Thursday, March 30, 2023

Singapore is losing confidence in trading with Malaysia after chicken ban

Social NewsSingapore is losing confidence in trading with Malaysia after chicken ban

Malaysia has recently put a stop to exporting chickens due in an effort to stable the chicken supply in the country.

In response to the move from Malaysia, Singapore Prime Minister Lee Hsien Loong expressed regrets for Malaysia being under pressure to take ‘unconventional measures’ by interdicting exports of products.

In addition, Lee said that being a consumer country which relies on imported foods, Singapore is adversely impacted by such measures.

According to The Straits Times, the Singapore Prime Minister did not single out any country in his response, but it is believed that the statement is aimed at Malaysia which will be imposing a chicken export ban until domestic prices are stabilised starting from this 1 June 2022.

Lee said that despite the latest global food supply crunch, the country has prepared for such disruptions so that Singaporeans are not unduly affected in the event of shocks.

Source: The Straits Times

He added that Singapore has been working for several years to secure its food supply, building up buffer stocks and resiliency, as well as diversifying its supply sources.

“So that when any single source is interrupted, we are not unduly affected, and if you can’t buy chicken from one place, you can buy from other countries. This time it is chicken, next time it may be something else. We have to be prepared for this,” he elaborated.

In 2021, Malaysia has been the largest source of fresh chicken supply in the Republic, amounting to 34% of Singapore’s chicken supply. Brazil, the United States and other countries amounted to the rest of the chicken supply for the country.

This sort of protectionism will tear away the fabric of free trade and mutual trust that the world and the broader ASEAN region have built over several decades. As nations begin to prioritise themselves, the entire start to break down and the rebalancing process will be painful and may result in much more expensive food prices.

While this move may seem logical for us, in the long term it’s likely to harm both Malaysia and Singapore. Singaporean suppliers may be loath to return to Malaysian suppliers even after the ban was lifted and this makes it difficult for Malaysia to recapture a valuable dollar-based export market.

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