tabloids reporters say they have no memory of such parties. Russel Myers, royal editor of the Daily Mirror tweeting, Meghan has just claims Buckingham palace throw holiday parties for the U.K. tabloids. And now, I am wondering, why I never got a ticket.


WINFREY: Were you silent, or were you silenced?

FOSTER: Oprah's question here has been the subject of countless means. But the answer has been deconstructed too.

MARKLE: I've advocated for so long for women to use their voice. And then, I was silent.

FOSTER: Is that true? Palace insiders will point to many occasions that show that Meghan was allowed the voice, they say. Particularity, on feminist issues. MARKLE: Right now, in the climate that we are seeing with so many

campaigns, with me too, and times up, there is no better time than now to really continue to shine a light on women feeling empowered and people really helping o support them.

FOSTER: Insiders will also tell you, they showed full support it Meghan. A junior member of her staff who has now left the palace told CNN, they've bent over backwards, as far as I can see. I think there was complete hospitality, and kindness, and grace. Everyone wanted to make it a success. A current royal source, add it. The queen's senior team were directed to avail themselves to ensure she had all the support needed.

MARKLE: Unlike what you are seeing the movies. There is no class on how to speak, how to cross your legs, how to be royal. There's none of that trend. That might exist for other members of the family that was not something that was offered.

FOSTER: But CNN has been told, the queen dispatched here closest aide to Kensington Palace. Lady waiting, Lady Susan Hussey, and dressers Angela Kelly, to offer advice, guidance, and (inaudible) to the duchess. Royal aides say this was an unprecedented gesture support for a new member of the family. And that every department of the queen's household was open to Meghan. Then, there is a question of titles.

MARKLE: They we're saying they didn't want him to be a prince, or a princess, not knowing what the gender would be, which would be different from protocol.

FOSTER: The protocol the duchess referred to was issue by King George V. And it limits princely titles to children and grandchildren of the serving monarch. As well as the first born child of the Prince of Wales. None of which applies to Archie. Though he will automatically become a prince when Charles becomes King. Max Foster, CNN, Hampshire, England.


HOLMES (on camera): Now you know. Thank you for watching everyone, I am Michael Holmes, follow me on Instagram and Twitter, at some CNN. CNN Newsroom continues with Kim Brunhuber, coming your way next.