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S.African trade deficit widens

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(Globalpost/GlobalPost)

South Africa's trade deficit widened to 15 billion rand ($1.5 billion, 1.1 billion euros) in April in the latest blow for Africa's biggest economy, the revenue authority said Friday.

The figure was nearly double that of the March deficit -- thanks to a spike in imports and less impressive export performance -- which had narrowed to 7.8 billon rand.

"Export performance is likely to remain weak in the months ahead this year," said economists at Nedbank.

This was due to a dent in production interrupted by strikes and infrastructure backlogs, slow global demand and depressed commodity prices.

"Imports will rise due to purchases of capital equipment as the government's large infrastructure development programme continues," they added.

The figures come after the rand has hit its lowest level in four years, and disappointing GDP figures showed a first quarter growth slump to 0.9 percent.

Imports rose last month by 12.1 percent to 80.5 billion rand, against a three percent increase in exports of goods worth 65.4 billion rand.

The increase in imports was largely driven by mineral products, plastics and rubber, and machinery and electrical appliances.

Nedbank said more deficits could exert further downward pressure on the rand, and therefore increase upside risks to inflation.

The cumulative deficit for 2013 so far is 57 billion rand, the South African Revenue Service said.

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http://www.globalpost.com/dispatch/news/afp/130531/safrican-trade-deficit-widens