Coronavirus affects Singapore construction firms

By Andy Brown21 February 2020

Singapore skyline

Singapore’s construction industry is dependent on foreign workers

Singapore construction firms are reported to be seeking legal advice about invoking force majeure clauses in building contracts as a result of a labour shortage due to the coronavirus.

Force majeure can be defined as unforeseeable circumstances that prevent someone from fulfilling a contract – in this instance Singapore construction firms not being able to complete work on time due to a lack of Chinese workers due to coronavirus.

Singapore is highly dependent on foreign labour, such as workers form China, and is investing heavily in infrastructure. GlobalData has previously reported that if all the projects in the current pipeline proceed as planned, spending could reach US$9.8 billion in 2020 and US$10.7 billion in 2021.

Singapore’s labour ministry was reported last week to have been rejecting 400 applications daily from returning workers with recent travel history to China

The construction sector, which is only allowed to hire workers from certain countries including China, India and Bangladesh, expanded 2.8% in 2019, one of the strongest performers in an economy that recorded a growth rate of 0.7%, its slowest in a decade, and down from 3.1% in 2018.

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