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NEWS STREAM

ISIS Demands $200 Million For Japanese Captives; Violence Escalating In Ukraine; U.S. President Set To Deliver State of the Union Address Tonight; China's Ghost City; China Denies Theft Of U.S. F-35 Stealth Fighter Plans; `American Sniper' Opens With Box Office Success, Controversy

Aired January 20, 2015 - 08:00   ET

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

KRISTIE LU STOUT, HOST: I'm Kristie Lu Stout in Hong Kong. And welcome to News Stream where news and technology meet.

Now suspects picked up in a terror sweep in France are set to appear in court. Now we go on the trail of one suspect who may have been smuggled

across the Turkish border into Syria.

And we'll tell you why this fully built Chinese city is virtually empty.

We begin this hour with heightened terror concerns in several countries around the world. In Australia, the threat level for police

officers has been raised to high.

Now federal officials say there is no specific threat, but they cited an overall elevated climate inside the country as well as terror related

events aboard.

Now in Belgium, a manhunt is underway for the leader of a suspected terror cell that was raided last week.

Now a Belgian counterterrorism official say authorities are looking for a 27-year-old Belgian-Moroccan ISIS fighter. His last known location

was believed to be Greece.

And in France, four of the nine people detained last week in connection with the Paris terror attacks are appearing before a court

today. And they will hear possible charges against them. The other five were released without charge.

Let's head straight to France now for the latest on the investigation over there. Our senior international correspondent Nic Robertson is in

Paris and he joins us now live.

And Nic, for the suspects arrested in that terror sweep are appearing in court before a judge today. What is the latest on the case?

NIC ROBERTSON, CNN INTERNATIONAL CORRESPONDENT: Well, this should give us a better insight into how and why the police are sort of able to

whittle down their suspects. When we hear the charges today that should give us an indication of what the police believe that they have been

involved in.

If we step back a few days to last week, they detained 12 people. They released three of them over the weekend. Those were three women.

They released the other five last night. And the remaining four, very interestingly and strikingly perhaps, are all young men in their 20s.

But once the magistrate sees them and we hear the charges, that's when we'll know exactly the lines that the police are pursuing against them,

Kristie.

LU STOUT: Now, one suspect's DNA links him to Amedy Coulibaly. Let's talk more about him. Authorities, meanwhile, they're trying to peace

together the route of Coulibaly's radicalization in a French prison. You've investigated this side of the story. What have you learned?

ROBERTSON: Well, that's right, Kristie. We do know that one of the nine that was detained by the police -- his DNA was found in a vehicle

believed to have been used by Coulibaly when he went to attack the kosher supermarket. It's not clear if this man was one of those released or not,

or even if he was a man or a woman at this stage, we don't know, but the presumption would be at this stage that he would likely be among those

four. But it's still not clear.

But what we are learning now about how the -- how Coulibaly met the two brothers, Cherif and Said Kouachi, how they met, the circumstances of

that in jail and their radicalization there continue to be of concern today.

(BEGIN VIDEOTAPE)

ROBERTSON: Inside a French jail, prisoners hang bed sheets from a window -- yoyoing, they call it, flaunting lockdown, spreading messages, a

gaping hole in prison security.

UNIDENTIFIED MALE: It is. It is becoming a university of terrorism.

ROBERTSON: Cameras are banned, yet prisoners, including kosher supermarket killer Amedy Coulibaly, shot this themselves several years ago,

according to journalists at French newspaper Le Monde who were documenting prison life.

The jail is Floury Meragise (ph) on the outskirts of Paris, the same jail where years earlier Charlie Hebdo killer Cherif Kouachi met Coulibaly

in 2005 and 2006 where both men were radicalized by fellow prisoner and al Qaeda recruiter Jemal Beghal (ph).

UNIDENTIFIED MALE: For both young men, being in contact, directly, for seven months with Jemal Beghal (ph) has had a terrible effect on them.

DAVID DULONDEL, PRISON GUARDS FEDERATION: When I come in jail, I come...

ROBERTSON: A 17 year veteran warder at the same jail tells me he is more powerless than ever to keep order.

DULONDEL: But some time we are two for 300 men.

ROBERTSON: That's impossible.

DULONDEL: You see?

Yeah, it's really hard to do, really, really.

ROBERTSON: The French justice ministry says 283 people are in French jails on terrorism charges. They judge 152 of those to be radical

Islamists. And there are growing concerns that they may be trying to radicalize others.

The French government says there are close to 67,000 people in jails here. And experts estimate as many as 60 percent of those are Muslims.

This man is on the front line, one of nearly 200 imams who visit prisoners, warns without more like him extremists could get the upper hand.

MISSOUM CHAOUI, CHIEF PRISON IMAM, PARIS REGION (through translator): Prisoners will declare themselves imams and will persuade other inmates of

their own message and bring them towards radicalization. That's a certainty. Up until now, authorities have not listened to us.

ROBERTSON: The prisoners' video reveals a jail rotting on the inside -- dilapidated showers, walls covered in mold, trash on the floors, a

system overwhelmed and incubating terror.

JEAN-CHARLES BRISARD, FRENCH CENTER FOR THE ANALYSIS OF TERRORISM: We lack intelligence in prison. There's only one officer of intelligence for

2,000 prisoners in France, for all the prisons. So it's not enough.

ROBERTSON: How many terror connections made here still unknown.

(END VIDEOTAPE)

ROBERTSON: And this is a concern, continues to be a growing concern for French authorities. Jemal Beghal (ph), the al Qaeda recruiter there

he's still in jail in France. But what we understand from experts is that he is being isolated and the authorities are trying to keep him away from

other Muslim prisoners.

And this is a technique that -- again we understand from experts -- that the French authorities are considering applying more broadly in jails

to try to stop this spread of radicalization. But again, the people we speak to who were involved with prisoners in jails really feel they are

just too shorthanded, need greater -- far greater resources to tackle this problem, that will go -- solving it, they think, will go beyond just

isolating the worst of the radicalizers -- Kristie.

LU STOUT: All right, CNN's Nic Robertson reporting live for us from Paris. Thank you very much indeed for that, Nic.

Now another key element of the French investigation is tracking down Amedy Coulibaly's wife, Hayat Boumeddiene.

Now we have an interview with two men who may have smuggled Boumeddiene across a Turkish border into Syria. Arwa Damon reports.

(BEGIN VIDEOTAPE)

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Hayat Boumeddiene today among Europe's most wanted women. But on January 2nd,

before her name was internationally known, Boumeddiene and a male companion cleared customs with ease at Istanbul's secondary airport.

Yet something raised a red flag with Turkish authorities and the two were placed under surveillance. They checked into this hotel on the Asian

side of Istanbul, were monitored for a couple of days, but after engaging in what was described as touristic activities, the surveillance stopped.

All this happened in the days leading up to the Paris attacks.

(On camera): Following the Paris attacks the Turks alerted the French that they had already in fact gathered some intelligence on Hayat

Boumeddiene. The French then provided the Turks with phone numbers that they were able to use to further track her movements.

Hayat Boumeddiene's last known location? Sanliurfa, along the Turkey- Syria border.

(voice-over): Sanliurfa has become a key hub for transit into Syria. The touristic city saw its population swell due to the refugee influx. And

just about anyone can blend into the chaotic streets, and from here there are plenty of routes to the next leg of their journey.

We meet these two men in a town close to the border. They are both professional smugglers.

For the last few months the soldiers have really cracked down, one says, but there are always security breaches and alternate routes to be

exploited.

The other tells us that a woman in all black paid him around two to three times the going rate, right around when Turkish authorities believe

Boumeddiene disappeared into Syria.

She said, "I will give you 100 lira just to get me to Syria," he recalls. "She was entirely covered in black like I am now."

It's the first time since the war in Syria began that either of them have taken a woman across on her own. The smuggler says she was of medium

build and guesses her age to be like Boumeddiene, in her mid 20s. She spoke classical Arabic and did not have a Syrian accent. That, he claims, is all

he knows.

"I saw the 100 lira and I did not ask anything," he tells us.

On the back of a motorcycle they headed down this border road, dotted with potential illegal crossing points.

(On camera): The Turkish military stopped us before we could get to the area where this woman crossed into Syria, but it is further down the

road in a similar sort of landscape. (Voice-over): There is no way of knowing if it was Boumeddiene, but within an hour of speaking to the

smuggler the woman covered in black was in Syria.

Arwa Damon, CNN, on the Turkey-Syria border.

(END VIDEOTAPE)

LU STOUT: Now the ISIS militant group has just issued a staggering ransom demand, this time for two Japanese hostages. They appear in a new

video posted online kneeling beneath their captor who says they will be killed unless Japan pays the group $200 million in three days time.

Now, CNN's Will Ripley is covering this story. He joins me now from Beijing with more. And Will, what are Japanese officials saying about the

video and this demand from ISIS?

WILL RIPLEY, CNN CORRESPONDENT: Well, the prime minister Shinzo Abe speaking in Israel saying that this -- these actions are unforgivable on

the part of ISIS.

The prime minister in the Middle East where just two days ago he announced $200 million to help the coalition against ISIS.

But, Kristie, as you know, Japan is a pacifist country. This money was never intended to pay for bombs or weapons or to kill innocent people

as ISIS claimed in their new video, this money was intended to help the refugees who have been hurt by ISIS, people who are badly in need of

assistance, people whose lives are in turmoil.

But in response to Japan's pledge to help innocent people, ISIS has taken two of Japan's own innocent citizens and put them on this new video

that was just released overnight here in Asia. Kenji Goto, a freelance journalist, well respected around Japan who has covered war zones for years

who last tweeted on October 23 and is believed to have been taken at some point after that. And Haruna Yukawa, a 42-year-old who lost his wife and

his business and went to the Middle East, had a website claiming that he had started a private military company described by some as a lost soul.

But these two Japanese men now find themselves together on their knees standing in between a man that the world has come to know as Jihadi John,

essentially telling the prime minister that as punishment for offering to help the innocent victims of ISIS, these two men will also lose their lives

in a brutal way if this ransom is not paid within three days, Kristie.

LU STOUT: And more on the video itself, we understand that Japanese officials are working to verify the authenticity of the video. How does

this video compare with this previous ISIS videos showing American and British hostages.

RIPLEY: Well, the one continuous -- you know, in addition to just this scenery that you see in the video, the man with the mask believed to

be Jihadi John with his very distinguishable British accent. The background very difficult to figure out where this video is being taken.

But this is what we've seen multiple times where this particular individual was seen on the video executing two Americans and two British

citizens as well. And so of course for anybody in Japan, a pacifist country that has only a self-defense force, they don't engage in military

action. They cringe at the thought of sending their own into harm's way overseas, you can imagine how gut wrenching it is tonight for people not

only who know these men, but people in their hometown, people in their home country see two Japanese citizens put before the world like this and like

sadly so many others before them.

LU STOUT: Yeah, gut wrenching indeed with this new ISIS video, this new demand online.

Will Ripley walking us through this story, many thanks indeed for that update.

Now you're watching News Stream right here on CNN. And still to come on the program, the U.S. president lays out his plan for the year ahead.

Why President Obama's sixth state of the Union address will also mark a first for him.

Also ahead, how a multi-billion dollar project in China set to mirror New York has ended up looking like ghosttown.

And we continue our Leading Women series with a look at one of the most powerful women in finance.

(COMMERCIAL BREAK)

LU STOUT: Welcome back, you're watching News Stream. And you're looking at a visual version of all the stories we've got in the show today.

We've already shown you the trail that one of the French terror suspects might have taken into Syria.

And a little bit later, we'll take you inside one of China's so-called ghost cities.

But now, U.S. President Barack Obama delivers his annual State of the Union Address later today.

Now Mr. Obama goes into this speech with the first uptick in his approval ratings in nearly two years. But, keep in mind he's also got to

deal with another first since he took office. His audience will be a Republican-led congress.

Now ahead of the speech, the Obama administration has shared some aspects of his ambitious agenda to try to rally public support.

Now aides say the theme of tonight's talk will be middle class economics. Now, Mr. Obama is also expected to bring up his move toward

normalizing relations with Cuba. And fittingly, Alan Gross will be there tonight. He is the American contractor whose release from prison in Cuba

last month heralded that new era in U.S.-Cuba relations.

Now Mr. Gross will be seated alongside the first lady, Michelle Obama.

Now the Republican senator, Marco Rubio has been formally against the president's move to normalize ties. And that is why Mr. Rubio will also be

accompanied by his own special guest, the daughter of this man, the late Cuba dissident Oswaldo Paya.

Now her father in what died in what the family says was a suspicious car crash in 2012.

Now let's get more now on what we can expect to hear a little bit later today. Now CNN's Michelle Kosinski is live from us at the White

House. She joins us now.

Michelle, with this speech, President Obama is going to put forth his new policy priorities, his new goals for the year. What will be the focus?

MICHELLE KOSINSKI, CNN CORRESPONDENT: Hi, Kristie.

Well, we've already seen much of it. I mean, the White House is saying that they still have a few cards up their sleeves, there could be

some surprises tonight -- they're not giving any hints -- but yet they are summing up the theme of this speech in three words. And you said it,

middle class economics.

So some of what we've seen already laid out were his ambitious tax plan that includes higher taxes on the wealthiest Americans, tax credits

for the middle class and lower class to try to balance that out. Things like two years of paid college education that he wants to do.

But a lot of what he's put out there everyone knows that the Republican congress is not going to pass.

So the question becomes, well why do this? The White House response has been the president is still going to put out his proposals and, you

know, and also looking at this and saying it's essentially throwing down the gauntlet to Republicans that they now have to come up with their own

proposals.

Both sides want to court the middle class going into the 2016 elections. So many see this as much as being about 2016 as it is right

now. Even if none of this gets down, this is still sparking a really strident debate over what can be done to grow and benefit the American

middle class and whose policies can do it better -- Democrats or Republicans, Kristie.

LU STOUT: So middle class economics likely to be front and center in the state of the union address. But what about other policy priorities in

areas such as the deficit to combating ISIS to terrorism? I mean, what do Americans believe should be the top priorities for Obama and congress to

both tackle?

KOSINSKI: Yeah, those are absolutely a big deal, too. And it's interesting when you've seen the president over the last several weeks and

months put out these kind of either teasers or proposals or executives actions themselves focused on the middle class, but the energy of them

sometimes gets taken away by cataclysmic world events like the rise of ISIS. And we're seeing, you know, him laying out some of his proposals and

on the heels of this comes a major cyber attack in the U.S. and a major terrorist attack in France.

So, you have to think that countering terror is going to have to figure significantly into his speech.

And it was interesting when I was talking to the former chief speech writer for President Clinton, Don Bear (ph). And asking him, well, given

what just happened in France, how much is the percentage going to have to be, you know, balancing domestic versus foreign policy. And he thought it

would probably be about 50-50. And I asked him, well, if you were writing this State of the Union speech would you feel the need to start out with

countering terror?

And he said that's a tough call, but he thought no. And he thinks that this speech tonight will begin with President Obama's domestic agenda,

that they feel hat is the most important thing in American's minds, because Americans don't necessarily feel an imminent threat by ISIS and by other

terror groups. What they do feel is the pinch of the economy. And America is coming back. It's, you could say, the strongest economy in the world

right now.

But the problem has been that much of the middle class doesn't necessarily feel that, because of things like wage stagnation. So they

really want to put that front and center, the middle class, but terror and the threat of terror is going to be a significant part as well, just not

maybe first thing off the block -- Kristie.

LU STOUT: I got it. CNN's Michelle Kosinski with the preview of the State of the Union Address. Many thanks indeed, Michelle.

Now, pro-Russia rebels, they have launched new attacks on Ukrainian government forces in the battle over the Donetsk airport. It is the latest

in an especially bloody week of clashes. Matthew Chance has more.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN INTERNATIONAL CORRESPONDENT: After months of heavy fighting for control of Donetsk airport, these dramatic images

captured by an aerial drone paint a startling picture with the devastation.

Just months ago, this was a modern functioning terminal, a gleaming symbol of economic progress in eastern Ukraine. Now it's a symbol of ruin.

Recent days have seen a sharp upswing in violence and bloodshed. Ukrainian government forces on the offensive, using heavy weapons, ceasing

territory controlled by pro-Russian rebels. It's raising concerns Moscow may intervene as it's been accused of doing in the past.

ANDREY LYSENKO, UKRAINIAN MILITARY SPOKESMAN (through translator): The decision was taken for a mass operation, which was successful. We have

almost completely (inaudible) the territory of the airport, which belongs to Ukrainian forces as marked by military separation lines.

CHANCE: But civilians continue to be caught in the cross-fire. Last week, at least 12 people were killed on this passenger bus, shelled as it

stood at a government checkpoint southwest of Donetsk.

Both sides blame each other for the tragedy, though it seems to have hardened attitudes in Kiev.

But a peace march in the Ukrainian capital to mourn the victims, the country's president was defiant.

PETRO POROSHENKO, UKRAINIAN PRESIDENT (through translator): We will not give up any piece of Ukrainian land. We will return (inaudible). We

will restore the Ukrainian nation there. And we will show that one more highly important factor of our victory is our unity.

CHANCE: But Ukraine appears far from united. We may instead beyond the brink of yet more violence.

Matthew Chance, CNN, Moscow.

(END VIDEOTAPE)

LU STOUT: You're watching News Stream. Still to come, China wanted the city to be a bustling metropolis and instead it turned into a ghost

town, abandoned by the Chinese government. And we'll tell you more after the break.

(COMMERCIAL BREAK)

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

Now new data from China shows its worse GDP in more than two decades. It only grew 7.4 percent in 2014, something most countries would consider

wonderful.

Now while growth did miss the official target of 7.5, this result was expected.

Now neither Beijing nor investors are concerned. As you can see, the Shanghai composite, along with other Asian markets, ended higher this

Tuesday.

Now the building sector accounts for about a quarter of Chinese GDP and Beijing has been trying to bolster China's property market. And one

ambitious project was to build a city to rival Manhattan. But instead, they built a ghost town.

Will Ripley has more.

(BEGIN VIDEOTAPE)

RIPLEY: It's a weekday morning at Yujiapu financial district in the Chinese city of Tianjin. The government spent billions of dollars on this

virtual replica of Manhattan.

But look around this major intersection and see what's missing: the people.

When construction began here in 2009, thousands of workers were building these skyscrapers modeled after some of New York's most famous

buildings. Today, we see few signs of construction. And even the buildings that look finished sit empty.

The Chinese government denies reports that this project has run out of money, but like this bridge there's a huge gap between their vision and

reality.

China's real estate market is declining in some areas, leaving more and more ghost cities, often the result of wasteful construction, too many

buildings, and not enough tenants. Because real estate has been fueling China's economic growth, a slowdown will affect a long list of industries.

This empty financial district, just alarming sign of bigger trouble for the world's second largest economy.

Will Ripley, CNN, Tianjin, China.

(END VIDEOTAPE)

LU STOUT: Incredible, desolate scenes there.

You're watching News Stream. And still to come on the program, the Oscar nominated American Sniper is a box office smash hit. But some in

Hollywood are snubbing the movie. We'll explain.

And we continue our in depth conversation with this month's leading woman Christine Lagarde. And today, she tells us the life lessons she's

learned by being a mother.

(COMMERCIAL BREAK)

LU STOUT: I'm Kristie Lu Stout in Hong Kong. You're watching News Stream and these are your world headlines.

Now Japanese Prime Minister Shinzo Abe says that the international community needs to deal with terrorists without giving in to them. He is

demanding the immediate release of two Japanese hostages ISIS is threatening to kill if Japan does not pay $200 million in ransom in the

next three days.

Now four of nine people detained last week in connection with the Paris terror attacks are to appear in court to hear any charges against

them. Now five other suspects have been released without charge.

German police conducted a series of anti-terror raids overnight. Now 200 officers hit 13 properties in three different states. And we are told

it is part of an investigation into two arrested suspects who were accused of providing support to ISIS.

Now China rejects the accusation it stole designs for the next generation of U.S. fighter jets. Now the Germany newspaper Der Speigel

says details of the theft is contained in top secret U.S. government files that came from the NSA leaker Edward Snowden.

Now one document says the U.S. believes China hacked terabytes of data related to the F-35 stealth fighter, including detailed engine schematics

and radar design. Now the jet-maker Lockheed Martin declined to comment.

In 2009, CNN reported that hackers had stolen thousands of files related to the F-35. At the time, Lockheed Martin said no classified

information had been breached.

Now China wants to know if the accusers can produce any real evidence.

(BEGIN VIDEO CLIP)

HONG LEI, CHINSE FOREIGN MINISTRY SPOKESMAN (through translator): Cyber attacks are hard to trace back and are usually committed across

borders. This complexity means that it's extremely difficult to identify the source of the attacks.

(END VIDEO CLIP)

LU STOUT: China showed off its new stealth fighter, the FC-31 at an air show last year. Experts say is bears a resemblance to the F-35, but

may not match its technological capability.

Now with U.S. allies planning to fly the F-35, including Australia, Britain, Japan, and Israel, China is trying to close the gap and create

jets that it can export.

Now the movie American Sniper has box office records, Oscar nominations and controversy. As George Howell now reports, the film about

the Iraq war has triggered an intense debate.

(BEGIN VIDEOTAPE)

GEORGE HOWELL, CNN CORRESPONDENT (voice-over): Americans are packing into theaters to see "American Sniper," the real life story of the man

known as America's deadliest sniper, Navy SEAL Chris Kyle, played by actor Bradley Cooper. The film is breaking box office records this debut weekend,

earning 105 million in weekend ticket sales and six Academy Award nominations.

UNIDENTIFIED FEMALE: I loved it. I loved it.

UNIDENTIFIED MALE: It was a very emotionally stressful movie, I thought.

UNIDENTIFIED MALE: It was pretty good. It's very compelling.

UNIDENTIFIED MALE: Very good. Excellent.

HOWELL: Not so excellent, however, in the minds of some in Hollywood. Actor Seth Rogin tweeting, quote, "American Sniper" kind of reminds me of

the movie that's showing in the third act of "Inglorious Bastards." And filmmaker Michael Moore igniting a firestorm on Twitter. Quote, "my uncle,

killed by a sniper in World War II. We were taught snipers were cowards. Will shoot you in the back. Snipers aren't heroes and invaders are worse."

Then, five hours later, quote, "but if you're on the roof of your home defending it from invaders who have come 7,000 miles, you are not a sniper,

you are brave, you are a neighbor." Moore's comment about cowards definitely getting some pushback.

CADE COURTLEY, FORMER NAVY SEAL: For somebody who has spent their entire career on freedom of speech and freedom of expression, to be

criticizing an individual like Chris Kyle, who exemplifies the very best, well, it's like -- that's really biting the hand that feeds you.

HOWELL: And the moviegoers we spoke to also took issue with the perceived criticism.

UNIDENTIFIED MALE: I think he was fighting for this country, was doing what he thought was right.

UNIDENTIFIED MALE: None of us who don't serve or can't serve have no idea what our soldiers are going through.

HOWELL: Whether Moore was actually talking about the film "American Sniper" is now sort of a gray area, tweeting, quote, "Hmm, I never tweeted

one word about "American Sniper," Chris Kyle. I said my uncle, killed by sniper in World War II. Only cowards would do that to him and others." He

goes on to say, quote, "so people want me to tweet something about "American Sniper." Great acting. Powerful message. Sad ending. There." Then

sending people to his Facebook page for further clarification. Regardless, one thing seems crystal clear on the streets among the masses who saw

"American Sniper."

UNIDENTIFIED MALE: It's not a coward. It's a matter of taking -- you know, doing what he was told to do and what he was trained to do.

UNIDENTIFIED MALE,: I'm ready.

HOWELL: George Howell, CNN, Chicago.

UNIDENTIFIED FEMALE: Oh, my God!

(END VIDEOTAPE)

LU STOUT: We want to pay tribute to a man who created an important part of television.

(BEGIN VIDE CLIP)

LU STOUT: We want to pay tribute to a man who created an important part of television.

(END VIDEO CLIP)

LU STOUT: Instant replay.

Now, Tony Verna passed away on Sunday. He created instant replay in 1963, using it for the first time during the Army-Navy football game. Now

Verna's invention was so surprising that the commentator has to explain to the audience that the replay was not live.

And now it's a common part of virtually every sporting event.

Now some sports even allow referees to check replays to make sure they made the correct decision all thanks to Verna's invention.

Tony Verna was 81.

We'll have more News Stream after this short break.

(COMMERCIAL BREAK)

LU STOUT: Welcome back.

Now all this month, we are profiling the most powerful woman in global finance, Christine Lagarde. Now she has led the International Monetary

Fund since 2011. And this week on Leading Women, Lagarde shares a painful, but pivotal life moment.

Now here's more of her in depth conversation with Gabriela Frias.

(BEGIN VIDEOTAPE)

CHRISTINE LAGARDE, DIRECTOR, INTERNATINAL MONETARY FUND: I'm lucky enough to live not far away from work. So it's walking distance.

Hi, Frank, how are you?

GABRIELA FRIAS, CNN INTERNATIONAL CORRESPONDENT: You may not expect one of the most powerful women in the world to walk to work, but that's

just one of the things that makes Christine Lagarde stand out.

LAGARDE: So it can be the nicest part of the day, depends on the weather.

FRIAS: She's the managing director of the International Monetary Fund, the first woman to hold the position.

We had the rare opportunity to spend four days with Madam Lagarde in three different countries and the chance to get to know her as more than

just a woman leading global finance.

LAGARDE: If you ask many women who are pioneers in their own field, they will often acknowledge that being a single woman, or being a small

minority is both hard and an opportunity.

FRIAS: Would you say there is some pivotal moments that brought you here?

LAGARDE: You know, clearly the death of my father when I was 16 was a pivotal moment, becuase you -- you know, suddenly realize the hardship, the

pain. It certainly was for me a better understanding of, you know, how tough it can be for a single mother to raise kids.

FRIAS: She points to her mother's strength as a big influence in her life. Lagarde was raised in France with her three younger brothers, and

went on to achieve a lot at an early age. She became a member of the French national synchronized swimming team.

As a teenager, she won a scholarship to study in America. She later passed the bar in France.

What have been some of the biggest challenges that you have faced working your way up in your career?

LAGARDE: Clearly to harmonize your personal life together with your professional life is a struggle. Maternity comes at a time when

professional demand on young women is at the highest. So that's a tough call. And I confronted that. And I dealt with it in the best way I

thought.

FRIAS: You have said that you have accepted that you can be successful at everything.

LAGARDE: You live with guilt, you learn how to deal with it, but there had been many occasions when my kids were small where I couldn't go

to a parent's event, and because I was tied up in court.

Well, you feel guilty about it. And my children today are telling me that, you know, they're 28, 26 and they say, fine, mother. You know, don't

worry, we are OK.

Doing a good job is demanding on a day-to-day basis.

FRIAS: Which is why for this leading woman it's important to find moments in her busy schedule to recharge, even if that moment comes at the

start of the day.

LAGARDE: Yeah, it's nice.

(END VIDEOTAPE)

LU STOUT: Incredible access and amazing family photos there.

Now next week, Christine Lagarde shares how she really feels about suggestions that she should run for president of France. And if you've

missed any part of our interview with the IMF chief, get caught up at CNN.com/leadingwomen.

And that is News Stream. I'm Kristie Lu Stout, but don't go anywhere. World Sport with Amanda Davies is up next.

END