CCTV Script 06/03/14


— This is the script of CNBC's news report for China's CCTV on March 6, Thursday.

Welcome to the CNBC Business Daily.

Ukrainian Finance Minister Oleksandr Shlapak says that his nation is nearly broke, and that he's willing to work with the IMF on an aid deal.

CNBC's Steve Sedgwick spoke to him, and began by asking about the current state of financial affairs:

Shlapak: Today we are using a third of our budget to finance government debt. According to our data, 300 to 500 million dollars were leaving the budget of Ukraine every month through different fraudulent schemes, like tax evasion. So the coffers are nearly empty, and we know that the budget deficit for 2014 is not as it was previously stated.

Sedgwick: Corruption frames the past so can you be sure it won't frame the futue?

Shlapak: I can say that there were significant changes in society. The mood of people changed. Ukrainians started to believe in themselves, found self respect and regained pride in Ukraine as a country. I can say that because of these changes, we are ready to build something significant, a new country without corruption.

Sedgwick: So are you confident that if and when money comes from the IMF and other international agencies, are you confident that you can meet the conditionality from the imf

Shlapak: I think the IMF will not let itself be fooled a third time and will do everything in its power to prevent this from happening. We are trying to persuade our Parliament that the austerity budget is not only necessary for the IMF, but our country in general.

Sedgwick: The support from the EU - will it be enough now that the money from russia is not forthcoming?

Shlapak: We are currently in dialogue with our investors and partners discussing aid packages. Correct usage of our resources is the main issue right now. I think that if we can manage this there will be no need for Russian aid. But right now our coffers are nearly empty and so the main problem is the need to pay $10 billion in debt by the end of the year. This number takes into account raise of russian gas prices for the second quarter of 2014.

Sedgwick: Will Ukraine default on its debts or be able to repay them?

Shlapak: I think Ukraine will pay all of its debts with the help of the IMF. The austerity budget will be provided, and the gas issue will be closed.

Sedgwick: How much money over 2 years does the Ukraine need? I've seen one figure of 35 billion dollars - how much do you need?

Shlapak: I don't think Ukraine needs this much money. I think 10 billion dollars will be enough this year, and next year we'll need a lot less. If you're speaking of the fiscal situation, maybe 10 billion will be enough for this year, and next year, 5 billion. But we have to take into account the positive investments.

Sedgwick: Finally, we have a presidential election on May 25, can any candidate be honest to the people on the kind of measures, austerity that's needed?

Shlapak: As you know, we have brought back the constitution of 2004, according to which the power is now in the hands of the Verkhovna Rada (the Ukraine parliament) and the Cabinet of Ministers of Ukraine. I think that in May the newly elected President won't let people down. I was there at Maidan with my compatriots and so I know they are standing there because they want changes. They want significant changes. People are ready to face real economic realities, an austerity budget, as well as crucial truths about realities in Ukraine. And they think that our new leader will be honest about real economic situation. (pause) I hope our new leaders will adopt European principles. We are a European country. Our nation is united.

Ukrainian Finance Minister Oleksandr Shlapak there, speaking to CNBC's Stephen Sedgwick.

I'm Sri Jegarajah, reporting from CNBC's headquarters in Singapore. Thank you for watching.

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