Trade surplus hits billion mark

Brian Benza
Staff Writer | Wednesday May 29, 2013 00:00

Figures released by Statistics Botswana (SB) this week indicate that in March there was a trade surplus of P1.01 billion, a 255 percent jump from the February surplus of P284.5 million. Anchoring March's 17 percent rise in exports was an P800 million jump in diamonds sales to P5.3 billion while copper exports weighed in with an increase from P243 million to P438 million. On a year-on-year basis, the March 2013 total exports increased by slightly over a 100 percent from the total value from the March 2012 figure, which stood at P3.1 billion.

Diamond trade, which comprises both rough and polished stones, accounted for over 85.5 percent (P5.3 billion) of exports. Copper and nickel, machinery and electrical equipment (mainly re-exports) contributed 7.1 percent (P438 million) and 2.1 percent (P130 million) respectively.

In imports, diamonds again contributed the highest share at 32.1 percent (P1.7 billion) during the month, followed by fuel at 18.4 percent (P957 million). Machinery and electrical equipment contributed 10.4 percent (P541 million) followed by food, beverages and tobacco and chemicals and rubber products, with 9.3 percent (P485 million).

March's surge in diamond exports pushed the first quarter trade balance into a surplus of P617 million.This is the first quarterly surplus since the third quarter of 2007. Apart from a few pockets of monthly surpluses, the country's trade balance has since 2008 been in the negative as imports outweigh exports with rolling annual deficits ballooning from P3 billion in 2008 to P16 billion last year. This led to the central bank withdrawing some P21 billion from the nation's 'sovereign wealth fund', the Pula Fund, late last year to pay for the country's ballooning trade deficit.

The central bank redirected the funds to the Liquidity Portfolio, a portion of the foreign exchange reserves set aside for the economy's short-term requirements.SB figures show that 60 percent of Botswana imports valued at P3.1 billion came from South Africa while Namibia supplied 12.6 percent (P655 million). The European Union (EU) supplied imports valued at P1.1 billion during March 2013, representing 20.7 percent of the total. Imports from Asia were valued at P267.8 million in March 2013 or 5.2 percent of total imports.

The major sources of imports from Asia were Israel and China with 2.1 percent (P107 million) and 1.0 percent (P54 million) respectively.On the exports side, EU remained the largest destination for Botswana products taking goods valued at P4.5 billion, representing 72.4 percent of total exports in March 2013.