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JOHANNESBURG - South Africa recorded a R27.6 billion trade deficit in January - the highest in 17 years - as exports plunged from December by R23.5bn.

The deficit was comparable to a downwardly revised R15.3bn surplus in December and well below the market expectations.

The SA Revenue Service (Sars) said the value of mineral product exports fell R5.9bn, while vehicle and transport equipment eased by R5bn and machinery and products shed R1.6bn.

South Africa’s most important export partners were China, with 9.5percent of total exports, the US with 7percent and Germany with 5.9percent.

The year-to-date trade balance deficit of R27.6bn was deterioration on the deficit for the comparable period in 2017 of R11.2bn.

When excluding trade with neighbouring Botswana, Lesotho, Namibia and Swaziland, the country posted a trade deficit of R33.8bn in January, swinging from an R7.5bn deficit in December.

NKC African Economic analyst Elize Kruger said the deficit was not expected to inform the trade performance of the South African economy for the rest of this year.

“January is seasonally a strong import month, following the Christmas period when imports dwindle, thus it is common to observe a swing from a trade surplus in December to a deficit in January,” Kruger said.

Double whammy

“However, the trade deficit in January 2018 is the worst in at least 17 years as it was a double whammy of not only a spike in imports but also a notable drop in exports.”

Last year’s strong trade performance provided underlying support for the rand exchange rate. The rand was unmoved after January’s poor trade surplus print was released, trading steady at R11.7636 against the US dollar by 5pm. Sars said imports increased from December to January by R19.4bn.

It said the main month-on-month import improvements were recorded in the original equipment components with R4.6bn, mineral products R3.4bn, machinery and electronics R2.2bn and base metals R2bn.

The country’s main import partners were: China with a 20.4percent share of total imports, Germany with 9.5percent, Saudi Arabia with 6.8percent and the US with a 5percent share of the pie.

Kamilla Kaplan, an economist at Investec, said with domestic economic growth expected to pick up at only a modest rate this year, imports of consumption and capital goods should remain relatively contained.