Hong Kong-Singapore Travel Bubble in Doubt, Sending Shares Lower

by BLOOMBERG 

A long-awaited quarantine-free travel corridor between Hong Kong and Singapore due to kick off later this month after several false starts may not go ahead due to a recurrence of coronavirus cases in Singapore.

Edward Yau, Hong Kong’s Secretary for Commerce and Economic Development, said Friday there’s a “high chance” the so-called travel bubble might not proceed as scheduled, which was later echoed by Singapore’s Transport Minister Ong Ye Kung. The comments deal another blow to a plan that was initially set to start last November, and had recently been rescheduled to begin May 26, and triggered a slide of more than 7% in Singapore Airlines Ltd. shares, weighing on the broader index.

“What we will do now is closely monitor the numbers the next few days, critically review the start date,” Ong said in a briefing in Singapore Friday. “Early next week, we will make a decision and make an announcement.”

Hong Kong and Singapore have both taken strict, zero tolerance approaches to the virus, imposing curbs aimed at stamping out infections when outbreaks swell to levels that in other parts of the world would seem low. While a flare-up in Hong Kong scuppered the earlier travel corridor plans, this time it is Singapore that is seeing a recurrence in Covid cases, with restrictions announced Friday that will return the city state to the lockdown-like conditions it last imposed a year ago.

While stringent, the approach has worked at keeping a lid on Covid, with Hong Kong seeing a total of 11,817 cases and 210 fatalities, while Singapore’s had about 63,000 cases, mostly in dormitories housing the city’s migrant workers. It’s seen just 31 deaths throughout the pandemic.

Other places in the Asia-Pacific region are following similar policies, seeking to eliminate Covid within their borders by snuffing out every case. Hardcore border controls, which often require lengthy quarantines and testing, are a key plank of the approach, and allowed Australia and New Zealand — which are also pursuing Covid elimination — to open their own bilateral travel bubble last month. It doesn’t require travelers to be vaccinated.

Changi Cluster

Singapore is now trying to control the growing virus outbreak, which includes a cluster at the city’s iconic Changi Airport. Dozens of cases have been linked to the airport, prompting the closure of two terminals and the Jewel shopping complex.

The bubble plans had triggered a rush on plane tickets, with many people planning to fly between the two Asian financial hubs for business and to reunite with friends and family for the first time in months. Even if the corridor does go ahead later this month, visitors to Singapore will be faced with the tighter social-distancing restrictions now in place, which include a ban on dining in and limitations on gatherings.