By Mark Chisholm and Kitty Bu
GUIYU, China, June 11 (Reuters) - Guiyu is a modern day gold rush town.
But instead of panning for gold in babbling streams, workers shift through piles of broken old computer parts in acrid smelling shacks, smelting down parts with crude equipment to extract valuable metals like gold and copper.
Every year, millions of unwanted computers, keyboards, television sets and cell phones are smuggled into China by sea. Much ends up in Guiyu, a rough town on the southern Chinese coast, not far from the former British colony of Hong Kong.
There is little regard for safety -- no masks, little ventilation and few signs of government officials enforcing what safety rules do exist in China.
The lucky few wear rough but thin gloves. They are too scared of losing their jobs, or being beaten up, to dare to talk to visiting foreign reporters.
The state-run newspaper the People’s Daily said last year that Guiyu’s more than 5,500 e-waste businesses employed over 30,000 people.
It estimated the business to be worth 1 billion yuan ($130.9 million) in Guiyu alone.
Yet many of the workers, who come from all parts of China, are paid as little as $3 a day.
"Workers never benefit from this," said Lai Yun from environmental group Greenpeace, poring over gruesome pictures of workers injured by exploding computer parts or burns from the furnaces.
"It’s always the middlemen. They scoop the most money out of this business. Workers usually end up with nothing, but still they are willing to work this job that’s damaging to their health," he told Reuters.
OUT WITH THE OLD
According to a 2005 U.N. report, up to 50 million tonnes of e-waste is generated annually, as people upgrade laptops and PCs and throw out old models.
The China Quality News estimates that about 72 percent of that e-waste ended up in China.
During the disposal process, workers, including women and sometimes children, are exposed to a toxic cocktail of chemicals. The many small businesses take few safety precautions to protect their workers.
State media estimated almost nine of out 10 of the people in Guiyu suffered from problems with their skin, nervous, respiratory or digestive systems.
After the useful metals are taken out, leftover parts are often dumped in landfills or rivers or simply burnt. Piles of old computers even block the traffic in some parts of Guiyu.
"People use the least investment, the most simple equipment, the shortest time possible to get the most profit out of this business," said Nie Yongfeng, an environment professor at Beijing’s prestigious Tsinghua University.
"That’s all they care about."
It is highly lucrative. The discarded waste is full of gold and copper.
Reporters and green activists are not welcome.
A car carrying Reuters journalists to Guiyu was stopped on the outskirts of town by stocky men travelling in a car with blacked out windows who threatened to beat up the driver.
Local businessmen fear critical reports, for if the government cracks down and the waste stops coming, the money will stop flowing too.
Nie said the local government did want to take control.
"The problem is that we can control the above board channels, but we cannot control what’s been coming in through underground channels," he added.
"I think this is the situation in China and it’s the same situation in Japan and the U.S. I can’t say the government is doing nothing to take control, but it’s almost impossible to regulate what happens underground," Nie said.
E-waste is not supposed to be exported without the consent of the importing country.
To bypass it, e-waste is labeled as "used PCs" or "mixed metals" according to Greenpeace, and smuggled in from Hong Kong.
According to Nie, the local government came up with a plan two years ago to remove the waste in Guiyu.
But the business was too lucrative to just vanish overnight, and little has changed except locals are now much more vigilant about outsiders. ($1=7.641 Yuan)