South Africa’s trade balance swung to its biggest surplus in eight months in August as mining exports surged.
The 6.8 billion rand ($448 million) surplus compares with a revised 3.7 billion shortfall in July, Pretoria-based South African Revenue Service said Monday in a statement on its website. The median estimate of seven economists in a Bloomberg survey was for a positive balance of 1.2 billion rand.
Key Insights
- The bigger-than-expected surplus may bode well for the current account, which is the broadest measure of trade in goods and services, and the rand in the second half of 2019. The deficit on the current account widened to 4% of gross domestic product in the three months through June, the biggest in a year. It’s been a key risk to the economy for years, given the country also runs a fiscal deficit, which is likely to overshoot the government’s projection of 4.5% of GDP after additional bailouts for the cash-strapped Eskom Holdings SOC Ltd.
- The shortfall for the first eight months of 2019 is 849 million rand, compared with a surplus of 4.7 billion rand for the same period last year, the tax agency said.
- Total exports rose 8.4% from a month earlier to 122 billion rand, led by an 18% surge in the shipments of mineral products, which include iron ore and coal. Precious metals and stones rose 10%. While mining makes up less than 10% of GDP, it accounts for about half of South Africa’s exports.
- Imports fell by 1% to 115 billion rand as the inward shipment in mineral products, which include oil, decreased by 12%.
— With assistance by Amogelang Mbatha, and Simbarashe Gumbo
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