Limitations of Small Domestic Markets in City-States
Continued Essential Travel Allowance for China and Malaysia
Quarantine Simplification for General Public in New Zealand and Others
[Asia Economy Singapore Correspondent Seo Jumi] Singapore has begun reopening its borders, which had been virtually closed since April. Although the COVID-19 pandemic is still ongoing, the city-state, facing the limitations of its small domestic market, deemed it inevitable to reopen its borders.
According to local media such as The Straits Times on the 8th, Singapore recently decided to accept essential travel such as business trips from China and Malaysia, and has also simplified quarantine procedures for the general public from New Zealand, Brunei, and others. They have implemented a self-quarantine exemption measure. Accordingly, visitors from these countries are exempt from the self-quarantine period and only need to undergo a COVID-19 test upon arrival in Singapore. However, if medical treatment for the coronavirus is required while in Singapore, visitors must bear the medical expenses themselves. Additionally, for visitors coming from countries or regions with relatively low COVID-19 risk, including Australia (excluding Victoria), China, Taiwan, Vietnam, and Malaysia, the self-quarantine period will be reduced from 14 days to 7 days.
Ong Ye Kung, Singapore’s Minister for Transport, evaluated the decision to reopen borders to Brunei and New Zealand as beneficial for Changi Airport, the gateway, and the recovery of Singapore’s aviation industry. In an interview with local media, Minister Ong stated, "Shortening the self-quarantine period will help increase the number of passengers at Changi Airport to about 40% of pre-COVID-19 levels."
This decision is directly linked to Singapore’s economy because the aviation industry is crucial. The aviation and related industries account for more than 5% of Singapore’s Gross Domestic Product (GDP). Before COVID-19, employment in this sector reached 190,000 people. However, after the pandemic, the number of passengers using Changi Airport was only about 7% of the pre-pandemic level in January. Changi Airport was once the 7th busiest airport in the world with over 1,000 daily flights, but now the number of daily flights has dropped to 150.
Singapore Airlines Group and low-cost carrier Jetstar Asia plan to increase flights if the aviation sector continues to recover. In particular, flight services connecting Singapore with Frankfurt, Germany, and New York JFK Airport in the United States will resume from November this year until March next year.
Reopening the borders also helps strengthen sales in related industries due to the influx of tourists through the recovery of the aviation industry. According to the second-quarter economic report recently released by Singapore’s Ministry of Trade and Industry, sectors representing tourism activities such as accommodation and food services decreased by 41%. The transportation industry, including air transport, declined by 39%.
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