The balance on South Africa’s current account swung to a surplus of R50.2bn in the fourth quarter of 2025 from a shortfall of R72bn in the previous three months, helped by a positive trade balance.
As a percentage of GDP, the account switched to a surplus of 0.6% compared with a deficit of 0.9%, the South African Reserve Bank said in its latest quarter bulletin released on Thursday.
The current account is a key component of the country’s balance of payments, showing the net flow of income, goods, services and unilateral transfers such as aid between residents and non-residents.
It comprises the trade balance — the net total of the export and import of goods and services — as well as the primary income, which is the difference between earnings on investments made abroad and payments to foreign investors domestically, and the secondary income, which is money sent abroad or received without a specific quid pro quo, such as foreign aid or workers’ remittances.
According to the Bank, the turnaround in the fourth quarter reflected a substantial widening in the trade balance in the last three months of 2025 to R282.2bn from R169bn as the value of merchandise and net gold exports increased while that of merchandise imports decreased.
The value of exports of goods and services in the fourth quarter of 2025 increased by R51.1bn, reflecting higher prices, while the value of imports of goods and services decreased by R54.4bn due to lower prices, the central bank noted.
For the whole of 2025, the trade surplus narrowed slightly to R212.1bn, or 2.8% of GDP, from R214.3bn, or 2.9% of GDP, the previous year.
The deficit on the services, income and current transfer account narrowed from R241bn in the third quarter of 2025 to R232.1bn in the fourth, stemming from a smaller shortfall on the primary income account while the deficits on the services and current transfer accounts widened.
As a percentage of GDP, the deficit on the services, income and current transfer account narrowed to 3% from 3.1% between the two quarters.
The Bank noted South Africa’s terms of trade improved in the fourth quarter as the rand price of exported goods and services increased while that of imports decreased.
South Africa’s current account has remained in modest deficit but relatively stable, supported by commodity exports, though still pressured by income payments to foreign investors and import demand.
The fourth-quarter surplus is, however, likely to be short-lived as the conflict in the Middle East between the US and Iran sends oil prices spiralling.
Prices pushed above $100 a barrel once more on Thursday, as attacks on oil tankers in the Gulf shattered any prospects of an imminent de-escalation in the conflict, Reuters reported.
“The trading landscape has changed notably. While commodity prices remain mostly elevated, the spike in the international oil price and related refined products will erode the trade surplus and also have a negative impact on South Africa’s terms of trade, that will filter through as a negative for the value of the rand exchange rate,” independent economist Elize Kruger said.
“The overall scenario for the South African economy has taken a negative turn due to the impact of higher fuel prices that will hit us at pumps on 1 April, it will lead to notably higher inflation, no more cuts in interest rates, maybe even a hike or two, and household and industrial sector budgets under increasing pressure.”
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