Singapore

Market overview

Singapore’s “circuit breaker” will end on 1 June, with less rigid restrictions, including that each household may receive up to only two visitors from the same household once a day. Commuters must wear masks and refrain from talking on the phone or to one another when taking buses and trains, to avoid spreading droplets in an enclosed space. Schools will reopen on 2 June, with most classes alternating weekly between online learning and lessons held on school premises.

National Development Minister, Lawrence Wong, has said he hopes to see almost the entire economy open before the end of June in Phase Two.

Phase Two will entail the resumption of a wider range of activities, including retail shops, consumer services, and dining in at food and beverage outlets subject to a cap of five people per group. The rule will still apply for households of more than five people, who will have to sit at different tables.

A NZTE survey of Singaporeans in April 2020 found many opportunities for New Zealand exporters to leverage New Zealand's brand and reputation.

The survey of 444 households found the safety of New Zealand products is perceived as very high in Singapore (81% agree), and 75% of Singaporeans agree that they trust products from New Zealand. Older demographics trust New Zealand products more than younger consumers.

New Zealand's image can help companies trade off natural, organic and sustainable claims in Singapore, with perception of its ability to produce natural products very high in Singapore at 79%. Singaporean consumers were also the most likely in the survey to claim to favour sustainable products at 73%.

Duke-NUS Medical School has announced the development of a rapid COVID-19 antibody test kit that is now available to Singapore hospitals.

Singapore Trade and Industry Minister, Chan Chun Sing, has said development of a COVID-19 rapid test kit is a necessity for the quick recovery of the Singapore economy, aiding the resumption of global travel and other activities that require social interaction.


Economy and trade

"Significant uncertainty" is the phrasing offered by the Monetary Authority of Singapore (MAS) on how long and intense the negative impacts of COVID-19 on the economy will be.

2020 GDP growth forecasts have been downgraded to -9.6% year-on-year from -3.1% year-on-year, accounting for the strict circuit-breaker measures due to end on 2 June. The new forecast also accounts for a milder recovery scenario than previously envisioned. This would be the worst ever economic contraction on record (compared to previous lows of 2009: 0.1%; 2001: -1.1%; 1998: -2.2%) as the economy is impacted by both demand and supply-side factors from both domestic and external sources.

Meanwhile, the 2021 GDP growth forecast has been raised to 10.8% year-on-year from 7.8% previously, due primarily to an even more favourable base effect. However, the degree of forecast uncertainty is high due to the difficulty in forecasting the economic hit due to the circuit-breaker measures in the absence of useful indicators.

Singapore's non-oil domestic exports increased 17.6% in March, despite experts predicting a drop of 8.9% with reduced consumer activity due to COVID-19. The surge was led by a 20.5% rise in the shipment of non-electronic products, including non-monetary gold (up 242.5%), specialised machinery (up 54.2%) and pharmaceuticals (up 48.6%).

MTI has acknowledged a sharp fall in tourists is affecting the tourism and transport sectors. Hotel, travel, cruise and air transport businesses are expected to be hit, leading to knock-on effects on the retail and food services sectors. Some sector exports have suggested the recovery of Singapore's aviation and tourism sectors in the wake of COVID-19 will be painfully slow given the lack of a domestic market to provide at least some business while international borders are closed.

Core inflation contracted for the second straight month in March on a fall in private transport costs and a steeper decline in the cost of services. Core consumer prices, which exclude accommodation and private road transport costs, dropped 0.2% from a year ago last month; more than the 0.1% decline in February.

New Zealand has taken action to secure the trade of necessities and medical supplies with Singapore, with Trade Minister David Parker and his Singaporean counterpart Chan Chun Sing releasing a declaration committing to "maintain open and connected supply chains" and "recognise the importance" of reducing trade restrictions, especially on the export of essentials and medical supplies.

The Declaration on Trade in Essential Goods, agreed on 15 April, identifies over 120 essential goods in combating the COVID-19 pandemic, for which Singapore and New Zealand will remove all tariffs.

This list includes PPE equipment, medical equipment, nutritional products, medicines and hygiene supplies. The Declaration also calls for participants not to apply export restrictions on food and beverage products, and to facilitate trade in food and beverage.

See the full list of products covered by the Declaration here.

The commitment between Singapore and New Zealand through the Declaration on Trade in Essential Goods - and the positive effects from the agreement so far - were outlined in an article for The Straits Times by New Zealand High Commissioner to Singapore, Jo Tyndall. The article can be accessed here (via free sign-up).

The Declaration on Trade in Essential Goods, together with the Enhanced Partnership signed in 2019, will provide a framework for cooperation across four main areas: defence and security, trade, science and innovation and people-to-people ties.

In the article, the High Commissioner addresses how the COVID-19 pandemic will force the two countries to re-evaluate everything to food supply chains, healthcare and education systems and digital infrastructure - and how the Declaration is designed to create long-term growth for both countries.

In the long term, Singapore may win business from Hong Kong as a result of the latter’s political instability. Some experts have identified Singapore as the leading contender for regional services business that are curbing current activities in Hong Kong and reconsidering their future commitment.

Supply chain, logistics & freight

Opportunities are limited by border restrictions, manpower challenge and logistics and supply chain availability in that air freight has been significantly impacted. Singaporean SME distributors have stated that:

  • The reduction in number of flights per day connecting to Australia and New Zealand has impacted on limited slots and infrequent supply to the market

  • They have experienced a price hike on air freight cost by 200% from Australia to Singapore via SQ, even though fuel prices have decreased by 50%

  • The severe reduction in flights between Singapore and other international hubs has seen scarcity drive price hikes for air freight.

Sea freight and maritime-related activities, including shipping and shipping-related services, safety and navigation services, port and terminal operations, and port marine services, are exempt from the movement control.

Maintaining trade links

Singapore was one of thirteen countries in the Ministerial Coordination Group on COVID-19 that has issued a Declaration on Maintaining Essential Global Links.

The countries issued a declaration which "encourages countries to maintain essential global links, especially with regards to trade and travel" and "recognises the importance of maintaining the flow of goods and commerce by air, sea and land, and reaffirms the need for countries to cooperate with each other and coordinate measures to minimise disruption and enhance recovery. "

The group also included ministers from Canada, Brazil, France, Germany, Indonesia, Italy, Mexico, Morocco, Peru, South Korea, Turkey and the United Kingdom.

Reference: Ministerial-Coordination-Group-on-COVID-19

Marine sector

Singapore initiated an agreement with port authorities around the world to keep ports open for trade amid the coronavirus pandemic. A total of 20 countries, listed below, recognised that the maritime sector plays a critical role in keeping trade flows open during this challenging time.

The port authorities committed to working together to ensure merchant ships can still berth at ports to carry out cargo operations and keep the global supply chain going.

It may be useful for New Zealand companies to keep abreast of shipping and logistic developments to tap on the routes which are more secure with these agreements in place.

List of countries that signed the declaration:

  • Abu Dhabi

  • Ports Antwerp

  • Port Authority Bureau of Port and Harbor, Tokyo Metropolitan Government

  • Busan Port Authority

  • Guangzhou Port Authority

  • Hamburg Port Authority

  • Maritime and Port Authority of Singapore

  • Montreal Port Authority

  • Ningbo Municipal Port Administration Bureau

  • Port Authority of Thailand (Bangkok Port)

  • Port of Barcelona

  • Port and Harbor Bureau, City of Yokohama

  • Port and Harbor Bureau, Kobe City GovernmentPort Klang Authority

  • Port of Long Beach

  • Port of Los Angeles

  • Port of Rotterdam

  • Port of Seattle

  • Shanghai Municipal Transportation Commission

  • Port of Le Havre

Government support

The Singapore Government has unveiled a second unprecedented “Fortitude Budget” stimulus package worth S$33 billion, on top of the S$48 billion package previously provided, by tapping in to the country’s vast reserves. While the first package focussed on offsetting lost earnings for workers affected by movement restrictions, the new package aims to “help businesses and workers adapt, transform and seize new opportunities in order to emerge stronger,” according to Deputy Prime Minister Heng Swee Keat.

The President of Singapore, Halimah Yacob, gave permission to fund the Government's support packages for businesses and workers from the national reserves, which have only been drawn upon once prior to COVID-19. The national reserves should only be used in "very exceptional circumstances", and the COVID-19 outbreak fits this definition, says Halimah.

A new COVID-19 (Temporary Measures) Act provides for a deferment of contractual obligations and suspension of rental payments for up to six months. It also prevents deposits paid from being forfeited, giving parties breathing space to work out a mutually acceptable compromise.

Enterprise Singapore, the Singapore Government agency responsible for supporting enterprise development, has boosted its Startup SG Founder scheme to a total of 57 partners who will help groom local start-ups. Most of these are in deep-tech industries such as agritech and advanced manufacturing. See more here.

Singapore and New Zealand's commitment to continued trade growth was cemented through the Declaration on Trade in Essential Goods signed on 15 May, which together with the Enhanced Partnership signed in 2019 provides a framework for cooperation across four main areas: defence and security, trade, science and innovation and people-to-people ties.

The positive effects from the agreement so far were outlined in an article for the Straits Times by New Zealand High Commissioner to Singapore, Jo Tyndall, that can be accessed here (via free sign-up).

In the article, the High Commissioner addresses how the COVID-19 pandemic will force the two countries to re-evaluate everything to food supply chains, healthcare and education systems and digital infrastructure - and how the Declaration is designed to create long-term growth for both countries.

Travel

Effective 9 June, Singapore Airlines will restart passenger flights to Auckland and Christchurch. The carrier will operate twice-weekly services to Auckland and a weekly service to Christchurch. Singapore Airlines has been operating five cargo services a week to Auckland. From 9 June two of those flights will move to passenger and cargo, and three cargo-only flights a week.

With new case numbers decreasing to an average of eleven per day in the last week of April, Singapore is now in discussion with ASEAN counterparts, Australia and New Zealand on resumption of travel with a cautious approach.

It is likely that essential business travel will resume while tourism will be put on hold. Singapore has also cited that they will likely start off with regional tourism, however with the different rate of recovery in each ASEAN country, it is tough to decide when is the appropriate time to open its doors.

The challenge for business travel is the implementation of measures to reduce the risk of spreading the virus. Talks about health declaration and the ability to track and trace travellers are some of the steps that may be implemented. No timeline has been indicated for business travel to resume.

It is advisable for New Zealand companies to closely monitor the progress of discussions between these countries so as to be prepared for resumption of travel. However, do note that the situation is fluid, and it is advisable to think about contingency plans for the next few months to a year when a vaccine or a solution is available to stop the spread of the virus.

Tradeshow and event information

Numerous international tradeshows and events are being postponed or cancelled in response to the COVID-19 pandemic.

Make sure you proactively check with organisers for any tradeshow or event you're scheduled to attend – conditions and regulations are changing rapidly overseas, and events may be postponed or cancelled at short notice.

Below is the status of major Singapore tradeshows and events that NZTE's teams are aware of.

If you have questions about an event not listed here, please contact the organisers in the first instance or get in touch with NZTE for further advice.

  • ADEX Ocean Vision 2020 is postponed to 29 – 31 May 2020.

  • FHA, HoReCa 13-16 July is postponed until further notice.

  • FHA, Food and Beverage 31 March – 6 April is postponed to 2 – 5 March, 2021.

  • Beauty Asia 24 – 26 February is postponed to 2 – 4 August, 2020.

  • IT Show 12- 15 March, is postponed.

  • Ecosperity Week postponed to 1 – 4 June 2021. This includes the Ecosperity Conference and Singapore Sustainable Investing and Financing Conference originally taking place on 7 and 8 July 2020.


Sector insights

As is to be expected, numerous sectors have been impacted by the COVID-19 pandemic. Below you'll find information on any COVID-19 effects across important sectors and industries in Singapore.

Airlines

Airline caterer SATS has asked older workers to consider earlier retirement and management to accept pay cuts of 10%, with options for others to go on voluntary unpaid leave.

Singapore Airlines has extended its flight cancellations to June amid global travel restrictions due to COVID-19, with a 96% reduction in passenger capacity for Singapore Airlines and its regional airline, SilkAir. For the foreseeable future, the airline will fly to just 15 cities, including London, Los Angeles and Seoul.

Singapore Airlines' low cost brand, Scoot Air, is operating at a 98% reduction in capacity.

The company has secured up to S$19 billion (US$13 billion) of funding to help see it through the pandemic and expand afterward, in a sign of confidence travel demand will eventually return. Singapore's biggest bank, DBS Group, will provide a bridge loan of S$4 billion until it gets the funds from the rights issue.

Additional resources

Below you can find information and contact details for other New Zealand government and international agencies regarding their response to COVID-19.

New Zealand Government agencies

Covid19.govt.nz
COVID-19 helpline for businesses
Business.govt.nz
New Zealand Customs
Ministry for Primary Industries (MPI)
New Zealand Export Credit (NZEC)
MFAT Export Helpline
MFAT Safetravel
Callaghan Innovation
Immigration
Ministry of Health
WorkSafe New Zealand

Global agencies

World Health Organization (WHO)
Centers for Disease Control and Prevention (CDC)

Contact NZTE

We're available to talk to you about any issues your export business is facing due to COVID-19.

For existing NZTE customers, please contact your New Zealand-based Customer Manager.

If you're unsure who to contact or haven't worked with us before, you can call NZTE on 0800 555 888 or email below and one of our Customer Advisors will help you.