File image: IOL.
CAPE TOWN - South Africa's trade balance swung up to a R9.47 billion surplus in March, beating market expectations by nearly R6bn, with a positive trade outlook forecast for the rest of the year.

Data released by the SA Revenue Service (Sars) on Monday showed that the surplus exceeded the market expectation of R3.7 billion and went beyond the R600 million deficit recorded in February on the on the back of bumper mineral and vegetable products exports.

Sars said exports rose to R98.28 billion, while imports fell 2% to R88.81 billion from a month earlier, as precious metals fell. “Exports increased from February 2018 to March 2018 by R8.27 billion (9.2%) and imports decreased from February 2018 to March 2018 by R1.8 billion (2%),” Sars said.

On a year-on-year basis, the March trade balance “is a deterioration from the R11.81 billion surplus recorded in March 2017,” Sars said, adding that the R98.28 billion exports in March were 3.1% less than the R101.48 billion exports recorded last March.

On a month-to-month basis, imports of base metals and vegetable products both increased by 19% to R1.97 billion and R715 million, respectively, Sars said.

Imports of precious metals and stones inched up 15% to R2.18 billion on a month-to-month basis, while mineral products imports reached R2.43 billion, a 12% increase, and machinery and electronics increased by R724 million. However, the import of vehicles, transport and equipment slid 9% to R1 billion.

Economists at Nedbank Group Economic Unit forecast a positive outlook for the year, although the threat of a trade war between the US and China would disrupt the strong global trade momentum. “Global conditions are still favourable and will boost local exports, while the recovery in domestic demand will support imports. We still anticipate a trade surplus for 2018 as a whole, albeit smaller than 2017's.”

Gerrit van Rooyen, an analyst at NKC Research, said given that trade figures were notoriously volatile in nature, the trends evident in the trade data would likely continue, with higher exports and lower imports, and it should over the coming months boost the trade account.

“Nevertheless, it seems (given the significant year-to-date traded deficit) likely that net trade could turn out to be a drag on the first quarter’s gross domestic product, despite March’s improved trade performance. Last year’s strong trade performance has provided much-needed underlying support for the rand exchange rate, while also playing into an improved current account deficit,” said Van Rooyen.