SMERU's performance in 2003 was marked by a significant increase in research output. We even managed to exceed our annual targets. It was also a year of recognition for SMERU. In addition to other achievements, one of our research teams won the 2003 H.W. Arndt Prize, an annual award from the Australian National University for the best article published in the Bulletin of Indonesian Economic Studies (BIES).

The year 2003 was also a very important year for SMERU because after recognizing SMERU's impact, our donors extended their support for several more years. In return, as SMERU moves into its fourth year in delivering quality research for the benefit of the Indonesian people, we promise to continue to uphold SMERU's commitment to making a difference in research in Indonesia. SMERU will continue to maintain its research excellence by leveraging its strengths, building on its core strategic areas, and improving its research output in 2004. At the same time, we will strive to improve partnerships with our stakeholders and diversify our sources of funding so that SMERU can achieve sustainability.

We will continue to focus on the most pressing issues in Indonesia such as poverty, health and education, decentralization, good governance, labor markets, land issues, and other socialeconomic issues. We will work hard to become more active in the research-policy interface through further participation in dialogues and discussions with NGOs, government institutions, private organizations, and the media.

I would like to thank our donors, the SMERU Board of Governors, and our stakeholders for their continued confidence in SMERU's capability to meet the need for quality policy and socioeconomic research in Indonesia. Finally, allow me to acknowledge the productive and tireless efforts of our researchers and administrative staff in delivering and producing high quality research. Without them, SMERU would not have been able to secure its present image.