Zimbabwe recorded a trade surplus for the month of October 2019  something last seen in 2017 and the second best monthly trade balance figure to be recorded in 11 years. Overall the trade surplus was US$83 million. The balance of trade had been on upward trajectory as the deficit gradually shrunk and the nation has finally broken positive. However many commentators have warned that we should not read too much into the results.

Image from www.equityaxis.netZimbabwe exported US$483 million worth of goods in the month of October. These were mostly buoyed by the export of tobacco accumulated during the marketing season and consistent nickel exports.This edged very close to the long term average of US$500 million. Zimbabwes exports have historically been seasonal with large peaks and valleys over time. Imports in the meanwhile stood at US$400 million for the month of October. While US$400 million represents a rebound from the record low import level of US$329 million of March 2019 it is still s far cry from the levels of US$600 million from a year ago and long term average of US$700 million.

 

While some may want to point to Mthuli Ncube speaking about a weak currency being better for exports and our return to local currency being responsible for finally recording a trade surplus a little more nuance is required to fully understand where we stand. A look at the trade graph shows how volatile our exports are. In the same breath our imports are relatively stable though they have been subdued of late. Since returning to the local currency value and purchasing power loss for Zimbabweans has happened at a level last experienced in the 2000s.

Internal production has not seen the best year in 2019. From a drier than usual rainy season affecting primary agriculture to energy challenges which have grossly affected manufacturing. Extractive sectors are plagued by excessive control and commodities such as gold have seen lower export volumes with a suspected rise in smuggling out of the country. The statistics may not represent a true or complete picture of the state of trade in the nation.