Debated in Parliament on 12 Jan 2022.
Mr Liang Eng Hwa asked the Minister for Trade and Industry (a) in the last five years, what is the annual amount of domestic consumer spending with a breakdown by luxury and non-luxury items respectively; (b) how much of the reduction in local tourism spending in the last two years have been offset by higher domestic spending; and (c) what is the expected trend in domestic consumer spending in 2022.
The domestic consumption expenditure of residents from 2016 to 2020 was $134.4 billion, $139.3 billion, $146.3 billion, $151.8 billion and $147.1 billion. The data is not granular enough to break down into luxury and non-luxury items.
Nonetheless, the Singapore Tourism Board has been in close contact with business operators in tourist shopping areas like Orchard Road and the Integrated Resorts. The general feedback is that Singaporeans have supported the tourism and tourism-related sectors by staying in our hotels, visiting our attractions, going on local tours, shopping locally, and eating at our F&B outlets. As of 1 December 2021, $280 million in vouchers and additional expenditure had been spent under the SingapoRediscovers Vouchers (SRV) scheme. However, such domestic spending is unlikely to make up for the decline in international tourism expenditure. In 2019, tourism receipts hit close to $28 billion, but fell to less than $5 billion in 2020. We expect further declines in 2021 because of the international travel restrictions put in place by many countries.
As we progressively ease domestic restrictions, and consumer sentiments improve in tandem with the turnaround in labour market conditions, the domestic consumption expenditure of residents is likely to increase in 2022. Nonetheless, this increase is unlikely to make up for the fall in tourism receipts. As the recovery in visitor arrivals is expected to be slow, activity in some consumer-facing sectors like the food & beverage services sector, may not return to pre-COVID levels by the end of 2022.
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