S. Africa records $24.25b current account surplus, best ever as Covid cases ease
South Africa’s Covid infection rate is falling and after two straight quarters of positive GDP numbers, it has one more economic reason to cheer.
The country just posted a record surplus on its current account of the balance of payments in the second quarter as the value of the country’s exports of goods and merchandise soared.
The surplus widened to $24.25bn in the second quarter of 2021, the biggest surplus ever and up from $18.45bn in the first quarter, the Reserve Bank said in an emailed statement on Thursday.
As a ratio of GDP, that took the current account surplus to 5.6% in the second quarter of 2021 from 4.3% of GDP in the preceding three-month period.
The value of South Africa’s merchandise exports increased to a record high in the second quarter of 2021 while the value of goods and services also rose.
While imports also increased across several categories, South Africa was still able to post a trade surplus that widened to a record high of $43.42bn in the second quarter of 2021 from $31.89bn in the first quarter.
The Reserve Bank said the higher value of exports of goods and services reflected increases in their prices rather than higher export volumes. The same was also true for imports.
The shortfall on the services, income and current transfer account widened noticeably to $19.16bn in the second quarter of 2021 from a relatively small deficit of $13.18bn in the first quarter.
As a percentage of GDP, that pushed the deficit up to 4.4% in the second quarter, from 3.2% in the previous quarter.
South Africa’s terms of trade, including gold, improved further in the second quarter of 2021 as the rand price of exports of goods and services increased more than the price of imports.
The South African currency the rand was trading at R14.1470/$ yesterday, just before the release of the data.