Bogor – Floods and killer landslides that followed each other in quick succession in Indonesia – flood warnings reached a peak this month – are the latest reminders that the country has a long way to go in correcting past environmental mistakes.

Heavy rainfall in different parts of the archipelago, including Java, southern Sumatra, Kalimantan, and southern and southeastern Sulawesi, has led to the dislocation of tens of thousands of people.

While the floods are not surprising, government officials and activists are saying their impact has been made worse by Indonesia's damaged environment, especially due to deforestation.

The huge gap between the annual demand for wood, which is placed at 60 million cubic meters a year by the Forestry Ministry, and the country's timber production – 12 million cubic meters per year – also plays a key part in the growing problem. The gap between supply and demand is met by widespread and devastating illegal logging.

"This gap has pushed up timber theft and driven the expansion of logging areas into conservation forest," said Togu Manurung, director of Forest Watch Indonesia (FWI), the national chapter of a global, independent forest monitoring network.

One example illustrates how that hurts Indonesia – the Gunung Palung National Park in West Kalimantan is a rainforest and one of the last safe havens for orangutans. According to Forest Watch, 80 percent of the national park has been illegally logged.

Here in the capital, many fear a repeat of last year's massive flooding, the worst in decades. Jakarta Governor Sutiyoso said there is unlikely to be repeat of that, but said heavy rains and high tides were likely to peak on February 20.

In Bandung, West Java, local officials are clear about why their area got major floods – and are livid about it. Endang Sudradjat, chief of the local forestry office, says the central government's interference in forestry affairs – allowing abusive firms to keep logging – hurts the environment further.

"The landslides and floods that hit several areas in the province over the last two weeks have a lot to do with the continued deforestation and rampant logging carried out by PT Pertuhani, which should no longer have the authority to slash trees in forest areas in the province," he told provincial officials.

He said that the central government's forestry ministry gave the firm authority to manage forests, when this power is now with the local governments. Likewise, he said that central forestry officials were ignoring the provincial administration's policy of a moratorium on logging for three years.

In the province of Riau, the local chapter of Koham (Human Rights Commission) is to sue 11 plywood and pulp and paper companies for destroying the forests, which led to the flooding that claimed at least five lives there as of last week.

The latest spate of natural disasters caused little surprise among non-government organizations (NGOs), which had recently issued a joint statement scathing in its criticism: "Illegal logging and corruption have changed from bad to worse; forest destruction intensifies ... but the Indonesian government does not learn from those occurrences."

Before the recent disasters, the government's forestry policies came under fire during a meeting of Indonesia's donors in late January, where activists demanded more action by both Jakarta – and its donors – to address the problem.

Reports discussed during that meeting said that "... the amount of forest cover lost every seven days is comparable to the area of Greater Jakarta".

Among its members of this group, called the Consultative Group on Indonesia (CGI), are the Indonesian government, World Bank, International Monetary Fund, Asian Development Bank, governments of the Netherlands, Japan, United States, Britain and Australia, and United Nations agencies. Activists say that the donors could use their clout to get the Indonesian government to improve its management of the environment, but that they are not doing this.

Law and regulations have been largely ineffectual in preventing deforestation due to the corruption that ties together forestry officials, police and the wood-based industry, critics say. Thus, "we see international pressure as the most effective way", said Manurung.

Arbi Valentinus of Telapak, a Bogor-based NGO that focuses on the timber trade, says that in effect, "The government and the CGI have used taxpayers' money and loans from foreign donors to help the companies continue to destroy forests illegally."

In fact, data from the Center For International Forestry Research (CIFOR) and Telapak show that the Indonesian government has bailed out companies in the forestry industry to the extent of Rp34 trillion (about US$3.8 billion) over three years to allow them to continue exploiting forests.

A big debtor is forestry tycoon Mohamad "Bob" Hasan – charged with embezzling state funds and now imprisoned for corruption – and the Sinar Mas Group, which is owned by Eka Cipta Wijaya, a crony of former Indonesian president Suharto.

These companies, now under the control of the Indonesia Banking Restructuring Agency (IBRA), have a combined production capacity of some 6.1 million cubic meters of timber. The official estimate of the timber available to them this year is only 3.5 million cubic meters.

"This means the remaining timber needed to meet their demands comes from illegal loggers, and that the government helps companies that are supporting illegal logging," said CIFOR's Bambang Setiono.

Since IBRA's aim is to sell these companies to any investors, including old owners, the fear is that once these companies are sold and attract new investors, they will be allowed to get new lines of credit from the Bank of Indonesia.

But CIFOR is urging the Indonesian government to delay the sale of loans owed by forestry companies at a large discount, saying this will allow their former owners or associates to buy them back, get new loans and further fuel illegal logging.