Influx of tourists may provide limited support on expected slow economic growth
The government saw a 12-fold boost in foreign visitor arrivals.
The surge of tourist entry in the Lion City may uplift the economic slowdown but it will only be limited amidst the ongoing conflict in global politics, analyst, ING Group, said.
“One development that could potentially partially offset the projected slowdown in household spending and the China slowdown could be the recovery of Singapore’s tourism industry,” read the report.
When the economy reopened, the market saw 1.5 million foreign arrivals, as of June 2022 from zero entry during the COVID-19 pandemic. Tourists spending then hit $1.3b as of the first quarter of 2022.
The downside, however, is the low visitor arrivals from China because of the zero-COVID-19 levels and Russia, which stemmed from its invasion of Ukraine.
ING noted that price pressures are beginning to heat up during muted government spending and capital formation.
Return of tourists could offset this but ING said the numbers are still below 2019 levels.
“Furthermore, despite tourist arrivals improving, Singapore may be missing the usual influx of tourists from greater China and thus the upside may be limited,” said ING.