Coronavirus: Singapore scrambles to house commuting workers after Malaysia bans overseas travel

Commuters from Johor, Malaysia, head to Singapore on March 17, hours before Malaysia imposes a lockdown on travel due to the coronavirus outbreak.
PHOTO: Reuters

For Tan Hang Kian, executive director of Singapore cleaning company Clean Solutions, Tuesday started with a "logistical nightmare". Of the 2,000 staff he employs, 800 are Malaysians and 150 of those commute daily into the city state.

Tan had to scramble after Malaysia on Monday night announced an overseas travel ban for its citizens among other measures to curb the spread of the Covid-19 outbreak. "It was not confirmed last night whether those with jobs in Singapore will be allowed to come in, but we started making preparations immediately," he said.

His line managers called their staff in Malaysia, telling them the company would try to house them in Singapore. Early on Tuesday, they started outfitting an existing dormitory - which can accommodate 400 people but is currently only half full - to hold these workers.

"We had to look for beds, look for towels, tooth brushes, all sorts of things. Now we are fixing more shower heads, adding security staff," Tan said, estimating that about 80 per cent of the workers have agreed to stay on in Singapore and continue working.

Malaysia's drastic measures include a 14-day self-quarantine order for residents returning from abroad, restrictions on public gatherings and the closure of most businesses except those selling food and everyday necessities. They start from Wednesday and last till March 31.

The total number of cases in Malaysia rose on Tuesday to 673, the highest in Southeast Asia, as it reported its first two deaths from the virus.

Putrajaya's announcement sparked some panic in Singapore, which as of Tuesday had 266 confirmed cases, 14 of which are in critical condition.

People flocked to supermarkets on fears that the supply of food and essential goods from its neighbour would be affected, in addition to staffing concerns such as those endured by Tan from Cleaning Solutions.

The Singapore government reacted quickly, with the island nation's Prime Minister Lee Hsien Loong announcing that the flow of food, goods and cargo from Malaysia would not be disrupted.

On Tuesday morning, the government said it was working with companies, dormitory operators and hotels to see how they could house Malaysian workers.

At a press conference later on Tuesday, Singapore's national development minister Lawrence Wong said the country was not ruling out a similar lockdown on its own, but it would depend on how the global and local situations evolved.

"It is certainly a very extreme measure… We are not planning for it. We don't want to get to that scenario," he said. "We could consider a major circuit breaker which does not entail a lockdown but entails school closure and workplace closure on a temporary basis."

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The Ministry of Manpower said it would extend help to companies, prioritising essential services such as health care, security, cleaning, waste management, facilities management, logistics and transport.

The authorities also announced they would provide companies with financial assistance of $50 a night for each affected worker to help with the cost of temporary lodging.

Public transport operators also moved quickly to secure hotel accommodation for Malaysian bus captains who wished to continue to work and stay in Singapore, according to transport minister Khaw Boon Wan.

OCBC economist Selena Ling said the development was "a little bit unfortunate, timing-wise" as Singapore was already feeling the brunt of the Covid-19 outbreak.

She said the economic impact could be manageable if the Malaysian partial lockdown was not extended beyond the initial two weeks, but there was no certainty given the fluidity with which governments were managing the outbreak.

Song Seng Wun, an economist from CIMB Private Banking, said this was bad news for Singapore's small and open economy dependent on trade and goods and services.

But he said it was too early to tell what the economic impact would be because Malaysian workers were spread across industries and "we don't know yet who can make arrangements to stay in Singapore and which industries they work in".

"If all of them are Changi Airport workers, it doesn't matter because Changi is already so empty. The hotels are also empty," he said, echoing Ling's sentiment that a two-week disruption was manageable.

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"But there are also those in professional services such as IT or engineering. We know there will be an impact, the question is how severe is it going to be?"

Other economists who spoke to This Week in Asia were hopeful that many of the Malaysian workers would be able to sort out temporary accommodation in the city state.

Irvin Seah, senior economist at DBS Bank, said the workers and companies were resilient. "All these Malaysian workers are not new to Singapore, many have existing accommodation arrangements or friends and relatives here, and companies are also offering accommodation to many of them."

Ling from OCBC is hopeful that up to 80 to 90 per cent of the workers would have made the necessary arrangements to stay in Singapore, given the time between the announcement and when it would take effect.

The government also said it was confident all housing needs could be met, adding it had found lodging for about 10,000 workers whose employers could not help them.

This notice allowed employers such as Raymond Tang, a committee member of the Singapore Vehicle Traders Association and owner of a car workshop, to give his Malaysian worker the day off to pack his items and return to Singapore as Tang arranged temporary accommodation for him.

"I have foreign workers from India and China and they do have a place here, so maybe they can bunk in together for these two weeks," Tang said.

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The economists agree that the economic impact of the Covid-19 outbreak on Singapore will be a lasting one due to its global spread. While the outbreak started in China, the number of infections in other countries have since outstripped those on the mainland.

"Some people thought it was a one-quarter story but now it seems to be dragging out," Ling said.

CIMB's Song, who earlier in the outbreak was hopeful its drag on Singapore's economy could be limited to just one quarter if China contained the spread, is now worried about the extent to which the contraction will spill over to the second quarter.

Seah from DBS said Singapore's growth this year faced significant downside risk given the escalating outbreak. "Rather than to calm nerves, many governments have stoked more fear and panic. This impacts global consumer sentiment and even if we've a recovery in China's supply chain, the demand will be a lot weaker."

He said the restriction on Malaysian workers coming to Singapore would cut both ways, as Malaysian workers in industries looking to reduce staff numbers were in a vulnerable position, and retail in Malaysia's southernmost city of Johor Bahru would also be affected when shoppers from Singapore were unable to head over.

"The silver lining is that the supply of goods and perishable items remains undisrupted," he said. "This addresses a significant chunk of the downside risk."

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This article was first published in South China Morning Post.