Wuhan virus: Singapore's economy will be impacted, but is diversified enough to mitigate uncertainty, says Manpower Minister
SINGAPORE: The Wuhan coronavirus will cause current economic uncertainties to escalate, but Singapore's economy is prepared to weather the impending financial impact, said Manpower Minister Josephine Teo on Thursday (Jan 30).
Speaking at a media interview, Mrs Teo said that there were already headwinds going into 2020 due to rising global conflict and trade tensions that had not been fully resolved. But with growing alarm worldwide over the spread of the Wuhan virus, economic uncertainty has heightened and "investment decisions are bound to be reexamined".
Yet, while no one knows how long this health crisis will last, it is unlikely that the situation will persist, Mrs Teo said.
“It will not be business as usual because we know businesses have to take more precautions than before, but life must somehow go on, businesses must operate, workers must still be able to go to work," she said.
She also said that current circumstances are "significantly different" than during the 2003 Severe Acute Respiratory Syndrome (SARS) epidemic.
READ: Commentary: SARS was scary, but the experience was invaluable in shaping our Wuhan virus response
“When you look at SARS, practically everyone was caught by surprise,” she said.
There was much that was not unknown and difficulty identifying the strain of coronavirus then. However, after the contagion first broke out in Wuhan, the Chinese government quickly released the genome sequence of the virus.
During the SARS outbreak, there was a "fairly long period of time where it was just ... grappling in the dark", said Mrs Teo. "Today it's all about organising the response."
Singapore’s economy has also diversified significantly since 2003. Tourism and the hospitality sector may still be an important economic growth engine but it is a “relatively modest contributor”, she pointed out.
Within the tourism sector, the origin of tourists and reasons they come to Singapore have also become more varied, she added. While the country still attracts recreational visitors, many are here for meetings, incentives, conferencing, exhibitions (MICE)-related activities as well.
When asked how the economic outlook will impact the employment status of Singaporeans in the coming months, Mrs Teo said that employers she spoke to are well-aware of the situation and are “making every effort to try and carry on with their daily lives and their work”.
“It’s not a case of everything coming to a standstill, but they are exercising greater caution,” she said.
“For example, business deals that involve Chinese contacts ... may moderate a little bit, but they will then look for other opportunities at this time,” she added.
Mrs Teo also said that companies will adapt. For example, they may hold teleconferences with clients instead of travelling overseas to meet them. Other firms may see this as an opportune time to train their staff.
“The important thing is people know that it will come to pass,” she said.