South Africa’s Economy Ch 9

Economic Geography •Economics = the study of HOW people produce goods and services

•The study of WHERE economic activities are carried out and why certain locations are chosen

Structure of the Economy: 3 Sectors of an economy

Primary: Extraction of raw materials from the earth -FFFMHQ

Secondary: Manufacturing

of raw materials

Tertiary: Services - retail,

education, trade

Quaternary Activities:

Intellectual services, especially IT, GIS!

Includes telesales, data processing, environmental consulting and R & D

Linking of Sectors

• A farmer produces wool from sheep – primary activity.

• A factory will manufacture the wool into a jersey – secondary activity.

• The factory will make use of railways to transport the jerseys to a shop, shop sells the jerseys to consumers. The shop uses a bank and insurance – all tertiary activities.

• The shop employs a computer agency to use GIS to determine where to open new branches – quaternary activity.

Activity 1 Answers• 1. There are many uses of rocks from quarries. Some

uses are road building, levelling out the ground for building railways or infrastructure, building walls. Interior architecture, weapon formation, sculpture.

• 2. Unsightly, noise and air (dust) pollution, problems associated with many large trucks coming to and from the quarry, destruction of natural vegetation, animal and bird habitats destroyed.

Economic Sectors’ contributions to SA Economy

•2.1) GDP(Gross Domestic Product) = the value of goods and services produced in a country in one year. Primary indicator of development.

Calculating GDP

• There are many ways of calculating GDP but a simple method is:

• Combine the value of the products produced in a country (farms, mines and factories together) together with the salaries of the people engaged in tertiary and quaternary activities.

GDP and development

• 1st world and 3rd world countries differ in employment in different sectors.

• If a country is highly developed, only a small proportion of the population is employed in the primary sector, while the majority will be involved in the tertiary sector.

• In developing countries (SA) the economically active population is engaged mainly in primary activities, while a smaller percentage of the workforce is employed in tertiary and quaternary activities.

• As countries develop economically, the proportions of the population active in the various sector changes.

How is the SA economy structured?

- Sector contribution

- Provincial contribution

Sector Contribution

Provincial Contribution

Is South Africa a developing country?

Unemployment

Activity 2 Answers

• 1. Malawi 84%, India 31%, USA 17%.

• 2. Malawi is the least developed as it has 84% of it’s population engaged in agriculture and only 13% in the tertiary sector. Either the UK or the USA is most developed as they have very small primary sectors and very large tertiary sectors.

• 3. In the USA agriculture is highly commercial and mechanised. Thus very few workers produce large amounts of products. In Malawi agriculture is mainly subsistence with many workers producing just enough for their families, with little being sold.

• 4. The higher the GDP, the greater the level of economic development. But this may not always be the case. Large countries with a high population, such as India, may have a large GDP but a small per capita GDP, showing that the average person is not well off. A small country such as Denmark has a smaller GDP but with a much higher per capita GDP, which shows greater economic growth.

• 5. As businesses grow, employment increases and more people will earn a living. This will increase the gross earnings of South Africans and the economy will grow.

• 6. a) 1910 primary 50%; secondary 5%, tertiary 45%

2010 primary 10%, secondary 15%, tertiary 75%

b) 1910

c) 2010

d) 1990

e) 1910

f) 1970

Unit 1 Questions: Answers

• 1. The sum total of a country’s output over a year. It is calculated by adding the value of the goods and services produced by all sectors of the economy.

• 2. India has a larger economy than South Africa, leading to a higher GDP. India has many more people than South Africa, which causes the lower per capita GDP.

•3a. The primary sector by 3,7%

•B. The tertiary sector by 4,8%

•C. The primary sector has dropped and the tertiary sector has increased. A small primary sector with a large tertiary sector is the mark of a developed country.

• 4a. Gauteng, KZN, Western Cape, Eastern Cape, Limpopo, Mpumalanga, North-West, Free State, Northern Cape.

• B. Northern Cape. Two from: This province receives very little rain so farming is of minor importance. There are diamond, iron and manganese mines but these minerals are exported without being beneficiated.

• C. Gauteng. Two from: The discovery of gold at the end of the 19th century led to the establishment of many industries. It is close to the main power stations.

• D. The Eastern Cape lacks development as much of the province consisted of former homelands in the apartheid era and little development was allowed. There is little commercial farming and virtually no minerals for industry.