Singapore Retailers Doubtful on the Help of Revenge Shopping
On Friday, Singapore further eased restrictions and reopened pockets of the economy suspended because of coronavirus. Still, retailers are not so hopeful that the move would do much to lift their already struggling businesses, according to an industry association.
The Southeast Asian economy has been extremely hurt as measures, overseas and domestically, targeted at containing the spread of the virus halted most of the global economic activity. According to the official forecast, they expect Singapore’s economy to narrow down by 4% to 7% this year.
Singapore Retailers Association’s executive director, Rose Tong, stated on Friday, “Retailers are definitely facing significant financial stress during this period. Whether big or small, they’re actually finding it really difficult to meet their financial obligations.”
She added that people are doubtful that business will be business like before, even after two weeks of euphoria shopping or ‘revenge shopping.’
In addition to that, several retailers expect sales to decline by around 50% due to the weakening economy.
Furthermore, the country has become one of the worst-hit in Asia by the coronavirus pandemic. As the health ministry stated, it reported having confirmed over 41,000 cases as of Thursday. They then found more than 90% of the said cases among migrant workers living in dormitories, official data displayed. The affected workers are generally men from other Asian countries working in low-wage jobs.
A reducing number of cases detected outside the dormitories allowed for Singapore to reopen its economy, starting June 2. And this will happen after nearly two months of partial lockdown that the government called a circuit breaker.
The further easing on Friday lets more activities go back to having precautionary measures in place. And these include shopping at physical retail stores and dining out.
Its Economy and Its Restrictions
The lifting of restrictions in Singapore happened earlier compared to what others had expected. As a result, this might help limit the economic slowdown in the country. This information was from Singaporean bank OCBC’s head of treasury research and strategy, Selena Ling.
Ling said on Friday, “We could actually see some pent-up demand, and retail sales could snap back a little bit in June.”
She also cautioned that this would possibly be a somewhat muted recovery from now on. The litmus test will most likely be two weeks later when they see if there is any pick-up, with COVID-19 cases returning.
Besides that, Ling noted that China’s experience has shown that a resurgence in cases could mute all recoveries in consumer demand. However, she explained that recent indicators hint Singapore’s economy passed through its trough in April.
With that, and with the planned government spending, they may be able to help the Singapore economy to register a less severe contraction of 5% this year.
Moreover, the government has recently revealed four stimulus packages worth nearly 100 billion Singapore dollars or $71.8 billion. This reaches almost 20% of its gross domestic product.
