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Moody's: Strikes affected deficit

"On September 9, the SA Reserve Bank released data showing that the country's current account deficit reached a seasonally adjusted annualized rate of 6.2 percent of GDP in the second quarter," senior vice-president Kristin Lindow said in a statement on Fin24.

This was up from 4.5% in the first quarter.

"The increase in the current account deficit was greater than we had anticipated, even though we had expected a negative effect from platinum and manufacturing sector strikes," Lindow said.

"Export performance was further affected by lower demand from trading partners in Asia and Europe and declines in the price of non-gold commodities."

Although merchandise imports also declined, mainly because of weak domestic demand for equipment and vehicles, the decrease was not enough to offset the decline in exports, reports Fin24.

This is just another one of the consequences of the perpetual strike action in South Africa. To read more about more the consequences of industrial action and the proposed solutions, follow this link

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