Chapter 4 Flashcards
(30 cards)
The primary sector usually involves:
- Unprocessed raw materials, such as minerals or trees, farm produce, etc.
- The product that is produced is usually very basic, such as timber, unprocessed fruit and vegetables
or various metals.
The secondary sector usually involves:
- Manufacturing products using the output of the primary industries or that of other secondary
industries to produce a range of goods. - Examples include canning factories, assembly plants, clothing factories, etc.
The tertiary sector usually involves:
- The services that support the economy such as selling and distributing those items produced in the
secondary industries. - Examples include transport services, courier services and computer network services.
THE PRIMARY SECTOR (Def)
- Primary sector industries are industries that get raw material from nature.
- Primary means that it is the first stage of production.
- The products supplied by this sector can be delivered to the consumer just as they are, or they can
undergo processing in the secondary sector.
Genetic operations (def)
This can return to nature what has been taken from it, such as farming or
forestry.
Exploitative operations
It cannot return to nature what has been taken from it, such as miningor
fishing.
Composition of the Primary Sector:
Cultivation of products –
agriculture
Exploitation of minerals –
mining
Collection of products –
forestry and fisheries
Economic importance of the primary sector:
Provides food and minerals
Earn foreign exchange
Train workers and create job opportunities
Provisions of raw materials for secondary industries
Contribution to GDP
Sources of capital formation
Stimulation of research and development
Sources of state income
Positive influence on infrastructure
THE SECONDARY SECTOR (DEF)
- Secondary sector industries are those industries that change natural resources into a form that is
suitable for human use. - The process that takes place to transform raw materials into consumer goods are known as
manufacturing. - Examples of industries in the manufacturing sector are car-manufacturing industries and food-
processing industries.
Composition of the secondary sector:
Manufacturing industries:
Electricity, gas and water supply:
Construction:
Economic importance of the secondary sector
Makes a significant contribution to GDP:
Create job opportunities:
Ensures economic independence:
Earns foreign exchange:
It is an important area for investment:
Ensures strategic importance in Africa:
THE TERTIARY SECTOR (DEF)
- Tertiary sector distributes goods (makes goods available) and provide services.
- Also referred to as the service sector and activities include public, commercial and professional
services. - Examples include transport services and financial services.
Economic importance of the tertiary sector:
Contributes to GDP:
Creates job opportunities:
It is a source of income for the state:
Creates a market for consumer goods:
SOUTH AFRICA’S INFRASTRUCTURE:
Communication, transport and other infrastructure are the backbone of economic activity in any country.
The infrastructure of a country ensures that the factors of production, as well as consumer goods and
services, will be available at the right place and the right time.
Three infrastructures: Communication, Transport and Energy
Composition of the tertiary sector:
Commercial services
Transport services
Storage services
Communication services
Banking and financial services
Personal services
Transport:
- Transport sector in any growing economy is the driving force for all economic activity, and therefore
needs constant upgrading. - This means investing in roads, rail, harbours and airports.
- Transnet provides an extensive rail commuter system to the South African business world.
- Economist often see transport as the firth factor of production.
Communication:
- Advances in communication technology have done for world economies what jet travel did in the
1960’s. - The world has become an increasingly smaller place.
- The use of superfast internet, satellite communications technology and cheap, reliable mobile
phones has made it possible for people to do business from anywhere in the world – without having
to physically be at the point of sale or negotiation.
Economic importance of communication:
- Cell phones and wireless technology have enabled entrepreneurs in remote and rural parts of the
country to set up small businesses. - Knowledge is gained through communication, which helps entrepreneurs to make the correct
business decisions. - The sector makes an important contribution to the gross domestic product of the country.
- It is a source of employment for all levels of labour.
Energy:
Most people’s energy needs are met by the provision of electricity, which is generated from coal
fired power stations.
* Eskom is South Africa’s major provider of electricity.
* Task is to provide electricity to households and business sectors in South Africa.
Economic importance of transport:
- It brings the consumer and the manufacturer together.
- Apart from increasing the standard of living of domestic consumers, our international transport links
make valuable contributions to the GDP of the country. - Projects like Gautrain and the upgrades to our international airports act as a spur to tourists to enter
the country and travel around internally in speedy and efficient comfort. - The new harbour at Coega near Port Elizabeth has created a hub for new businesses to set up that
can benefit from tax free imports.
Economic importance of energy:
Energy is crucial to the functioning of modern society.
* This includes energy for industry, domestic consumption, transportation and the business world.
* The energy supply problem in South Africa since 2005 has highlighted how reliant businesses,
households and the state are on electricity.
* Energy takes various forms, including the burning of wood and coal, the burning of oil and gas, the
provision of energy from nuclear power plants and hydroelectric plants.
* Using technology to generate electricity from renewable sources such as wind, solar and wave
energy is one of the growth sectors identified by the state.
