Exports likely to improve as production activity normalises

The country’s exports are likely to improve during the remainder of 2015 as production activity normalises‚ while the weakness of the rand exchange rate will add further support‚ according to Nedbank’s economic unit.

However‚ it says‚ electricity load shedding will restrict mining and manufacturing output and this could inhibit export growth.

“The renewed weakness of commodity prices and the planned mothballing of some mining shafts are likely to dampen exports of mineral products. Purchases of capital equipment for the infrastructure programme will continue to prop up imports‚ but a lower oil import bill and weak consumer spending will help to offset this to some extent‚ the economists predict.

They add that the country’s trade account which turned to a R397.7 million deficit in July after two months of large surpluses‚ was worse than their and the market consensus of a R1.5 billion surplus after the R5.48 billion surplus recorded in June.

The cumulative deficit for the first seven months of 2015 was R25.23billion compared with R53‚37billion over the same period in 2014.

Exports rose by 10.3 % year on year to R94.21 billion‚ while imports were up by 2.6 % to R94.61 billion.

RDM News Wire.