South Africa Records Better Than Expected Trade Surplus

The South African Revenue Service on Monday made known that South Africa exported ZAR 6.8 Bn more than it imported in August.

The trade surplus was bigger than expected as economists expected a surplus of ZAR 1.2 Bn.

The surplus has been attributed to exports which rose to ZAR 122.02 Bn and imports which decreased 1 percent to ZAR 115.17 Bn.

During the period, exports of precious metals and stones rose by 10 percent, machinery, and electronics (+11 percent), vehicle transport equipment (+4 percent).

Mineral products export rose by 18 percent while vegetables rose by 6 percent. During the period, exports to China, Germany, and the UK rose by 11 percent, +7 percent, and +6 percent respectively.

In July, South Africa recorded a ZAR 2.88 Bn trade deficit following a revised surplus of ZAR 5.4 Bn in June. The deficit was pinned on exports of ZAR 112.94 Bn against imports of ZAR ZAR 115.82 Bn.

Elize Kruger, a research analyst from NCK, however, said the rebound in August should not be a reason to celebrate as things could take a different turn for the rest of the year.

“Monthly trade statistics remain very volatile, thus the sizable trade surplus in August is welcomed, but not necessarily reason to cheer, as the year-to-date figures suggest a moderate deterioration in the trade account so far in 2019,” said Kruger.

He added, “With escalating trade tensions and the synchronised global economic moderation expected to become more entrenched, export demand could take some strain during the remainder of 2019, while a slight recovery in domestic demand will drive imports growth higher in coming months, which could potentially place renewed strain on the trade account.”

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