Trade data nar­rows as SA im­ports drop

Weekend Argus (Saturday Edition) - - BUSINESS -

JO­HAN­NES­BURG: The deficit on South Africa’s trade ac­count nar­rowed sharply in 2009 com­pared with the pre­vi­ous year due to a re­ces­sion that slashed im­ports, of­fi­cial data showed.

The South African Rev­enue Ser­vice said yes­ter­day the trade deficit for 2009 nar­rowed to R25.84 bil­lion ($3.42 bil­lion) from a R71.63 bil­lion gap the pre­vi­ous year, eas­ing pres­sure on the coun­try’s cur­rent ac­count, pre­vi­ously a drag on the rand and econ­omy as a whole.

For De­cem­ber, the trade ac­count recorded a sur­plus of R3.7 bil­lion from a R2.47 bil­lion deficit in Novem­ber as im­ports fell by 13.73 per­cent in the month and ex­ports eased by 1.08 per­cent.

The trade num­ber is gen­er­ally volatile and dif­fi­cult to fore­cast.

Economists polled by Reuters pre­dicted an R800 mil- lion deficit for De­cem­ber.

“The trade bal­ance typ­i­cally im­proves in De­cem­ber, as im­port ac­tiv­ity winds down. This looks to have been the case this time around as well,” said Razia Khan, head of macro­eco­nomics and Africa re­search at Stan­dard Char­tered.

“As much as the im­prove­ment in the trade bal­ance over­all is good news... it mostly re­flects the weak­ness of the econ­omy. As the econ­omy re­cov­ers (very slowly), the trade bal­ance should worsen again. But given the weak­ness of con­sumer de­mand, do not ex­pect that to hap­pen in a very dra­matic way just yet.”

South Africa’s econ­omy came out of its first re­ces­sion in al­most two decades in the third quar­ter of 2009, sup­ported by the man­u­fac­tur­ing sec­tor as ex­ports re­cov­ered in line with the global econ­omy. – Reuters

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