SA has recorded its highest monthly trade account deficit to date on the back of rand strength but is expected to improve in the coming months. According to the South African Revenue Service (SARS) SA recorded a trade deficit of R27.66bn in January compared with a deficit recorded of R11.28bn in the same period a year ago. Based on historical data available — it’s the biggest deficit ever recorded. The trade statistics indicate the balance of trade. A deficit occurs when the cost of SA’s imports exceeds the value of its exports. In Janaury, a deficit is typically incurred as imports increase from the seasonal decline in the month of December when factories usually close operations and generally does not inform the trade performance of the SA economy for the rest of the year. Chief economist at the Institute of Race Relations, Ian Cruickshanks said: "You’ve got to look at the dollar to rand and the strength of the exchange rate. This has blown up the cost of imports in rand terms." I...
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