Virus updates: Singapore braces for recession
published : 14 Feb 2020 at 16:46
writer:
Agencies
A woman wearing a protective mask passes empty shelves of instant noodles and canned food, as people stock up on food supplies after Singapore raised coronavirus outbreak alert level to orange, at a supermarket in Singapore on Saturday. (Reuters photo)
SINGAPORE: The city-state's economy could enter recession due to the blow from the 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, its biggest source of tourists, while some countries have advised against travel to Singapore which has one of the highest virus infection tallies outside China at 58.
Its manufacturing and trade sectors may also be hit by widespread economic disruptions in China due to the outbreak.
The Asian business hub had just been showing signs of recovery from its lowest growth rate in a decade last year — a paltry 0.7% — when the outbreak spread to the city-state in late January.
Singapore is due to release final fourth-quarter growth data on Monday, and 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 virus relief package of at least S$700 million ($505 million).
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China National Health Commission Vice Minister Zeng Yixin said 1,716 health workers have been infected and six of them have died as of Tuesday.
Mr Zeng said the number of infected medical staff is increasing.
Chinese officials and hospitals have repeatedly noted a shortage of protective equipment, including face masks, as the disease took hold in Hubei and spread throughout the country.
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The outbreak could mean a $4-5 billion drop in worldwide airline revenue, the International Civil Aviation Organization said.
The UN agency reported that 70 airlines have cancelled all international flights in and out of China and 50 others have reduced their operations.
Preliminary estimates show this has meant a reduction of nearly 20 million passengers compared to expectations for the first quarter of 2020.
That figure equates to potential lost revenue of up to $5 billion, the agency said.
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