South Africa recorded a weaker-than-expected preliminary trade balance deficit of R23.05 billion, SA Revenue Service (Sars) said yesterday.
The country’s exports amounted to R139.36bn in January, with imports of R162.41bn.
The deficit was a deterioration from the R4.64bn trade balance surplus for the comparable period in 2022, Sars said. And in December the country posted a R4.98bn (revised) surplus reading.
Three of the five key import categories recorded increases over January, with imports of vegetable products increasing by 80%, followed by original equipment components at 32% month on month (m/m).
However, all key export categories declined on a m/m basis except for base metals. Exports of vehicles and transport equipment fell by 5% m/m.
Sars said the top five countries South Africa exported to was: China (14.1%); US (8.3%); Japan (6.0%); Germany (5.8%) and Mozambique (5.6.%).
The top five countries South Africa got imports from was China (22.6%); Germany (8.2%); US (6.9%); India (6.3%) and the United Arab Emirates (3.7%).
Lara Hodes, an economist at Investec, said, “The result which was substantially weaker-than-consensus expectations (Bloomberg) of a -R7.5bn deficit was underpinned by a -14.4% m/m (month on month decrease in exports to R139.36bn coupled with an increase in import activity to R162.41bn (2.9% m/m).
“Indeed, a deficit is typically incurred in the month of January as imports increase from the seasonal decline in the month of December,” she said.
However, she said a 2.9% m/m lift in imports was reflective of the domestic demand environment, which remained subdued, with heightened load shedding weighing heavily on economic activity and confidence.
Hodes said, “Going forward the opening of China and a global growth picture that is not as negative as previously envisioned should support growth in exports. Indeed, flash PMIs from key advanced economies show an improvement in activity in February.
“Specifically, according to S&P Global ‘Eurozone business activity growth accelerated to a nine-month high in February’. Increasing “demand, healing supply chains, order book backlog reduction and improved confidence underpinned the upturn,” she said.
BUSINESS REPORT