Chart of the Day: Food sales to surge despite retail spending slump

Household and tourist spending will support growth.

This chart from BMI Research shows why multinational food producers are so attracted to Singapore. Food sales in the city-state are expected to rise rapidly this year, underpinned by strong domestic spending and a recovery in tourist arrivals.

"Singapore's positive long-term economic outlook, increasing tourism and low unemployment levels will ensure that domestic food and beverage consumption remains high. Singapore is, therefore, likely to continue playing a significant role in the regional growth strategies of multinationals, as the country's solid existing spending levels provide steady returns on investments and thus supporting companies' expansions into emerging markets," BMI Research said.

The report noted that food sales are expected to grow 4.9% year-on-year in local currency terms this year. From 2015-2020, BMI Research says that food sales have a compound annual growth rate (CAGR) of 5.5%.

"The food industry is mature and has limited growth opportunities, but high levels of spending will continue to prop up the industry. The drinks industry will remain slow-paced; we expect health consciousness trends to drive growth in the bottled water and wine categories,” BMI Research said.