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CONNECT THE WORLD

Mission to North Korea; Japan Revamps its Military Forces; Barack Obama Signs Tax Cut Deal; The Threat from North Korea; United Nations Calls for Lauren Gbagbo to Step Down; Julian Assange Calls Swedish Charges "Smear Campaign." Chinese Premier Makes Trade Deal With Pakistan. Are US Attempts to Rebuild War-Torn Afghanistan Paying Off? Champions League World Cup Draw and Club World Cup Football. Week on the Web.

Aired December 17, 2010 - 16:00:00   ET

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


BECKY ANDERSON, HOST: North Korea warns it will attack again if the South flexes its military muscle. That while a U.S. governor is on a one man mission in Pyongyang, trying to soothe tensions. And U.S. ally Japan isn't taking any chances. It's shifting its military to meet a growing threat.

Is the near 60 year status quo on the Korean Peninsula about to change?

Going beyond borders on the day's biggest stories, on CNN, this is the hour we connect the world.

Well, the U.S. has told North Korea not to retaliate if the South goes ahead with a live firing drill. Russia says it's deeply concerned.

Joining the dots, as ever, in London, I'm Becky Anderson.

Also tonight, as pressure mounts on Ivory Coast's incumbent president to step down, we'll ask his rival's spokesman whether the power struggle can reach a peaceful conclusion.

Out of jail and speaking out -- Julian Assange tells us why the accusations against him are just a smear campaign.

And a chance for revenge for buying (ph) Munich as they are thrown against (ph) into Milan in the Champions League.

Remember, you can connect with the program online via Twitter. My personal address, as ever, @beckycnn. Do log on and do join the conversation.

Warnings, counter-warnings and a high profile attempt to douse tensions, which appear close to boiling over on the Korean Peninsula. North Korea says if the South stages another round of military exercises year Yeonpyeong Island, it will respond with a, quote, "unpredictable self- defensive blow."

Well, the last time Seoul staged drills near the island, Pyongyang shelled it. Four people were killed.

And concern stretches far beyond the Korean Peninsula. In Washington, the U.S. says North Korea would be -- and I quote -- "very unwise" to react with military force.

Russia today summoned the U.S. and South Korean ambassadors to the Kremlin to express deep concern over the planned drills.

In Beijing, an official insisted the only way to diffuse tensions is to resume six-party talks.

We're going to come back to this story.

But first, some developing news here on CNN.

Let's take you back to the White House.

You're going to see live pictures as I speak of a ceremony at the White House of President Barack Obama, as he signs off on a major tax bill. As we've said, the $858 billion bill -- nearly a trillion dollars -- extends unemployment benefits to jobless Americans. It also extends the tax cuts from the Bush era, including those for the nation's wealthiest citizens. You are seeing those involved taking to the stage, as we await the U.S. president on what is an historic occasion.

Just consider, as we watch these pictures, the enormity of this bill. Once again, a near trillion dollar bill extending unemployment benefits to jobless Americans, also, though, extending tax cuts from the George W. Bush era, something that the Democrats, led by Barack Obama, were pushing just a little.

Let's take a look and listen to what's going on here.

Here comes Mr. Biden.

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: Thank you all very, very much.

Please be seated.

Ladies and gentlemen, the -- this is -- this is -- I was going to say big deal, but an important deal.

(LAUGHTER)

ANDERSON: All right. Joe Biden. Joe Biden there, telling us it's an important deal, as well as a big deal.

We will come back to that, as we see Barack Obama signing in.

We -- we are talking North Korea here on CONNECT THE WORLD.

Can a U.S. envoy help ease the rhetoric?

Back in the U.S., of course, we've learned that Bill Richardson, a former United Nations ambassador, was on his way to Pyongyang on what is an unofficial visit.

Well, he's there now.

And CNN's Wolf Blitzer is traveling with Richardson and tells us about the start of what is an unofficial diplomatic mission.

(BEGIN VIDEO CLIP)

WOLF BLITZER, HOST, "THE SITUATION ROOM": So far, he's had a meeting with a senior official of the foreign ministry, who is in charge of U.S. affairs -- a lengthy meeting that they had today. He's trying to ease the crisis a little bit. They -- they went through various options of what -- what potentially could be achieved and then later tonight, they -- they just wrapped up a dinner that they had.

This sets the stage for what will probably be an even more important meeting that Richardson will have tomorrow with North Korea's chief nuclear negotiator, Kim Kye-Gwan. This is the man who invited Richardson to come here on this trip. They've had a -- a close relationship over the years.

And what is clear, according to Richardson and everyone else, that the crisis right now is the most intense since 1953, the armistice that ended the Korean War, given what's going on over these past several months.

The North Koreans see these South Korean exercises as a provocation and presumably they'll respond if they see some more.

So it's -- it's a very worrisome situation. And what Governor Richardson is desperately trying to do is calm the tensions and -- and get some sort of dialogue going to see what can be worked out.

He was encouraged by the first round that the North Koreans appear to be anxious to do the same thing, but we'll see what happens over the course of the next few days.

(END VIDEO TAPE)

ANDERSON: Wolf Blitzer traveling with Bill Richardson.

Well, Japan has a double-pronged concern when it comes to regional security -- North Korea and China. Tokyo says the actions and policies of each nation led to a defense overhaul.

Kyung Lah explains the changes and what they may mean going forward.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT: (voice-over): Call it Japan responding to the times, with a major overhaul of its defense strategy, realigning heavy armored military forces from the north to more mobile forces in the south, away from a cold war era threat from the Soviet Union to the increasing tensions with its Asian neighbors, namely, North Korea.

It's been the subject of much public discussion, especially over the past year. In a visit to the region last week, chairman of the U.S. joint chiefs of staff, Admiral Mike Mullen, urged Japan to take a larger regional role, joining American military exercises with South Korea...

HILLARY RODHAM CLINTON, SECRETARY OF STATE: A grave concern...

LAH: -- and diplomatically, forge a closer partnership with Seoul and with.

PETER BECK, KEIO UNIVERSITY: Really, you know, Pyongyang's behavior leaves Japan and -- and North Korea's neighbors no choice but to prepare for a contingency on the Korean Peninsula.

LAH: Keio University's Peter Beck says there's another reason why Japan is making the defense shift -- China's growing muscle in the region. This collision last September between Japan's Coast Guard and a Chinese fishing vessel happened near islands both claimed as territory by Japan and China. The dispute brought relations between the two nations to recent lows and raised concern in Tokyo about what Beijing's increasing naval activities mean to Japanese sovereignty.

BECK: Beijing has been building up its military and -- and now that they've been flexing their muscles, the -- the panda is growling, if you will. And I think that's making Japan very uneasy and they're looking for ways to strengthen their presence in the south.

LAH: China's government, in response to CNN's question on Japan's defense realignment, says Beijing wants mutual security, trust and improved relations and wishes the same from Tokyo.

"We hope that Japan, as a major country in the region, will contribute and put forth a more concerted effort to contribute to peace and stability in the region," says a spokeswoman.

Japan's prime minister says a new defense policy should not raise concern among its neighbors.

"It's necessary for the Japanese government to establish our defense in this manner," says Japan's prime minister. "But that does not mean it's a threat to other countries," he adds.

(on camera): This overhaul in defense strategy does not change the essence of Japan's military. Post-World War II, Japan has maintained a pacifist constitution. That means even with the new guidelines, Japan's military exists in self-defense only.

Kyung Lah, CNN, Tokyo.

(END VIDEO TAPE)

ANDERSON: All right. I'm going to move on, on this story. But before we do, let me just bring you what is going on at the White House as we speak.

This is a breaking news organization. Of course we, you rely on us to bring you stories as they happen. And what you've got there, live pictures of a ceremony at the White House for President Barack Obama's signing of what is a major tax bill, extending the tax cuts from the George W. Bush era. It's an $858 billion bill extending unemployment benefits to jobless Americans.

Let's just listen in to what Barack Obama is saying.

It's an important moment in American history.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: -- who couldn't be here today and all who worked together to get this done.

First and foremost, the legislation I'm about to sign is a substantial victory for middle class families across the country. They're the ones hit hardest by the recession we've endured. They're the ones who need relief right now. And that's what is at the heart of this bill.

This bipartisan effort was prompted by the fact that tax rates for every American were poised to automatically increase on January 1st. And if that had come to pass, the average middle class family would have had to pay an extra $3,000 in taxes next year. That wouldn't have just been a blow to them. It would have been a blow to our economy, just as we're climbing out of a devastating recession.

I refused to let that happen. And because we acted, it's not going to. In fact, not only will middle class Americans avoid a tax increase, but tens of millions of Americans will start the new year off right by opening their first paycheck to see that it's actually larger than the one they get right now.

Over the course of 2011, 155 million workers will receive tax relief from the new payroll tax cut included in this bill, about $1,000 for the average family.

This is real money that's going to make a real difference in people's lives. And I would not have signed this bill if it didn't include other extensions of relief that were also set to expire, relief that's going to...

ANDERSON: And lest we forget, this, of course, is a financial crisis that the world faces. And Barack Obama there about to sign into law a new tax bill and a new unemployment benefit deal.

Tax cuts extending those from the George W. Bush era, of course, and the unemployment benefits an extension to jobless Americans. An important moment there in American history. Times are tough, still, as we move out of 2010 and into 2011.

All right, let's return to our top story this hour and that is tensions on the Korean Peninsula.

I want to talk more about this with Christopher Hill.

He's an expert, of course, on this subject, the former Bush administration point man on six-party talks with North Korea.

He joins us now from CNN in Washington.

Chris, you're a regular guest on the show. You know the region.

What's going on?

CHRISTOPHER HILL, FORMER U.S. NEGOTIATOR, SIX PARTY TALKS: Well, basically, we have a North Korea that is not playing well with anyone else. North Korea has some internal problems and they're looking, I guess, to externalize some of these internal problems.

And so they've really caused a crisis right now with South Korea. And I think what's important right now is you see South Korea and Japan very much aligned in a way they haven't been in many years. So you see the U.S., South Korea and Japan.

And you even see Russia issuing some very strong statements, telling the North Koreans that they need to denuclearization.

So the -- the missing link, at this point, of course, is where the Chinese are. Now, as you know, there's a U.S. delegation in Beijing just - - just recently, talking with the Chinese. And the Chinese have had one answer for everything, which is let's get back to the six-party talks...

ANDERSON: Sure.

HILL: -- and -- and these other countries have said wait a minute, let's make sure there's a purpose to getting back to the six-party talks. And so far, the Chinese have not delivered on that purpose.

ANDERSON: Though, of course, during the WikiLeaks period, we've also heard -- or we're certainly led to understand that China is just beginning to bet -- get a little tired with Pyongyang and the North Korean leadership.

So -- so far as the six-party talks are concerned, which is the sort of the headline as far as China is concerned, do you think we're beyond that at this point?

HILL: Well, I -- I think the rest of us are concerned that there is really no purpose to calling a six-party meeting when, in fact, the North Koreans have continued to create these crises. So there has to be a foundation for having these -- this meeting.

And I'm sure

At some point Bill Richardson visiting Pyongyang, we'll hear the North Koreans say, yes, we'd like to come back to the six-party talks.

That, in and of itself, is no news at all. What the North Koreans need to do is come back for the purpose of those talks, which is complete denuclearization. And, clearly, the North Koreans are not heading in that direction now.

ANDERSON: Bill Richardson is out there, we are told, not the -- at the behest certainly, of the -- of the North Koreans, but not on behalf of the U.S. administration. I believe that John McCain is headed out there this weekend, as well.

Listen, you know, we're seeing the ratcheting up of what has been months of tension here.

Where is this headed, Chris?

HILL: Well, you know, it's hard to say. But certainly this is more tension than we've seen on the Korean Peninsula for many years. So this is a rather dangerous moment. And I think we need to work very carefully and work -- work very assiduously to deal with it.

But I really think the element here that we don't see present enough is China. I think China needs to take more responsibility for this historic ally, this neighbor of theirs, North Korea. China really needs to get moving on this. And for them just to call for the six-party talks is a way of saying let's have a six-party meeting that will get us, the Chinese, off the hook.

ANDERSON: Let's just think the unthinkable here briefly.

Are we witnessing the end of the near 60 years of status quo in the region?

And if so, what's the worst case scenario, Chris?

HILL: Well, I mean the worst case scenario is one we all know and it's called war. And that's a scenario we all must avoid. I mean war is a catastrophe for so many people.

But I think stepping back a little, what we're seeing is a country that is really having difficulty articulating to its own citizens, much less to its neighbors, what the purpose of it is.

Why North Korea today, in 2010?

Is it just a relic of the mid-20th century?

I think the North Koreans have had a real difficult time explaining to -- to themselves why they exist. And I think the fact that this succession, where they are trying a hereditary sec -- succession for now, the -- the second time, I think many North Koreans, probably including the North Korean military, are not buying this.

And so in this internal crisis, I think they're looking for external ways to try to pull them all together.

ANDERSON: Tensions on the Korean Peninsula.

Your expert on the subject tonight, a man who knows the region better -- he's probably forgotten more about the region when -- than we will ever know.

Chris Hill with you out of Washington this evening.

Chris, we thank you very much indeed, for that.

You're watching CONNECT THE WORLD here on CNN.

One man still sits in the president's seat in Ivory Coast, but another man says it's his turn. When we return, we'll talk with a spokesperson for Alassane Ouattara.

(COMMERCIAL BREAK)

ANDERSON: From the U.N. to Ivory Coast, President Lauren Gbagbo has been told he must pack up and leave.

Secretary-General Ban Ki-moon says Gbagbo's attempt to hold onto power cannot be allowed to stand.

French President Nicolas Sarkozy has also chimed in. He says Gbagbo must admit defeat before the end of the weekend.

Meanwhile, the U.S. and a growing number of countries are threatening sanctions.

Ivory Coast's independent election commission says Alassane Ouattara clearly won last month's vote. But the country's constitutional council overturned the commission's ruling.

Well, if criticism aloe were enough, Laurent Gbagbo would be long gone.

Let's see what weight, if any, then, that the U.N. call will have.

Let's get to our New York bureau, where we're joined by senior U.N. correspondent, Mitchell -- Mr. Richard Roth.

Good evening, sir.

RICHARD ROTH, CNN SENIOR UNITED NATIONS CORRESPONDENT: Good evening to you, Becky.

UN Secretary-General Ban Ki-moon, in his most forceful comments to date, says the situation in Cote d'Ivoire is heading toward a dangerous turn. He called on Laurent Gbagbo to step down. He said that any attack on U.N. officials would be an attack, in effect, on the international community.

The secretary-general had a year end press briefing and again, in strong language, he said that what this current outcome makes a mockery of democracy. And he had a message for Mr. Gbagbo.

(BEGIN VIDEO CLIP)

BAN KI-MOON, U.N. SECRETARY-GENERAL: The results of the election are known. There was a clear winner. There is no other option. The efforts of Laurent Gbagbo and his supporters to retain power and flaunt the public will cannot be allowed to stand. I call on him to step down and allow his elected successor to assume office without further hindrance.

The international community must send this message loud and clear. Any other outcome would make a mockery of democracy and the rule of law.

(END VIDEO CLIP)

ROTH: Cote d'Ivoire is the opposing ruler who has won, but he hasn't really been declared the winner by Mr. Gbagbo, who doesn't want to step down. He's asking for Ivory Coast's U.N. ambassador to be replaced by one of his own men. That will up to the U.N. Credentials Committee, Becky.

These types of processes happen in these situations. It could take weeks for them to be decided on.

ANDERSON: And lest we forget, there are 8,000 U.N. troops there. I mean if the world didn't care, they care for that reason. But they do care, at this point.

Richard, we thank you for that.

Yesterday on CONNECT THE WORLD, I sat down with an adviser to the Ivory Coast's incumbent president.

As you're about to hear, Abdon Bayeto is convinced that his side is right.

(BEGIN VIDEO CLIP)

ABDON BAYETO, ADVISER TO IVORY COAST PRESIDENT: President Laurent Gbagbo won the election in the country. The supreme court of the country ruled out the north part of the country in the voting system. It was rigged. It's the only (INAUDIBLE) we are saying. There were some independent observers who said it. And you know that.

Why are the world against Laurent Gbagbo?

We don't know that. This is not a typical person. This is a person who is not in (INAUDIBLE) with them.

ANDERSON: All right...

BAYETO: That's why they're all against him.

(END VIDEO TAPE)

ANDERSON: A spokesman for the incumbent.

All right, there are obviously at least two sides to this story.

Let's go to Abuja (ph) in the Ivory Coast for you.

Patrick Achi joins me.

He's a spokesman for the man who believes he has won this election.

That man is Alassane Ouattara.

Sir, people are dying on the streets.

How much suffering is Ouattara prepared to condone, at this point?

PATRICK ACHI, ALASSANE OUATTARA SPOKESMAN: Oh, how many victims -- how many lives the international community is ready to accept to have him step in?

I heard a representative of the secretary of the United Nations saying Gbagbo should step down the one that we all recognize he's the elected president should step in.

Now how does he step in if the former president has the army and the state media?

That's the issue. The people are getting in the street to really ask for the law to be applied, for the president -- the elected president to step in. They're -- they're just peacefully marching. They have no arms. And they are killed like animals. And no one does anything. Everybody is just saying he should step down.

Now, how does he step down?

This is a very important issue as far as democracy in the world is concerned. The whole world has admitted that someone is elected and someone is there not leaving the power and killing kids in the street like animals, following them in houses...

ANDERSON: All right...

ACHI: -- in streets with machine guns and trucks...

ANDERSON: Yes. And we've seen the...

(CROSSTALK)

ANDERSON: And we've seen the pictures.

ACHI: This is (INAUDIBLE)...

ANDERSON: I don't -- I want to stop you there.

Let's -- let's -- let's get this conversation going. We've seen the pictures. It is -- it's diabolical what's happening on the streets.

What is Alassane Ouattara's next move at this point?

ACHI: He's been telling everybody that he doesn't want people to die anymore. This country has suffered for 10 years on crises. People have died. Enough is enough.

We want to move on with peace. That's why we believe everything that could be done to follow on Gbagbo, who lost five years to organize elections -- the most costly elections in the whole world, but we just followed it, because we knew he would lie and he would not accept the results of the election.

We say we want a third party to control.

ANDERSON: All right...

ACHI: We asked the secretary-general to appoint a representative. He got all the billing (ph), all the vote and he didn't count himself. And he said Alassane Ouattara has (INAUDIBLE)...

ANDERSON: All right, let me stop you there.

ACHI: (INAUDIBLE) any crimes...

ANDERSON: I need to...

ACHI: -- any lives lost.

ANDERSON: -- move you on.

ACHI: (INAUDIBLE) come back in power.

ANDERSON: All right. I need to move you on.

Do you fear, at this point, that there is civil war in the making?

ACHI: Civil war is what people want because they have lost and they don't know what to do to stay in. Today, there was not a march. I'm telling you, there will be 20 people killed in (AUDIO GAP) we can ask anyone. These people were shot down in their houses. People getting out of the church were killed. This is (AUDIO GAP). No one can (AUDIO GAP) that.

And do you want to stay there (AUDIO GAP) that there is no interest in (INAUDIBLE).

ANDERSON: What do you say...

ACHI: (INAUDIBLE).

ANDERSON: What do you say...

ACHI: This country has all...

ANDERSON: What do you say to...

ACHI: This country has (AUDIO GAP). This country has only one problem. His name is Laurent Gbagbo.

ANDERSON: What do you say to his supporters...

ACHI: Let's have (INAUDIBLE)...

ANDERSON: What do you say to his supporters who say that the election result was overturned by the Supreme Council and that he stands as president?

What do you say to that?

ACHI: What I'm saying is that (AUDIO GAP) in the constitutional council, he has just appointed friends and family members.

Now, this is the whole issue of democracy in Africa, you know?

You set up a constitutional council where you have only family members, you control the army, you control the media. You can stay for 15 years.

Now, what we're fighting for democracy is to say let's do -- let's go for elections fair, transparent and free. And this is what we've been able to do in Cote d'Ivoire. And the whole international community has helped to get this.

ANDERSON: Sure.

ACHI: Now we have the result. Now, I'm asking you, we have the result. We did what you said we should do. You (AUDIO GAP).

ANDERSON: And Patrick, with a...

ACHI: (AUDIO GAP).

ANDERSON: I'm losing your connection...

ACHI: (AUDIO GAP) the international community.

What are you waiting -- what are you waiting to move on after having said that we have won (AUDIO GAP) sitting there instead of seeing these guys killing people in the street and killing...

ANDERSON: And we hear you.

ACHI: (INAUDIBLE).

ANDERSON: And we hear you. And I'm afraid tonight the connection with you in the Ivory Coast isn't particularly good.

But we certainly understood your message to the outside world tonight and we do appreciate your time making it here onto CONNECT THE WORLD.

So we thank you very much, indeed, for joining us.

Apologies there. You got the interview. It was difficult to get.

Moving on, Beijing is inking trade deals left and right. A day after boosting trade with India, China begins hammering out some multi-billion dollar packages with Pakistan. That's up next.

(COMMERCIAL BREAK)

BECKY ANDERSON, CNN HOST: At half past nine in London, you are back with CONNECT THE WORLD. I'm Becky Anderson. Coming up, yet another deal. We are following in the footsteps of the Chinese premier as he continues his trade mission into Pakistan. So, what's in it for both players?

Then, nine years on in Afghanistan, are US attempts to rebuild the war-torn country paying off? The last in our special series and reports this week.

And then, a unique glue for a unique team. We'll be asking footy -- I'm sorry. We'll be talking footy and asking, can this little-known Congo football club defeat a European powerhouse? Well, they're certainly going to give it a shot this weekend, and we're going to bring you the details of that in the next half hour.

Before we do that, let's get you a very quick check of the headlines this hour.

North Korea is warning South Korea it will respond with a, quote, "unpredictable self-defensive blow" if the South stages their military exercises near Yeonpyeong Island. The exercises could start anytime. When Seoul staged drills near the island last month, Pyongyang shelled it, killing four people.

UN Secretary General Ban Ki-moon says Ivory Coast president Laurent Gbagbo must step down. Any other outcome, he says, would make a mockery of democracy. Ivory Coast Independent Electoral Commission has ruled challenger Alassane Ouattara won last month's vote, but Gbagbo refuses to relinquish his post.

US president Barack Obama has just signed an $858 billion bill to extend tax cuts for all Americans that were set to expire on December the 31st. The US House gave final approval last night over the fierce objections of liberal Democrats. The bill also extends unemployment benefits.

WikiLeaks founder Julian Assange called Sweden's sex crimes investigation against him a smear, and Julian Assange says he's worried the US might be planning to extradite him on espionage charges. Assange also says he does not know who sent WikiLeaks the thousands of classified US documents the website has been releasing. Atika Shubert has more.

(BEGIN VIDEOTAPE)

ATIKIA SHUBERT, CNN CORRESPONDENT (voice-over): Julian Assange steps into the media spotlight out of the country home of a prominent supporter where, for now, he is living. Relaxed but defiant, repeating that the accusations against him are part of a campaign to ruin his reputation.

JULIAN ASSANGE, FOUNDER, WIKILEAKS: This has been a very successful smear but, ultimately, it will not be successful. Ultimately, people will see what is behind them.

Now, what is behind them? What are precisely the allegations? Well, we don't know, precisely. In fact, the Swedish prosecution refused to give any evidence whatsoever to the British courts.

SHUBERT (voice-over): He spent his first day out of prison making the rounds with the TV networks camped outside in the snowy garden. I asked him to comment on Bradley Manning, the army private and alleged source of WikiLeaks' enormous cache of classified US government documents. Manning was spending his 23rd birthday on Friday in solitary confinement in a military jail in Virginia.

ASSANGE: We see, in this case, a young soldier who has been embroiled by allegations that they have had something to do with this -- with some of the materials that we have published. The helicopter murder video was the first charge that he's alleged to have been involved in.

Now, as an organization, we're in a very difficult position, that our technology does not permit us to understand who our sources are. I'd never heard of the name Bradley Manning until I saw it in the media. And that is right because, in the end, that is the only way which sources can be guaranteed that they are protected if even the journalists don't know who they are.

SHUBERT (on camera): This is the new home of Julian Assange and WikiLeaks. It's an 18th century manor house set in 600 acres of parkland. But Julian Assange is restricted to this area. He also has to wear an electronic tag that monitors his movements. And every day, he must check in with the local police.

SHUBERT (voice-over): And that's what he did Friday afternoon. He was greeted by curious locals who wanted his take on England's current cricket match against Australia.

UNIDENTIFIED MALE: What about the cricket score, Julian?

ASSANGE: I've been in a black hole for ten days. I don't know about cricket.

SHUBERT (voice-over): And he was in an equally talkative mood when he returned, bemused by his new circumstances.

SHUBERT (on camera): Do you feel safe here?

ASSANGE: I feel as safe as one can under the circumstance. It's always a bit safer -- feel much safer if I was here and no one knew I was here.

SHUBERT: Julian Assange has just returned from what will now become a daily routine. He must report to the Beccles police station every day between the hours of 2:00 and 5:00. Just some of the conditions of his release.

But despite these restrictions, Julian Assange says it is business as usual for WikiLeaks. Atika Shubert, CNN, at Ellingham Hall in Suffolk, England.

(END VIDEOTAPE)

ANDERSON: Those are your headlines this hour. This is CONNECT THE WORLD. I'm Becky Anderson with some of the biggest stories today. And one of them is China, which is on a trading spree at present. The nation has lots to buy and sell.

On Thursday, Chinese premier Wen Jiabao was in India. Well, now he's in Pakistan. As Chris Lawrence tells us, this is trading with a little political horse trading tossed in for good measure.

(BEGIN VIDEOTAPE)

CHRIS LAWRENCE, CNN CORRESPONDENT (on camera): Well, this meeting between Prime Minister Wen and his Pakistani counterpart was mainly about money. Specifically, trade and investment. The two prime ministers signed about 13 deals, totaling about $20 billion. That's how much the Chinese government will invest in Pakistan.

It covers everything from loans for Pakistan to do some reconstruction work in those areas hit by the floods. Agriculture. Energy is a big part of it, as well. Chinese agreeing to fund all of the Pakistani energy projects. That's big, because Pakistan faces a huge energy shortage.

And, also, a development in banking. The top private bank of China is going to open a branch here. ICBC. That's huge, because that bank is flush with money, and it could fund a lot of development projects here in Pakistan.

Now, before Prime Minister Wen stopped here, he was also in India. And there, they completed other deals worth about $16 billion with his Indian counterpart. He also called India a cooperative partner, not a rival.

Those sort of close words between China and India could worry some in Pakistan. But I spoke with the former deputy ambassador to China, Pakistan's former deputy ambassador to China, who told me he is not worried because what he sees is a sort of a larger world picture in which China is reaching out and establishing a more strategic relationship with India.

Deepening economic ties is a way to sort of blunt or put a check on any strategic agreements that India may make with, say, the United States that would not be in China's interest.

SYED TARIQ FATEMI, FORMER PAKISTANI AMBASSADOR TO US: So, instead of seeking to isolate India or seeking to bypass India, I think the Chinese believe that deeper relations with India are going to be more helpful to them in maintaining peace and stability in the region than otherwise.

And I think this is something that we endorse. We want China and India to have good relations because our own relationship is based on a degree of trust and confidence that should not give us any concern as to the emerging ties between Delhi and Beijing.

LAWRENCE: So again, the Chinese government promising about $20 billion in deals with Pakistan, and we expect there will be another $10 billion added to that by private Chinese firms at the business summit here on Saturday. Becky?

(END VIDEOTAPE)

ANDERSON: All right, Chris Lawrence for you. Let's just remind you, then. China has become one of Pakistan's top five import sources. Their major imports from China include machinery, construction materials, chemicals, and textile products.

Now, according a report this year, more than 67 percent of total exports to China from Pakistan is cotton yarn. Pakistani officials say trade between the countries stands around $7 billion a year, and have a target to reach about $15 billion by 2012, so doubling that.

More than 120 Chinese companies are working in Pakistan from oil and gas to IT industries, power generation, infrastructure, and mining sectors.

Well, Akbar Ahmed is the former Pakistani ambassador to the UK. He's a regular guest on this show, one of your big thinkers, is joining us, now, from Washington. Sir, how significant is Wen Jiabao's visit to Pakistan?

AKBAR AHMED, FORMER PAKSTIANI AMBASSADOR TO THE UK: Significant, Becky. It tells us a lot of what's going on in Asia on the world stage, in fact. He goes to India for three days, he comes to Pakistan for three days. So, immediately, there's a symbolic assertion that Pakistan is valued, and that plays very well in terms of Pakistani pride, national dignity, and so on.

But there's substantial support, also. Support for Pakistan's nuclear program, support for the military aircraft, support for this new port in Gwadar, which would link Pakistan directly with the Gulf, the Gulf states, and then, further on, the Arab world.

And, of course, this is what Pakistan expects its key ally, China, to be providing. Because Pakistan values this stable and long-standing relationship.

ANDERSON: And that, the operative word is "key ally China." Washington's not going to enjoy this much, because Washington expects Islamabad to treat it as its key ally.

In the broader context, then, Wen Jiabao took something like 300-odd people with him on this trip. That was more than Obama took with him when he visited India, recently. He will be going to Pakistan, we're told, in the coming month. Within a broader context, let's just talk about how significant this trip is to the region.

AHMED: Well, again, Becky, take a look at what's happening in the world today. Japan for the first time is beginning to flex its military muscles. India has emerged as a giant. And China has always been very sensitive to the concept and idea of being encircles. And it may be subconsciously feeling encircled.

And therefore, Pakistan becomes critical. Because, if you look at the map, Pakistan provides China land access straight into the Gulf.

ANDERSON: Right.

AHMED: And Gwadar, then, becomes a critical port which will link China via the Karakoram Highway and, in fact, a military, geopolitical, economic, trade, everything that gets involved. So, this relationship, China, Pakistan, is like a stable, long-term marriage. Slightly boring, but both partners are happy and comfortable with each other.

With the United States, Pakistan has a more turbulent, more exciting relationship. President Obama goes to India for the better part of a week and avoids Pakistan. And that sort of reflects the relationship.

ANDERSON: There is no love lost, as we know, between Islamabad and New Delhi. These bilateral deals that China has struck with India dwarf those that it struck with Pakistan. I think the deal was something like to the tune of $100 billion, whereas those with Pakistan have been to the tune of about $20 billion. How will that have been received in Islamabad?

AHMED: There's a lot of apprehension in Pakistan, always, when relationship with India become warm between China and India, because these are the two great powers in Asia today.

At the same time, Pakistanis are conscious that the relationship with China will, ultimately, always prevail, even if relations are improved between India and China.

And, in a sense, this relationship will also help bring down the temperature in South Asia and, ultimately, will be good for everyone, because the more peace and prosperity you have, these nations in South Asia can really begin to normalize relationships and live normal lives.

ANDERSON: And the tectonic plates of bilateral trading move as we speak. Sir, we thank you for joining us. It's a Friday night here in London, a Friday afternoon in Washington. We thank you very much, as ever, for your time on this show. Akbar Ahmed, a regular guest on this show.

The road to recovery. Ahead on CONNECT THE WORLD, we return to a public works project began at the very start of the war in Afghanistan. What impact has it had nine years on? Stay with us.

(COMMERCIAL BREAK)

ANDERSON: All right. It's a quarter to ten in London. I'm Becky Anderson, this is CONNECT THE WORLD. All this week on the show, we've been giving you an in-depth look at Pak -- Pakistan? At Afghanistan. From conditions on the ground to behind-the-scenes diplomacy.

Well, we end the week by looking back somewhat. The focus, a public works project that has had its roots at the start of the war. Nic Robertson explains why projects like this one are so important for the country on its long, slow road to recovery. Have a look at this.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): The province of Herat in Afghanistan nine years ago. A US-funded canal repair project just after the Taliban were defeated. Five hundred men, $1 a day each. We've come back to ask if the money was well spent.

ROBERTSON (on camera): For the canal, I can just see -- we can see the water right down here. It looks far.

ROBERTSON (voice-over): Some farmers arrive. We show them a picture.

ROBERTSON (on camera): Do you remember when the canal here was dug out nine years ago?

ROBERTSON (voice-over): They answer quickly. "Yes, it was Ramadan," he says, "22 days I worked here."

Every year, they say, sand blows in and they dig it out. Only now, the village is more prosperous, and they pay for it themselves.

The equation is a simple one. Provide some income and better security will follow. And these men say that's down to better government. Music to the ears of USAID, the agency that funded the work.

MIKE GREEN, USAID: And so, I was so pleased to hear them say as a group that what has been done here, the economic growth, the jobs, the security, is actually something that's being provided by their central government.

ROBERTSON (voice-over): This USAID-funded school we saw being built in 2002 proved harder to find. The agency records don't go back that far. So we came here, to another USAID-funded school in the town of Shah Bash, built five years ago.

ROBERTSON (on camera): In the past nine years, close to 100 schools have been built, but the province needs 400 more. Back then, they cost about $50,000 to build. But material costs have gone up. Now, they cost about $200,000, even more. And this one is just five years old and is already showing signs of wear.

ROBERTSON (voice-over): As we walk in, we discover it's a holiday. No lessons, only teachers marking exams. They tell me the school has benefited the town. A thousand young boys and girls are taught here, but they need a high school and a health clinic, too. And also, they want the leaks fixed.

I ask if the children appreciate their benefactors.

ROBERTSON (on camera): When they come to school, do they think, "Yes, this was a school funded by the United States, this is wonderful"? Do they like the United States.

(LAUGHTER)

ROBERTSON (voice-over): The head teacher replies, "If you're asking my opinion, they don't like America." It's a common view. Many Afghans see the US as responsible for the war.

GREEN: They didn't really understand that it came from the American government and, frankly, that's in line with what we're trying to do here in terms of building commitment to the Afghan government.

ROBERTSON (voice-over): So long as there's peace here, US officials don't mind the Afghan government getting the credit. It's what the troop drawdown and exit strategy is all about. Nic Robertson, CNN, Herat, Afghanistan.

(END VIDEOTAPE)

ANDERSON: Closing out a week of reports to you from Afghanistan behind the battle lines.

A Champions League draw is out. Inter Milan, for one, facing a tough fight in a 2010 final rematch against -- question mark, not going to tell you. Can the Italians retain their title? We're talking footy, up next.

(COMMERCIAL BREAK)

ANDERSON: All right. A chance for redemption, a chance for revenge. The round of 16 draw for the 2011 Champions League Cup is in, and we can look forward to some terrific battles. Don Riddell here with the details. Sir?

DON RIDDELL, CNN CORRESPONDENT: One match stands out above all others. It's a rematch of this year's final, would you believe, between Inter Milan and Bayern Munich.

ANDERSON: Remarkable, isn't it?

RIDDELL: I think both teams would have really loved to have avoided each other, especially Bayern Munich. They won their group. You expect to get an easy team in the next round. Maybe Inter are an easy team, because they're certainly not the team that won the Champions League back in May. But a fascinating clash nonetheless.

ANDERSON: Yes, we're going to talk about Inter in a moment. The other clash, of course, is --

RIDDELL: Barcelona versus Arsenal. Arsenal doing very well in the Premier League, Barcelona doing tremendously in Spain. I think they are everybody's favorites for the competition this year, with the exception of Real Madrid fans, of course.

But Barcelona doing really, really well. They thrashed Real Madrid a couple of weeks ago five-nil. This is a rematch of the 2006 Champions League final. And remember that Barcelona knocked Arsenal out last year, Messi scoring four goals against the gunner for the second-ranked.

ANDERSON: It was all Messi, it was all Messi.

RIDDELL: It was, yes.

ANDERSON: All right. Listen, last Champions League, and it goes on into the new year, and it's a draw of sixteen and we love it. What we don't talk enough about is what's called the Club World Cup. This is going on this weekend and, of course, it involves Inter. Also, another -- tell us about this, because this is fascinating.

RIDDELL: The Club World Cup always tends to be a little bit predictable because it's always a European team versus a South American team in the final.

ANDERSON: Yes.

RIDDELL: Not this year. TP Mazembe of Lubumbashi in the Democratic Republic of Congo have completely broken the mold. They are absolutely brilliant. They're the African champions two years running. They're a really infectious team to watch. They play the game with so much passion and enthusiasm.

And when they win, as they did against Internzionale this week. Boy, do they know how to celebrate. We're hopefully going to bring you some pictures of their goalie. He --

ANDERSON: Look at this. Look at this! How does he do that?

RIDDELL: That is one of the most original celebrations I have ever seen. And I don't think anybody else could do it. I phoned up my trainer, actually, and said, "How do you do that?" Strong hamstrings, strong core, hip flexors have to be phenomenal. And above all else, timing and rhythm. Which rules most of us out.

ANDERSON: We talked about this earlier on, and you promised me that you'd show me how he did it. Remember?

RIDDELL: No, I did not. I said I will not be doing it, because I've got a couple of daft discs in my back.

ANDERSON: You are too much.

RIDDELL: Hopefully, we can show you what one of the team officials tried. He tried to have a go at it, and he is absolutely useless.

ANDERSON: Let's have a look. Can we bring that up?

RIDDELL: As I say --

ANDERSON: Oh, we haven't got it.

RIDDELL: Frankly, most of us couldn't do it. But, I mean, that -- isn't that just incredible? And I do think neutrals around the world will be rooting for Mazembe this year.

ANDERSON: Do they -- they stand a chance, do they?

RIDDELL: Well, they've got this far. Inter, as we all know, are having a pretty disastrous season. They're not playing like the European champions. And Mazembe, they knocked out Internzionale in the last game. That just wasn't what was in the script, so, who know?

ANDERSON: Fantastic. We'll look forward to that. Out of Abu Dhabi, I believe, this is.

RIDDELL: Indeed, that's where it's played.

ANDERSON: Good stuff. Don Riddell, for you, with your footy news this evening.

Next up, what's gone viral on the web this week? Stay with us for our cyber wrap. That's on CONNECT THE WORLD.

(COMMERCIAL BREAK)

ANDERSON: All right, well, we've still got a week or so of 2010, haven't we? You can toss a shoe at George Bush, and now you can nab a secret file from President Barack Obama. That's just one example of what's gone viral on the internet this week. Our digital producer Phil Han, as ever, takes us through the latest web hits.

(BEGIN VIDEOTAPE)

PHIL HAN, CNN DIGITAL PRODUCER (on camera): Welcome to another edition of Week on the Web. It's the place where we show you all the highlights from social media from the past seven days.

Let's get started, though, with this one. It's the holiday season, so lots of Christmas videos out there. But here's a viral video which shows the birth of Jesus, but tells it through the eyes of social media. Let's take a look.

(MUSIC - "Jingle Bells")

HAN (voice-over): The video uses everything from Google Maps to Facebook, Foursquare, and Twitter, and it includes parts of the story from finding the manger to the actual birth of Jesus. Here's a look at how it all happened if it happened in 2010.

Next up, we have this amazing new product from the people at Google. The company's been at the forefront of innovation for many years. But imagine if you could learn about the human body without any textbooks. And all you had to do was point and click.

Now, the Google Body Browser is being hailed as a breakthrough in the study of the anatomy, and some people are even saying that it could fast- track medical research. Now, it's not available for download just yet. But you can be pretty sure that when it is, there will be a lot of people who think that they've become instant doctors overnight.

Another story that is making headlines in the mainstream press has been WikiLeaks. But an online video game about it has been creating big waves on social media. In "WikiLeaks the Game," you assume the character of founder Julian Assange. And your goal is to smuggle a secret document from President Obama's desk.

Now, more than a million people have played the game since it was first posted earlier this week, and developers generally have been fast to take advantage of big news events over the past few years. And other games include the Chilean miner rescue to the Hudson River plane landing, which have all gone big online.

A big movie that is getting lots of attention is the release of "Tron: Legacy." It opens globally today, and the trailer on YouTube has already gotten more than three million hits. Now, the story is a sequel to the original "Tron" from 1982, and it centers around the story of Sam Flynn, who tries to find his father that has been trapped in a virtual world, stuck inside a computer.

While the film trailer is a big hit on YouTube, the soundtrack to the movie is also getting a lot of buzz online. The electro duo of Daft Punk have created some of the songs, and this particular one called "Derezzed" is particularly big, with more than a million hits on YouTube.

(MUSIC - "Derezzed")

HAN: And finally, check out this amazing new tool. It's called World Lens. And if you've ever been stuck in a country where you don't speak the language, this could be the thing for you. It's made using augmented reality software, and it translates a foreign language right in front of your eyes. All you have to do is lift up your iPhone to the words that you need translated, and it does it nearly instantly for you.

Right now, you can translate from Spanish to English and vice versa, but in the future, it's promising that it can translate a lot more language. Now, this is a gadget that is going to be the must-have one for frequent travelers.

Well, that's everything you need to know from the world of social media from the past seven days. I'm Phil Han for CNN in London.

(END VIDEOTAPE)

ANDERSON: Oh, that was too fab, that last piece. Great piece from Phil, there. And that closing out your week. I'm Becky Anderson, that is your world connected this week. "BackStory" is up next, right after a very quick check of the headlines this hour.

END