Current account swings into surplus in fourth quarter

South Africa’s current account returned to surplus in the fourth quarter of 2025, recording R50.2 billion after a R72 billion deficit in the previous quarter. As a share of GDP, the balance moved to a surplus of 0.6% from a deficit of 0.9%, supported by a stronger trade balance, according to the South African Reserve Bank’s latest quarterly bulletin.

What the current account measures

The current account reflects the country’s net transactions with the rest of the world. It includes:

• Trade balance: exports minus imports of goods and services
• Primary income: investment earnings received from abroad minus payments to foreign investors
• Secondary income: transfers such as foreign aid and workers’ remittances

Together, these components show whether the nation is a net earner or spender in its dealings with non-residents.

What drove the Q4 turnaround

The swing to surplus primarily reflected a substantial widening of the trade balance in the final quarter of 2025, to R282.2 billion from R169 billion. The value of merchandise and net gold exports rose, while merchandise imports declined.

Export values for goods and services increased by R51.1 billion, largely due to higher export prices. At the same time, the value of imports of goods and services fell by R54.4 billion, reflecting lower import prices.

Services, income and transfers: narrower deficit

The combined deficit on services, income, and current transfers narrowed to R232.1 billion in the fourth quarter from R241 billion in the third. This improvement stemmed from a smaller shortfall on the primary income account, even as deficits on the services and current transfer accounts widened. As a share of GDP, the combined deficit edged down to 3.0% from 3.1%.

Full-year 2025 snapshot

For 2025 as a whole, South Africa’s trade surplus eased slightly to R212.1 billion, or 2.8% of GDP, compared with R214.3 billion (2.9% of GDP) in 2024.

Improved terms of trade

South Africa’s terms of trade strengthened in the fourth quarter, as the rand price of exported goods and services rose while the rand price of imports declined. This price dynamic supported the expansion of the trade balance and, in turn, the overall current account position.

Context and outlook

In recent years, South Africa’s current account has generally been in a modest but steady deficit, underpinned by commodity exports yet weighed down by income payments to foreign investors and ongoing import demand. The fourth-quarter surplus marks a notable, albeit potentially temporary, improvement.

Looking ahead, elevated global oil prices pose a risk to sustaining the surplus. Crude prices have pushed above $100 per barrel amid heightened geopolitical tensions and disruptions to tanker routes in the Gulf. Higher oil and refined product prices tend to compress South Africa’s trade surplus and worsen its terms of trade, given the country’s dependence on imported fuel.

“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,” said independent economist Elize Kruger.

Kruger added: “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.”

Bottom line

The fourth-quarter current account surplus reflects stronger export prices and softer import prices, which lifted the trade balance and narrowed deficits elsewhere. However, sustained gains will depend on the trajectory of global energy prices and broader external conditions, which could quickly shift the balance back toward deficit.