Recovery in Singapore's aviation sector will be a ‘long haul,’ says transport minister

SINGAPORE — Singapore is lifting some border restrictions but recovery in its important aviation sector remains challenging given the Covid-19 pandemic’s uncertain trajectory, said the country’s transport minister.

“The fact remains that it’s going to be a long haul because while certain countries are more advanced in vaccination, others are still trying to vaccinate their population,” S Iswaran told CNBC’s “Squawk Box Asia” on Friday.

“And at the same time the virus is in different phases in different parts of the world, and therefore countries have also adopted different types of border measures,” the minister said.

The aviation sector contributes around 3% of Singapore’s gross domestic product.

Singapore is a city-state with no domestic air travel market. As a result, its aviation sector and flagship carrier Singapore Airlines have both been badly hit by travel restrictions that countries imposed to limit the spread of Covid.

The Singapore government on Thursday announced several steps to reopen its borders, by allowing certain groups of travelers to skip quarantine upon arrival in the city-state. Those groups include vaccinated travelers from Germany and Brunei, as well as both vaccinated and unvaccinated travelers from Hong Kong and Macao — provided they meet certain conditions.

Iswaran said the “vaccinated travel lanes” arrangement with Germany and Brunei could help Singapore’s aviation sector to recover.

“But I think we have to be quite realistic that it is a challenging pathway, and it has to be one where we accept that there’ll be a dynamic profile responding to situations as they evolve,” he added.

Singapore and Hong Kong had plans to launch a widely anticipated air travel bubble, which would allow quarantine-free leisure travel. The plan was postponed twice because of rising Covid cases, and both cities announced Thursday that the travel bubble has been scrapped.

Singapore has one of the highest Covid vaccination rates globally. Around 77% of its roughly 5.69 million population has completed their inoculation as of Wednesday, the health ministry said.

The Southeast Asian country relaxed social-distancing measures further this week. The easing includes raising the cap on the number of attendees for business conferences and live performances, as well as allowing more people to return to their workplace.  

Even with Singapore’s high vaccination rate, measures such as mask-wearing are still needed to minimize the risk of transmitting Covid, said Iswaran.

“The reason is because vaccination — whilst it affords protection — we do need the complement of the other safe management measures, especially when you consider some of the new variants like delta, which still has a quite-high transmissibility,” said the minister.