A pall of smoke began to spread over the region in early March. Haze and pollution levels reached hazardous levels in parts of Sumatra and Kalimantan last week. Neighbouring Singapore, Malaysia and Brunei sent letters concern urging the Indonesian government to take action. Satellite images showed an increasing number of "hot spots" - or fire locations - including over 1,000 on Sumatra alone last week.

There have also been serious fires in West and Central Kalimantan. A rise in the number of respiratory problems has been reported in the worst hit areas.

The fires are an annual problem. In 1997 and 1998 the worst fires in the region to date wiped out an estimated 10 million hectares of forests and small-holdings, inflicting billions of dollars of losses to Indonesia and neighbouring countries affected by the disaster. The livelihoods and health of forest-dwelling indigenous communities and rural villages located near forests were particularly badly hit.

Only one of the companies identified as being responsible for the fires has been successfully prosecuted by the government and then only three low-ranking staff spent a few days in prison.

The fires have started unusually early this year, but were not expected to be on such a disastrous scale as 1997/8 as the La Nina effect is still bringing high rainfall. to the region..

Since last year's fires hit the headlines in April, Indonesia has had its first democratic elections and a new civilian President has been installed. But little has changed on the fires front. Indeed, the situation for forests is worse. According to a recent World Bank study, the current rate of deforestation is at least 1.5 million hectares per year; nearly 17 million hectares have disappeared in the last 12 years. At current rates the once densely forested island of Sumatra, will be logged out in five year's time. In Sulawesi, dry lowland forest has already been effectively wiped out and Kalimantan's will last only another ten years.

Indonesia's new environment minister has called the fires a national disaster and the government and has pledged to direct state funds to put out the fires, but it lacks funds and equipment and what little fire fighting action it takes will be woefully inadequate. Like the previous Suharto and Habibie regimes, the current government has failed to prepare for the fires, despite pressure from ASEAN neighbours and its main creditors and despite numerous workshops and training programmes on fire prevention. A positive difference this time is that the government has not ignored the fires. Another is that officials have pointed the finger of blame at plantation companies rather than the farmers and shifting cultivators who were always the government's scapegoats. Whether the promised action will be more effective than previous years remains to be seen.

However, the government shows no signs of addressing the roots of the problem. These lie in a forest management system that is geared toward the commercial production of timber and wood products for export, rather than toward the conservation of a valuable biodiverse resource which provides a sustainable livelihood to millions of forest-dwellers, and regulates the water supply of populations living outside the forests.

Indonesia is still bogged down in a deep economic crisis, brought on by years of corrupt government under former President Suharto backed by huge loans from the international community and easy cash from foreign investors. The crisis and political changes have directed attention away from the annual problem of the forest fires, whose choking effects are rarely felt in the capital, Jakarta.

The government wants to revive the economy by attracting inward investment from abroad to exploit its natural resources - and plantations, such as oil palm and rubber, are one of its target sectors. It also wants to continue exploiting timber in the fast-dwindling forests.

The International Monetary Fund, which leads Indonesia's creditor group and more or less dictates economic policy to the new government, is providing loans to restructure the economy and encourage more foreign investment.

The IMF and the World Bank also says they want to help Indonesia manage its forest resources sustainably, but Indonesian civil society groups say the lending institutions are going about this in the wrong way. They argue that forest policy requires fundamental reform to shift management from state control to local communities who use tried and tested traditional forest resource management systems. They want to see an end to conversion of natural forests to plantations and no more logging until the borders of indigenous peoples' lands have been recognised.

They also want the international community to provide grants, not more loans, to help Indonesia reform forest policy. A new Forestry Act, passed by former President Habibie's discredited interim government last year, should also be scrapped as it merely perpetuates the commercial exploitation of Indonesia's forests. It does include fire control measures, but these are weak and are not being enforced. Indonesian groups also want local communities and indigenous groups to participate in policy-making.

In the short term, the Indonesian government must fulfil promises to use existing laws to prosecute companies that burn illegally. This would send the right signals to others intending use the same land clearance methods later this year. So far the government has announced the formation of an enforcement team and has suspended the licences of four plantation companies in Sumatra, three of them Malaysian-owned. Follow-up action must be taken quickly on these and many more cases if the government is to get its message across in time.

Rain has damped down some of these early fires and is expected to do so until late March or April, but the fires will return once drier weather sets in after that. Once the fires really take hold of Indonesia's forests fire-fighting is hopeless. Until fundamental reforms geared towards environmental protection and promoting community forest management are implemented by Indonesia's leaders and fully supported by the international lending community, rain will remain the best hope of putting out these and future fires.