South Africa posted a current account surplus in the first quarter of 2020, Reserve Bank data showed on Thursday 2 July. This was the first surplus since 2003 and would often be taken as a good sign. But in this case, it highlights a fragile economy with falling demand for imports.
The current account records South Africa's economic and commercial transactions with the rest of the world, including exports, imports and earnings on international investments. In the three months to the end of March, the current account posted a surplus of R69.7-billion or 1.3% of gross domestic product (GDP) - the first surplus in 17 years. This, compared to a deficit of R68-billion or 1.3% of GDP in the last quarter of 2019.
"South Africa's terms of trade (including gold) improved further in the first quarter of 2020 as the rand price of exports increased while that of imports decreased," the South African Reserve Bank (SARB) said.
"South Africa's trade surplus more than doubled from R102.5-billion in the fourth quarter of 2019 to R208-billion in the first quarter of 2020. The larger trade surplus reflected an increase in the value of merchandise exports and a decline in imports."