The economy of Singapore could enter recession due to the blow from the Covid-19 coronavirus outbreak, its prime minister said on Friday. Adding that Singapore was bracing for a “significant” hit in the coming quarters.
“The impact will be significant at least in the next couple of quarters. It is a very intense outbreak,” Lee Hsien Loong said in a video interview posted on his Facebook page.
“I can’t say whether we will have a recession or not. It’s possible, but definitely our economy will take a hit,” Mr Lee said in remarks made to media at Singapore’s main Changi airport.
Mr Lee said business at the airport had suffered with flights down by a third.
Singapore has in effect banned all visitors from China, Singapores’s biggest source of tourists. Furthermore some countries have give travel warnings advising against travel to Singapore. The island state has one of the highest virus infection tallies outside China at 58.
Manufacturing and trade sectors in Singapore may also be hit by widespread economic disruptions in China. Above all due to the Covid-19 Virus outbreak.
The Asian business hub had just been showing signs of recovery from its lowest growth rate in a decade. Singapore had a paltry 0.7% growth rate when the outbreak spread to the city-state in late January.
Singapore is due to release final fourth-quarter growth data on Monday. Furthermore economists are anticipating revisions to its 2020 growth forecast range of 0.5-2.5%.
On Tuesday, the government is set to roll out a hefty package of budget measures to cushion the economic blow from the epidemic, with some analysts expecting it to run its biggest deficit in over a decade.
Economists at Citi and Maybank expect a Covid-19 virus relief package of at least S$700 million ($505 million).
Singapore braces for more Covid-19 virus cases
Meanwhile, a minister said Friday that Singapore must be prepared for the number of people in the country infected with the new coronavirus disease. — formally named Covid-19 virus — to continue to climb in the coming weeks.
As of Thursday noon, Singapore had 58 confirmed cases of Covid-19 virus. Fifteen of which have recovered and been discharged, according to the country’s Ministry of Health.
Singapore has not recorded any deaths, but that too is something people must be “psychologically prepared” for as the number of cases continues to rise, said Janil Puthucheary, senior minister of state at Singapore’s Ministry of Transport and Ministry of Communications and Information.
“I think it’s really too early to talk about a peak. Cases are coming in on a daily basis and you have to have the expectation there are going to be more cases over the next few weeks,” he said.