In situations where failure of a sector or business has a potential for a catastrophic impact on Singapore\u2019s competitive or national security, the government might step in, said Deputy Prime Minister and Finance Minister Heng Swee Keat in Parliament in October.<\/p>\n\n\n\n
“In such instances, we cannot preclude the possibility of government taking some action to ensure these strategic capabilities are preserved,” he said.<\/p>\n\n\n\n
This was in reference to firms in sectors facing the biggest impact from the COVID crisis but will eventually recover. Sectors such as aviation, aerospace and tourism \u2013 dubbed tier 1 sectors \u2013 are among the hardest hit. These firms might have to receive additional support to weather the COVID-19 downturn in order to prevent permanent scarring on Singapore\u2019s economy. <\/p>\n\n\n\n
Read also: October 2020 Ministerial Statement: 5 Government Scheme Updates That Businesses Should Know<\/a><\/em><\/strong><\/p>\n\n\n\n There are existing support schemes for such sectors, such as the SingapoRediscovers Vouchers for tourism, the Enhanced Aviation Support Package, and resilience packages for arts and culture. In addition, the Jobs Support Scheme (JSS)<\/a> for tier 1 companies was also extended at the 50% level from September 2020 to March 2021, while other sectors receive lower salary support levels. <\/p>\n\n\n\n Other than these sectors, there may also be other sectors that will require support if necessary, especially if the COVID situation worsens or drags on. Such sectors will be integral to Singapore\u2019s viability as a commercial hub and national security, and special care needs to be taken to ensure firms in these industries continue to operate in this uncertain business climate.<\/p>\n\n\n\n Arguably the most important sector in Singapore\u2019s economy, not only because we are a trusted financial hub, but also because banking supports the rest of the economy in providing the infrastructure necessary to build (or rebuild) businesses. The three local banks \u2013 DBS<\/strong>, OCBC <\/strong>and UOB<\/strong> \u2013 are key drivers of the local financial landscape in terms of the total amount of assets owned and the amount of integration between the banks and the local economy. <\/p>\n\n\n\n They have total assets of over $1 trillion (as at FY-2019), making them key stakeholders in the local economy. Given that so many people and businesses rely on them for day-to-day functions, they can be deemed as \u201ctoo-big-to-fail\u201d.<\/p>\n\n\n\n Historically, Singapore\u2019s success was founded on its strategic location as a harbour and port. Today, Singapore\u2019s international standing still hinges on our reputation as one of the busiest ports \u2013 PSA<\/strong> \u2013 as well as a global offshore and marine hub. <\/p>\n\n\n\n Servicing worldwide demand for ship repair, shipbuilding, rig-building and offshore engineering, there is a need to ensure that we are still seen as an esteemed international trade partner and service provider in order to retain our competitiveness. As such, the big firms in this sector \u2013 Keppel<\/strong> and Sembcorp Marine<\/strong> \u2013 are a critical component of Singapore\u2019s future economic viability. <\/p>\n\n\n\n More so during this period of economic uncertainty when oil prices are volatile and demand for offshore and marine services have slowed, there might be additional support required in order to help these firms change with the times. <\/p>\n\n\n\n It is no surprise that critical communications infrastructure needs to be on any \u201ctoo-big-to-fail\u201d list in Singapore. Everything in our economy depends on efficient and operational telecommunications infrastructure, from calls to Internet provision, and failure in this sector would have devastating consequences for the rest of the economy.<\/p>\n\n\n\n As the biggest telecom service provider in Singapore, Singtel<\/strong> is a significant stakeholder in the local economy and the fate of many a business will hinge on the infrastructure that has been laid out, not forgetting the future of communications in 5G Internet as well. Other local telcos such as StarHub<\/strong> and M1<\/strong> may also be supported.<\/p>\n\n\n\n As COVID-19 continues to ravage aerospace manufacturers, this high-value industry<\/a> that employs more than 22,000 people, about which 80% are Singaporeans, is \u201cunder threat\u201d, as explained by aviation analyst Shukor Yusof of Endau Analytics. There may be a need to support these firms \u2013 ST Engineering<\/strong>, SIA Engineering<\/strong>and Singapore Aerospace Manufacturing<\/strong> \u2013 during this crisis as the aerospace ecosystem is \u201cbroken\u201d and will require time to rebuild.<\/p>\n\n\n\n As this sector prepares itself for a post-COVID world, it will be several long months or more before Singapore can slowly re-establish itself as a regional hub. Before demand comes back on, however, firms in this sector will have to find a way to minimise cash burns and offload costly assets. This could mean major company restructuring in this space. <\/p>\n\n\n\n Overseas holiday trips that Singaporeans have been looking forward to are struggling to materialise. The aviation industry has not been dealt a good hand, especially with the lack of domestic air travel in Singapore. With travel bubbles slowly opening to places like Hong Kong, only time will tell whether the aviation industry can bounce back. <\/p>\n\n\n\n#1 Banking Sector<\/strong><\/h3>\n\n\n\n
#2 Port, And Offshore And Marine<\/strong><\/h3>\n\n\n\n
#3 Telecommunications<\/strong><\/h3>\n\n\n\n
#4 Aerospace<\/strong><\/h3>\n\n\n\n
#5 Aviation <\/strong><\/h3>\n\n\n\n