SA trade data, oil producers in the line of fire

South Africa’s external sector probably shifted from being an economic tailwind to a headwind in the second quarter. Meanwhile, Africa’s oil producers are facing mounting pressure from OPEC to comply with their quotas. While lower output would reduce oil revenues, the cost would be even greater if Saudi Arabia reacted to non-compliance by raising oil output, which would have the effect of driving prices down. Finally, protests that erupted this week in Ethiopia underscore the high risk of political instability in the country, which could undermine the ambitious reform agenda.