Johannesburg - South Africa's trade deficit for July 2012 increased by R1bn to R6.7bn, the SA Revenue Service (Sars) said on Friday. Exports in July increased by 2.9% (R1.8bn) to R63.5bn. A country reaches a trade deficit when it imports more goods than it exports. The month-to-month increase in exports was mainly made of mineral products, which increased 12% to R1.8bn. Exports of products of the chemical or allied industries increased by 44% to R1.5bn. However, the precious and semi-precious stones and metals sector decreased by 3% to R402m. Sars said the increased trade deficit in July 2012 was mainly due to increased imports of machinery and electrical appliances, products of the chemicals or allied industries, and original equipment components. On the other hand, imports increased by 4.1% (R2.8bn) to R70.2bn. Imports of machinery and electrical appliances increased by 14% to R2.2bn. Imports of products of the chemical or allied industries increased 28% to R1.4bn. Nedbank economist Isaac Matshego said the performance of exports was not likely to recover significantly during the remainder of the year, due to both global and domestic factors. "Weak global demand and domestic supply disruptions, particularly in the mining sector, will keep export performance depressed," he said. Matshego said imports would continue to benefit from low interest rates, rising disposable incomes, and the government's infrastructure expansion programme. *Follow Fin24 on Twitter, Facebook and Google+.