Friday, May 1, 2009

Trade deficit R512m for March in South Africa

April 30, 2009

South Africa recorded a trade deficit of R512-million for March, the SA Revenue Service (Sars) said on Thursday.

It said the deficit was mainly due to increased exports of 17.94 percent and increased imports of 17.58 percent.

The deficit eased from R571-million in February.

Exports for March 2009 of R52.0-billion and imports of R52.5-billion resulted in the deficit of R512-million.

Standard Bank economist Shireen Darmalingam said the improvement in exports in March was likely to be temporary within a general falling trend.

The sustained weakness in the global economy, especially in SA's major trading partners, was expected to continue to the final quarter of the year, she said.

The rebound in exports could very well have been a function of past export orders.

"This view is corroborated by the recent manufacturing data, which point to a severe recession in the sector, having been impacted adversely by poor manufacturing export orders."

Darmalingam said export volumes for manufactured goods were expected to decline by close to 10 percent in 2009, adding considerable downside risks to the recent buoyancy in exports.

"Furthermore, the rand is likely to maintain a strengthening bias, which is supportive of increased imports going forward, but may be offset by weakening demand."

This, combined with the general weak demand for exports, was likely to translate into continued trade deficits for the remainder of this year.

Darmalingam said according to the World Trade Organisation, world trade (including both imports and imports) volumes were expected to decline by 9 percent in 2009.

"The developed world’s exports are expected to decline by 10 percent this year while emerging market economies’ trade may be subjected to a 2 percent to 3 percent decline."

The Organisation for Economic Co-operation and Development (OECD) had pencilled in a larger decline in trade volumes, amounting to 13.2 percent in 2009, she added.