S. Africa March Trade Gap Narrows as Metal Exports GainMike Cohen
South Africa’s trade gap narrowed more than economists estimated in March as metal exports increased, while mineral imports, which includes oil, fell.
The shortfall eased to 7.8 billion rand ($865 million) from 9.5 billion rand in February, the Pretoria-based South African Revenue Service said today in an e-mailed statement. The median estimate of 11 economists in a Bloomberg survey was for an 8.5 billion-rand deficit.
South Africa’s trade gap widened to 41.8 billion rand for the first quarter from 27.6 billion rand in the first three months of 2012, keeping pressure on the rand and the current account deficit. The currency has declined 6.1 percent against the dollar this year, the second-biggest fall among the 16 major currencies monitored by Bloomberg after the Japanese yen.
“While the rand might receive some temporary reprieve from this data, the overall trend is still a concern,” Razia Khan, the London-based head of Africa economic research at Standard Chartered Plc, said in an e-mailed note to clients. “The key question is when South Africa will see more meaningful recovery in key export markets.”
The rand fell to 9.0245 per dollar at 2:20 p.m. from 8.9568 before the release of the trade data. Yields on the benchmark 10.5 percent bonds due December 2026 dropped four basis points, or 0.04 percentage point, to 6.73 percent.
The deficit on the current account, the broadest measure of trade in goods and services, will probably average 6.2 percent of gross domestic product in the next three years, up from an earlier estimate of 5.6 percent, the National Treasury said in its Budget Review in February. South Africa relies mainly on foreign investment in stocks and bonds to finance the shortfall, inflows that have fluctuated as investors sold riskier, emerging-market assets.
Exports climbed 2.9 percent to 64 billion rand in March from the previous month, led by a 6 percent gain in shipments of mineral products and a 12 percent increase in base metal exports. Shipments of precious, semi-precious stones and metals fell 7 percent.
Imports dropped 0.3 percent to 71.7 billion rand in the month, led by an 18 percent decline in mineral-product purchases, which includes oil. Imports of vehicles, aircraft and vessels rose 33 percent and chemicals 18 percent.
The monthly trade figures are often volatile, reflecting the timing of shipments of commodities such as oil and diamonds.