>> syrian armored units are deploying in alepp as artillery and attack helicopters continue their assault spirit with hostilities intensifying near the turkish border, ankara has close crossings, although it says refugees will be allowed through. >> it has transformed from an insurgency in remote provinces into a battle for control in the main cities. >> rebels and government troops are fighting in close quarters at aleppo. dozens of people are said to a been killed since tuesday. rebels are already claiming a partial victory. >> the free syrian army has captured 50% of aleppo city. with the help of god, we will

soon capture the whole city. >> opposition sources say syrian warplanes have been attacking rebel positions, as shown in this video, and there are reports that some 2000 regime troops are already on their way to the city. increasing numbers of syrians are fleeing the violence. over 120,000 people are estimated to have sought refuge in neighboring countries, including iraq. >> can you imagine what it feels like to leave your home, your family, your people? >> turkey has closed some of its border crossings into syria, citing security concerns and the need to protect citizens, but ankara says it will continue to admit assyrian refugees. >> with some border crossings now close, let's bring in our

correspondent from istanbul. -- it will continue to admit syrian refugees. >> it is a symbolic act against damascus, one of the last remaining for turkey, but the main concern is syria is a major transit route for syrian -- four turkish truck drivers -- for turkish truck drivers. only last weekend, dozens of trucks were looted by syrian rebels when they seized a crossing point. there is the fear that with the situation getting worse, this is unsustainable, but ankara has reiterated there will be no change in its policy, and the united nations has confirmed this as well. >> with more and more people fleeing the fighting, that is no doubt very important. what is the rebels' situation right now inside turkey? >> -- what is the refugees'

situation right now inside turkey? >> ankara is concerned the numbers are rapidly increasing. around 1000 a day in many cases. there have been tensions within the refugee camps within the last days, fighting which saw the police having to intervene, and there are also tensions with some local turks. many of them belong to the same set as the syrian president, and there is a bit of antipathy and dislike of some of the syrian refugees -- many of them belong to the same sect as the syrian president. now that the fighting has reached aleppo, which is close to the turkish border, ankara fears a major influx of refugees. it says it will not allow a humanitarian crisis to happen in the country would it standing by and has warned it would

consider military intervention to prevent that. >> thank you so much. a think tank financed by billionaire financier george soros is calling for germany and other eu countries to surrender more political power to brussels. >> the group of 17 experts says the eurozone debt crisis is poised to get a lot worse unless the political leaders moved to give supranational organizations more budgetary oversight. >> the report is only 11 pages long, but it packs a serious punch. the european rescue fund is far too small, the experts warn. eurozone states, especially germany, must take responsibility for each other's debt. the alternative is a potential financial collapse. the report states europe is sleepwalking towards a disaster of incalculable portions. among the 17 economists are two

members of the german council of economic experts, which advises the german government. the report was published by the u.s.-based institute for new economic thinking, which is financed in large part by american billionaire investor george soros. he has long been calling on germany to give help to weaker eurozone countries and has called chancellor angela merkel 's policies shortsighted. meanwhile, a ratings agency moody's says germany could be overwhelmed by the debt crisis in the long term -- meanwhile, ratings agenciy moody's. it warned that top states could lose their credit ratings. >> the meetings reidy -- the moody's rating is justified. the question is why they are blind towards the americans and british because the problems there are not smaller than in europe. >> the downgrade of the rescue fund did not surprise the

markets. traders said they had expected the move. >> let's cross over to our political correspondent for some analysis on this. doom and gloom on all sides. tell us more about economists and what they are really saying. >> the report was commissioned by an american think tank, financed largely by the very controversial hedge fund manager george soros, it is hardly surprising that the report is critical of the new crisis management. the most surprising thing is the extent to which it agrees with angela merkel. for example, in opposing the introduction of eurobonds and also in warning against the european union becoming a transfer union. >> what is the german government's expected response? >> i do not think the german government will react directly to this. the ideas are not new. they belong to mainstream american economic thinking. chancellor merkel is aware of them, of course, and is not convinced by them.

far more important is the possible influence of moody's, warning that germany could lose its aaa rating because of its exposure to weak southern european economies. that will strengthen chancellor merkel's resolve not to give any more cash to greasece until it elements reforms. i think there's probably secretly rejoicing about the chancellor's warning because it strengthens her hand against european partners and the likes against -- the likes of george soros who would like to see germany put up more money up front. >> thank you for the analysis. with solvency concerns mounting, business confidence in germany continues to fall. >> the closely watched business climate index is at its lowest level in two years. >> economists regard the monthly survey of around 7000 managers as the most important gauge of german economic sentiment.

july's survey has fallen for the third month in a row. many german companies report real orders are not matching annual targets. companies like engineering firm m.a.n. are scaling back production. the survey of business sentiment has fallen almost 10 points since july 2011, and managers are even gloomier about the outlook for their companies. >> companies are delaying big purchases because of economic uncertainty. that has hit german manufacturers hard, particularly those making capital goods. >> the ifo survey says only exporters remain confident about their prospects. while sentiment among exporters is down from a month ago, many are still hoping for renewed growth in asia and the u.s. >> stocks took a break from their recent falls on wednesday. our frankfurt correspondent told us more.

>> the reflex is that investors start hoping for the central banks to jump in. the speculation that the european central bank might soon start to buy government bonds again helped to keep the stock market up a little bit higher in frankfurt. but of course, the general mood was not good after the ifo institute reported its business climate index, and after companies like deutsche bank and the hamburg port reported dismal earnings for the second quarter. >> let's look at the stock exchanges around europe. the dax in positive territory today, only up by 0.25%. over to new york where things were also looking a little rosier -- 12,714 points. the euro trading up -- $1.2159.

>> the big question being asked these days -- can face ever be completely restored in the global banking system after the libor banking scandal that saw the world bank's colluding to fix borrowing rates -- can faith ever be restored? >> barclays bank was fine after admitting to attending to manipulate rates, but four top executives, there has been no legal consequence. >> with the fallout from the libor scandal still claiming bank executives, the lawmakers are taking steps to restore market confidence. barclays admits it colluded with other european banks to manipulate interest rates on interbank loans. the eu commission is drafting legislation, forcing member nations to enact heavy fines and impose severe criminal penalties

for market manipulation. the justice commissioner spoke of scandalous behavior by the banks. >> if there is casual talk about popping bottles of champagne in order to celebrate the artificially fixed rates, that is a very callous attitude. i think that bankers should also start to think because some of them are perhaps more banksters than bankers. >> many believe the banks and not exercise sufficient control over the sectors with often little or noishment for infractions -- many believe the regulators do not exercise sufficient control over their sectors. >> the trial of four men charged with plotting a terrorist attack in germany has started in the soil. >> they are accused of planning

an attack and have been in custody since april of last year. >> they are accused of planning attacks that could have resulted in murder and manslaughter. it is alleged the men experimented with homemade mont -- homemade bombs but had not yet selected a target. >> prosecutors say al qaeda leaders in afghanistan or the men to carry out an attack against a target in germany. they alleged that the ringleader travel to an al qaeda training camp on the afghanistan/pakistani border to receive weapons and explosives training. >> the results of investigation showed that there was no firm target selected. but preparations for a bombing had begun. >> german authorities had arrested three of the men in april 2011. prosecutors say the men had begun planning the attack months earlier. it is claimed the men experimented with homemade bombs

and timers. reports say american intelligence tip off german authorities about the suspects' unusual travel patterns. more than a year later, the german government remains worried about terrorist attacks. >> we believe that al qaeda wants to carry out attacks in europe, and that means in germany as well. we have no information about possible targets right now, but the danger of an attack still remains. >> security was tightened at german government buildings after the alleged plot was discovered. these security controls in berlin have been in place since then. the dusseldorf four are refusing to testify. a verdict in their case is expected by november. break.are going to take a short- when we come back, some of the stories we will cover -- china lowers its interest rates in an attempt to keep its economy

moving. >> and the lead in games closer than ever. we continue our coverage and preview what you can expect from the premier event. >> stay with us.

>> welcome back. >> to business news, first of all, and a look at the slowing chinese economy. authorities are looking at ways to boost economic activity. they are listening requirements for the amount of reserves banks have to maintain and loosening rules. >> the cheap funds are meant to boost china's economy. beijing aims to make up for sales losses china has suffered as a result of sagging demand in europe and north america. last year, china's economy grew by more than 9%. since then, growth has slowed.

in the second quarter of 2012, it dipped to a three-year low of just 7.6% -- higher than in europe but not enough for china. even the demand for cheaper goods has dropped. this factory already received its christmas orders in july. this year, the owner is expecting 20% fewer commissions. >> my clients say next year things could be even worse. still, i hope things will get better. >> economic growth may be down, but the cost of living here keeps going up. grocery's got 11% more expensive in the first quarter of 2012 alone -- groceries. home buyers are also in for a shock. the cost of apartments has exploded. for most people, they are out of reach. cheap credit could affect real- estate further, forcing home prices up even more.

>> i think these prices are absurd. most people i know are being pushed beyond their limits, even though we make a good living. we cannot afford to buy our own places to live in. that china has also seen huge construction project -- >> china has also seen huge construction projects in many provinces. such developments have consumed much of the money the government has pumped into the economy. when spending in china drops, it affects many german exporters. china is germany's third biggest trading partner. technical manufacturers a specially have felt the pinch in china. their profits in china have already dropped by more than 10% over last year. >> all in all, german firms have chalked up that profits in china, whether from sales to chinese customers or outsourcing manufacturing to cheaper locations there.

>> german investment in china has been stalled for decades, but the slowdown both there and here in europe has some companies very anxious about what the future holds. >> chinese officials are doing their best to allay those fears. >> china has long been known for white hot growth rates and cheap labor, offering massive potential to foreign companies. this german businessman has been living there for 20 years. his company, based in germany, makes automobile headlights. the seven chinese plants generate a large share of the company's profits. talk of an economic slowdown does not worry him -- his company is investing millions of euros in shanghai right now. >> if there is a certain weakening of the chinese economy, that is not so relevant to our overall development, but if it came to a drastic slump, that would have a corresponding influence. >> foreign companies have never had an easy time in china.

the government insists that they team up with a chinese counterpart. really lucrative sectors like telecommunications are closed to foreigners. that has never been a problem until now. chinese labor is no longer cheap, and businesses which become too strong for their chinese competitors can even become rigid can even be forced out of the country. many european companies are even looking out of china. >-- businesses which become too strong for the chinese competitors can even be forced out of the country. that south america may -- >> south america may replace china. >> beijing has sent a consultant to get german investment. she says without foreign capital, the chinese economy risks stagnation. >> we need foreign capital, expertise, and more jobs for chinese.

>> the chinese have a variety of different words for crisis, but she uses the word meaning "transition period." >> in france, the government is proposing bigger tax bonuses for those interested in buying eco- friendly cars. >> the subsidies are part of a support plan for the nation's troubled automotive sector. >> it helps the plan will help soften the blow. >> the french government's rescue plan is a glimmer of hope for the carmaker's employees. it represents 490 million euros in subsidies for consumers to buy the most environmentally friendly cars. plan seems modest advance the european debt crisis, but its goals are ambitious -- the plan seems modest. >> it is time to create a new strategy by progressively

reinventing the french car with the support of national and local governments. automakers, companies, and the french people. >> the government hopes to carve out a niche for france in the market for low emission vehicles, but the plan also contains tens of protectionism. paris is calling on the eu to review its 2010 deal with south korea, due to what it called unfair competition. but despite the state aid, the plan to lay off workers in france is still expected to go ahead. >> it is a plan which has been a shock for most of the country. you need some time to understand why we do the plan, what are the concerns of the plan, and to understand that we definitely

need to do it. >> the company lost 800 million euros in the first half of this year. sales were especially weak in southern europe. it is little comfort that rival renault is not doing much better. >> india has a new head of state. >> he has been sworn in as the country's 13 president. hundreds of proletarian is where there to welcome the new president, who belongs to the governing body -- hundreds of parliamentarians were there. >> london is making last-minute adjustments before the world's biggest sporting event kicks off. the summer games start on friday. >> fans are already embracing the athletes they will be cheering for. >> in germany, they include an aquatic couple that hopes to bring home some top metals --

medals. >> they are germany's swimming sweethearts, but in recent months, the couple has been training separately. now they are both hoping to win gold medals. >> i want to get out of the pool at the final and be able to say that i gave it all i could, that there was nothing left in me. then i can be content whatever the result is. back after winning two gold medals, he is relaxed ahead of the lending games. >> i have the reassurance that i have already won the gold, and for the rest of my life, no one can take that away from me. that is a great feeling for me. >> the biggest challenge will likely be the 200-meter freestyle. the competition is especially stiff, and anyone can win the gold. >> the better the opponent, the better i am, too, usually, and that is why i am is so excited that international competition is so strong. it is really fun when you can

get everything you have got. then he has already got two world championship titles and holds the world record in the 204 hundred-meter freestyle, but he still wants to win an olympic medal -- in the 200 and 400- meter freestyle. >> i know he would be there for me if something did not go well, and the same is true the other way around. >> both will have their shots on saturday. >> hockey player natascha keller is set to carry the flag at the opening games. >> basketball player dirk nowitski had the honor in 2008 and assured keller the flag is not that heavy. at the keller came across as rather shy at the press conference, but she has seen a lot of action in her career --

>> keller came across as rather shy at the press conference, but she has seen a lot of action in her career. in 2004, she even took gold. >> it is a great honor to walk in front carrying the flag. i am really happy, especially because everyone else is so happy. >> that keller has been selected as flag bearer reflects a growing interest in hockey in germany. she comes from a long line of hockey players. both her father and brother had taken olympic gold. >> the team will be proud to line up behind her. she is never full of herself. she is modest and performance- oriented at the same time. >> friday's opening ceremony will be a big occasion for keller, and there are high hopes her team may win a medal at the london games. >> former heavyweight boxing champion muhammed ali join soccer star david beckham to

present the first ever generation ali beyond sports award. it celebrates young people who have inspired their peers through their participation in sports. north korea has ended speculation about the woman seen accompanying leader kim jong un that recent events. >> they say she is his wife. the images are a major shift for the communist country, which had previously refrain from reporting on private lives of its leaders. korean state media did not provide further details about the new first lady. >> bye bye for now. captioned by the national captioning institute --www.ncicap.org--

striking back. government forces attack from the air and the ground in the battle for syria's commercial capital. residents of aleppo are getting out while they still can. people in the northern syrian city fear another onslaught is on the way. government forces have reinforced troops and equipment, and fighter pilots are trying to dislodge rebel fighters from their strongholds. government troop