South Africa recorded a smaller-than-expected trade deficit of R2,7-billion in February, down from R11,94-billion in January, the South African Revenue Service (Sars) said on Friday.
Sars said exports rose 23% while imports fell 5%, compared with the previous month, thanks to a decrease in imports of mineral products including oil, base metals and machinery.
South Africa has blamed larger-than-expected trade deficits in the past few months on oil imports, which the country is using to pump up its investment and infrastructure drive.
Central Bank Governor Tito Mboweni has warned that if oil imports remain high, it could prove a challenge for South Africa’s effort to rein in its current-account deficit.
”It is an encouraging number and better than expected, which is pleasing [because] the latest current-account figures have obviously increased fears that the currency might have to correct sharply,” said Monica Ambrosi, an economist at ETM.
Analysts said imports would, however, remain high for the remainder of the year, exerting pressure on the current account — which was 7,8% in the fourth quarter of last year.
South Africa’s consumers have shown an insatiable appetite for imports to feed demand that the country’s manufacturing sector is unable to meet. — Reuters