Coronavirus pandemic

Firms making essential items unlikely to be hit

A production operator for contract manufacturer Watson EP Industries assembling a measuring instrument. The firm was granted an exemption to continue operations after several clients provided letters of proof to show that it was part of the global supply chain for essential services. PHOTO: WATSON EP INDUSTRIES

Contract manufacturer Watson EP Industries is among companies which have been granted an exemption to continue operations amid circuit breaker measures that mandate all non-essential businesses to cease operations.

The firm, which manufactures components for sectors such as telecommunications, medical technology and construction, was initially unsure if it would be considered an essential service provider.

It was pushing out orders up till the last day before the measures kicked in, group executive director Joyce Seow told The Straits Times.

But it has been granted an exemption, after several of its clients provided letters of proof to show that the firm was part of the global supply chain for essential services.

Experts say firms in upstream and downstream manufacturing processes for essential products and professional services firms are unlikely to be affected by the authorities' plans to trim the list of essential services.

On Tuesday, National Development Minister Lawrence Wong, who co-chairs the multi-ministry task force dealing with the Covid-19 outbreak, said that the current categories of essential work were being examined to see which could be cut further, to reduce movement and keep more people at home.

Maybank Kim Eng senior economist Chua Hak Bin pointed out that the costs to Singapore's economy are already severe, and a large proportion of the workforce has already either been affected by shutdowns or shifted to work from home.

"Tightening the list further seems unwarranted unless there are signs of clusters emerging in essential service workplaces," he said, adding that the gains from heightened measures could be marginal.

Watson EP's Ms Seow said: "Although we have the exemption, we are operating on a stand-by basis. Most of our 70 (employees) are staying at home unless we have an urgent order... Staff are paid and given allowances as per usual."

She said that there are only two to three workers on site, including the factory manager and staff facilitating delivery of orders.

Association of Small and Medium Enterprises president Kurt Wee said he was not in favour of reducing the list of essential services, noting that there are companies which have currently not been granted exemptions to work even though they support essential services in key industries. He cited those supplying components to the shipping and aerospace industries as examples.

"Making sure that companies in essential services have sufficient resources and help to implement (safe distancing) measures would be a more meaningful action to take," Mr Wee said.

He strongly advised firms to check government advisories twice a day to ensure that they are in compliance with the latest regulations.

While insurance firms are allowed to continue operating as they are considered essential services, NTUC Income said that it is progressively closing its service branches this week until further notice. Fewer customers have visited its service branches since the start of the circuit breaker period and the insurer is encouraging customers to use its online services instead.

CIMB Private Banking economist Song Seng Wun said most financial services firms already have most of their back-end staff telecommuting, and banks have scaled back their operations, closing some branches. Reduced work hours or limited days of operation could be a possible course of action for services such as remittance services used by domestic workers and hardware stores, instead of doing without such essential services.

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A version of this article appeared in the print edition of The Straits Times on April 16, 2020, with the headline Firms making essential items unlikely to be hit. Subscribe