In December 2022, STB convened the Meeting, Incentives, Conferences and Exhibitions (MICE) sustainability Summit with the Singapore Association of Convention & Exhibition Organisers & Suppliers (SACEOS). During the summit, the MICE Sustainability Roadmap was launched which set clear targets and strategies to raise sustainability standards and certification across Singapore’sMICE industry. TheMICE industry has also picked up momentum in 2023, with Singapore hosting somemajor events including Formula 1 Singapore Grand Prix (F1), ZoukOut, Singapore Comic Con 2023 and World’s 50 Best Bars announcement ceremony. In May 2023, STB announced the Singapore Tourism Accelerator programme. The programme is equity-free for the world’s most promising technology startups that can power the travel and tourism industry. It aims to support scalable tech innovations to develop and adapt to future-proof the industry through access to some of Asia’s and world’s most important industry players. Companies will receive funding support of up to 70%of qualifying costs, up to S$25,000 per company to testbed their solutions. Singapore's visitor arrivals are projected to continue its road of recovery in 2024. While the current Chinese economy may be underperforming, the full recovery of Singapore's tourism is hinged on the potential resurgence of Chinese tourists. This could be supported by the recent easing of travel restrictions where Chinese tourists are exempted from visa requirements for stays of up to 30 days in Singapore. Overall, STB forecasts international visitor arrivals to reach 15-16 million, bringing in approximately S$26.0-S$27.5 billion in tourism receipts in 2024. RETAIL MARKET OVERVIEW Retail Sales Index Compared to the high growth in 2022 due to the low base in 2021, the total Retail Sales Index4 (excluding motor vehicles) in December 2023 experienced some contractions YoY, with some retail subsectors registering growth while others contracted. Subsectors which registered YoY growth in December 2023 include Watches & Jewellery (6.0%), Food & Alcohol (4.4%), and Computer & Telecommunications Equipment (1.9%). Conversely, Recreational Goods (-12.3%), Optical Goods & Books (-11.8%), and Furniture & Household Equipment (-8.5%) recorded a YoY decline in sales during the same period. 4 Retail Sales Index (2017=100), At Current Prices, Monthly 5 Food & Beverage Services Index, (2017=100), At Current Prices, Monthly 6 Source: Office for National Statistics, United Kingdom 7 Source: Australian Bureau of Statistics 8 Source: National Bureau of Statistics of China 9 Source: Census.gov 10 CBRE Viewpoint – Singapore Retail in the Post-Pandemic Era The Food & Beverage Index5 recorded a 0.3% YoY expansion in December 2023, a step down from the 13.8% YoY increase in December 2022. Despite small growth for the overall Food and Beverage sector, Food Caterers saw the largest growth at 14.5%YoY. In contrast, the largest contraction came from restaurants with a YoY contraction of 4.8%. The growth in food catering subsector was likely due to the increased number of MICE and larger scale events, while the contraction in restaurants could be attributed to changing consumer preference as cost of living increases due to GST hikes and inflation. Online Sales as a Percentage of Total Retail Sales While more than 80% of the retail sales in Singapore are generated from physical stores, the penetration of e-commerce in Singapore remained elevated in 2023 as consumers continued to shop online. The average proportion of online retail trade (excluding motor vehicles) stood at 14.4% in 2023, which remained 7.6 percentage points higher as compared to pre-COVID levels (2019). However, this is 1.4 percentage points lower compared to the peak in 2021, and proportionally lower compared to that in the United Kingdom (UK), China and United States (US). The trends observed in online retailing in the UK and Australia were similar to that of Singapore. UK’s average proportion of online retailing accounted for 26.5%6 of the total retail sales in 2023, 7.4 percentage points higher than that of the average in 2019. Similarly, the proportion of online retail sales in Australia accounted for 16.8%7 of total retail sales in 2023, 6.5 percentage points higher than that of December 2019. Online retailing has also seen increased levels of activity in China and the US. China’s online retail activities remained robust, with online sales accounting for 27.6%8 of the total retail sales in 2023, representing a 6.9 percentage points increase compared to 2019. In the US, retail e-commerce sales accounted for 15.6%9 of its total retail sales in 3Q 2023, growing by 7.6 percentage points over 3Q 2022. Shoppers’ Consumption and Behavioural Trends Three years after the onset of COVID-19 pandemic, retail sales have recovered and exceeded pre-pandemic levels10. However, shopper traffic has yet to fully recover. CBRE observed that while consumers are visiting malls less frequently, they stay for longer durations in 2023. Consumption patterns have also changed, driven by the proliferation of e-commerce, rising income levels Overview Leadership Performance Framework Other Information ANNUAL REPORT 2023 93
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