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MCDONELL: There is hardly a corner of China without people living in it. Yet, for centuries, this huge land was able to absorb much of what human development could throw at it. Early travellers from overseas marvelled at the beauty of Chinese civilisation and its adoration of the natural world. Today, the historic city of Xiangfan in Hubei Province is still protected by its ancient walls. This is a place of famous battles and kung-fu legends - but we've come here for another reason - to see the Han River and meet the people trying to protect it.

YUN JIANLI: I think in China you could hardly find a river as big as this one, with such good water quality.

MCDONELL: 66-year old Yin Jianli runs a community conservation group called Green Han River. They're on the look out for deteriorating water quality.

YUN JIANLI: We use our boat once a week - four or five times a month - to travel along the Han River. If we see a place that we think has a water quality problem, we take a bottle of water as a sample.

MCDONELL: The water here will soon be pumped one thousand kilometres north and into the homes of the elite in Beijing. The local government has shut down the worst polluting factories, making this part of the Han unique in China - a river inside a major city, which is actually pretty clean.

YUN JIANLI: All ordinary people here know our mother river will face a difficult time soon so they are trying to protect it by not dumping rubbish into it.

MCDONELL: In recent decades, China has seen unparalleled economic growth and this country's environment has faced an unprecedented assault. Rivers which can only be described as toxic, are everywhere to be seen. If you chose a random city or town here and go looking for a waterway, you'll be very lucky if it's fit for any human use. We saw people growing vegetables next to a river which has turned black. They're either oblivious the state of this water, are ignoring the dangers of using it or have no other choice.

Then there's the air quality. China's air pollution problem is enormous. The impact of coal fired power stations and heavy industry is felt right across the country - and when it comes to industrial pollution of all types, factory employees are at the front line.

This hospital in Suzhou has been treating more than a hundred workers who breathed in the vapours of a dangerous chemical. It was being used in the production of computers and in particular they say Apple products. We snuck into visit some of the workers who are still being treated. They didn't want to show their faces.

WOMAN #1: I've been hospitalised for more than six months. I think as I'm getting better I'll probably be able to leave hospital at the end of this year.

WOMAN #2: At first the symptoms were pretty obvious. My hands were numb. I could hardly walk or run.

MCDONELL: These young women used to finish off laptop computers by gluing on, measuring and then polishing Apple logos. For this they used a chemical used N-Hexane. One of the women has kept some of the logos they used to show that their work was connected to Apple products.

WOMAN #3: I think they knew it was poisonous to humans but if they used another chemical our output would not have been increased. Using N-Hexane was much more efficient.

MCDONELL: The workers have recovered considerably in recent months. They met us outside the hospital and showed us what it was like when they couldn't walk properly. Doctors say that prolonged exposure to N-Hexane can harm the nervous system, lead to muscle damage and even cause paralysis.

WOMAN #2: The workspace was very small with no air circulation equipment.

MCDONELL: This small factory was hidden away in this housing estate and their boss, Zhong Jianxiang refused to be interviewed for the program.

It doesn't look like it but Apple computers were being finished off in a little workshop here. At least the workers assumed that the laptops were not fakes, but importantly if you house an operation like this in a residential alleyway, you're doing so away from the prying eyes of work safety inspectors and the like.

But working for a large company doesn't guarantee your safety either.

Hu Zhiyong, Jia Jingchuan and more than 100 of their workmates also became sick after breathing in the vapours from the chemical N-Hexane. They, and 60 of their colleagues, were hospitalised for more than nine months.

HU ZHIYONG: Our company mainly produces touch screens for mobile phones. Our main client is Apple.

JIA JINGHUAN: In October 2008 our company introduced a new kind of chemical solvent. We only knew that it was effective for wiping. It would dry off in one or two seconds.

MCDONELL: Unlike the women we met, theirs is a big, established factory with its headquarters in Taiwan. So when workers started collapsing at the factory by the dozen, it was not going to be good for their company's or for China's reputation as a manufacturer. The sensitivity of this issue became clear when a plain clothed policeman of some type filmed us using a secret camera in his bag. We turned our camera on him and he left quickly. We were followed everywhere we went in Suzhou.

JIA JINGCHUAN: I am back at work, but my symptoms are still with me. My legs still hurt. This will accompany me for the rest of my life. It's very painful.

MCDONELL: Their company, Wintek, has now stopped using N-Hexane. Nobody from this company, which employs twenty thousand people was available to be interviewed when we visited and their security guards were keen for us to stop filming.

[McDonell to guard] From where I see it you can't stop us filming your factory from the outside. We're filming from the street. We're not inside.

SECURITY GUARD: Go and film another place.

MCDONELL: [To security guard] We're doing a story about your company. You should tell your boss that this is his chance to speak to us.

To be fair to this company, the workers say that Wintek did look after them when they got sick, by paying their medical bills and keeping their jobs for them for when they got out of hospital. Yet under Chinese law, its workers will only get compensation if they leave these jobs.

But it's not only in making computers that China is having problems with toxins. When countries like Australia, the United States and Japan are finished with their keyboards, laptops, hard drives and mother boards, they go back to China to be pulled apart and recycled. This is a thriving business in places like Wenling in Zhejiang Province. Children pitching in to help their parents, learn of its value at a young age.

Mercury, led, chromium and other poisons from this e-waste, leach into the groundwater.

China is sacrificing its own environment at both ends of the production life of these computers. In this way, it's effectively subsidising other countries. People all over the world are getting cheap electrical goods in part because China is trashing its air, its earth and its waterways.

YOUNG RECYCLE MAN: We take the plastic parts to the grinder to break them up. Then we wash them and they'll be okay to be re-used.

MCDONELL: In Zhejiang these are principally jobs for migrant workers, poor farmers who've drifted into bigger towns and cities looking for work. In this cluster of shacks a group of families who've travelled from Anhui Province live and work together.

[McDonell to man] Some say this kind of work will damage the local environment. Do you think so?

YOUNG RECYCLE MAN: [Long pause] How should I put it? It's hard to say.

MCDONELL: Apart from overall environmental damage, in the short term it's the health of these workers and their families, which could suffer. Nearby, we saw women sorting recycled computer plastic by burning it with a cigarette lighter and sniffing the fumes. By sniffing the plastic, they can quickly identify its type. Imagine the damage to your brain from sniffing burned plastic every few seconds, all day every day. This woman didn't want to speak on camera.

It would be wrong to think that in China there is no awareness of industrial pollution and its effects on people. It would also be wrong to think that there's nobody trying to fight against it.

LIU JINMEI: Early this year we received an email from these villagers saying there were pollution problems here. So we came to have a look. We think this is a strong case so we decided to provide legal assistance for them. Many villagers have died from liver or brain cancer - or other types of cancer over the last two years.

MCDONELL: Liu Jinmei and Liu Yanping work for the only Chinese law firm that specialises in environmental pollution and here they've walked into the middle of what's become quite a large fight. The historic Qingpuling Village in the hills above Minhou in Fujian Province is in a beautiful location. For generations its inhabitants grew fruit here and they remained a tight-knit community.

Then the new neighbours moved in.

For the last nine years an incinerator has been churning out its dark discharges next to the village. The company will soon process industrial material, but at the moment says it's burning medical waste.

YANG GUANGZHONG: The medical waste includes the drips when you're hospitalised and stuff for surgery... bandages...things cut off people's bodies...as well as needles and bottles - they're all medical waste.

MCDONELL: If you go anywhere near this incinerator, you get an idea of how far the wind has carried the smoke. All of the leaves here are smeared with this black gunk and the locals say that the whole valley is covered in it.

LIN GUANGHAO: No-one knows who will be the next to die. Many villagers get dizzy and have palpitations. When we work in the field, as soon as we breathe in the disgusting smoke, we get dizzy.

MCDONELL: Lin Guanghao was born in this village. After school he joined the air force and says he devoted the best part of his youth to the Communist Party. These days, he's angry.

LIN GUANGHAO: Eleven villagers have died within two years.

WOMAN #1 FROM VILLAGE: [talking to lawyer] Many villagers died last year.

WOMAN #2 FROM VILLAGE: [talking to lawyer] In my family, my brother's grandson, my sister's child and my sister's husband - 31 years old, 32 years old, 59 years old - three of them died within one year.

MCDONELL: The villagers believe that it's definitely pollution from the incinerator, which has been killing off their loved ones.

The lawyers say there's still no solid proof to directly link these deaths to the incinerator in a court case, but for their purposes they don't need to prove that the company's pollution has been killing people.

LIU JINMEI: Chinese law states that people should not live within 800 metres of a dangerous goods management plant. In fact these villagers live less than 200 metres, which is very close. So there's no doubt that they're being harmed.

MCDONELL: In China power politics often intervenes when disputes like this arise. Police and government officials somehow heard that we were in town and they came to pay us a call.

CHINESE POLICE: Okay stop.

GOVT OFFICIAL: Excuse me... who are you?

MCDONELL: [To Govt Official] We're from the Australian Broadcasting Corporation.

The government official told me that they could help us and then asked a question that would be put to us again and again.

GOVT OFFICIAL: Who introduced you to this? Who asked you to come here?

MCDONELL: Many villagers think that the local government and police have been working hand in hand with the company. So when they thought the local authorities were trying to stop us from interviewing them, you could feel the tension building. They started letting these government officials know what they thought of them.

LIN GUANGHAO: Don't we have the right to speak? As citizens, isn't it our basic right to speak? Can't we express our grief? Isn't this our right? Nobody should try to stop us speaking, no matter who it is - especially the government. We didn't act violently. Why do they always - send in the police? Well, we have a question - are they putting pressure on the villagers to stop us talking about pollution? They don't want to solve the problem, they just want to put pressure on us.

MCDONELL: The villagers were then ordering government officials to leave. Some of the locals were exploding with anger, but the officials still wanted to find out who they could blame for us being there.

GOVT OFFICER: Who asked you to come here?

MCDONELL: We came to film here. Nobody asked us to come.

GOVT OFFICER: So how did you know about this place?

MCDONELL: Why are you asking me that?

GOVT OFFICER: Huh?

MCDONELL: A woman threw herself onto the ground in protest and the official told me that this was not a problem.

MCDONELL: [To Govt Official] They want you to leave, and then everything will calm down.

Finally they went. The chaos of the day prompted the incinerator company to speak to us. Yang Guangzhong is the local manager who was on site.

[To company manager] What do you think of the pollution from the old incinerator?

YANG GUANGZHONG: The old incinerator does have problems - when it's not running smoothly, it has problems.

MCDONELL: So you think the old incinerator, in terms of its impact on people, isn't that good?

YANG GUANGZHONG: It is not good.

MCDONELL: In the village here, lots of people have died from cancer. They say it's because of pollution. Do you think that's right?

YANG GUANGZHONG: There's no scientific evidence for this. Our workers have been working here year round. In fact, they're the ones who have first contact with this environment. Until now, as far as I know none of my workers (has died) because of the waste.

MCDONELL: One of the reasons we were allowed in was to see the new incinerators, which are being built. The company says that they'll drastically reduce pollution and that as soon as they're ready, the old one will be shut down.

LIN GUANGHAO: If the company moves, we will light fireworks to celebrate. We will applaud. We wont want any compensation as long as they piss off and move as far away as possible.

YANG GUANGZHONG: There are two solutions. One is, we move - the other is, they move. The government is already organising for them to move. We think our enterprise is contributing to society and the environment.

MCDONELL: If the lawyers can't get the factory to close, then there's the second best option. They'll try and negotiate a settlement in which everyone is moved to a safer location and this historic town will probably be demolished.

Then they'll move on to another pollution case because there are a lot of them in China and plenty of potential for them to make enemies.

[Stephen to Lawyer] Aren't you afraid?

LUI JINMEI: There will be risks for sure in doing this job but we know about those risks when we chose to do it. But China keeps making progress and gets more open by the day.

MCDONELL: Until recently, it had been economic growth, which had won out every time in China at the expense of the natural world, and at times it has come at quite a cost to this country's people.

YUN JIANLI: I tell the bosses of some companies that you might make money as big as mountains of gold and silver - but, if all the money is made from the loss of green rivers and blue mountains your future generations won't be able to eat gold for food or drink silver as water. You'll be cursed by them, because you've ruined their life and their earth.

MCDONELL: Now there are those trying to turn the tide here. The question is, is it all too late?

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When things suddenly go BOOM!!! chances are somebody's going to get hurt or something's going to be destroyed. In China it's both. There's a high human cost and a heavy environmental price as a tearaway, juggernaut economy thunders across a vast landscape, spreading toxic effluent and grave illness.