welcome to nhk world "newsline." i'm gene otani in tokyo. here are the stories we're following this hour. the cradle of the u.s. auto industry has filed for bankruptcy, struggling with a multibillion-dollar debt. >> scientists have established a new characteristic of a nutrinos.

>> and as japanese voters get ready for sunday's upper house election, we look back on prime minister shinzo abe's first six months in office. before we go to those headlines, officials at china's central bank have announced they will liberalize interest on business loans starting saturday. the move should lower lending costs and promote bank lending. it is apparently aimed at controlling the expansion of so-called shadow banking. this growing practice of nonbank lending for real estate and other transactions is considered a risk factor for the chinese economy. u.s. automakers consider detroit their heartland, but authorities there are dealing with a debt of more than $18 billion. they have declared bankruptcy, the largest-ever municipal failure in u.s. history. detroit officials filed in court on thursday. >> one of the things that i want to say to our citizens is that

as tough as this is, i really didn't want to go in this direction, but now that we are here, we have to make the best of it. >> detroit has traditionally been the center of the u.s. auto manufacturing industry. general motors has headquarters in the city. gm responded to industry decline by declaring bankruptcy in 2009. people living in detroit numbered about 1.8 million in 1950. now, there are just 700,000. the population decline led to a decrease in tax revenues, city officials have faced financial distress ever since. market experts have seen signs of recovery in the u.s. including the auto industry. but analysts say detroit's bankruptcy is a hangover from longer term problems. president barack obama and his senior advisors are reportedly monitoring the situation. a white house spokesperson said the administration is committed to working as a partner in detroit's recovery. people are reacting to the

news that their city has gone bankrupt. our correspondent maki hatae is in detroit. >> reporter: overnight it was dark in detroit simply because the city does not have money to pay its electricity bills. you can see the headquarters of general motors back there, the world renowned automaker, the heart of the american auto industry. i asked people what they thought about the bankruptcy. >> it's gotten to a point where people got tired. we're paying services that we don't get. >> had no clue and i didn't know it was that bad here. i mean, i thought it was going to get a little bit better. >> i feel it's a good thing this city needs to turn itself around. it's got to start some place. this is what has to be done. >> reporter: people are naturally disappointed, but most know that something has to be done in order to make the city livable again. this may provide detroit with just enough breathing space to

start rebuilding. maki hatae, nhk world, detroit. >> for more on why detroit went bankrupt and what's ahead, we spoke to an expert on public policy at the nomura research institute. >> reporter: the biggest factor behind the collapse is the city's failure to adapt to a decreasing population. the trend began in the 1950s and accelerated after general motors bankruptcy in 2009. >> gm and car industries moving their industry property to overseas like developing country like china or south america. this offshore trend led to the

need for workers in detroit, so they layoff a lot of workers from their industry. >> reporter: he says the city was too slow to scale down excess infrastructure in line with the population decline. and he believes this problem will continue affecting detroit. >> one biggest concern for the situation that is that it will deteriorate quality of life of people living in detroit cities because detroit city have to cut its government budget, they need to cut benefit -- welfare benefit such as food stamps for poor people, or they have to reduce the pension for older people. this will make the life of

citizens very worse rather than now. they need to shrink the area of city of detroit more on a more smaller. >> reporter: he says city executives need to implement the necessary reforms to avoid going into another tailspin. jun yotsumoto, nhk world, tokyo. a group of researchers says they're one step closer to understanding their origins of the universe. they've confirmed that fundamental particles known as neutrinos have the ability to transform themselves. a group led by professor kobayashi made the observation. the team generated neutrinos at the japan proton accelerator

research. they then beamed them toward the observatory about 300 kilometers away. 500 researchers from 11 countries observed the experiment. they helped confirm that neutrinos transformed into electron neutrinos. this finding could help solve one of the basic mysteries of physi physics. >> translator: i think neutrinos may hold the key to understanding why matter exists in the universe. they could help reveal the ultimate law that controls matter. >> scientists say when the big bang created the universe more than 13 billion years ago, equal amounts of matter and antimatter were present. but for some unknown reason the antimatter disappeared a short time later. researchers expressed hope the experiment will shed light on the nature of neutrinos and lead

them to understand why the antimatter disappeared. a crew of a north korean cargo ship could be spending more time in panama than expected. panamanian authorities have charged them with smuggling. their freighter was seized as it tried to pass through the panama canal. it was found carrying obsolete weapons from cuba hidden under bags of sugar. panamanian investigators say the captain and 35 crewmen have been charged with attempts against panama security in transporting undeclared military equipment illegally. they also say the north koreans declared the ship was carrying sugar but not any weapons. they say the north korean sailors could face more than four years in prison if convicted on the attempts on national security charge only. the captain and 35 crew members have refused to speak to the authorities. both north korean and cuban officials confirm the soviet era weapons were to be repaired in north korea and returned to cuba. united nations security

officials say transporting weapons is in violation of u.n. resolutions prohibiting north korea from dealing in arms. panamanian officials say that u.n. investigators will inspect the freighter. north korean officials have called on the panama officials to release the crew members without delay. ob everybody servers say north korea will file against the charges. supporters and opponents of morsi are in a stand-off raising fears of confrontation. both camps called for nationwide demonstrations to coincide with friday prayers. morsi's power base the muslim brotherhood refuses to recognize the interim government that was sworn in on tuesday. they continue sit-ins and rallies to press for his reinstatement. interim president adly mansour said in a televised speech that his government is committed to restoring security and will fight to achieve it. earlier in the week the european union foreign policy chief catherine ashton visited egypt.

she urged both sides to open dialogue. but there are no signs a compromise can be reached since the brotherhood doesn't accept the interim authorities. on monday and tuesday, morsi supporters clashed with his opponents and government security forces. seven people were killed and more than 250 were injured. the u.s. president has urged the prime minister of israel to help revive stalled middle east peace talks. in a phone call, barack obama asked benjamin netanyahu for help in resolving dialogue between israelis and palestinians. the talks have been on ice for nearly three years. u.s. secretary of state john kerry met with the leaders of jordan and other arab countries. palestinian sources say kerry made a new proposal that accepts some palestinian demands. u.s. state department officials say kerry saw a narrowing of differences between israelis and palestinians. he's yet to decide when to return home as he continues last minute negotiations.

observers are watching whether the latest u.s. engagement can break the deadlock in dialogue. the general public allowed to attend a sensitive political ceremony that remembers political leader. prevented from marking the occasion worried it might bolster the position of the general's daughter, pro-democracy leader aung san suu kyi. a ceremony held on friday. aung san suu kyi offered prayers to her father assassinated 66 years ago to the day. elsewhere others gathered in front of a bronze statue of the late general. >> translator: we still have a long way to go as a democratic nation, but it's good to know that we can participate in an

event like this. >> translator: even now this event isn't as big as it was before the military years. the government still has a lot more to do. >> general aun san is considered the nation's founding father. he holds a special place in public consciousness. the general is a sensitive subject for former military rulers because his daughter was their fiercest critic. seeing pictures of him in public was rare. allowing citizens to take part in the memorial service is viewed as another milestone on the nation's long road towards democracy. politicians in japan are chr crisscrossing the country making last-minute pitches. voters will decide on sunday who should represent them in the upper house of their diet. and as they fill out their

ballots, they'll also be considering whether to give prime minister shinzo abe and his liberal democratic party more power. the ldp controls the lower house, but opposition parties hold the majority of seats in the upper chamber, and that's created a divided diet where passing legislation can be tricky. in the lead up to when japan decides, we've been looking at some of the key campaign issues and hearing from voters about what matters to them. candidates from these nine parties are running in the election. the groups qualified for political party status. others that failed to meet the standards are still fielding candidates. in all 433 candidates including independents are running in this election. now, prime minister abe sees this vote as his second shot at political redemption. he led the ldp to a crushing defeat in the 2007 upper house election then resigned. abe took power again last

december determined to do things differently. nhk world looks back on his first six months in office. >> reporter: shinzo abe and his liberal democrats came roaring back to power last december after defeating the democratic party in a general election. the landslide victory marked a political comeback for abe. he'd resign as prime minister in 2007 after only a year in the job because of a health issue. on day one, he labeled his new cabinet a crisis breakthrough cabinet. >> translator: voters helped us win the general election because everyone wanted to end the political turmoil and impasse once and for all. >> reporter: abe said japan faced three crises. the prime minister described the

economic situation as very serious, so he drafted a bold strategy to end decades of deflation. his policy became known as abenomics and it pushed up stock prices, it also weakened the yen, something experts applauded. helped keep the approval rating around 60%. abe maintains that part of bringing japan back includes rebuilding the disaster-hit regions. and despite the nuclear accident in fukushima, he's standing firm on his plan to restart reactors in order to meet energy demands. abe says as long as reactors pass new safety standards, they can start generating power again. in addition he's made exporting japanese nuclear technology part of his growth strategy. the prime minister said the u.s./japan alliance is an

integral part of foreign policy. he argued the previous administration ripped the alliance apart. abe flew to washington to try to fix things. and he wasted no time stressing he would take a firm stance when it comes to the territorial disputes with china, south korea and russia. he vowed not to budge. >> translator: i declare to protect the lives and property of citizens and territories of the country's land, sea and air. >> reporter: for abe, protecting japan means upgrading the self-defense forces to a national defense military, and having the right to defend allies that come under attack. the prime minister says he's ready to revise the constitution to do that. restarting nuclear reactors and amending the institution, these issues are dividing the country, but prime minister abe says he's ready to tackle them head-on.

his first term in office was cut short, but he's determined to show that this time around he's in it for the long haul. michio kijima, nhk world, tokyo. >> so that's the record that prime minister will be running on, and voters will judge him on the results. our political commentator has covered both abe administrati s administrations, he tells us what is at stake in the election. >> we'll be watching to see if the prime minister and his ruling coalition will be able to take back the upper house and end the long standing gridlock in the diet. the liberal democratic party and his partner new komeito, already control the lower house. but the opposition camp has majority in the upper chamber, and that means it has the power to block legislation. as a result, abe has struggled to get bills passed.

he says the divided diet has produced years of indecisive politics. and he says his ruling coalition needs to win this election to ensure a stable future for japan. survey suggests that japanese favor abenomics and that helps the prime minister stay popular. he says the benefits of abenomics have changed the mood in this country, even though many people say that they still haven't felt the effects of an economic recovery. voters also are focusing on energy policy. they want to know where the parties stand on nuclear power following the 2011 accident in fukushima. abe favors restarting reactors that pass new safety checks, but voters are divided on the issue.

well, as michio mentioned in his story, prime minister abe wants to revise the constitution. his main goal is for japan to have an official military. the constitution hasn't been amended since it took effect in 1947. and changing it woen't be easy. abe will need the backing of two-thirds of lawmakers in both houses of the diet. then any revisions must be approved by voters in the referendum. the liberal democrats and new komeito control two-thirds of the lower house seats. abe hopes a strong showing in the upper house election will get him to, or close to, two-thirds in the chamber. he says he plans to build a broad coalition of lawmakers who

support constitutional change. but some regard abe as being too hawkish and worry that the changes will cause friction with japan's neighbors. polls suggest that many voters are still wondering whether the constitutional changes or amendments are even necessary. we'll see just how they feel about this and other key issues in a couple of days. >> and masayo will be part of our team covering the election this sunday. our special program, japan decides, begins at 7:10 p.m. japan time. after the polls close at 8:00 p.m. we'll combine our exit poll data with information our journalists gather across the country to project the winners. do stay with "newsline" for the latest results and analysis. nhk world's special coverage of japan's upper house election is just a click or tap away.

we're adding a host of features to our web and mobile sites. you'll find backgrounders and analysis, plus in-depth reports on the issues that could define the campaign. from the economy to the constitutional debate, www.nhk.or.jp/nhkworld/election, get online and get informed. cross-border tax evasion has been a headache for many governments. now an international economic organization has drawn up an action plan to stop what it calls tax system abuses by multinational corporations. the global roadmap by the organization for economic cooperation and development has 15 specific plans. they include establishing guidelines by september 2014 for businesses in transferring profits to their subsidiaries and countries with lower tax rates. it also aims to set up tax rules on electronic commerce. the plan also calls for preparing a system by september

2015 to require multinationals to report tax payment plans to their governments. the oecd move follows an agreement at the group of eight summit in june to follow international rules to address the problem of profit shifting. the organization has taken the step also to address rising criticism that global businesses like starbucks and apple abused the systems of countries and regions with lower tax rates. it may not be easy to come up with common rules though. major countries say multinationals should be taxed where they are headquartered, on the other hand emerging nations say those companies should be taxed more heavily in countries where they make profits. here are the latest market figures.

there's flooding in china. meteorologist robert speta has been following the havoc there. robert. >> let's start off by talking about what's going on into central and northeastern china where we have this heavy rainfall continuing to occur. not just there even towards north korea actually so far into july pyongyang has recorded about 490 millimeters of rainfall. typically by this time of year you see about 310. so it is well above average and definitely still the risk of flooding out here as this front does continue to linger overhead. and about 100 to 200 millimeters still expected going throughout the next several days. and that is per day going through the weekend. so flooding is going to be a continued risk here in not just out there towards the northeast, down towards the southwest,

sichuan province, we've been seeing the heavy flooding there. we had video earlier tonight that showed you severe flooding and landslides that resulted in two deaths. we want to continue to watch that. farther towards the east into japan, the weather's clearing up here. we have this high pressure ridging in from the south. that's bringing a big dome of warmer weather, hotter weather and thankfully at the relief of many. yesterday we showed you video out of yamagata prefecture of the flash flooding there. today, this out of fukushima where there's a landslide occurred about 30 meters -- or 20 meters in height, ten meters in width. this road crashed down onto these train tracks and obviously it stopped the train service there. crews had to get out there, clear it up. definitely disrupted anybody's travel plans going through that area of fukushima. this was due to rainfall earlier in the week, saturated the ground and caused a landslide. that's what we're talking about

heavy rainfall, saturated ground and risk of landslides. for now tokyo with a high of 29 on saturday. expecting to get into the 30s by sunday. seoul at 28. shanghai, 37 to start off your weekend. look towards the americas. what's going on here? well, the southwest monsoon, that moisture being pulled out of the pacific still bringing showers in mexico, four corners region, risk of thunderstorms and also flash flooding out of that as well in the short-time heavy rain. but the bulk of the severe weather is off to the north. you can even see on satellite picture that cold front starting to develop towards the midwest pushing off towards the east. that is going to bring some thunderstorm activity in places like chicago over towards detroit, into buffalo as well as that does continue to push through the great lakes region. we've already been seeing some hail out here, up to about golf ball size. winds, damaging winds very welcoming out of this. don't be surprised if you hear of a report of a tornado or two with it. not a big tornado outbreak, but it is going to be packing quite a punch as it pushes off to the east being fueled by the absolutely steamy and warm

temperatures we have been seeing across the northeast. right now chicago with a high of 36, washington, d.c. as well. new york, sunny skies and 36 degrees there for you. that is accompanied by this very high humidity. so it's very hot and muggy. the good news is take a look at this. once that front drifts down there towards the south, it's going to cool off, become a little more bearable here across much of the great lakes region toronto dropping all the way down to 25 here by sunday going into monday. i want to quickly show you what's going on here into europe where we have, well, this high pressure into the northwest. it is keeping things hot and we have thunderstorms flaring up due to moisture off the mediterranean into southern france, northern italy. but temperatures here are well above average. we want to stay cool, especially if you're in madrid getting up to 36 still above average, paris, 35 by monday. but that's a look at your world weather. here's the extended forecast.

that's "newsline" for this hour. i'm gene otani in tokyo.

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♪ the children boarding this van in seoul, south korea are so-called 1.5 generation defectors from north korea.