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President Trump Reaches 100 Day Milestone; North Korea Defiant; Confusion Over Trump's Statements on THAAD, Possible Conflict with North Korea. Aired 8-9a ET

Aired April 28, 2017 - 08:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


[08:00:10] KRISTIE LU STOUT, HOST: I'm Kristie Lu Stout in Hong Kong. And welcome to News Stream.

A major conflict with North Korea is possible. That is the assessment from the U.S. president, though he still hopes diplomacy will win.

Also on the eve of his 100th day in office, Donald Trump sings the praises of China's leader, a very different tone from the campaign trail.

And from victim to entrepreneur, CNN's Freedom Project introduces you to a woman who broke free from Mexico's sex trade and she is now a self-made

success.

The U.S. president is closing in on the 100-day milestone, but challenges from abroad are holding much of his attention. Chief among them, North

Korea. Now, in a new interview, he says diplomacy is the best way forward to resolve the standoff, but he is not

ruling out an escalation.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Well, there's a chance that we could end up having a major, major conflict with North Korea,

absolutely.

(END VIDEO CLIP)

LU STOUT: Now, a wild card in the American strategy towards Pyongyang is Beijing. And President Trump has praised efforts made by his Chinese

counterpart saying this, quote, I believe President Xi Jinping is trying very hard. He certainly doesn't want to see turmoil and death. He is a

very good man. I got to know him very well.

He goes on to say, I know he would like to be able to do something, perhaps it's possible that he can't.

Now, in just the last hour China said it is willing to work with the U.S. to promote an effective and sustainable solution in North Korea and the

nuclear issue there; however, there is a major disagreement between Washington, Beijing and South Korea. The deployment of a U.S. missile

defense system and who should be paying for it.

So, let's bring in Alexandra Field from Seoul. We also have David McKenzie standing by in

Beijing. And Alex, dominating discussion in the South Korean capital, Trump saying it would be appropriate for South Korea to pay for for THAAD.

What kind of reaction have you heard there?

ALEXANDRA FIELD, CNN INTERNAITONAL CORRESPONDENT: I think this has caught everyone wildly by surprise, Kristie. It wasn't something that anyone was

expecting to hear President Donald Trump say. Yes, we know back during the course of the campaign he

had suggested that the U.S. would look at some of its alliances around the globe and re-evaluate whether others should

paying more for their defense.

But that's not the kind of rhetoric that's come up since he's been in office. In fact, you've had three high-level diplomats who have been to

the region to sort of confirm to the South Koreans the strength of the alliance and the support the U.S. would continue to give. In the past few

days, as we've been reporting, the pieces of this highly controversial THAAD missile defense system have been moved to the deployment site.

You've had the U.S. Pacific Command commander say that this system will be operational in just a matter of days, because of the advanced threats from

North Korea, underlining what they consider to be the essentialness of the system.

And now you have U.S. President Trump saying publicly that South Korea should paying for the billion dollar system. Well, South Korea was quick

to react. Defense officials said that their understanding has not changed, it's their understanding that the U.S. pays for the operation and

deployment of THAAD and that it is their responsibility to provide the site and infrastructure.

There was also a South Korean defense official who told CNN that an agreement to that effect had been signed stating that the U.S. does, in

fact, cover the deployment of THAAD.

So, it's left a lot of people wondering why President Trump is saying this at this time, especially when the U.S. has been trying to drum up support

for this controversial system. Russia has objected ot it, China has objected to it. Both of them have said that the radar in THAAD can be used

to spy on them.

Obviously, the system has angered North Korea. And yet the U.S. and South Korean officials have been plowing ahead with this, saying that they need

to get it in place, they need it to be operational and ready to intercept missiles should North Korea fire off missiles.

At the same time, this has been a hot topic for domestic politics here. There's a presidential election that's going on. This has been an issue

that's been debated by the candidates here. Not everyone in South Korea supports THAAD. About 40 percent of people say they're against it.

Tonight, in the presidential debate that's going on right now, Kristie, it was the first question that came up. And the front running candidate who

said the deployment of THAAD should really be left as a decision to the next administration has now said that this has gone beyond a security

issue, that it seems to now be an economic issue.

So, he's really been pushing for this decision to be made once the next president takes office. The election isn't set until May.

And again, the system is set to be operational in a matter of days.

[08:05:02] ANDERSON: Yeah, Trump's blockbuster statement on THAAD setting ripples and waves, geopolitically, also in domestic politics as well there

in South Korea.

In that same interview with Reuters where he made that statement, he also said that a major conflict with North Korea is possible, but he would

prefer a diplomatic outcome.

So, Alex, it's kind of a mixed message there. So, how is that being weighed in South Korea?

FIELD: Yeah, it's absolutely a mixed message. And this is sort of like the ping-ponging that we've seen over the last few days, because there was

so much concern here on the peninsula as you heard this rhetoric from Washington about the possibilities of a military option. You have seen

them bring in more military assets to the region, the U.S. that is. So, there has been a lot of tension on the peninsula about whether or not

somebody could make a move or a false move and whether or not that would put South Korea square in the center of a conflict that could be unintended

and also catastrophic, but it seems that the rhetoric had really toned down in just the last day or so.

So, you have that really unprecedented meeting where senators were summoned to the White House, but there are no blockbuster headlines that came from

it, instead what you heard in the aftermath of it was the U.S. secretary of state and the U.S. secretary of defense saying that the goal really was to

pursue economic sanctions and diplomatic measures in order to try and force cooperation from the regime. And in the last day, you've also heard

Secretary of State Rex Tillerson suggesting that the door could be open for conversation with North Korea if the agenda was right.

And that's really a change of tone from previous statements that had been made by administration officials who said that the climate and conditions

were not at all right to be talking to North Korea. so, it seemed that there could be perhaps some progress, certainly this interest in

economic measures and diplomatic measures. And then you've got the president talking about the possibility of major, major conflict which I

think has again heightened a little bit of the tension here, or at least frayed some of the nerves in South Korea - Kristie.

LU STOUT: Alexandra Field live in Seoul for us. Thank you.

Now, let's go to David McKenzie in Beijing next. And David, we know that the Chinese government has long called for calm. But how is it reacting to

the statement from President Trump saying that there is a good chance for a major, major conflict with North

Korea?

DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: What they're doing, Kristie, is really focusing on what they want to focus on, and that's

within that interview from President Trump and in recent statements from U.S. officials, as Alexandra mentioned. There isnow talk of direct

negotiations, talks and diplomacy. So the Chinese certainly are kind of ignoring that discussion of major, major conflict and pushing forward with

trying to get talks or negotiations or at least talks about talks going - Kristie.

LU STOUT: Got it. So the Chinese preferring to focus less on what Donald Trump told Reuters and more on what Rex Tillerson told NPR, saying that

direct talks with North Korea would be the way we'd like to solve that. Is that the solution that China wants for North Korea?

MCKENZIE: Well, yes. And they're been consistent for several years in fact, Kristie. There's no change in China's policy. They have

consistently said they want calm in the region. Their diplomatic strategy at least has been to ask both the U.S. and South Korea, North Korea, to

stop any military drills before starting talks. There's been really no takers to that strategy.

But yes, talks have been consistently what China has wanted in conjunction with diplomatic pressure - Kristie.

LU STOUT: All right. And we know that the U.S. House of Representatives next week,

they're due to vote on a bill to authorize new sanctions against North Korea. What's the appetite there in Beijing, to apply more sanctions as

well?

MCKENZIE: Well, I think the appetite is not necessarily there, Kristie, as much. I mean, what we've seen from state media, foreign policy experts

I've spoken to recently is that they really feel there needs to be another direct provocation from North Korea like that possible sixth nuclear test

for them to push for stronger sanctions. Even today, the Chinese government saying if the meeting in the UN Security Council later today

only focuses on tougher sanctions and not other ways to end this crisis, they say it will be, quote, a lost opportunity.

So, China is definitely taking the route for talks. Maybe they see an opening for their long-held view that that this can only be solved with

discussions with North Korea.

Worth remembering, though, in fact, that previous discussions failed and really in a way the nuclear program has only accelerated out of Pyongyang.

So, there will be skeptical people and officials in South Korea and the U.S. to that strategy. But it appears the U.S. is opening the door at

least a tiny bit, to possible talks - Kristie.

LU SOTUT: all right, that's right the failure of six-party kind of brought us to this situation where we are today.

David McKenzie reporting live for us from Beijing. Thank you.

Now, during his campaign Mr. Trump lashed out at China time and time again over trade and diplomatic issues. Now it seems that he is changing his

tune. Navigating U.S.-China relations is a delicate matter. So I spoke with John Pomfret, author of The Beautiful Country and the Middle Kingdom,

a history of U.S.-China relations.

And I asked him how Mr. Trump is doing in his first 100 days.

(BEGIN VIDEOTAPE)

JOHN POMFRET, JOURNALIST: He came into office basically claiming he was going to become the great disruptor. but the reality is he's pivoted since

he entered office to become a relatively traditional so far curator of the U.S.-China relationship.

LU STOUT: What about in terms of North Korea? In a recent op-ed, it came out earlier in April you argue that China is suddenly leaning on North

Korea, and it might be thanks to President Trump.

You wrote this, quote, something interesting is happening in China and perhaps President

Trump deserves some credit.

Now I know a lot has changed since you wrote that. But do you think Trump in his first

100 days has succeeded in getting china to finally rein in North Korea?

POMFRET: I think Chinese have been increasingly irritated with North Korea and Trump has over the course of the last several weeks really pushed them

to come to the conclusion that perhaps supporting the North Korean regime no longer is beneficial to China's

interests.

In addition, North Korea's regime is acting increasingly belligerent. And so from that perspective I think the combination of North Korea's

trajectory, their increasing belligerance and Trump arguing that if the Chinese doesn't really begin to help out more, the U.S. could cause China a

lot of problems with secondary sanctions and a variety of other issues. The Chinese are concluding that perhaps it's time to really put pressure on

the North Koreans.

This is a work in progress, though. IT's a work in progress.

LU STOUT: I've got to ask you about trade, because Trump just made that U- turn on NAFTA. He now says he wants to mend it, to renegotiate it, not end it. And that of brings us to the TPP. That he did scrap early on in his

presidency. What does that mean for China? Has that turned into an opportunity for China, an ever-rising and ever-prosperous China?

POMFRET: So, by removing the United States from the Transpacific Partnership on his first day of office, Trump did more than several of his

predecessors in the White House to help China in Asia and to actually bolster China's power and influence in Asia, because the Transpacific Partnership was for better or worse, no matter what you

think about what it would do for American workers, it was a trade agreement that joined together almost all of America's friends and allies in the

region. And by removing the United States from that conversation, you effectively cede to China the future of trade relations and economic

relations in Asia for the foreseeable future.

It was a huge self-goal for the United States.

LU STOUT: Self-goal, because on his first day of office, scrapping the TPP, it was a huge boost

for future prospects for China and its business ahead. The One China policy, Trump had publicly challenged it. He questioned it. He had that

phone call with the Taiwan President Tsai Ing-wen. Trump later, he agreed to honor One China and has again signaled that he will continue to do that.

But what's the view among the Chinese? Do they trust him? Do they think he - that President Trump will continue to honor the One China principle?

POMFRET: I think they're taking him for the time being at his word. But again, like the trade issue, the One China issue has shown Trump to be the

guy who is pivoting 180 degrees away from his original policy, which was to throw into question the One China policy.

The reality though -- the question, is Trump offering to soften U.S. policy towards Taiwan in exchange for more Chinese help on North Korea? Trump in

his transactional way, his sort of let's make a deal approach to foreign policy could clearly put Taiwan on the trading block, if you will, if the

Chinese play ball on North Korea with more aggression. And that's something the U.S. would like to see.

LU SOTUT: So Donald Trump at the end of the day, he has pivoted on different issues. He is not so far the great disruptor after all. What is

going to happen next? I mean, as you write in your book, the relationship between these two countries has been there since the founding of the

American republic. This is a very deep relationship. What's your thinking on the

future of the relationship as Trump continues his term in office?

POMFRET: Right now, if you look at his China team it's extremely thin. Dozens of people who would normally be involved in the creation of China

policy are just not working yet. And so he has an extremely thin bench looking at China. And that's not to the long-term benefit of the United

States.

The second thing is, the Chinese respect power. And they also respect, they want predictability, and being the great disruptor is running at

loggerheads with the Chinese desire for predictability in their relations with the United States, and that's another issue.

And finally, the Chinese are very sensitive to American presidents who make demands and threats and then don't carry them out. They would end up

looking at a person like that as what the Chinese say is a paper tiger. And Trump in his bluster and bunctiousness, needs to make sure that if

he says he's going to do something, he's got to go ahead and do it.

(END VIDEOTAPE)

[08:15:47] LU STOUT: That was John Pomfret, author of The Beautiful Country and the Middle Kingdom speaking to us about Mr. Trump's ever

changing relationship with Beijing.

As mentioned, Mr. Trump has scrapped the TPP, something he pledged he would do during the campaign. But as he wraps up his first 100 days in office,

there are promises he has not checked off.

For example, he has backed away from labeling China as a currency manipulator saying that he has great respect for Chinese President Xi and

that China is helping the U.S. with North Korea.

Now, to follow the many promises he's made, you can track his progress on our website here at CNN.com.

Now, of course one of Mr. Trump's major promises was to defeat ISIS. And coming up next on News Stream, we'll take you live to Iraq to see how well

he's living up to that pledge as he nears 100 days in office. Stay with us.

(COMMERCIAL BREAK)

LU STOUT: Coming to you live from Hong Kong. Welcome back, you're watching News Stream.

Now, President Trump's administration hits the 100-day milestone this Saturday. And we're looking back at his campaign promises to measure what

he's accomplished since he took office.

Now, one big pledge, the defeat of ISIS.

Nick Paton Walsh examines what Mr. Trump is doing to take on the terror group.

(BEGIN VIDEOTAPE)

NICK PATON WALSH, CNN SENIOR INTERANTIONAL CORRESPONDENT: He said nobody would be tougher on them.

TRUMP: I would bomb the (EXPLETIVE DELETED) out of them.

(CHEERING)

WALSH:But 100 days in, how are ISIS doing under Trump? In Iraq, they're losing badly.

(GUNFIRE)

WALSH:Now controlling only 7 percent of it, down from over a third. Several civilian casualty incidents have led to questions whether Trump has eased

rules of engagement, made it easier to bomb. Yet in west Mosul, civilians are so frequently caught in the crossfire or dragged into it by ISIS, the

higher death toll was always a risk at the fight's bitter end.

(on camera): You can see the problem. These Iraqi police and army have in streets as tight as this where, frankly, any item around them could be a

booby trap, any roof could have an ISIS sniper on it.

(GUNFIRE)

PATON WALSH (voice-over): But is this retreat down to Trump?

(GUNFIRE)

WALSH:Not really. You will struggle to find officials who say it isn't just the same plan the Obama Pentagon put together being followed through.

And then there's Syria.

(EXPLOSION)

WALSH:Trump's decision to launch strikes against its regime for using chemical weapons possibly complicated the fight against ISIS. By making a

clear enemy of the regime, who were, on paper, at least, also fighting ISIS.

But the plans to retake their capital city, Raqqa, moving along fast, regardless, coal coalition-backed fighters set to encircle it from the

south.

ABU BAKR AL BAGHDADI, ISIS LEADER: (SPEAKING FOREIGN LANGUAGE)

WALSH:But the ultimate symbolic prize, the capture or death of ISIS leader, Abu Bakr al Baghdadi, eludes them.

(voice-over): Do you think Abu Bakr al Baghdadi is still in Mosul or greater Mosul?

[08:20:56] LT. GEN. STEPHEN TOWNSEND, COMMANDING GENERAL, OPERATION INHERENT RESOLVE: Well, I sure hope he is. I don't think he is. I sure hope

he is because, if he is, we've got him trapped. I'd like to see his end. I'd like to see his end in Mosul.

WALSH:Where's your best pointer of where he is right now?

(voice-over): Elsewhere, like in Afghanistan, they are on the rise. His commandos deploying the MOAB, the largest nonnuclear bomb the U.S. has ever

dropped in anger, and a strategic review is under way.

But there aren't really any new options in America's longest war. Just more of the same. And still the Taliban, are the bigger problem. But it's hard

to know how Trump, or anyone, can fight ISIS's most enduring threat, the idea. Transferable now indefinitely, online, inspiring deranged thugs from

London to Paris. Defeating that idea requires a better one, and nobody's found that yet.

(END VIDEOTAPE)

LU STOUT: And Nick joins us live from Irbil in Iraq. And Nick 100 days now into his

presidency, what kind of impact has Donald Trump had on ISIS and its foothold in Iraq and in Syria.

WALSH: Not clear what he's personally done in terms of changing or speeding up the plan

that had been put in frankly in the last year of the Obama administration. So, it's difficult really to gauge exactly what extra impetus or extra

resources have been put the military's way. They're certainly not complaining that they're being deprived of resources, and also, too, it's

quite clear that he hasn't come in, the great disruptor, and torn up the plan the way it was in mid-flow. It is still continuing. There is still

pressure on the west of Mosul, particularly around the old city. It's a bloody unpleasant fight for civilians caught in it there, but it is still

moving forward.

A sense of impetus certainly there and across the border, too. The de facto capital of ISIS's self-declared caliphate, Raqqa, in northern Syria.

That is increasingly under pressure despite turbulence now between Turkey and Kurdish forces fighting alongside the United States.

It's moving forward. The question really is how much longer until we finally see it in the

private territory in Iraq and Syria - Kristie.

LU STOUT: The battle is moving forward. You mentioned the battle for Raqqa. There's also the battle for Mosul as well. Now, I know it's

premature, but in the event of victory over ISIS, is the Trump administration ready for it? There are many challenges that lie ahead,

like sectarianism, regional powers exerting influence. Have you seen any sign that Donald

Trump and his administration can deal with these problems?

WALSH: I'm sure there are elements of the administration who can grasp the complexity of exactly what they're dealing with here. And everybody knows

that ISIS's demise territorially at least, is simply a matter of time. But, yes, then you're left with who comes in to fill the vacuum after them.

They're already shaping up here an intensified battle between the Kurds in Syria and the Turkish

military, which is a NATO member, despite the Syrian Kurds fighting alongside U.S. special forces at the moment against ISIS.

We have Iranian-backed militia in Iraq who want a stake in the game, too, and the Syrian regime as well. They've yet to stamp their mark on some of

this area that ISIS currently controls.

So many competing factions, I think possibly it's fair to say that Donald Trump hasn't spent that much time examining the details and complexities of

Syria's civil war, but he may well have to in the months ahead. And we are looking at a potentially bleaker period after here.

Hard to imagine this region could slip into more chaos after ISIS, but there are many competing factions here who don't seem to be showing signs

they wish to step back and let things calm.

LU STOUT: Nick Paton Walsh live from Irbil for us. Thank you, Nick.

Now, the Pentagon is investigating whether former U.S. national security adviser Michael Flynn

accepted payments from foreign groups. Now, according to new documents obtained by the U.S. House oversight committee, Flynn was warned not to

accept foreign payments by the defense intelligence agency back in 2014.

Now, Flynn has been accused of taking money from Russian and Turkish sources and not disclosing those payments.

Now, the relationship between the Trump team and Russia was scrutinized even before the U.S.

election. And based on Mr. Trump's rhetoric on the campaign trail, observers thought the old cold war enemies might be set to become allies,

but as CNN's Matthew Chance reports, relations with Moscow have been unexpectedly rocky since Trump took office.

(BEGIN VIDEOTAPE)

[08:25:25] MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): At first, he was the darling of the Kremlin-controlled media. Russian state television fawning over Donald Trump and his pro-Moscow

promises.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Wouldn't it be nice if we actually got along with Russia? Wouldn't that be -- wouldn't that be nice?

CHANCE: There were even Trump election parties in Moscow with some Russians literally toasting their good fortune. "To Donald Trump", cheered this

prominent nationalist politician, "now we can become allies in Syria and Ukraine," he declared. "Maybe America can stop funding NATO."

It was, of course, wishful thinking. Talk of partnership ended in a barrage of 59 U.S. cruise missiles aimed at Russia's Syrian ally. The Assad air

base may have been moderately damaged, but prospects for a Trump-Putin friendship were blasted in smithereens.

The Russian president preferred understatement to (inaudible)

PRESIDENT VLADIMIR PUTIN, RUSSIA (through translator): One could say the level of trust on a working level and especially on a military level has

not improved. Rather, it has deteriorated.

CHANCE: In fact, that deterioration began well before, amid lingering accusations of Russian interference in the U.S. presidential election, and

suspected Russian links with Trump officials, reporting of which annoyed the Kremlin as much as it did the White House.

MARIA ZAKHAROVA, RUSSIAN FOREIGN MINISTRY SPOKESWOMAN: Come on, stop -- stop spreading lie and false news. This is a good advice for CNN.

CHANCE (on camera): Are you concerned the investigations into Russia are going to turn up more secret meetings?

ZAKHAROVA: Please stop spreading lies and false news.

CHANCE (voice-over): It was that almost constant flow of bad news that may have eventually taken its toll. Disillusioned Russians protested that the

amount of Trump coverage on their television screens.

"We're all against Trumpmania here," said this woman.

Behind the complaints, though, real disappoint, with Trump's first 100 days saw hopes of an early diplomatic thaw with Russia slip away.

Matthew Chance, CNN, Moscow.

(END VIDEOTAPE)

LU STOUT: Coming up right here on News Stream, as President Trump prepares to mark 100 days at the White House, the standoff with North Korea

dominates his agenda. And CNN will take you live to Pyongyang with the only American television journalist inside North Korea.

(COMMERCIAL BREAK)

[08:31:27] LU STOUT: Let's go back to our last news story. In just one day, Donald Trump marks 100 days in office. But the standoff in North

Korea is holding much of his attention.

Now, let's take you straight to Pyongyang now and to CNN's Will Ripley, the only American

television journalist inside North Korea.

And Will, of course as you know, a lot of news lines out of that Reuters interview with Donald Trump, but the headline is Donald Trump saying we

could end up having a major, major conflict with North Korea. I mean, does that change the dynamic in the eyes of Pyongyang?

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Well, certainly unprecedented that a U.S. president would say openly, even though

privately, the U.S. has considered conflict with North Korea a possibility for quite some time.

But now with President Trump there's a whole new dynamic here. It is clear that North Korea has become his major foreign policy focus. You have

Secretary of State Rex Tillerson chairing that special meeting of the United Nations Security Council. And here on the ground you have North

Korean officials saying defiantly they will not back down despite pressure from the U.S. or from China.

Beijing is indicating a new willingness to perhaps work with the United States to punish Pyongyang economically for its provocative behavior. But

here they say it will not matter and it will not stop them.

(BEGIN VIDEOTAPE)

RIPLEY: North Korea says it values one thing above all else, self-reliance, a concept they call 'ju chang.'

Driving around the North Korean capital, it's clear this fiercely independent nation is not entirely self-reliant. Many everyday items are

imported, from cars on the streets, electronics in the stores, even food in the supermarkets. These shelves are surprisingly full of imports,

especially from one particular country.

It is interesting, a lot of the canned food items you see here come from China. It shows that there's a lot of trade happening between the two

countries despite heightened international sanctions.

North Korea claims to locally produce most of the products they sell, and the government says domestic production is increasing.

China's is North Korea's neighbor and most important ally, a powerful patron that pumps billions of dollars into this still largely impoverished

economy.

We're not allowed to see life outside the show piece capital. Inside, people say life is getting better. "Under Kim Jong-un our living standards

are improving," says this doctor.

North Korean economists say China still accounts for at least 70 percent of their trade, and not just consumer items. A Chinese oil pipeline literally

helps keep this country's engine running.

President Trump is urging China to use its economic leverage to punish Pyongyang for provocative behavior. North Korean officials say China's

actions won't affect their weapons development.

"Whatever new sanctions we're likely to face, whatever trade restrictions, we're not afraid," says Sok Chul Won (Ph). Every day North Koreans also

insist they will be just fine with or without China.

"We don't worry much," says this housewife. "We have a strong military. We can overcome anything." Despite five nuclear tests in the last decade,

Beijing has been reluctant to get too tough on Pyongyang. North Korea serves as a buffer between China and South Korea where 28,000 U.S. troops

are based.

China also worries a destabilized Korean Peninsula could trigger a refugee crisis at its border. China has taken some steps to sanction North Korea,

temporarily suspending coal imports, a major source of revenue for the regime.

But in the first quarter of this year trade is still up nearly 40 percent. The true test will come if Pyongyang keeps its promise to launch more

missiles and conduct more nuclear tests. North Korea says they will remain self-reliant, no matter how China and the world responds.

(END VIDEOTAPE)

RIPLEY: Kristie, we've been on the ground here in North Korea for the better part of this month. And what we've seen repeatedly is a government

with something to prove, from that massive military parade on April 15th to the huge live fire drill just this week with hundreds of artillery -

hundreds of artillery rounds being fired simultaneously to the new propaganda video showing a simulated missile attack on Washington and what

appears to be the Carl Vinson carrier strike group.

Government officials are telling us they are not going to back down to international pressure even if it means hardship in this country. They say

they have a right to develop these nuclear weapons and the missiles to carry them to protect their national sovereignty.

LU STOUT: Yeah, it's all about self-preservation isn't it?

And Will, there inside Pyongyang, you and the team have picked up some just really remarkable footage including that moment you're in a North

Korean supermarket looking at canned food items from China there in North Korea supermarket looking at canned food items from China. They're there

in North Korea.

And that brings up the question of sanctions. You know, we know that the U.S. congress they plan to vote on more sanctions next week. If China

passes more sanctions as well, what kind of impact is that going to have?

RIPLEY: Well, you know, that supermarket is a sensitive topic here because they want to point out that even though there are Chinese items on the

shelves, the majority of the products are domestically produce A that North Korean leader Kim Jong-un has tried to build new factories to grow

the economy and include - that includes domestic production of many items. But you can't deny the imports that you see around the city.

But the issue is really bigger than consumer electronics, items in the stores. China's probably biggest leverage over North Korea is this oil

pipeline that flows from China into this country. If they were to cut that off, it would be very difficult for this country to continue to move and to

operate as usual because there's a lot of oil coming over from China and another potentially more symbolic move than with economic penalties would

be to restrict flights from Chinese cities to Pyongyang via Air Korio. I mean, that's one of North Korea's few remaining links to the outside world,

it allowing the elite in this country to travel to China and then to other countries where they are permitted to travel.

And so if those flights were suspended. And so if those flights were suspended, if the oil pipeline was cut off, if trade was really restricted

in addition to the existing sanctions on coal and other raw materials, outsiders would say it could be a very, very difficult situation inside

this country.

But again, I cannot stress enough that we have brought this issue up repeatedly and officials tell us they are not concerned at all about what

China does or anyone else. They're go into push forward.

LU STOUT: Got you. But as you point out, it's about oil, it's about travel and tourism, those are ways that China can really exert some

pressure on North Korea.

Will Ripley reporting live for us from Pyongyang, thank you so much. Take care.

You're watching News Stream. Still ahead in the program, Xi is a self-made success. But you would never guess what this entrepreneur had to overcome.

Her story is next as part of CNN's Freedom Project.

(COMMERCIAL BREAK)

LU STOUT: Welcome back.

Now to the incredible story of a young woman who went through a nightmare but has found the strength to rebuild her life. Now, when she was just 18

years old, Neli Delgado says she was forced to work as a prostitute. Years later she has turned her life around and is fulfilling a lifelong dream.

Rafael Romo has her story.

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RAFAEL ROMO, CNN SENIOR LATIN AMERICAN AFFAIRS EDITOR: Just about everyone who stops by La Familia restaurant in Mexico City is welcomed by Neli

Delgado's warm smile. But the happy feelings on display are in sharp contrast to her early adult life.

NELI DELGADO, HUMAN TRAFFICKING SURVIVOR (through translator): My father died the month before I was to finish high school and my family completely

collapsed.

ROMO: At 18, homeless, penniless and grieving, she says she was easy prey for a charming man who promised to care for her.

DELGADO (through translator): I used to eat cheap apples and coffee, that's all I could afford. I was suffering a lot. And when he approached me

offering to help I felt I had no other option.

ROMO: But the promise of marriage was just a trick. Her suitor was a human trafficker.

DELGADO (through translator): One day he told me, I gave my life for you and you're also going to have to give yours for me. I'm struggling

financially so you're going to have to help me by being a sex worker in Mexico City.

ROMO: Neli was soon forced to work in an alley in La Merced, a notorious red light district in Mexico City.

DELGADO (through translator): Those of us girls who were new would stand at the entrance. They would show us off as if we were merchandise.

ROMO: Neli says she was forced to have sex with 30 to 40 men every night for a month until a police raid finally set her free.

DELGADO (through translator): Ninety percent of those of us there were human trafficking victims.

ROMO: Her trafficker was convicted and sentenced to nearly 14 years in prison and Neli set out with an ambitious plan to make something out of a

second chance.

Opening her own restaurant was a dream Neli had since she was working on getting her business degree after regaining her freedom. Her dream is

growing her business enough to make it a franchise here in Mexico City.

DELGADO (through translator): This represents everything for me. Now I'm free to do whatever I want. Back then I wasn't free. He would use me as an

object clients could buy as they please at any time. Now I have the freedom to do what I like.

ROMO: Luis Narciso is Neli's friend and business partner who helped open La Familia. He says he is awed by her determination.

LUIS NARCISO, NELI DELGADO'S BUSINESS PARTNER (through translator): I wonder where she got the strength to overcome so much and prevail because

you need a lot of will power to get back up again.

ROMO: And this budding entrepreneur has no plans of slowing down.

DELGADO (through translator): We would like to open another chicken rotisserie in about a year. I used to be discriminated against because I

was poor and dark skinned. I would like to empower women so they can become providers for the business group I'll have in the future.

ROMO: And until then, at this restaurant smiles will always be free.

Rafael Romo, CNN, Mexico City.

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LU STOUT: I am also in awe of her determination.

And that is News Stream. I'm Kristie Lu Stout. World Sport with Amanda Davies is next.

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