MONEYWEB / 30 AUGUST 2019 - 16.00 / MFUNEKO TOYANA
Trade balance swings to a R2.9bn deficit.
South Africa’s trade balance swung to a R2.9 billion ($190 million) deficit in July after a revised R5.5 billion surplus in June, data from the revenue service showed on Friday.
July exports rose 3.4% on a monthly basis to R112.9bn, but were outpaced by a steep climb in imports, data shows.
A Reuters poll had forecast a R2.7 billion trade surplus.
The trade war between China and the United States and its impact on global trade demand are expected to begin hurting the country’s exports sales, especially of commodities.
Exports rose 3.4% on a month-on-month basis to R112.9 billion in July, but were outpaced by a steep climb in imports, which were up 11.7% to R115.8 billion, the South African Revenue Service (Sars) said.
Sales of base metals fell 10%, mineral product sales fell 8%, and precious metal sales dipped 5%, data from Sars showed.
Mining production in South Africa has been in free fall since 2018, hit by uncertainty over local ownership and by sluggish international demand for commodities with economic growth in China slowing.
Mining companies are also fighting to have a 2018 mining charter aimed at increasing black ownership reviewed, with uncertainty over the outcome of the move leading to reduced capital investment.
The charter, which was delayed for years amid wrangling with the industry, among other stipulations raised the level of black ownership to 30% from 26% for new mining rights while companies that have met the 26% threshold do not have to increase it
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