South Africa Trade Gap Narrows in September as Exports SurgeMike Cohen
South Africa’s trade deficit narrowed more than estimated in September as production and exports of precious metals gained pace after platinum miners ended a five-month wage strike.
The trade gap narrowed to 2.9 billion rand ($267 million) from a revised 16.7 billion rand in August, the Pretoria-based South African Revenue Service said in an e-mailed statement today. The median estimate of 14 economists surveyed by Bloomberg was for a shortfall of 11.5 billion rand.
Weak export growth this year has added to pressure on the current-account gap, which swelled to 6.2 percent of gross domestic product in the second quarter. The trade deficit widened to 73.7 billion rand for the first nine months of the year, compared with 63.7 billion rand for the same period in 2013, the revenue service said.
“Despite today’s surprising improvement in South Africa’s trade balance, these figures are notoriously volatile from month to month,” Phoenix Kalen, a London-based strategist at Societe Generale SA, said in an e-mailed response to questions. “It may be challenging for the country to post sustained improvements in the large trade deficit, given entrenched structural supply-side constraints hampering the export sector.”
The rand dropped 1.1 percent against the dollar to 10.9923 as of 3:30 p.m. in Johannesburg, taking its decline this year to 4.6 percent.
The strike by more than 70,000 miners at Anglo American Platinum Ltd., Impala Platinum Holdings Ltd. and Lonmin Plc cost the companies 23.9 billion rand in revenue and workers 10.6 billion rand in lost wages before it ended on June 24. Mines took several months to ramp up production.
Exports jumped 18 percent to 90.8 billion rand in September as shipments of precious metals and stones, including platinum, surged 45 percent. Mineral-product shipments advanced 24 percent, while exports of vehicles and transport equipment increased by 22 percent.
Imports gained 1.4 percent to 93.7 billion rand as purchases of mineral products, which includes oil, rose 0.2 percent. Imports of vegetable products surged 77 percent.