"newsline." it's thursday, august 11, 8:00 a.m. in tokyo. i'm catherine kobayashi. in the new york stock exchange on wednesday, the key index ended over 500 points down amid concerns over the u.s. economic slowdown and europe's credit crunch. sell orders were placed over a wide range of issues as the market opened. the nose dive follows a rise of over 400 points in the dow jones industrial average on tuesday after the u.s. federal reserve said interest rates will stay at near 0% until at least the middle of 2013. market players say uncertainty over the financial markets is

also picking up steam. at the new york foreign exchange market on wednesday, the yen at one point neared the record low at 76.25 yen per dollar set on march 17, a week after a massive earthquake and tsunami hit northeastern japan. now investors are watching the bank of japan for a possible intervention to support the dollar if the yen surge continues. japan's government is set to downgrade its economic growth forecast for fiscal 2011 to 0.5%, down 1% from its previous estimate. in december last year, the government predicted growth of 1.5% in actual terms for the current fiscal year ending next march. but it says the march 11 disaster in eastern japan caused production and exports to plunge. personal consumption also came to a stand still.

the growth forecast serves as the basis for the government's budget plan and revenue predictions. the downward revision means its target to restore the country's financial health and achieve a fiscal surplus by 2020 is not realizable, even if consumption tax is doubled by 10% by the end of fiscal 2015. the cabinet will shortly endorse a plan to cap the issuance of new government bonds at $44 trillion yen, or $571 billion for fiscal 2011 for the second year in a row. the government predicts growth of 2.7% for 2012 as reconstruction from the disaster gains momentum. china's government has decided to slow the running speed of the nation's bullet trains following a deadly accident last month. the premier held a meeting on

monday. they decided to re-examine safety measures in projects already approved before construction work begins. new trains designed to run at 350 kilometers an hour will slow to 300 kilometers, and those built for 250 kilometers per hour will run at 200 kilometers. china has raced ahead with the construction of its high-speed railway network as a symbol of the nation's growing prowess. but a crash on july 23 killed 20 people, sparking public concern over the safety of the trains. analysts say the latest decision is aimed at addressing those concerns. the british government has vowed to get tough against young people who have rioted for four consecutive days. on wednesday, prime minister david cameron chaired an emergency cabinet meeting to discuss how to quell the riots. later, he said thousands of police officers will be mobilized to conduct a massive criminal investigation.

so far, at least 1,300 people are reported to have been arrested. >> whatever resources the police need, they will get. whatever tactics the police feel they need to employ, they will have legal backing to do so. the police are already authorized to use battering rams, and we agreed that while they are not currently needed, we have contingency plans for water cannon to be available at 24 hours notice. >> on tuesday, the fourth night of rioting, no major disturbances were reported in london after authorities poured extra police officers onto the streets. but the riots have spread to other cities, including england's second largest city, birmingham, and manchester. the rioters attacked shops and set fire to cars. the rioting is seen as a reaction -- to contain the

situation as it's doubtful that cracking down on rioters alone will stop the unrest. the united states has suggested that its efforts to democracyize syria are nearing their limits. a state department spokeswoman told reporters in washington on tuesday that syrian president bashir al assad shows no sign of stopping the use of force against anti-government protesters. >> it is deeply regrettable that president assad does not seem to be hearing the increasingly loud voice of the international community, a voice of concern that is now growing in strength and volume, and in number of countries making their views known. >> she said the u.s. cannot have any kind of partnership with the regime that cracks down on the innocent. she added that there are limits to what the u.s. can do if its

partner chooses to violate the human rights of its own citizens. the obama administration reportedly is preparing to slap additional sanctions on assad and other syrian leaders and demand the president's resignation as early as thursday. >> announcer: "newsline" is the place to turn to for the latest on japan post march 11. we have two segments offering two unique perspectives on the fallout from the earthquake and tsunami. nuclear watch brings you insight and information on the impact of the fukushima daiichi crisis. and "the road ahead" examines japan's efforts to recover and rebuild. don't miss "nuclear watch" and "the road ahead" on "newsline." the decontamination of radioactive water at the crippled fukushima nuclear power plant is failing to reach its target, throwing the timetable for bringing its reactors under control in doubt. exactly five months have passed

since the plant's cooling system was shut down by the earthquake and tsunami disaster of march 11. operator tokyo electric power company has entered stage two of its timetable to end the nuclear crisis. tepco aims to stably cool the reactors by january of next year. decontaminating thousands of tons of waste water at the site holds the key. but failures of the installed filtering system has prevented the facility from achieving its operation rate of 90%. the figure as of wednesday stands at 66%. they have been hit by different malfunctions despite fully operating for more than a month. the nuclear safety commission said on wednesday that tepco must improve the system by pinpointing the common root of problems rather than addressing them ad hoc. to complete the second stage, they must reduce the amount of contaminated water. that means it must operate the

decontamination system effectively. nasa says the powerful tsunami that ravaged japan's northeastern coast in march also had an impact thousands of kilometers away from this country. the u.s. space agency says for the first time ever, observations show that the big waves broke off chunks of an iceberg in antarctica. nasa says it observed the breaks from the ice shelf in images shot from two satellites in the days following the earthquake and tsunami. nasa says the waves that reached antarctica were only 30 centimeters here at most, but that they likely affected the ice shelf because they hit many times. there's probably no other

place other than a town in northeastern japan right now where one tree has so much meaning. when the march 11 tsunami ripped through the coastal city in iwate prefecture, it destroyed everything in its path except a lone pine tree. now we get a story about a campaign to preserve this miraculous survivor that's quickly becoming a symbol of the community's reconstruction efforts. >> oh, my gosh. its condition is worse than i expected. >> reporter: he is a landscape artist in japan. he is now trying to rehabilitate the pine tree that clearly has nine lives. >> translator: this is going to be very tough. we really need a good plan.

>> reporter: along the coast is a two kilometer long plantation of 70,000 pine trees protecting inland areas against the sea breeze. all but this one tree were washed away by the tsunami. now the die-hard pine has become a symbol of hope for the local people. who are struggling to piece their lives back together. >> translator: i didn't want to let it die. it looks like it's begs us to look after it. some day i want it to become the icon of our city, giving strength to everyone who sees it. >> reporter: as an arborist, he knows about saving trees in disaster areas. he survived the great earthquake that hit his hometown in 1995

and killed more than 6,400 people. these photographs show a pine grove in the city park soon after the disaster. shaking caused by the quake weakened the roots of the trees. he spent four painstaking years treating the 500 pine trees one by one, until they all recovered. during his time tending to the grove, he realized how important the trees were to the local people who found strength in them as they strive to recover their community. so he decided to volunteer to help save the only surviving pine tree in this community. >> translator: there is still a chance. it may not be too late. i'll do all i can.

>> reporter: he was welcomed by members of the local citizens group. they badly needed an experienced arborist to help them. they wasted no time in investigating the conditions of the soil and roots. >> translator: the soil is too salty. >> translator: the color of the leaves seems to be different than before. >> reporter: he knew that the conditions here were different from what they were in kobe in 1995. there had been no tsunami there. here, the soil is saturated with sea salt left behind by the receding tsunami waves. the tree's roots are unable to absord nutrients. as a first step, he puts conditioner along the trunk to help remove the growth of new roots.

>> translator: now we are fighting for the tree survival. i hope to win this battle and ride out the summer to grow it back into a lush, green healthy pine tree. >> reporter: the project to save one pine tree is now attracting landscape gardenering nationwide who will do all they can to save the iconic tree of hope. nhk world, kobe. in other news, south korea says it has returned fire in the yellow sea after a north korean artillery shell landed in waters near the two countries' maritime border. the south defense ministry said artillery fire was heard five times in waters west of the korean peninsula on wednesday. the ministry said that the south fired back twice. residents of the south korean island say they evacuated to shelters after hearing shell

fire, but returned home because the north made no further moves. the ministry says the firing was part of a routine north korean military exercise, but is investigatinto determine if the north intentionally fired a shell near the border. north korea does not recognize the border, and claims that waters around the island are its territory. north korean artillery attacks on the island last november killed four people, including two civilians. south korea then beefed up defense in the area. china is testing out the latest piece of hardware in its growing military apparatus. its newly refurbished aircraft carrier has left on a trial voyage. the former soviet union built the ship and china bought it from the ukraine 13 years ago. the navy carrier left a northeastern port on wednesday. it says the sea trial will be short, and that the carrier will undergo further rebuilding and testing after returning to port.

china says the vessel will be used for research and training. last month, a chinese defense ministry spokesman says the country has a long coastline and broad marine areas under its jurisdiction, and that the military has an obligation to protect the nation's sovereignty and maritime interests. china is reportedly planning on building other aircraft carriers on its own. observers say the chinese military is increasing its ocean going capability to secure its maritime interests and sea lanes. japan's chief cabinet secretary said on wednesday he is closely watching the refurbished carrier's trial voyage. >> translator: i think japan -- at watching as well. japan will work with those countries to seek higher transparency from china.

time to check on some of the stories we've gathered from broadcasters around asia. we begin with this item sent by rtm malaysia. air asia is going to acquire a 20.5% stake of the country's national carrier malaysia airlines. the rival carriers announced the share swap on tuesday. under the deal, it would get 10% in air asia's parent company. analysts say it will allow the carriers to work together to cut rising costs by sharing on maintenance and making bulk aircraft and parts purchases together. floodwater in northern thailand is on the move. the knot 10 storm hit the country a week ago bringing heavy rain. now it's all flowing south, damaging crops and housing along the way. the swollen river has flooded

communities in several provinces. the central province is the worst-hit. hundreds of homes there have been inundated. farmland and banana plantations in a neighboring province have also been soaked. ongoing heavy rain is causing problems in bangladesh as well. traffic has been disrupted in the capital of daka and other parts of the country. t china's ministry of health says that the black vinegar produced in the northern province is safe and meets quality standards. the ministry's response came tuesday after media reports said that excessive food additives and preservatives are used to prepare the product. the black vinegar is a famous condiment in china. the health ministry says all of the ingredients used to prepare the vinegar meet chinese food safety standards.

consumption of sake or japanese rice wine has dropped nearly 40% in japan over the past decade. but sake exports have nearly doubled as more japanese restaurants open up abroad. we look at one long established sake brewery's strategy to up exports. >> reporter: this sake marketer gets lessons from a veteran sake brewer. dana works at this brewery, where she is learning the secret behind what makes good sake. the brewery was founded 170 years ago in aki city. last year, the brewery hired her in the hope that she could help boost exports. she majored in japanese culture at a u.s. college. after graduation, she moved to japan for work, and fell in love

with sake. at the brewery, she proposes new types of sake to develop for overseas markets. >> translator: there are some people who are simply not going to like sake as it is. i'd like to somehow introduce them to a kind of sake that they can enjoy. >> translator: we hope that berte will bring us more interest. >> reporter: she organizes a sake tasting event for non-japanese residents in the prefecture. she offers participants a variety of sake. all were made using special methods and carefully selected ingredients. but not everyone is a fan. >> i think that when it is hotter that the taste is a lot stronger.

>> there's not this up and down -- there's not a richness or a velvetiness. the luxury. i don't taste luxury. >> reporter: berte reviewed survey results from the tasting event. some participants described the taste of sake as safe or mo not nous. they say it is less exciting than beer or whiskey. berte studied how to make sake please the palate of non-japanese while maintaining its selling points. she came up with the idea of mixing sake with car bonnic acid, a common ingredient in soft drinks. but it is difficult to strike a good balance between sake and carbonation. if too much is added, the mild flavor of sake will be weak. if little, it may be too bland

for non-japanese consumers. she conducts taste tests on her colleagues. >> translator: this could work. >> translator: it may be a good idea to make the sake a bit drier. >> reporter: in this way, a new type of beverage at this traditional brewery is being developed, sparkling sake. sparkling sake is fizzy, so berte works hard to make sure that bubbles do not kill the distinct aroma and flavor of sake. she decided to ask some of the tasting event participants to sample her new concoction. she chooses two women who said they did not even like sake. >> thank you. it looks like champagne. >> it does, doesn't it? >> tell me what your impression is. >> it's really summery. >> that's good. >> that's good. i like that. i actually can taste the sake, though. >> yeah? >> yeah.

but i think it's -- i like it a lot better. >> better than sake? >> yeah. >> reporter: the positive feedback boosts berte's confidence in commercializing the new sparkling beverage. >> translator: sake as a beverage can easily compete with wine or beer. i think it will be widely accepted abroad if it's tailored for non-japanese consumers. >> reporter: the unique pair, an american marketer and the long established sake maker, continue to promote sake that appeals to foreign taste buds. now they must wait and see how the new products fare in overseas markets. >> i'd like to try some of that sparkling sake. japan's sake exports have been rising, but since the fukushima nuclear accident, concerns on food safety are hurting exports. now more breweries in japan are taking steps such as including radiation test results to ensure safety.

time now for a check on the markets. hello there. time now for your weather update.

across eastern asia, we are expecting additional widespread rain for eastern and southern china. picking up a lot of moisture from the south china sea as well as the east china sea, especially in and around shanghai. could experience some pockets of heavy rain as well as thunderstorms breaking out there. so that's something to watch out for. across the korean peninsula, light showers will touch the west coast of the peninsula here. meanwhile for japan, lots of humid air coming in from the sea of japan. that could certainly trigger sharp showers along the west coast of the country. but otherwise, looking at fair amounts of sunshine. to the south of japan, we are seeing a bit of development in the rain clouds here. it is a tropical depression. in fact, soon to become a tropical storm by the end of the night. but at this point, it doesn't look like it's going to be having a huge impact on pan. it may bring some high waves in the days to come. temperatures will stay hot across much of japan today. tokyo rising to 35 degrees. elsewhere looking at temperatures in the mid 30s.

again, especially for the contour areas, you could really be experiencing that intense heat and humidity today. 35 in fukushima, and 36 degrees in nageosa. over towards the americas, widespread rain continues to impact the northeastern corner of the continent re. lots of showers in place. severe thunderstorms possible in southern quebec as well. and this low pressure system generally on a weakening track. but it is moving very, very slowly, so it looks like that rain will continue throughout your thursday. across the central plains down into the southeastern corner as well, that severe weather threat will stay with you here. it's that boundary between that cooler and drier air and that warm humid air coming in from the gulf of mexico. so quite a wide area, you're looking at the possibility of strong winds, large hail, and isolated heavy rain. so do watch out for that.

temperatures will stay fairly hot down in the south again, especially for texas and louisiana. heat advisories again in effect. 38 degrees in houston. across the noh, though, it does look a bit more pleasant, 27 in chicago, 28 in new york city. 26 in toronto. plenty of sunshine. now, for europe, we're looking at a very long frontal system stretching across the northern tier of the continent. lots of showers and strong winds in place over the next few days, especially for the british isles. you'll be continuing with that heaviest rain here. so flood could be a concern here. otherwise, looking a very unsettled conditions for the northern end of germany as well as poland. now -- picking up that moist from your the mediterranean, looking at the heavy thunderstorms, parts of bulgaria, greece, as well as romania. the central mediterranean all the way into southwestern europe, very dry and quite

pleasant with good spells of sunshine out here. things really warming up. madrid at 36 degrees today. 36 in lisbon. looking pleasant in paris today, 26 for your daytime high. but looking much cooler in central and eastern areas. all right. here is your extended forecast now. that's all for this edition of "newsline." i'm catherine kobayashi in tokyo. thanks very much for joining usp