How E-commerce and Online Shopping Affect Singapore's Economy and Its Citizens

This paper explores the impacts of e-commerce and online shopping on Singapore's economy and its citizens. It covers the effects on employment, infrastructure development, online advertising, and competition. The study shows that Singapore has a well-developed e-commerce infrastructure and a tech-savvy population. The government has also been committed to promoting and developing internet infrastructure and formulating favorable policies.

Running Head: E-COMMERCE AND ONLINE SHOPPING
HOW E-COMMERCE AND ONLINE SHOPPING AFFECT SINGAPORE’S ECONOMY
AND ITS OWN CITIZENS.
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E-COMMERCE AND ONLINE SHOPPING
ABSTRACT
The primary objective of this paper is to explore and study the impacts of both e- commerce
and online shopping not only to Singapore’s economy but also to the citizens themselves.
According to Singapore Department of Statistics, over 4.59 million Singaporeans have access
to internet per 2018 and the figure is estimated to grow to 4.93 million by the year 2022. Our
findings prove that Singapore is one of the countries that have a well-developed e-commerce
infrastructure not only in Pacific Asia but also in the world. Despite most of the academic
studies focusing on countries in Europe and the United States of America, the documentation
of the e- commerce in the Pacific Asia has improved over time as the region strives to be a
global leader in commerce. Various literature review has been done in a bid to determine the
impacts of the growth of e-commerce in Singapore.

E-COMMERCE AND ONLINE SHOPPING
Introduction
The World Bank ranked Singapore as the second place to do business in the world
after New Zealand. This has been facilitated by various factors including a fast-reliable IT
network, tech savvy population and a highly dedicated government to ensure and promote
and develop internet infrastructure and formulating favourable policies. It is estimated that by
the year 2021 the mobile ad expenditure will grow up to $2.20 accounting for 69% of the
total digital ad expenditure (Tandon, 201). A study done by a property consultancy group JLL
in Singapore showed that over 60% of the population shop online or at least they base what to
buy on the information they get online either with mobile phones or with computers.
Literature Review
The development of ecommerce has far-reaching impacts to the economy. The
economic growth of most countries in Pacific Asia is attributed to the development of ICT as
well as the digitalization of business according Fintech Singapore study (Singapore, 2018).
The growth of online shopping and e commerce has the following thematic impacts on the
general economy. The impacts have been seen to cause a good elevation towards the
economy and people of Singapore. Development of ICT has played the major role in the
economic growth of Singapore and its people.
Employment
According to the Ministry of Manpower statistics, unemployment rate in 2017 stood
at 2.2 % (manpower, 2015).The development of e commerce has opened numerous
employment channels to the residents of Singapore at different stages from ICT experts who
develop web pages and shopping sites to sales agents who are online throughout the day to
meet the needs of buyers at any time of the day. In addition, the need of easy and convenient
delivery of goods purchased online lead to the need of employing people for the same

E-COMMERCE AND ONLINE SHOPPING
purpose. As more people are employed, more business is expanded also the living conditions
of the citizens is improved as they can afford a decent living (export.gov, 2017).
Infrastructural Development
Singapore has one of the most extensive and developed IT infrastructure in the world
(Holodny, 2015). According to Singapore Business review newspaper, the government rolled
out a $2.82 billion project in a bid to enhance ICT infrastructure and IT security (Singapore
Business Review, 2016). The growth of online shopping demanded a well-developed
physical infrastructure as well to facilitate quick and reliable means of transporting goods to
the buyers as most of the sellers have do have delivery services (Chye & Ong, 2016).
Online advertising
With over 81% of Singaporeans being able to access internet and the number
increasing by over 10% in 2013 -2014, it creates a suitable and most efficient channel for
marketing (Rajeck, 2016). The rapid and consistent growth of e commerce and online
shopping has led to a massive growth in the online marketing agencies in Singapore (Anusha,
2016). This has been made possible because business can design adverts in a way that will
attract their target audience, which in return will result into purchases. Business are also able
to make more money by allowing business to advertise in their websites. This was various
business support each other promoting the idea of e commerce even further (one, 2017)
Greater competition

E-COMMERCE AND ONLINE SHOPPING
The growth of online shopping has many advantages compared to those that trade in a
physical shop, it has several setbacks one of them being the development of a stiff completion
to the entry of new competing business both local and international that offer either same
goods or alternative goods (Anusha, 2016). The increase in competition is because of
introduction of new chains of distribution in the market (dot.econ, 2015). This has a direct
impact on the success of any individual investor and if the external intrusion is great. The
growth off local consumer innovativeness as new goods and new marketing methods have
been developed to boost sales (Chan, 2013).
Findings and analysis
E- Commerce has a direct impact to both the final consumers and to the economy of
the country. This is because majority of the citizens are employed and hence they can take
afford a decent living. A healthy nation translates to a productive nation. In addition, the
goodwill of the government to support small business that are trying to make it in the online
platform has opened new channels to create jobs to the innovative population in Singapore
(Sam & Sharma, 2015).
The infrastructural growth in Singapore has been on the rise due to the government’s
commitment to open the country to promote entrepreneurial spirit (Lu, Pang, Hang, & Tailor,
2015). More IT experts have been employed leading to the growth of computer literate
population. This has affected the economy positively has more revenue is collected from the
exports that are made to other countries not only in Asia but also in Europe and Africa.
The growth of e commerce has enables citizens of Singapore to make well-informed
decisions before purchasing goods. This has been made possible by the availability of reliable
access to internet and thus purchases are based on the information obtained online. This has
eliminated chances of making impulse buying and doing away with intermediaries who

E-COMMERCE AND ONLINE SHOPPING
sometimes exploit innocent unsuspecting buyers or sometimes forcing them to acquire goods
they did not want.
E-commerce has opened Singapore’s retail market hitting $4.4 billion in 2015. This is
since majority of the citizens conduct business online. This retail market is expected to grow
even further because of the growth of both local and international markets and a well
receptive of Singapore’s goods in international market. This way Singapore’s business will
be able to trade internationally bringing home more revenue for the government for economic
development (Sebastian, 2016).
Limitation of the study
There is a gap in literature regarding the studies of Pacific Asia as majority of the
scholars focuses on Europe and other countries in America. Countries such as Singapore
whose culture is very different from those in Europe do not benefit from such studies, as the
data obtained may not be relevant to Singapore’s current conditions.
E-commerce is a broad and involving subject that requires a lot of time and resources
to cover fully. In addition, the literature used to review might not cover it adequately and
exhaustively considering that, it operates in an ever-changing environment. Some of the
sources used in this study are not easy to verify that they contain correct information as not
all sources have been approved for publishing.

E-COMMERCE AND ONLINE SHOPPING
Conclusion
E- Commerce has far-reaching impacts in any economy. The effects of online
shopping to individual citizens vary as they are affected differently. Employment
opportunities created by online business has boosted economic growth. Equally, the stiff
competition experienced ensures that the goods offered are of high quality and business
maintain ethics as they conduct business. Development of online marketing revolutionizes
business and hence promoting economic growth in many ways.
References

E-COMMERCE AND ONLINE SHOPPING
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