money 쐽 ● THE STRAITS TIMES FRIDAY, NOVEMBER 21 2008 PAGE D15

DOUBLE-DIGIT DIP IN SURVEY FINDINGS

Consumer confidence at 3-year low

Nielsen: Slump likely to
have serious impact on
lifestyle of consumers
BY MICHELLE TAY
CONSUMER confidence in Singapore has
sunk to its lowest level in more than three
years as the economy enters its first tech-
nical recession since 2002, a survey has
found.
The Nielsen Company, a marketing
and media information firm, said yester-
day that Singapore’s consumer confi-
dence index is at the lowest level of 92
points since it started the twice-yearly
survey in the first half of 2005.
Readings are based on a series of ques-
tions to consumers, with a maximum pos-
sible score of 200 points. In contrast, ex-
actly one year ago, consumer confidence
here was at an all-time high of 114 points.
In August, it had registered its first
drop of 12 points, to 102. The latest drop
of 10 points marks the second double-dig-
it decline in consumer confidence here
this year.
“For global consumers, the last 12
months have been challenging and turbu-
lent – Singapore is no exception with an
economy that is closely intertwined with
the world’s demand,” said Ms Vicky San-
tos, executive director of The Nielsen
Company Singapore.
Nielsen polled over 26,000 consumers
in 52 countries, including 500 Internet us-
ers in Singapore, in September and last
month.
Singapore’s economy shrank for a sec-
ond straight quarter in the three months
to Sept 30 as a slowdown in the United
States, Europe and Japan reduced de-
mand for the nation’s exports.
Compared to previous downturns, the
turmoil this time is likely to have a seri-
ous impact on lifestyle and cultural fac-
tors of consumers, said Nielsen.
“Staying In has become the new Going
Out for a new breed of credit-crunch con-
sumers,” said Ms Santos.
Indeed, “staycations” – a term coined
in the US meaning staying at, or near,
home on vacation – seem to be catching
on here too, as hard economic times have
led to job cuts.
Singaporeans, avid travellers who still
want to enjoy the annual overseas trip,
have ranked spending on holidays second
on their list of things to do if they had ex-
tra cash to spend.
About half of Singaporeans surveyed said they will switch to cheaper grocery brands. They are
also likely to cut down on out-of-home entertainment. ST PHOTO: CAROLINE CHIA
Instead, seven out of 10 surveyed said
they would put the cash into their sav-
ings.
The survey also found that about six
out of 10 Singaporeans will spend less on
clothes, as well as save on gas and elec-
tricity, to cope with the rising cost of liv-
ing in the coming months.
A clear indication that extravagant
spending sprees are not on the cards this
Christmas season: Nearly half of respond-
ents described their personal finances as
“not so good” or “bad”.
About half will also cut down on
out-of-home entertainment, switch to
cheaper grocery brands and put off up-
“Staycations” –
a term coined in
the US meaning staying at, or
near, home on vacation –
seem to be catching on here
too, as hard economic times
have led to job cuts.
grading their technology gadgets.
When contacted, Sheng Siong Super-
market, which prides itself on selling gro-
ceries and fresh produce at lower prices,
said its “sales turnover has achieved posi-
tive, steady year-on-year growth” in the
last two months.
Its “performance shall remain steady”
despite rising food prices and uncertain
market conditions, said its spokesman.
Mr Jimmy Fong, chief executive of Epi-
Centre, which sells Apple computer prod-
ucts, said: “We are still cautiously opti-
mistic about bringing in more sales in the
Christmas season.
“We are doing all we can to provide
more delightful customer service and
more bang for the buck.”
michtay@sph.com.sg

CSR is “more than just writing a cheque

SMEs can gain only with a steady social focus
BY ROBIN CHAN
CORPORATE social responsibility (CSR)
is not just a slogan and it does not simply
involve handing out cash to charities.
It can, for example, mean better envi-
ronmental practices, or adopting more
transparent corporate governance.
Small- and medium-sized enterprises
(SMEs) have been urged to step forward
to seek support for implementing CSR
programmes.
Having a good CSR programme will
help SMEs distinguish themselves to a
generation of more discerning consum-
ers.
These were some points raised yester-
day at the two-day 7th Asian Forum on
CSR.
Dr Vivian Balakrishnan, Minister for
Community Development, Youth and
Sports opened the forum by urging SMEs
to get support and assistance from the Na-
tional Volunteer and Philanthropy Centre
in areas that range from planning to im-
plementing CSR strategies.
A survey by the Ministry of Trade and
Industry last month found that less than
a third of SMEs are aware of CSR, while
those that are, need support to imple-
ment their CSR plans.
Under the ComCare Connection
Scheme, firms can get advice and be
matched with non-profit organisations to
make a significant difference, Dr
Balakrishnan said.
Ms Claire Chiang, president of the Sin-
gapore Compact for CSR, said that with a
young generation more sensitive to sus-
tainability, SMEs can distinguish them-
selves to customers through the good im-
plementation of CSR programmes.
She said many SMEs still have a limit-
ed understanding of what CSR means, be-
lieving it is only about giving money
away rather than the running of a busi-
ness in a socially responsible way.
She added that smaller firms also feel
that it is the work of multinationals
(MNCs) and Western countries and not
something Asian companies do. But this
can be changed through a continuous
process of education.
Mr Keith Kaerhoeg, Coca-Cola Pacif-
ic’s group communications director, said
large companies also have their part to
play in raising SMEs’ uptake of CSR activi-
ties. They should talk more about CSR as
part of being a sustainable corporation
and not just pure charity.
Dr Balakrishnan reinforced this idea.
While a survey showed that some 71 per
cent of Singapore firms had donated to
charity in 2005 and 2006, he said that
for a worthy cause”.
He cited City Developments’ work
with the Singapore Environment Council
as a good example. City Developments is
nominated for tonight’s Asian CSR
Awards as part of the two-day forum.
Having a CSR forum at a time when
the financial crisis is dominating head-
lines could make people either respond
with higher aspirations or cynicism, he
said.
But he urged for the former, and said
that CSR is how firms can focus on more
than just their shareholders and help to
manage risk through trust building.
He believes that it is possible for busi-
nesses to have an “enlightened view” to
focus on “people, planet and profit” – the
model for sustainability – and not just ex-
clusively on profit.

start of the crisis. Capital went in-

Indonesia rupiah to a panicked flight and Jakarta
was forced into agreeing to an
IMF rescue package.

hits decade low The central bank, which last

JAKARTA: The Indonesian rupiah
tumbled yesterday to its weakest
level since the Asian financial cri-
sis a decade ago and trading al-
most ground to a halt as forward
markets indicated the currency
would slump further.
Investors in the offshore
non-deliverable forwards mar-
kets were pricing in a 12 per cent
depreciation in the rupiah in one
month and 25 per cent in a year.
The authorities are scrambling
to contain a crisis sparked by
fears that Indonesia could be-
come the next casualty of a global
flight from risky assets that has
forced governments from Iceland
to Pakistan to seek emergency aid
from the International Monetary
Fund.
“It’s fear of domestic capital
flight and Indonesians caught
long on rupiah structured
trades,” said Mr Thio Chin Loo, a
strategist with BNP Paribas, refer-
ring to a sharp fall in the currency
in recent weeks.
The rupiah changed hands at
12,400 per US dollar in a few
deals, a trader in Jakarta said, ask-
ing not to be identified.
That would be the weakest lev-
el since August 1998, when Indo-
nesia was grappling with the fall-
out from the Asian financial cri-
sis.
At that time, the rupiah went
into free fall, dropping from
around 2,000 per US dollar in
mid-1997 to 17,000 in early
1998, leaving swathes of corpo-
rate Indonesia technically bank-
rupt.
Indonesian firms owed credi-
tors abroad about US$80 billion,
or four times the country’s for-
eign exchange reserves at the
week tightened foreign exchange
rules, intervened yesterday to
staunch the slide in the currency.
A trader in Jakarta said the cen-
tral bank’s constant enquiries in
the market had depressed vol-
umes.
The central bank bought rupi-
ah at 12,250, traders said.
In another reminder of the
Asian crisis, the Korean won
slumped to its lowest close in
nearly 11 years, reflecting inves-
tor concerns that a recession in
the developed economies will
hammer export demand.
The Indian rupee dropped to a
record low in opening trades as in-
vestors took fright at another
sharp fall in global stock markets.
The rupee and rupiah have
slumped more than a fifth this
year and the won is down more
than a third as foreign investors,
stung by bank failures in the Unit-
ed States and Europe, bailed out
of emerging markets.
REUTERS

Look beyond crisis, firms urged

BY FIONA CHAN
COMPANIES should “look be-
yond the immediate downturn”
and plan for the recovery that
will come after, advised Senior
Minister of State for Trade and In-
dustry S. Iswaran yesterday.
Even within the electronics sec-
tor, which has been hit hard by
the slowdown in global export de-
mand, “all industry players be-
lieve that beyond the downturn,
there’ll be a recovery and there’ll
be growth again”.
Firms must be ready for that
with measures including retain-
ing and upgrading their staff, said
Mr Iswaran. He spoke at the offi-
cial opening of semiconductor
maker Marvell’s new building,
where he was guest of honour.
Marvell, a California, United
States-based firm that started op-
erations in Singapore 11 years
ago, is one company that is al-
ready making plans for the
post-downturn rebound.
“The key thing is to continue
to invest in the future,” said presi-
dent and chief executive officer
Sehat Sutardja yesterday.
This is so that “when the
downturn is over, we’ll continue
to have the best products that our
customers need”, he said.
Marvell invested $54 million in
the land and construction of its
new building in Tai Seng Link,
the firm said yesterday. The build-
ing houses about 250 employees,
half of whom are Singaporeans
and the other half, permanent res-
idents.
Mr Iswaran also said yesterday
that Singapore “continues to
have a strong pipeline” of foreign
investments, even though poten-
tial investors “would obviously
be reviewing their plans” in the
light of the expected worldwide
recession.
When asked whether any inves-
tor is thinking of pulling out of a
previously made commitment,
Mr Iswaran said: “It’s hard for
me to second-guess compa-
nies...we have to wait and see
what the outcome will be.”
He also said it was too early to
say if the Economic Development
Board is on track to meet its tar-
get for pulling in investments this
year, and said he could not com-
ment on whether the agency
would lower its investments tar-
get for next year.