I am pleased to present this report that provides a comprehensive overview of the accomplishments and impact of SMERU’s activities in 2007.

We believe that our real impact lies in our ability to influence public opinion and policy. As a result of our latest independent review, and in order to make our presence more visible, SMERU has initiated a medium-term research plan. We have identified several research themes that mirror the dominant socioeconomic issues affecting the lives of many Indonesians. These include poverty, governance, decentralization, social protection, and pro-poor growth. We hope to apply our research expertise to these themes to make a difference in the life of Indonesian citizen.

2007 has been very challenging for SMERU. Some highlights of the year include our research on the impact of supermarkets on traditional markets, the findings of which influenced the formulation of the Presidential Regulation No. 112/2007 on traditional market management. Our research work on cash transfer began a few years ago and in 2007 we collaborated with other think tanks to explore the veracity of our findings. This cash transfer study, our research on Raskin and OPSM (subsidized rice programs) as well as our study on DAK (the Specific Allocation Fund) all attracted the attention of the government and public.

In addition, SMERU has been providing advice on how to improve the quality of statistical data gathering in Indonesia. This involvement is a manifestation of SMERU’s vision to promote researchbased policies. Finally, we produced several research reports and working papers, and had articles published in refereed international journals.

In a period of unprecedented challenges, these are successful achievements, made possible through the support of our stakeholders—the government, academics, NGOs, the private sector, and donors. Through their confidence and trust, we are encouraged not to lose sight of our public mission. We will continue to participate in global partnerships and research collaborations while improving our research performance. We will also work together towards realizing our shared goal for SMERU to become a distinguished research institute in the global arena.

I thank and commend all researchers and staff of SMERU for their hard work, resourcefulness, ingenuity, commitment, and creativity that directly contribute to SMERU’s research excellence. On behalf of the SMERU board and staff, I look forward to providing you with innovative quality research in 2008.