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Wuhan virus outbreak likely to have 'much wider and deeper impact' than Sars: Chan Chun Sing
THE novel coronavirus outbreak is likely to have a much wider and deeper impact on the world economy than the severe acute respiratory syndrome (Sars) episode of 2003, with the Singapore government closely watching the impact on jobs here, said Minister for Trade and Industry Chan Chun Sing on Sunday.
Mr Chan was speaking to reporters during his visit to Oasia Hotel Downtown, where a 73-year-old Chinese national had stayed before testing positive for the coronavirus.
He said: "I've heard a lot of people comparing this episode with the Sars episode many years ago in 2003. I think we shouldn't do that kind of direct comparison ... In 2003 compared to now, China's GDP (gross domestic product) has gone up by about four times. Our trade with China has also increased by nearly four times."
China's GDP as a proportion of the entire world’s GDP has more than doubled from 2003 till now, from 9 per cent to more than 19 per cent, Mr Chan said, adding: "So what we must be mentally prepared for is that the impact of any disruption to the Chinese economy and the supply chains is likely to be a much wider, much deeper impact because of the interlinkages with the global economy, and certainly with the Singapore economy."
It is too early to give a number on how big the impact will be, Mr Chan said, but the shock suffered by China's economy will be transmitted to the rest of the world. "As the rest of the world progressively tightens their border controls, there will also be serious implications on tourism and other industries, including manufacturing and elsewhere."
Last Friday, Singapore announced that it will indefinitely ban anyone with a Chinese passport from entering the country, with exceptions made for Singapore permanent residents, those on long-term passes, and those who can show they have not been to China recently.
International visitors who have been to mainland China within the past 14 days will also be denied entry. In the 13 hours since these travel restrictions kicked in with effect from 11.59pm on Saturday, 15 travellers have been refused entry to Singapore.
Since Chinese tourists account for around 20 per cent of Singapore’s total international visitor arrivals, with about 3.6 million visitors to the republic in 2019, the tourism industry has already been directly impacted.
To dampen the punch for tourism businesses, the Singapore Tourism Board (STB) announced on Sunday that it will waive licence fees for hotels, travel agents and tourist guides, and defray enhanced cleaning costs of hotels that provided accommodation to confirmed and suspected cases of Wuhan virus infections.
Mr Chan promised that the actions taken by STB are the first in a wider set of measures that will be unveiled in the Budget speech on Feb 18.
Some tourism-related industries such as tour agents and the food & beverage sector have been very badly hit because 80-90 per cent of their business comes from the Chinese market, he noted.
He said: "Companies have also asked if we can help them with temporary bridging loans. This is something that we are studying to see how to help them with their cash flow."
The ministry is also studying how it can help defray costs for the aviation sector while maintaining air connectivity between Singapore and China, he said.
Mr Chan added: "For the taxi industry and the private hire industry, we will be looking into measures to see how we can help the drivers alleviate some of the temporary cash flow issues that they have at this point in time."
He reassured Singaporean businesses and Singaporean workers that "we stand together with them", adding: "We do have the means to help them tide over this difficult moment, but we must do this with a long-term perspective. We must make sure that whatever we do is sustainable because we are not sure how long this crisis will last.
"We must be mentally prepared, psychologically prepared that the impact of this, compared to Sars could be wider, deeper and longer."