Retail sales plunge 15.3% in 2020, in worst year on record: economists react

SINGAPORE's retail sales fell for the 23rd straight month in December 2020 by 3.6 per cent year-on-year (y-o-y), bringing the full-year contraction in retail spending to 15.3 per cent y-o-y. This is Singapore retail's worst performing year on record since data was made available in 1985, said economists, underperforming even their bearish forecasts.

"The decline is almost double the pace recorded during the 2009 global financial crisis (-7.8 per cent) and 1998 Asian financial crisis (-7.8 per cent)," said Lee Ju Ye, an economist from Maybank Kim Eng. "This was due to a combination of factors including Singapore's circuit breaker in Q2 2020, the closure of borders, and more time spent at home which reduced the demand for apparel and cosmetics."

UOB economist Barnabas Gan observed that most retail industries continued to stay subdued due to low visitor arrivals and domestic demand, with y-o-y sales contracting in food and beverages (-35.0 per cent), departmental stores (-28.7 per cent), apparel and footwear (-22.8 per cent) and watches and jewellery (-10.2 per cent).