The post-Covid-19 world will be different. Consumer and business behaviour will need to change, in some cases permanently. From food delivery to telemedicine, entertainment and education, more firms will have to pivot to online operations and services. E-commerce and e-payments have seen a distinct uptick in recent months, as Singaporeans do more online shopping and cashless deliveries. In short, the economy will be increasingly digitally driven. Covid-19 has resulted in five years of digital adoption around the world being compressed into eight weeks. In Singapore alone, 50,000 e-payment businesses have adopted the e-payment platform PayNow Corporate since last month. It will also not be business as usual for retail outlets and restaurants even after they reopen. In Hong Kong, plexiglass dividers are being used to separate diners and tables are spaced further apart. Changing work patterns, such as telecommuting, could lead to more people cooking at home instead of eating out.
With shops unable to operate at full capacity, some will close for good. Tech and social media giants such as Google and Facebook have said that a majority of their employees can work from home until 2021 or later. In the rental space, landlords face the prospect of companies shifting their cost structures away from longer-term fixed costs, such as five-year leases, to more flexible and short-term contracts. It is hard enough for entrepreneurs to build a lasting business, let alone start off with the economic storm battering them.
But disruptive products and services have emerged in times of crisis, such as Alibaba's online shopping platform Taobao during the Sars epidemic of 2003. Social changes accelerated by this crisis will generate new business opportunities in sectors such as healthcare, fintech and education. As long as governments around the world resist the urge to prop up zombie firms, newcomers with bright ideas and the right skills could ride a fresh wave of creative destruction.
The Fortitude Budget announced on Tuesday aims to support Singapore to thrive in a post-Covid-19 world. Some $500 million has been set aside to help businesses transform digitally, from adopting e-invoicing to e-commerce solutions. Hawkers, wet markets and coffee shops will receive a bonus of $300 a month over five months to encourage them to use e-payments. Some $250 million will be given to businesses to partner digital platform solution providers, to develop offline-to-online solutions to meet new demand. More resources will go to online education; disadvantaged students and seniors will be equipped with both IT devices and digital skills. Supporting businesses to go digital and global, and preparing individuals to be tech-savvy, will help create and secure good jobs for Singaporeans. Digital transformation is no longer a choice, but a necessity.
