South Africa’s foreign trade gap soared nearly nine-fold to ZAR9.95bn ($719.2mn) in August chiefly due to a plunge in the value of commodity exports, preliminary data from the South African Revenue Service (SARS) showed. Moreover, the July shortfall was revised substantially to ZAR1.11bn from an initial estimate of ZAR397mn.
The data sends disappointing signals for the country’s ailing economy after the trade balance’s encouraging swing into surplus for the first time since Q4 2011. The Q2 trade surplus of ZAR14bn, or 0.4% of GDP, was achieved on the back of increased global demand and weakening rand coupled with waning domestic demand. It helped for the narrowing of the country’s problematic current account deficit to 3.1% of GDP from 4.7% in Q1.
South Africa’s exports fell 5.9% m/m to ZAR87.63bn in August, driven down mainly by a 20% drop in exports of both mineral products and base metals.
At the same time, imports grew 3.6% m/m to ZAR97.58bn chiefly due to a 22% rise in imports of vehicles and transport equipment, and a 12% increase in imports of both mineral and chemical products.
For the first eight months of the year, South Africa’s trade gap totalled ZAR36.27bn, 48% smaller y/y. Exports grew 5.9% y/y to ZAR677.6bn, while imports edged up 0.6% y/y to ZAR713.8bn.
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