Expert Speak Raisina Debates
Published on Dec 29, 2020
What will Singapore look like in the post-COVID world? Three things stand clear.
Singapore and the post-COVID world This article is part of the series — The Future of the Pandemic in 2021 and Beyond.

A negative COVID-19 RT-PCR test report 72 hours prior to arrival. A separate entry permit, apart from visa, granted on a case-by-case basis. Fourteen days of compulsory quarantine at a dedicated government facility, which must be paid for pre-arrival. A pre-exit negative COVID-19 test report on the eleventh day of quarantine. Masks and social distancing at all public places. This is what traveling to Singapore looks like in the post-COVID world.

For a country that runs on tourism, finance and trade, the impact of COVID-19 in general and travel restrictions in particular, has been significant. In February 2020, Singapore’s Ministry of Trade and Industry (MTI) had predicted a negative GDP growth rate of 0.5 to 1.5 percent for 2020. However, the impact of the pandemic on the economy was much more severe. Singapore’s economy contracted by 0.3 percent in the first quarter, 13.2 percent in the second quarter and 5.8 percent in the third quarter on a year-on-year basis. For the year 2020, the MTI now has an updated GDP forecast of -6.5 percent to -6 percent growth.

The impact of the pandemic on the economy was much more severe.

However, all is not lost. Compared to just a couple of months ago, the country has managed to get the virus under control, with most days in the past three weeks reporting zero locally transmitted cases. Even when one includes cases imported from outside, Singapore now, is in a much better position (Figure 1). Therefore, for year 2021, MTI has provided a more positive outlook, with forecasted GDP growth rate between 4 to 6 percent.

Source: Our World in Data

This positive economic outlook is also the result of the increasing probability of having vaccines available for all within the next few months. On 5 October 2020, Singapore had appointed an expert committee under Dr Benjamin Ong to make recommendations on how the country should arrange to vaccinate its residents. While no tender has been awarded, Singapore has indicated that it is not going to rely on a single supplier given the race between multiple vaccine manufacturers such as Pfizer, BioNTech and Moderna. For now, the government has also guaranteed free vaccine to all Singaporeans and long-term residents.

If the world economy flourishes, so will Singapore.

Singapore is also one of those countries that is actively engaging with WHO, CEPI and the Global Alliance for Vaccines and Immunisation (Gavi), to make sure that the COVID-19 vaccine is accessible to and affordable for all. It makes economic sense too. For many countries that are reliant on international trade and tourism, getting the world back on its feet is mutually beneficial. If the world economy flourishes, so will Singapore.

Of course, in this equation, not all countries hold the same amount of power. For instance, it is clear that China and maybe India, would hold the key to world growth in the next two decades. Therefore, countries like Singapore are actively engaging with them to bring business back on track. With China, Singapore has already established a fast lane for business and official travel, in collaboration with ten Chinese provinces and cities. With India, such an arrangement might be possible, once the number of cases in the country are under control.

Singapore has already spent close to S $100 billion directly to fight this health crisis and to support its businesses, its workers and its households.

Until the same level of connectivity and trade is established, as during the pre-COVID world, countries like Singapore will have to support its citizens to survive the effects of this pandemic. To some extent, this has been done. Singapore has already spent close to S $100 billion directly to fight this health crisis and to support its businesses, its workers and its households. The Monetary Authority of Singapore (MAS) has estimated that the government’s expenditure has helped reduce economic contraction by 5.6 percent in 2020 and 4.8 percent in 2021. It has also helped reduce the unemployment rate from rising further by 1.7 percent.

What will Singapore look like in the post-COVID world? Three things stand clear. Firstly, since Singapore is central to trade and tourism in Asia, the threat of importing the virus from other countries might continue to remain a reality for the next year until the whole world is vaccinated. In the future, having been vaccinated might be a prerequisite to travel to Singapore.

Secondly, the pandemic has also spurred innovation, forcing governments and businesses to find novel solutions to complex problems. And some of these innovations are here to stay. For instance, the rapid development of online government services might be here to stay longer, if it turns out to be more convenient and efficient. Similarly, tele health consultations for diseases might become the norm to ease the burden on the healthcare sector, in the increasingly ageing society of Singapore.

The pandemic has also spurred innovation, forcing governments and businesses to find novel solutions to complex problems.

Finally, because Singapore has had to provide numerous kinds of support to its citizens to survive the pandemic, its social security net has expanded. This means that many citizens are now being supported in cash and kind, in a way and to the extent that they may not have experienced before. If such support remains in place for a longer time, it might be difficult for the government to withdraw it at a later stage. Once citizens realise that a social security net which covers a larger population and provides deeper coverage is a possibility in Singapore, they might demand it more assertively. At the least, the government will have to be cognizant of the needs of its citizens and withdraw the support in a staggered manner.

Overall, Singapore is definitely going to find itself in a new and challenging terrain in this post-COVID world. How well it adapts to it, remains to be seen.

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Contributor

Mohnish Kedia

Mohnish Kedia

Mohnish is a PhD Candidate at the Lee Kuan Yew School of Public Policy (LKYSPP) National University of Singapore. He holds aMaster of Public Policy ...

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