Singapore retail sector poised for 2025 rebound amidst new attractions

In December 2024, retail sales declined by 1.5% MoM seasonally adjusted after a 2.8% drop in November.

Singapore’s retail sector is expected to see positive momentum in 2025 despite sales falling for the second consecutive month in December 2024.

The expansion of a local theme park in February 2025 and the launch of Singapore’s fifth zoological park, Rainforest Wild Asia, in March 2025, are expected to drive domestic tourism and boost retail spending.

Additionally, Budget 2025 is set to be expansionary, with measures such as CDC vouchers and higher cash disbursements under the Assurance Package, which could further support consumer spending.

In December 2024, retail sales declined 1.5% MoM seasonally adjusted after a 2.8% drop in November.

The slowdown was largely attributed to weak tourist arrivals, which were at 81% of 2019 levels, alongside normalising tourism receipts per capita. Estimated tourism receipts per capita declined to $1.76K in 2024, compared to $2.00K in 2023 and $2.25K in 2022.

Another factor contributing to the slowdown in retail sales was increased outbound travel by Singapore residents, driven by the strong Singapore Dollar.

Resident air departures in December 2024 exceeded pre-pandemic levels at 107% of 2019 figures, suggesting that more Singaporeans opted to spend abroad rather than domestically.

For the full year, retail sales grew by 1.2% in 2024, lower than the 2.3% growth recorded in 2023. The increase was largely driven by motor vehicle sales (+17.1%), whilst eight out of 14 retail categories recorded declines.

Sectors that experienced growth were primarily in necessities, with food & beverages (+8.4%), medical goods & toiletries (+2.0%), and supermarkets (+1.9%) showing resilience. Excluding motor vehicles, retail sales would have declined by 0.7% in 2024.