Indonesia faces an epidemic of deadly bird flu, the country’s health minister said today, after the deaths of four people apparently as a result of the infectious virus.

Eight other people remain in hospital in the capital, Jakarta, suspected of suffering from the disease which has raised fears of a global pandemic which could cost millions of lives.

"This can be classified as an epidemic and most definitely there will be other [deaths] as long as we are unable to positively identify the sources," Siti Fadilah Supari, the Health Minister, said.

"I do not want to wait for more deaths to take place." She later adjusted her comments to say that, although an epidemic had not yet arisen, it could do in the future.

The Indonesian Government also sacked a senior official at the ministry of agriculture, Tri Satya Putri Naipospos, on the grounds that she mishandled the bird flu crisis. It announced that, contrary to earlier statements, it is prepared to cull large numbers of farm birds as a means of stifling an epidemic.

Indonesia has already begun stockpiling anti-viral drugs, and officially declared an "extraordinary situation" - a state of 21 day high alert, which gives it legal powers to confine and forcibly treat anyone showing bird flu symptoms.

A 5-year-old girl who had been showing influenza-like symptoms died in hospital in Jakarta today and eight others are receiving treatment. Several of them came from rural areas with large numbers of poultry. One 9-year-old girl succumbed after visiting Jakarta’s Ragunan Zoo, which was closed after the virus was detected there over the weekend.

The strain of the bird flu virus known as H5N1 has killed 64 people in South-East Asia in the past two years, most of them in Vietnam. Nearly all of the infections have occurred in people who lived in close proximity to chickens or ducks, and is believed to have been transmitted through the droppings or saliva of sick birds.

The great fear is that the virus could mutate and merge with human influenza to take on a new and highly infectious form. Such a process is believed to have created the notorious Spanish flu, which killed between 20 million and 100 million people across the world from 1918 to 1919.

Human to human infections may also have occurred during earlier outbreaks of bird flu in Hong Kong and Europe in 1997, which remained under control.

"It’s obvious that a pandemic will occur, all the conditions are in place," Lee Jong Wook, the director general of the World Health Organisation, said on Monday. "The problem now is time."

Few countries would be prepared for a mass outbreak, especially not in the developing economies of south-east Asia. Until now, Indonesia has insisted that it could not afford to carry out the mass culls of millions of birds that have helped to contain previous outbreaks of the virus in Vietnam and Thailand.

Today it changed its mind. "If we declare one area highly infected, we are going to do a mass slaughter," the Minister of Agriculture, Anton Apriyantono, said.

"We haven’t identified the high-intensive areas but once it is done then there will be [a mass cull]. According to the President, funds will not be a problem - if it needs to be done then we will do it with all our resources."

The Government is in the process of stockpiling Tamiflu, an antiviral pill which can be used to treat bird flu. Reports of the recent infections are already affecting the sales of chicken in shops and street stalls.

"It should be clear that it is no longer the time for choosing between the interests of the poultry industry and those of the public at large," the Jakarta Post newspaper said today in an editorial.

"Has the Government managed to overcome ... the reluctance of hospitals to treat patients, or their excuses that they are full or that they have not received the funds promised by the government to enable them to treat patients for free?"

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