Exports narrow SA’s trade deficit to R302m

Johannesburg – A Surge in exports of precious and semi-precious stones and metals outweighed an increase in imports of vehicles, aircraft and boats, narrowing South Africa’s trade deficit unexpectedly in May. The deficit of R302 million followed a R1.9 billion shortfall in April, the SA Revenue Service (Sars) said in an e-mailed statement this week. The median estimate of 12 economists surveyed by Bloomberg was for a R2.5bn deficit. Freddie Mitchell, an economist at Efficient Group, was quoted as saying it was a good figure, adding that given international circumstances, the growth in exports was very encouraging. However, he said exports could have been even higher had there not been a strike (at transport parastatal Transnet). Exports rose 6.8 percent to R47.2bn in May from the previous month, as shipments of precious and semi-precious stones and metals surged 37 percent, Sars said. Exports of mineral products, including coal, rose five percent. Overseas shipments of metals, wine and fruit were partially disrupted when workers at Transnet embarked on a three-week strike on May 10. Several companies, including Exxaro Resources, ArcelorMittal South Africa, and Xstrata, were forced to declare force majeure on metal and coal deliveries, enabling them to miss contracted deliveries. Imports climbed 3.1 percent to R47.5bn, with purchases of vehicles, aircraft and boats rising 40 percent. Exports were up 6.8 percent compared with the previous month, while imports rose by 3.1 percent, Sars said. Razia Khan, the head of Africa research at Standard Chartered, said this would be seen as marginally positive for the rand. The trade deficit so far this year was at R12.42bn, compared with a R19.82bn gap between January and May last year.

July 2010
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