S’pore retailers could lose S$1.5B to S$2.1B in ‘leakage’ after RTS Link commences operations: DBS

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Those in the F&B and services sectors are likely to be most badly affected.

By Jay Lo - 16 Jul 2024, 4:05 pm

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F&B & services retailers in Singapore expected to see ‘expenditure outflow’ when RTS Link starts operations

Retailers in Singapore are expected to lose about S$1.5 billion to S$2.1 billion in “leakage” when the Rapid Transit System (RTS) Link connecting Singapore and Johor Bahru (JB) commences operations.

Source: SG Warehouse Sale & Events on Facebook

DBS pointed out that the “substitution effect” which contributes to the expenditure outflow is likely to be most prevalent in the F&B and services sectors.

The bank estimates that travellers could save between 30% and 50% by spending on such products and services in Malaysia instead of Singapore.

Unsurprisingly, DBS also attributed JB’s popularity among Singaporeans to the favourable exchange rate.

Number of day-trippers might rise to 700,000 daily

DBS also predict that the RTS Link connecting both countries is likely to cause an increase in “day trippers” from Singapore.

Come end-2026, when the RTS Link project is slated to be completed, DBS said the number of day trippers might spike to 700,000 daily.

Source: RTS Link JB-SG on Facebook

For context, the highest daily number of travellers crossing from Singapore to Malaysia currently stands at about 530,000.

DBS, however, said that the higher number of day trippers is dependent on the “continuation of price differentials” between both ends of the Causeway.

Also read: JB-S’pore RTS Link Construction 65% Complete, Expected To Start Service By End-2026