In May 1997, Indonesia had more serious forest fires that lasted for several months and damaged hundred thousand hectares of forest land. Land cultivation by fire [shifting cultivation] was a direct cause. Frequent man-made forest fires were the results of inadequate Indonesian forest policies, since to pursue rapid economic growth, the Indonesian government exploited forest resources in order to export huge amounts of forest products and promote huge settlement projects. The nationalization of forest resources and cancellation of property rights of forest dwellers generated social conflicts and sabotage by forest fires. The paper reviews Indonesian forest policy in the light of the importance to Taiwan of the many forest products imported from Indonesia.