30/08/2016 Outside Source


30/08/2016

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Hello, I'm Ros Atkins, this is Outside Source.

:00:09.:00:13.

An hour of international news live from the BBC newsroom.

:00:14.:00:18.

Apple is at the centre of our lead story.

:00:19.:00:23.

Apple's effective tax rate in 2011 was 0:0.5 -- was 0.005%.

:00:24.:00:31.

The European Union says Apple has to pay Ireland 13 billion

:00:32.:00:34.

We'll explain why. We will also be live at Apple's headquarters in

:00:35.:00:48.

California. Nearly 7000 migrants have been saved off the coast of

:00:49.:00:55.

Libya. It is the busiest day for the Italian coastguard in several years.

:00:56.:00:57.

Also, The Zika virus has spread to Singapore -

:00:58.:00:59.

The government is advising all pregnant women with

:01:00.:01:02.

We will also get the help of the BBC World Service on the state of

:01:03.:01:17.

Uzbekistan's President's ill-health. Not a part of the world we talk

:01:18.:01:20.

about much but the head of the BBC's Central Asia Service will be

:01:21.:01:24.

here to talk about And scientists say the earth has

:01:25.:01:26.

entered a new geological age - now they are trying to work out

:01:27.:01:30.

what defines it. Our science reporter

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is here with more on that story. Apple's 's European headquarters are

:01:34.:01:53.

in Dublin. The European Union wants the Irish government to claim 13

:01:54.:01:57.

billion euros in back tax from Apple.

:01:58.:02:00.

The EU argues it paid minimal tax on its profits.

:02:01.:02:02.

For example, two years ago Apple paid 0.005%

:02:03.:02:06.

Normally, companies in Ireland usually pay 12.5%.

:02:07.:02:15.

Both Apple and Ireland are taking issue with the ruling -

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They will face stiff opposition. Here is a tweet from Martin Schulz,

:02:22.:02:26.

the president of the European Parliament.

:02:27.:02:35.

Next, let me play you a report on the story.

:02:36.:02:41.

It is a vastly wealthy technology company.

:02:42.:02:47.

Their products earn money around the world.

:02:48.:02:51.

Outside America, nearly all of Apple's sales

:02:52.:02:53.

revenues are channelled through one small country.

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Now the deal made between the Irish government and Apple has been

:02:57.:02:59.

ruled illegal and the tech firm have been told to pay back

:03:00.:03:02.

We've found that the Irish have allowed the huge majority

:03:03.:03:09.

of the profits of Apple sales international to be sent to a head

:03:10.:03:19.

office which only exists on paper and which is not taxed and that

:03:20.:03:22.

means a large majority of the profits are not taxed.

:03:23.:03:27.

It was in 1980 that Steve Jobs opened his first

:03:28.:03:33.

Along the way they signed the tax deal which the

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We should not have given them a deal like that.

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It would be marvellous if this country got the tax.

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I suppose the other thing is they could leave

:04:04.:04:05.

I think it is fair, they are making a lot of profits.

:04:06.:04:09.

The European Commission says at one point Apple were paying

:04:10.:04:12.

That meant on every 1 million euros they took they paid tax of 50 euros.

:04:13.:04:18.

But Apple says the expensive development takes place

:04:19.:04:21.

in America and that is where it should pay tax.

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Apple says it is the largest taxpayer in both Ireland

:04:35.:05:05.

and the United States and this afternoon the White House expressed

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concern about Europe's general stance on tax.

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We are concered about this approach that threatens to undermine progress

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we have worked on collaboratively with the Europeans.

:05:37.:05:38.

Ireland has worked hard to bring tech jobs to the country so is

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But the EU are determined to change the rules of the game.

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Their Deputy political editor of the Irish Daily Mail, asking a question

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a lot of people are asking. -- the Deputy political editor. The

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argument is that the economic benefits that come from hosting

:06:06.:06:10.

companies like Apple outweigh the extra tax they could try to recoup.

:06:11.:06:15.

Not one-way traffic in Ireland. Clearly there is a healthy debate

:06:16.:06:33.

over how this should be approached. The ruling today is clearly part of

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a broader struggle between some of the world's most powerful countries

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and some of the world's most powerful companies. To understand

:06:42.:06:47.

that dynamic better I turn to Simon Jack who has spent the day in

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Dublin. I think there is this trade-off

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about the power of the multinationals. Lots of countries

:06:55.:06:59.

use their tax regime as a come-hither, an attraction to global

:07:00.:07:02.

companies. Point is, with everybody setting their road tax rate it easy

:07:03.:07:06.

for multinational companies, particularly the modern companies

:07:07.:07:09.

which are not manufacturing stuff and selling stuff within

:07:10.:07:13.

jurisdictions, these are intellectual properties, royalties

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on those intellectual rights. It's difficult to pin down where the

:07:17.:07:19.

money is earned and where the costs are actually incurred. That allows

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multinational companies like Apple to play governments off against each

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other. That is why they think they need an approach with all of the

:07:30.:07:31.

governments on board. They think they don't have that in place after

:07:32.:07:39.

this ruling from the EC today. This ruling has come from Brussels.

:07:40.:07:43.

It will be contested in Dublin. Meanwhile, thousands and thousands

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of kilometres to the west is where Apple is based, in Cupertino. Our

:07:50.:07:59.

correspondent is there. Apple isn't normally a company that takes a

:08:00.:08:03.

backward step, so we will expect a vigorous stance, I suspect.

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Yes, it's already come. Tim Cook published a letter on the company's

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website mostly saying how disappointed he was with the ruling.

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He said it had implications for jobs in Europe and Ireland. He said Apple

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would continue to invest in Ireland. That situation hasn't changed. But

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he followed that statement up by saying that is because they are

:08:27.:08:30.

confident they will win their appeal against this decision. If they don't

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win that appeal and they have to pay this massive tax bill, whether their

:08:34.:08:39.

presence in Ireland where they hire almost 6000 people, whether that

:08:40.:08:45.

will remain. Apple is annoyed, fair to say, it's disappointed, thinks it

:08:46.:08:49.

has been unfairly treated, which is also what the US government thinks

:08:50.:08:52.

of the situation. It is determined to fight with this appeal. In the

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meantime it has to pay that money pretty quickly. It is going to pay

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even though they are appealing. They will have to hand the money over

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relatively quickly after this decision.

:09:04.:09:07.

It is a legal argument but there is also a moral argument that a company

:09:08.:09:11.

as big as Apple ought to be paying significant amounts of tax on its

:09:12.:09:16.

profits. What does Apple say to that moral argument?

:09:17.:09:22.

Apple says it has been working within the tax laws of each country

:09:23.:09:27.

it's been living in. They say they pay their fair share. Despite the

:09:28.:09:33.

tax situation in Ireland it is still the country's biggest taxpayer. One

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argument that comes from particularly the US government is

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that all of Apple's hard work of curating its products, the iPhone,

:09:45.:09:47.

iPod, so one, that happens here at HQ. It anywhere should be getting

:09:48.:09:51.

more tax money the US argues it should be here in the United States.

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-- and so on. If Apple does eventually pay this bill, that

:10:00.:10:03.

amount, that 13 billion euros, almost $15 billion, that will be

:10:04.:10:08.

offset against US tax. That is money essentially leaving the US economy

:10:09.:10:11.

and arriving into the European economy. Obviously the US government

:10:12.:10:15.

is particularly concerned about that.

:10:16.:10:18.

This time yesterday we saw that invite go out about an Apple event

:10:19.:10:22.

on the 7th of September. You a good place to find out what they are

:10:23.:10:26.

going to tell us. -- you are in a good place.

:10:27.:10:30.

They will be hoping to business as usual next week when they launched

:10:31.:10:34.

the new iPhone. But the iPhone has not been doing as well as it has in

:10:35.:10:38.

previous years. Apple has been fighting several battles on several

:10:39.:10:40.

fronts at the moment. Thanks very much.

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Let's turn from that story which is playing out in Brussels, Dublin and

:10:46.:10:54.

California to a very urgent story in the Mediterranean. The Italian Coast

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Guard says it has had one of its busiest days in years. There have

:10:58.:11:03.

been 14 coordinated mission saw off the coast of Libya in North Africa.

:11:04.:11:07.

The latest figures the authorities are providing is that almost 7000

:11:08.:11:13.

people have been rescued. All of them, we understand, in one area, 20

:11:14.:11:19.

kilometres off the coast of the Bristol city. They are hoping to

:11:20.:11:29.

reach an Italian island, Lampaduna, where we have reported on the story

:11:30.:11:35.

many times before. Already this year 112,000 migrants have arrived there.

:11:36.:11:38.

Many of them across the Mediterranean from Libya. The report

:11:39.:11:42.

we have on this story comes from our diplomatic correspondent James

:11:43.:11:43.

Landale. When you're tired and desperate,

:11:44.:11:56.

and so close to safety, A final leap of hope

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after a journey that has Just some of the almost 7000

:12:00.:12:02.

who were rescued on Monday. It is a crisis were the numbers

:12:03.:12:07.

are already extraordinary. Most were picked up 13 miles off

:12:08.:12:17.

the western Libyan coast. Packed into fishing boats and 44

:12:18.:12:24.

inflatable dinghies, often with just enough fuel

:12:25.:12:26.

to reach international waters. Phoned around 5am, they had been

:12:27.:12:35.

for 14 hours, and in that time we rescued over 5000 people,

:12:36.:12:39.

according to the information we have Rescuers said most of the migrants

:12:40.:12:41.

appeared to be from sub Saharan Africa, from Eritrea,

:12:42.:12:50.

Somalia, and Nigeria, encouraged to leave the beaches

:12:51.:12:52.

and take to the sea. They were rescued by ships

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from the Italian coastguard, aid agencies and even

:13:00.:13:02.

the British Navy. The survey vessel HMS Enterprise

:13:03.:13:06.

picked up more than 700 of the migrants and will land

:13:07.:13:09.

them in Italy tomorrow. The International organisation

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for migration says so far this year 111,000 migrants have

:13:16.:13:17.

been rescued in the central At the same time, some

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2700 have died. Those are pretty similar numbers

:13:20.:13:29.

to the same period last year Even though migration across

:13:30.:13:31.

the eastern Mediterranean here has dropped substantially since the deal

:13:32.:13:39.

with Turkey, the numbers crossing from Libya do not appear

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to have risen as a result. The migrants keep coming

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because there is no safety or work And there's always the chance

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of rescue in the sea. It's a very dangerous

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journey and people don't This evening, the first of those

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rescued in recent days If others are prepared to go to sea,

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even with newborn twins, The Italian coastguard

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expect more to come whilst Hello, I'm Ros Atkins,

:14:23.:14:26.

this is Outside Source. An hour of international

:14:27.:14:36.

news live Authorities in Singapore are saying

:14:37.:14:47.

all pregnant women with symptoms of the Zika virus should get themselves

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tested. We also had another confirmation -- also had

:14:57.:14:59.

confirmation of another 26 cases. The cases have been found in the

:15:00.:15:08.

same area which is Aljunied Crescent. This means a wider part of

:15:09.:15:15.

Singapore is affected. Some countries have responded directly,

:15:16.:15:18.

telling pregnant women to avoid going to Singapore. Here are the

:15:19.:15:22.

thoughts of some people who live there. Afraid, because I hurt about

:15:23.:15:38.

how difficult it is to be pregnant with the Zika virus. I'm afraid

:15:39.:15:44.

about it going on and how it might affect my relatives. Steps should be

:15:45.:15:48.

taken to find out how or why the sudden spread has occurred. My

:15:49.:15:59.

husband has suggested to me that I should go for a checkup. If it is

:16:00.:16:04.

positive then it is quite bad. If it is not quite safe. So I don't worry

:16:05.:16:08.

that much. But I am doing the checkup. We should emphasise that

:16:09.:16:16.

the Zika virus has been far more prevalent in South and Central

:16:17.:16:19.

America. If you would like more information on how it has manifested

:16:20.:16:26.

itself there, go to the BBC News website. In a moment, a big

:16:27.:16:30.

political story in France. The French economy Minister Emanuel

:16:31.:16:39.

Macron has resigned. And there is speculation he may be looking to

:16:40.:16:40.

become the next French president. Researchers say almost a third of

:16:41.:16:49.

patients in England and Wales are being given the wrong initial

:16:50.:16:53.

diagnosis after a heart attack. The British Heart Foundation says women

:16:54.:16:57.

are more likely than men to be misdiagnosed and it is beginning a

:16:58.:17:01.

campaign to make people more aware of the symptoms. Doctor Kevin Fox,

:17:02.:17:07.

from British cardiovascular Society, speaks.

:17:08.:17:09.

Although their tremendous pressures on the NHS and all health care staff

:17:10.:17:13.

are working hard, in this particular case it is about money. Prevention,

:17:14.:17:19.

which is the first step, if women are not having heart attacks that's

:17:20.:17:22.

fantastic, that isn't necessarily expensive. -- it is not about money.

:17:23.:17:27.

Awareness and alertness, that isn't expensive. Diagnosis and treatment,

:17:28.:17:32.

yes, expensive, but it is cheaper to get the right diagnosis to the right

:17:33.:17:38.

patient at the right time. This is not entirely a question of money as

:17:39.:17:43.

is being reported in the media, it is about optimisation of care.

:17:44.:17:52.

Hello, I'm Ros Atkins, this is Outside Source.

:17:53.:17:54.

An hour of international news live

:17:55.:17:55.

The European Union has told Apple to pay back 13 billion euros in taxes

:17:56.:18:04.

to Ireland. That is where the company has its European

:18:05.:18:07.

headquarters. The EU is saying Ireland offered on fair tax breaks

:18:08.:18:11.

to Apple. Ireland and Apple will appeal the rule. Some of the main

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stories: From BBC Arabic, it is reporting the death of one of the

:18:20.:18:22.

Islamic State group's most senior leaders. A website affiliated to the

:18:23.:18:30.

group said its spokesman was killed while surveying operations in

:18:31.:18:31.

Aleppo. Dilma Rousseff has resumed her

:18:32.:18:39.

defence at her impeachment On Monday she spent fourteen hours

:18:40.:18:41.

rejecting allegations that she manipulated government

:18:42.:18:44.

Budget accounts. Senators have the option

:18:45.:18:45.

of reinstating or removing her as President -

:18:46.:18:47.

the latter if far more likely. We have covered drone racing before,

:18:48.:18:50.

now this. It's a self-driving car

:18:51.:19:01.

being trialled on a race track. The company behind it want to launch

:19:02.:19:03.

a competition featuring self Let's go back to our top story. The

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decision by the European Union to instruct Apple to pay 13 billion

:19:20.:19:23.

euros in back tax to the Irish government. We are joined by dashed

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earlier, we were joined by a former Nobel Prize winner. -- earlier, we

:19:33.:19:39.

were joined. The first corporate responsibility is paying your fair

:19:40.:19:43.

share of taxes. Not trying to avoid taxes. When you operate in a

:19:44.:19:50.

country, where you produce and sell in a country, you have an obligation

:19:51.:19:53.

to pay taxes. There has been a culture developed where you are a

:19:54.:20:00.

hero amongst CEOs if you can avoid paying taxes. We can now talk about

:20:01.:20:07.

some of the issues raised with Michelle. We focused on the European

:20:08.:20:11.

decision with regard Apple, what is the relationship between the

:20:12.:20:16.

American regulators and Apple on this issue? In this particular

:20:17.:20:19.

instance we are seeing the US Treasury come out in support of

:20:20.:20:24.

Apple. Certainly suggesting that perhaps the EU has overstepped in

:20:25.:20:28.

this particular instance ahead of this decision about a week ago the

:20:29.:20:33.

US Treasury issued a white paper talking about this novel approach

:20:34.:20:37.

that the EU had taken towards some sort of tax investigations, and

:20:38.:20:40.

saying they found this deeply troubling. Today they said they

:20:41.:20:44.

found the ruling disappointing. They were concerned that perhaps US

:20:45.:20:50.

companies were being targeted. I was talking with Dave Lee, who is at the

:20:51.:20:54.

Apple headquarters, we were talking about the legal and moral argument.

:20:55.:20:57.

Clearly the EU is making a moral argument. I get the impression Apple

:20:58.:21:06.

says, look, there are different ways you can contribute to society. If

:21:07.:21:10.

you look at the letter Tim Cook wrote, his press release response,

:21:11.:21:15.

one of the arguments, or The KC made was, hang on, we entered into an

:21:16.:21:19.

agreement with Ireland, we complied with the law that was set out to us.

:21:20.:21:25.

-- all the case made was. What is interesting is how the US government

:21:26.:21:29.

and Treasury has responded. In this case they feel the EU has

:21:30.:21:33.

overstepped the mark a bit. But the irony is, if you look at the US

:21:34.:21:37.

Treasury it has had its own problems with some multinationals who have

:21:38.:21:44.

relocated overseas to reduce their tax bill. We see the government is

:21:45.:21:47.

aligning with American corporate interest. But that isn't necessarily

:21:48.:21:50.

always the case when it comes to collecting tax dollars. Presumably

:21:51.:21:55.

the long-term prospects of tax collecting will be in part decided

:21:56.:21:59.

by who comes into the White House next. We could see different

:22:00.:22:04.

approaches to corporate tax and the treatment of corporations by

:22:05.:22:07.

government. Well, we've heard a lot on the campaign trail, certainly

:22:08.:22:12.

from Donald Trump. The presidential hopeful has talked about reducing

:22:13.:22:15.

substantially the corporate tax rate, which currently stands at

:22:16.:22:20.

around 35%, reducing it to sort of essentially to the kind of 15%

:22:21.:22:27.

range. Whether or not that is achievable, it is something that

:22:28.:22:30.

Congress has wrestled with for a long time and no doubt we will hear

:22:31.:22:34.

more about these debates. The other area which could also be impacted by

:22:35.:22:40.

this going forward, how governments around the globe work together. We

:22:41.:22:44.

have seen various efforts, certainly among G20 countries, trying to

:22:45.:22:49.

tackle this idea of taxes, making sure that companies that do not play

:22:50.:22:55.

governments against each other -- making sure that companies do not

:22:56.:22:58.

play governments against each other. But this seems to be an issue. It

:22:59.:23:03.

will continue because we have other companies including Amazon and

:23:04.:23:06.

McDonald's still being investigated for deals in Luxembourg. Thanks very

:23:07.:23:15.

much. Very useful. To France, there is a big political story which could

:23:16.:23:18.

have economic consequences. The economy Minister, Macron, has

:23:19.:23:24.

resigned from the government and there is heavy speculation he will

:23:25.:23:27.

look to stand for president next year. Let's get the thoughts of the

:23:28.:23:31.

BBC's Hugh Schofield. The economy Minister, Macron, is

:23:32.:23:47.

resigning to Francois Hollande. It is a big story around the world. He

:23:48.:23:54.

has become perhaps one of the most recognisable figures in the French

:23:55.:23:57.

government. He's young, he's freshfaced, he looks like the boy at

:23:58.:24:02.

the top of the class, and he's a social and economic liberal. That's

:24:03.:24:08.

key. Since he came to his ministerial post, he has pioneered a

:24:09.:24:11.

number of measures to open up the French economy. He has been

:24:12.:24:15.

partially successful. Increasingly he's run into opposition from parts

:24:16.:24:19.

of the government. Francois Hollande one of them. There has been growing

:24:20.:24:24.

tension. Now he has decided to hand in his resignation. The key point is

:24:25.:24:28.

that we are eight months from a presidential election. Does this

:24:29.:24:35.

mark Macron's bid to enter the presidential race? Well, that's the

:24:36.:24:40.

big question. Mark Zuckerberg has been in Lagos meeting young

:24:41.:24:43.

entrepreneurs. He posted this picture online earlier saying he had

:24:44.:24:48.

come to Lagos to learn about the start-up ecosystem in Nigeria. Some

:24:49.:24:52.

of the people who have been helping him to do that have been speaking to

:24:53.:25:01.

the BBC. I just met Mark Zuckerberg. I'm so happy. It was cool, very

:25:02.:25:05.

interesting, he played with some of my apps. It is sort of like a stamp

:25:06.:25:13.

of approval. For someone who, I mean, made his way in tech, and

:25:14.:25:20.

understand how the industry works. There is a negative perception of

:25:21.:25:24.

what we are doing here, but to see him using a product, that is a huge

:25:25.:25:32.

step. A big plus. He's probably still going to meet all of these

:25:33.:25:37.

important people, but coming here shows how in the young people. That

:25:38.:25:43.

is the big part of it. The fact he understood what we were to become

:25:44.:25:46.

invalidated everything we had been doing and had planned. Coming here,

:25:47.:25:52.

and wanting to see the technology, that is a good one for me, you know.

:25:53.:25:59.

It then shows, OK, you need to recognise talent in Africa. I will

:26:00.:26:04.

be back with you in a couple of minutes'

:26:05.:26:05.

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