R9.5BN TRADE SUR­PLUS IN MAY

Boosted by higher sales of man­u­fac­tured and veg­etable prod­ucts

The Star Early Edition - - BUSINESS REPORT - Ka­belo Khu­malo

THE SA REV­ENUE Ser­vices (Sars) on Fri­day said the trade sur­plus widened to R9.5 bil­lion in May from a down­wardly re­vised R5bn recorded the pre­vi­ous month boosted by higher sales of miscellaneous man­u­fac­tured articles and veg­etable prod­ucts.

Karl Gotte, the head of com­mer­cial bank­ing at Stan­dard Bank, said on Fri­day that the trade bal­ance was sup­ported by a more sta­ble to stronger rand com­pared with pre­vi­ous months, hence the in­crease in the ex­port vol­ume as seen in min­ing ma­chin­ery, elec­tron­ics, and trans­port equip­ment.

“Whilst the trade bal­ance is only one com­po­nent of the cur­rent ac­count, it shows that the real econ­omy is ad­just­ing in spite of gross do­mes­tic prod­uct (GPD) growth fore­cast be­ing re­vised down­wards in 2017 as con­sumer and busi­ness sen­ti­ments fail to re­cover from the cur­rent lows due height­ened po­lit­i­cal and pol­icy un­cer­tainty,” Gotte said.

Ear­lier this month, data from the SA Cham­ber of Com­merce busi­ness con­fi­dence in­dex fell to 93.2 points in May, which is the low­est since Oc­to­ber.

May’s trade sur­plus was the net ef­fect of in­creases in both ex­ports and im­ports. Ex­ports in­creased by 15.4 per­cent month-on-month to R13.9bn, while im­ports in­creased by 11 per­cent month-on-month to R9.4bn.

Largest in­crease

The largest monthly in­creases in ex­ports were recorded in the veg­etable prod­ucts which in­creased 46 per­cent on a monthly ba­sis to R1.8bn, while base me­tals went up 14 per­cent month-on-month to R1.6bn.

Ve­hi­cles and trans­port equip­ment in­creased 15 per­cent to R1.5bn, while chem­i­cal prod­ucts in­creased by 28 per­cent on a monthly ba­sis to R1.4bn and miscellaneous man­u­fac­tured articles surged 220 per­cent month-on-month to R1.3bn.

In the year to end-May ex­ports in­creased by 6.1 per­cent com­pared with the same pe­riod in 2016.

Mean­while, the largest monthly in­creases in im­ports were recorded in min­eral prod­ucts which in­creased by 22 per­cent in the pe­riod to R3.1bn, while orig­i­nal equip­ment com­po­nents surged 33 per­cent month-on-month to R2.1bn and ma­chin­ery and elec­tron­ics in­creased 7 per­cent on a monthly ba­sis to R1.4bn. On a yearly ba­sis, im­ports de­clined by 1.3 per­cent.

El­ize Kruger, an an­a­lyst at NCK Re­search, said with four con­sec­u­tive monthly trade sur­pluses now recorded, the early in­di­ca­tions for 2017 were pos­i­tive.

“Ex­port growth is sup­ported by a mod­er­ate re­cov­ery in South Africa’s ma­jor trad­ing part­ners and higher com­mod­ity prices, whereas the slug­gish lo­cal econ­omy is keep­ing a lid on im­port growth – both de­vel­op­ments are play­ing favourably into an im­proved trade bal­ance, which will also have a pos­i­tive im­pact on the cur­rent ac­count bal­ance and, sub­se­quently, also on the rand ex­change rate,” Kruger said.

“Fol­low­ing the pos­i­tive start to 2017, we fore­cast a cur­rent ac­count deficit of 3.2 per­cent of GDP this year, com­pared to an es­ti­mated deficit of 3.3 per­cent of GDP for 2016,” she said.

PHOTO: TRACEY ADAMS

Con­tain­ers are lined up at Cape Town Har­bour. South Africa’s ex­ports in­creased by 15.4 per­cent month-on-month to R13.9bn in May, re­ports Sars, while im­ports in­creased by 11 per­cent month-on-month to R9.4bn.

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