South Africa’s merchandise exports declined by 0.8% year-on-year, amounting to R484 billion (constant rand terms) in the first quarter of 2023, while imports saw an increase of 15.1%. This resulted in a trade deficit (R1.2 billion) which was last experienced in the first quarter of 2019. The fall in exports in Q1 2023 was driven by the drop in commodity prices, particularly coal, which led to a decline in export revenues as coal is one of South Africa’s top export commodities. Since Q3 2021, South Africa’s imports have grown at a faster pace compared to exports, amounting to R485 billion in Q1 2023. The growth in imports has been primarily driven by increased demand for inputs to increase electricity generating capacity, with a rise in imports of products such as electrical transformers and electric batteries.