Exports a ray of light for SA’s economy
Marked increase in international trade perks up business confidence
SOUTH Africa’s international trade was a “ray of light” as the country was going through an exceptionally difficult business cycle, with business confidence at rock bottom, Terry Gale, the chairperson of the Exporters Club Western Cape, said.
Gale was commenting on the latest Maersk Trading report for the first quarter of this year, which showed that South Africa’s exports increased 20% year-onyear and growth in refrigerated exports 7%.
Gale said South Africans are incredibly resilient and, since the dawn of democracy in 1994, have struggled with droughts, recessions and labour unrest, among other things, and have managed to overcome these challenges, “because that’s who we are”.
“This has boded well in the Western Cape, taking into account the devastating fires earlier this year, resulting in a smaller harvest but of a much better quality, in both our deciduous fruit and grapes. We are at the start of the citrus season and that’s also looking good, South Africa being the second-biggest global exporter.”
Gale said the swing will be to source from the Western Cape and the foreseeable future is looking good.
“We have also noted an increase in manufactured goods leaving our shores, the weaker rand and … a stabilised rand has helped here. There is also growth into Africa that is picking up, including some large-scale developments in East Africa. West Africa is also more positive and will become a growth node for our exports.”
According to the Maersk trade report, stronger global trade is expected this year and, as reported by the World Trade Organisation (WTO), indicators such as export orders and container shipping are on the rise. The report added that, recognising the uncertainty on economic and policy development, the WTO had still forecast overall expansion in global trade.
Jonathan Horn, the managing director for Maersk Line Southern Africa, a member of AP Moller-Maersk, said while ongoing economic uncertainty was also seen in South Africa over recent months, the country’s container market had shown solid growth across both imports and exports during the first quarter, resulting in strong year-on-year growth of 10%.
Horn added that Asia exports grew 37% year-on-year over the first quarter, on the back of growing demand for local mining commodities. “Asia is South Africa’s largest export corridor, making up around 45% of total exports,” he said.
Horn added that refrigerated exports rose about 7%, compared with the first quarter of last year, a reflection of a robust grape crop and strong demand in Europe for South African grapes. –