3. Economic Sector

• The Primary Sector in South Africa is rich in

  • Minerals such as coal, gold, diamonds, etc.
  • Long coastline that enables fishing of a variety of fish
  • Favourable climate with fertile soil for agricultural activities
  • Many regions suitable for animal husbandry
  • Fresh water is essential and scarce in South Africa
• It is important to protect the environment especially since growing communities, urbanization and the improvement of technology have put pressure on natural resources

  
  

  Ways to protect renewable and non-renewable resources:

  • Plant trees after they’ve been cut
  • Prevent overgrazing and allow the soil to restore itself
  • The government must build dams and promote ways to conserve water
  • People should not waste or pollute water
• Additional ways to protect renewable and non-renewable resources

  • Businesses should use biodegradable materials in their products and packaging
  • Businesses should recycle paper, glass, and plastic
  • Cost-effective energy resources like hydro, solar, and wind power should be developed
  • The government should protect the fishing industry by issuing permits and quotas
• The Secondary Sector


  • Takes place in manufacturing plants and factories
  • Includes activities like construction, manufacturing of food, car manufacturing, clothing manufacturing, furniture making, engineering, chemical plants, and manufacturing of electricity
• The Tertiary Sector


  • Includes the sale of all goods and services by businesses and individuals
  • Contributes the most to South Africa’s economy
• Name the Works of the different sectors

  A) Forestry

  B) Fishing

  C) Farming

  D) Mining

  E) Car manufacturers

  F) Steel works

  G) Dress markers

  H) Builders

  I) Legal services

  J) Distribution

  K) Accounting

  L) Customer service

  M) Extract

  N) Manufacture, construct, refine

  O) service,distribute

  
• The Three Economic Sectors

  • Primary
  • Secondary
  • Tertiary
• Economic Growth

  The country’s actual GDP (Gross Domestic Product) grows from one year to the next
• GDP

  The total amount of final products and services produced within the country’s borders in a year
• Real GDP


  Takes into account inflation
• Economic Development

  The average GDP improves and the majority of people in the country experience a higher standard of living
• Strategies to increase real GDP

  1. Human Capital: Equipping people with additional skills

  2. Population control

  3. Improve healthcare to reduce productivity loss
• Strategies to increase real GDP

  1. Natural resources preservation

  2. Improving the secondary sector to avoid re-importing finished goods

  3. Encouraging capital formation and foreign investments
• Strategies to increase real GDP

  1. Technology usage leading to structural unemployment but also job creation

  2. Institutions focusing on economic growth and development through private and public sector partnerships (Private Public Partnerships; PPPs)

  - Industrial Development Corporation (IDC)

  - Small Business Development Corporation (SBDC)

  - Development Bank of Southern Africa (DBSA)
• Private Sector

  • Sole proprietor
  • Partnership
  • Private company
  • Public company
  • Formal sector
• Informal Sector

  • Excluded economic activities from GDP
  • Development of entrepreneurial skills and job opportunity
  • Includes legal: street vendors, spazas and stalls at flea markets
  • Illegal activities: drug selling, prostitution and chop shops
• Advantages of Informal Sector


  • Creation of work opportunities
  • Development of entrepreneurial skills and self confidence
  • Low capital requirement: little stock is needed
  • Competition for formal sector businesses: help prices stay low
  • Potential transition to formal sector and tax contribution
• Disadvantages of Informal Sector

  • Shortage of skilled entrepreneurs
  • Low-quality goods and services
  • Encouragement of crime through illegal activities
• Public Sector Initiatives


  • The Reconstruction and Development Program (RDP)
  • Growth Employment and Redistribution (GEAR)
  • Accelerated and Shared Growth Initiative for South Africa (ASGISA)
  • New Growth Path (NGP)
  • National Development Plan (NDP)