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Thursday, 13 November 2008

Financial storm hits home

BY RACHEL CHAN

AN OVERWHELMING majority of people in Singapore say they are feeling the impact of the worsening global economic crisis, with many already taking steps to deal with it.

This is borne out in the inaugural SPH Web-Panel Poll conducted by the Research, Analysis and Planning Department (RAPD) of Singapore Press Holdings for my paper. The survey was conducted between Oct 23 and 27.

It sought to gain insight on Singapore residents' reactions to the economic crisis, and how they are coping with it.

A staggering 86 per cent of 487 respondents said they have been affected by the crisis, with 56 per cent of this group cutting back on dining at restaurants and opting for more affordable meals at hawker centres instead.

For example, Ms Tan Mei Ling, 30, an advertising executive, said that while she eats out every day for lunch, she has stopped frequenting mid-range restaurants.

Instead, she chooses to eat at hawker centres and makes sure her meals cost less than $10.

'It's a big pinch as I'm a foodie and I hate scrimping on food,' she said.

'But it's more important to try to save some cash these days, as opposed to splurging.'

Bank executive C.L. Yong, 33, said: 'I'm more careful with my spending. I used to go out every Friday for drinks with friends, but I've stopped for the past two months.

'Instead, I either go to coffee shops for a coffee or beer with friends or stay at home reading, surfing the Internet, chatting online with friends or playing online games.'

A check with Japanese restaurants Ichiban Boshi and Ichiban Sushi appears to bear out the findings.

A spokesman said: 'Business is still brisk, though we are seeing shorter queues.'

The Singapore situation is not unique in Asia-Pacific. According to the results of the twice-yearly MasterCard Worldwide Index released yesterday, consumer confidence in the region has turned 'increasingly pessimistic'.

It reported that 70 per cent of consumers in places such as Vietnam, China, India, Hong Kong, Taiwan and Singapore are tightening their belts by cutting down on discretionary expenses.

The SPH Web-Panel Poll results are in sync with Master-Card's findings.

In the SPH survey, 43 per cent of those who said that they have been affected by the downturn are cutting down on their shopping.

Furthermore, 35 per cent are now staying home to watch television shows instead of clubbing or going to the cinema, and a fifth of the respondents are cancelling their year-end overseas vacation.

For instance, production manager Tan Kaili, 25, is glad that she and her family will be going to nearby Vietnam for their vacation early next month.

'I won't be planning any long-haul trips in the near future. If I'm going on a solo vacation, my budget should preferably not exceed $600,' she said. Revealingly, the respondents aren't completely downbeat about the situation.

While 81 per cent of them believe times ahead would be getting tougher, they are also a pragmatic lot who understand that the financial crisis is a global one, and that Singaporeans can't do much about it.

Most of the respondents ' about seven out of 10 ' say they have full trust in the Government's ability to tackle the problem and protect the interests of Singaporeans.

'I think Singaporeans have an inherent trust in the Government as it's seen us through bad times before,' said communications consultant Foo Ling Feng, 29.

'The Government also has reserves that it may use, should it decide to step in with any bailout plans in the future.'

Surprisingly, only 29 per cent of the 384 working adults surveyed were fearful of losing their jobs or retrenchment.

Also, just over half of the respondents have not changed any of their saving habits yet.

Most also expected the crisis to peter out in one to three years' time.

Asked to name the culprits who caused the current crisis, about 77 per cent of the respondents blamed the lack of checks and balances in the world's financial system as the No. 1 factor, which led to the exploitation of the system by the greedy and corrupt.

Avaricious bankers and shoddy oversight by government agencies came in second (71 per cent) and third (64 per cent), respectively.

Also, two in five people also felt that the financial crisis has undermined their trust in local banks, while half felt the financial crisis had affected their attitude towards life insurance.

The people polled in the SPH survey are between 16 and over 50 years of age, with close to 70 per cent being professionals, managers, executives and businessmen.

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