Spend if you can to help Singapore economy, urges SM

Go ahead, enjoy life's little pleasures
Sylvia Toh Paik Choo, The New Paper 8 Nov 08;

THE hip or the foot?

That may have to be the choice facing residents of Marine Drive after Senior Minister Goh Chok Tong's speech in their precinct last night.

As adviser to Marine Parade GRC grassroots organisations, SM Goh launched the Home Improvement Programme (HIP) for Blocks 72 to 79. He also officiated at the polling for HIP.

In his short speech - first in Mandarin, then in English - he, of course, could not avoid the financial crisis.

While saying that next year's economy will be tougher, he also urged Singaporeans not to give up on life's little pleasures. Like taking in a movie, eating out, going to a spa, using taxis, donating to charities, having a foot massage.

Can a foot massage lift the economic doldrums?

It can, if you have enough savings to indulge now and again. Mr Goh said: 'It's what economists call the paradox of thrift.'

In a time of global financial tsunami, he cautioned, if we all go into what he termed 'power save mode', then for sure the economy will really go into a recession.

With a knowing smile, he added: '(In) slow period, get best bargains.'

Wah, minister ask me to spend money. With the promise of discounts!

'If those with savings, who can afford to spend, and they don't, then this will affect the vibrancy of the economy,' he said.

Those with little or no savings can still be in for improved living, with HIP. Like an episode out of television's Home Improvement, Mr Goh was walked through a mock-up of a five-room HDB flat. For some reason, even the toilet bowl was tied up in gold ribbon.

He also toured an exhibition of essential (government-paid) and optional (government-subsidised) home improvements, encouraging residents of the eight 30-year-old blocks to vote yes.

So will it be hip, hip, yay, yay then? For HIP to be implemented, 75 per cent of eligible homeowners must vote for it. The upgrading programmes will cost billions.

'We can afford it,' Mr Goh reassured the residents. 'Because of our past economic growth, and we have been careful with money, so now, confronted with this financial crisis, we can help people.'

The four- and five-roomers of Marine Drive turned up on the hard court of Block 75 for the event as a lion dance poom-poom-cheh SM Goh to his seat.

Children put on a ballet, another child in a new dress for the occasion handed 'Uncle Goh' the gold scissors to cut the ribbon to the exhibition.

As grassroots leaders milled about, a couple told me: 'And to think when these flats came up, nobody wanted to move here - because it's reclaimed land!'

So this weekend, it's okay to spend. And don't mind me if I put a dollar or two on the unit number of the mock-up apartment: 2193.

When times are tough... go indulge
Singaporeans are doing just that, splurging on 'little treats' like premium foods and wine
Sandra Davie, Straits Times 9 Nov 08;

Economic crisis? Spend more money, urge the economists. And some Singaporeans are taking that advice to heart.

They may have put a hold on big-ticket purchases but are not letting up on 'little treats' like Godiva chocolates, otoro sushi or white truffles, now in season and served up at $10 a gram in upscale restaurants.

Chef-restaurateur Mervin Goh keeps up with the news on the credit crisis that is unfolding around the world. But the 36-year-old, who runs seven Japanese restaurants with two of his brothers, said that on some days, he wonders when it will hit Singapore.

Especially on days like Friday and Saturday over a week ago, when his two most expensive restaurants - the Akashi Japanese restaurant and Inakaya Robatayaki grill at Orchard Parade Hotel - were completely full.

'I felt bad. I had to turn away several customers who turned up at the restaurants. On weekends like this, I feel optimistic.'

He said business has been largely unaffected. Singaporeans still splurge $1,000 on a meal for two, including wagyu beef which costs $40 per 50gm and otoro (fatty tuna belly) sushi which costs $20 a slice.

'Touch wood, people are still spending. On a good night, I can sell 400 slices of otoro,' he said.

Mr Goh's business is not the only one yet to see the effects of the economic slowdown. The cash registers at popular high-end restaurants and shops that sell premium foods like hand-made chocolates, French fare and single malt whiskies are still ringing away.

Brand manager Sebastian Lim, 32, who represents the single malt scotch whisky Macallan, was bracing himself for lacklustre sales. But some 4,000 bottles of Macallan, which run up to about $298 a bottle at bars, were consumed here last month, 3 per cent more than in October last year. He expects sales to be even higher this month and in December.

Gourmet shop Le Bon Marche, which recently opened a cafe on its premises in Tiong Bahru, also reports brisk business. 'Call to book a table,' husband-and-wife team Stephane Herve and Shirley Tang advise Singaporeans eager to dine at their cafe, where a cup of hot chocolate costs $7.50.

No wonder figures released for August showed that the volume of retail sales remained constant. According to the Department of Statistics, telecommunications and computer products saw the biggest year-on-year jump in retail sales. Supermarkets, apparel and footwear retailers, jewellery shops and department stores all raked in higher sales.

Singaporeans seem to be still splurging, despite warnings from economists that the current down cycle may be way worse than the Asian financial crisis in 1997 to 1998 and projections of at least three quarters of negative growth next year.

Singapore Management University's Associate Professor Seshan Ramaswami said this is not atypical. Spending patterns during past recessions have shown that indulgence products do not fare that badly.

What people hold off buying are big household durables such as 50-inch plasma TV sets, cars or a new home, as these are often bought on credit and involve monthly debt repayments. But having forgone larger, big-ticket indulgences, they seek out smaller, affordable luxuries in bad times.

Retail expert Lynda Wee, who has a PhD in retail marketing, agreed: 'Since buying a new home is no longer affordable, people may think, 'Let's own that dream bag or watch first'.

'Consumers buy to de-stress in a down period, to feel good so that they can keep going on with their work, and to keep their spirits high.'

Indeed, 11 shoppers interviewed at high-end brand name shops in Takashimaya and Paragon shopping centres said they knew they are not immune to the recession. A 25-year-old lawyer, who had just paid over $3,000 for a Louis Vuitton bag, and declined to be named, said: 'Life has to be worth living. Why am I working so hard if I can't buy a handbag I want?'

Ms Candice Lim, 29, who was stocking up on handmade Belgium chocolates at Godiva, spoke like a true banking executive when she said: 'You have to figure out what your personal recession is. What are you willing to bear?

'Some like me are willing to hold off on buying a BMW or a 50-inch LCD TV set. But don't ask me to give up my favourite Godiva chocolates. They keep me going in these stressful times.'