Indonesia has within its borders the third largest area of rainforests in one country (after Brazil and the Democratic Republic of the Congo, DROC; formerly called Zaire).

Heavy logging began in Indonesia in the early 1980s and reached unprecedented levels by the early 1990s. Much of the exports from Indonesia were meranti (lauan) and by then Indonesia had become the world’s largest producer of tropical plywood.

Then-president Suharto’s policies were geared toward enriching friends and family members. This croney capitalism bolstered logging levels and allowed key individuals to amass huge fortunes. One such person, Mohammed “Bob” Hassan, controlled much of the timber industry. As president of Apkindo, the Indonesian Wood Panel Association (the cartel of plywood exporters), as well as the owner of numerous logging, milling and export companies. Hassan was later jailed for using funds from the national reforestation fund for personal use.

President Suharto was finally ousted in 1998 and with the loss of central control through the fear he had engendered, local authorities filled the power vacuum. This loss of control allowed for a massive increase in illegal logging which became well organized by 2002, including massive illegal logging infrastructures in national parks, such as Tanjung Puting National Park and Gunung Leuser National Park. By this time, teak poaching had reached epidemic proportions, causing, for instance, Rainforest Alliance’s SmartWood program to pull the well-managed certification from Perhutani because they were no longer able to keep illegal loggers out of their lands and thus there was no longer any way to tell whether their exports were from legal sources.

At one point the World Bank tied new loans to the Indonesian government cracking down on illegal logging, but the loans have since been paid out with little enforcement occurring. Illegal logging continues today.

At the current rate of logging, the remaining forests of Indonesia are estimated to last only until 2010.