- New VTL lanes to return starting from 25 February with sharp relaxation of Singapore’s quarantine and testing requirements
- Singapore should ‘reopen’ 65%-70% by June 2022, and could potentially reach 90%-95% if the Greater China market eases border controls
- Recovery for aviation sector on firmer footing while hotel S-REITs to benefit from Asia’s border reopening, the biggest market for hotel S-REITs with a 42%-100% revenue exposure
- Healthcare service providers poised to benefit from return of elective procedures and medical tourism while there will still be some demand for COVID-19-related services in the near-term
What’s New
Singapore plans for further easing of travel restrictions and domestic health protocols once Omicron subsides
- The government announced that it plans to substantially loosen travel restrictions and relax domestic COVID-19 measures after Omicron peaks in a few weeks’ time.
- New VTL lanes with Qatar, the UAE, and Saudi Arabia, will begin on 25 February, and VTLs for Israel and the Philippines will begin on 4 March; vaccinated travellers from Thailand will soon be allowed entry without quarantine.
- VTL travellers and travellers from low-risk countries will now take supervised ART tests instead of PCR tests within 24 hours on arrival from 22 February.
- Additionally, VTL travellers will no longer be required to undergo a seven-day self-supervised ART testing regime.
- Quotas on VTLs will also be progressively raised, given that imported infections only account for about 1% of the total daily case count.
- Singapore will also eventually transition towards allowing entry for all vaccinated travellers, instead of purely relying on VTLs with selected countries.
Our thoughts
- This clearly demonstrates the government’s commitment to reopening and enabling Singapore to shine as an aviation and business hub once again.
- Other countries in the region like Australia, Malaysia, Vietnam, the Philippines, and Indonesia are also reopening their borders, which is crucial, given that a large number of tourists that visit Singapore typically have multi-country itineraries in Asia.
- Simplified testing requirements will also drastically reduce costs for travellers, and the imminent relaxation of social restrictions, like the reopening of nightlife businesses and increasing maximum group sizes and capacity limits should stimulate inbound tourism.
- Additionally, the gradual streamlining of border restrictions to include fully vaccinated non-VTL travellers will accelerate the inflow of tourists
- We expect the pandemic situation to peak by mid-1Q2022, in line with the curve of new cases witnessed in South Africa, the US, and countries in Europe.
- Hence, Omicron’s impact to the sector should be largely confined to 1Q2022, and we should see a
- swift rebound in both inbound and outbound tourism from 2Q2022.