Economic activity can be classified into Primary, Secondary and tertiary sectors. The primary sector is concerned with the exploitation of natural resources. It includes the activities such as farming, fishing, forestry and mining.
The raw material produced by the Primary sector are processed or manufactured in the secondary sector. For example, iron ore is turned into steel, crude oil is refined into petrol and wheat is milled into flour. The tertiary sector provides services, for instance banking, transport and retailing.
Countries with the lowest per capita GDPs generally have the biggest primary sectors. So, for example, in the mid 1990s, the agricultural sector’s output in one of the poorest countries in the world, Tanzania, was approximately 55 per cent of GOP. Middle income countries, for example the Newly Industrializing Countries of south and East Asia, have experience a relative decline in their primary sectors and growth in their secondary sectors.
In Malaysia, for instance, between 1980 and 1995, the share of GOP contributed by agriculture fell from 22 to 14 per cent and the share contributed by manufacturing rose from 21 to 32 per cent.