South African August Trade Deficit Widens to Seven-Month High
South Africa posted its biggest trade deficit in seven months in August as exports of mineral products such as coal and iron ore slumped.
The shortfall reached 12.2 billion rand ($1.5 billion) compared with 6.7 billion rand in July, the Pretoria-based South African Revenue Service said in an e-mailed statement today. The median estimate in a Bloomberg survey of seven economists was for a 6.9 billion-rand gap.
A debt crisis in Europe is cutting export demand from a region that buys about a third of South Africa’s manufactured goods, widening the trade gap. South Africa posted its biggest current account deficit in almost four years in the second quarter, adding to pressure on the rand, which has slumped 7.1 percent against the dollar in the past six months.
The trade shortfall was surged more than eightfold to 69.9 billion rand in the first seven months of the year compared with the same period in 2011, the revenue service said.
Exports fell 3.3 percent to 61.4 billion rand in August from the previous month, led by a 17 percent decrease in mineral product shipments, the revenue service said. Coal exports from South Africa’s Richards Bay port dropped 16 percent in August from a year ago, the Richards Bay Coal Terminal said on Sept. 5.
Imports advanced 4.9 percent to 73.6 billion rand as mineral product shipments, which include oil, rose 24 percent and chemical purchases jumped 11 percent.
The current-account gap widened to 6.4 percent of gross domestic product in the second quarter, the central bank said on Sept. 11. South Africa relies on foreign investment in stocks and bonds to finance the deficit, inflows that have fluctuated this year as slower economic growth led investors to sell riskier emerging-market assets.
The monthly trade figures are often volatile, reflecting the timing of shipments of commodities such as oil and diamonds.
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