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By Martin Fackler, AP

GUIYU, China, 28 February 2002 -- Chen Wu was glad when his village became a dumping ground for discarded computer hardware from the United States. Salvaging computer parts meant jobs for this rural area of China's southeast - even if it did poison the drinking water and create an unsightly landscape of broken circuit boards and hard drives. But Chen's attitude changed two years ago when his 11-year-old daughter grew weak, suffered nose bleeds and was diagnosed with leukemia. Two of her classmates were stricken by the same illness.

Teachers say more than half the students complain of chronic breathing problems.

"We did not care much when outsiders talked about the environmental pollution here. We did not see any harm," said Chen, 50, who works at a drug rehabilitation center. "But now our kids are getting sick." Environmental groups consider Guiyu, a cluster of five villages in Guangdong province about 150 miles northeast of Hong Kong, a cautionary tale for poor countries that accept high-tech waste. Over the last decade, these groups say, as much as 80 percent of the old computers, monitors and printers collected for "recycling" in the United States wound up in China, India and Pakistan, according to a report released Monday by environmental groups, documenting the flood of e-waste to the southeaster Chinese villages. Most of the e-trash, which environmentalists say comes mostly from brokers and recyclers who collect old equipment from larger U.S. businesses, ends up in Guangdong, in Guiyu and other towns.

There, workers rip through the waste - trashed hardware bearing brand names including Compaq, Apple and IBM - looking for every reusable part. Some components are melted to extract precious metals such as gold and platinum.

What's left - from sophisticated flat screens to low-grade plastics - is burned or dumped beside Guiyu's rice paddies and waterways. Toxic chemicals such as mercury, lead and dioxins are released into the air and water.

The first sign of danger in Guiyu came when fish disappeared from a local river in the early 1990s, not long after the first truckloads of foreign computer waste rolled in.

Chemicals poisoned the wells, so drinking water must now be trucked in. The odor of burning plastic is so strong that classes at the nearby Dongyuan Middle School must sometimes be halted.

One teacher, who gave only his last name, Guo, said about 60 percent of students and even many teachers cough and have trouble breathing. "The villagers here are growing richer," he said, "but their wealth is built atop the health of other victims."

This year alone, the United States will export as many as 10.2 million discarded computers to Asia, including about 9 million to China, the environmental groups' report said.

It's hard to tell how much of it will end up in Guiyu, where the local economy has come to depend on computer garbage despite China's 1996 banning of computers and monitors as waste.

Environmental authorities in Shantou, a city with jurisdiction over Guiyu, say they have launched five crackdowns over the last two years, shutting down hundreds of computer waste operations.

But most of these quickly reopened, they concede, often with the help of village officials. The Beijing government has weak control in Guangdong, a region where organized criminal gangs are strong.

Environmentalists estimate the region now has some 2,500 computer waste businesses, mostly family-run. The industry may employ as many as 100,000 people, many of them migrants from elsewhere in China.

"People in Guiyu have made a living out of waste collection for generations. They used to deal in pig bones and duck feathers. But now it's integrated circuits," said the head of the Shantou environmental bureau, who gave only his family name, Kuang. Officials in Guiyu refused to comment.

Imported computer waste has grown into a full-fledged underground economy in this part of China, said one man who employs two dozen people stripping apart desktop PCs from California and Japan.

The man, who asked to be identified only by his surname Li, said he buys about 200 tons of computer waste a year from Taiwanese brokers for about $600 per ton. The waste is smuggled via the port of Nanhai and trucked to Guiyu.

Outside Li's dirt-floored workshop, workers use reed baskets to unload a truck full of hard drives, keyboards and PC bodies.

Inside, workers rip them apart with hammers and screwdrivers. Others sift the debris for anything of value - tiny nuts and screws, capacitors, high-grade plastic.

In a smaller room, two women hold green circuit boards over open coal fires. As the fumes of melting lead solder redden their unprotected faces, they use pliers to pick off tiny black computer chips.

The recovered parts are separated into burlap sacks. Li said he sells them by weight to buyers, mostly from Japan.

Li said he earns more than $12,000 a year - 15 times the average rural salary in Guangdong.

"We're worried about our children, sure," said Li, who said he has a 15-year-old daughter. "But what can I do? This is our livelihood."