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Trade gap widens as mine exports fall

Oct 31 2012 14:41 Reuters

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Johannesburg - South Africa’s trade deficit widened to R13.8bn in September after a R12.2bn shortfall in August as mining exports fell, the South African Revenue Service said on Wednesday.

Exports decreased by 7.7% month-on-month to R56.7bn in September while imports fell by 4.2% to R70.5bn, SARS data showed. The September deficit compared with a small surplus of R2.5bn in the same month last year.

Economists surveyed by Reuters had expected a shortfall of R10bn for September due to lower mining exports as the sector grapples with reduced output because of strikes that began in August.

Sars data showed exports of precious and semi-precious stones and metals decreased by 4% month-on-month,  mineral products were also down 4% while base metal exports fell by 9%.

The cumulative deficit for the year to date amounted to R86.1bn compared to R5.8bn for the same period in 2011, Sars said.

Said Elna Moolman, Renaissance Capital economist: “Much worse than expected, partly because of the strikes and that portion should ultimately improve.

“We remain very concerned about the current account deficit generally.”

The rand initially fell to R8.6905 against the dollar from R8.6737 before the data was released at 12:00 GMT. It had recovered to R8.68 by 12:09 GMT.The yield on the 2015 bond was steady at 5.485% as was that for the 2026 issue at 7.76%.

The trade account recorded its first annual surplus in seven years in 2010 but swung back into deficit last year as  rising imports outweighed export receipts.

Weak trade data will add pressure on the current account, which recorded its largest deficit in nearly four years at 6.4% of GDP in the second quarter of 2012.

The current account deficit, which widened to 3.3% of GDP in 2011 from 2.8% in 2010, has generally been funded by portfolio inflows.

 

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sars  |  mining unrest  |  sa economy  |  trade deficit
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