Primary sector of the economy

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The primary sector of the economy involves changing natural resources into primary products. Most products from this sector are considered raw materials for other industries. Major businesses in this sector include agriculture, agribusiness, fishing, forestry and all mining and quarrying industries.

The manufacturing industries that aggregate, pack, package, purify or process the raw materials close to the primary producers are normally considered part of this sector, especially if the raw material is unsuitable for sale or difficult to transport long distances.[1]

Primary industry is a larger sector in developing countries; for instance, animal husbandry is more common in Africa than in Japan.[2] Mining in 19th century South Wales is a case study of how an economy can come to rely on one form of business.[3]

Canada is unusual among developed countries in the importance of the primary sector, with the logging and oil industries being two of Canada's most important.

Contents

Agriculture

in developed countries primary industry becomes more technologically advanced, for instance the mechanization of farming as opposed to hand picking and planting. In more developed economies additional capital is invested in primary means of production. As an example, in the United States corn belt, combine harvesters pick the corn, and spray systems distribute large amounts of insecticides, herbicides and fungicides, producing a higher yield than is possible using less capital-intensive techniques. These technological advances and investment allow the primary sector to require less workforce and, this way, developed countries tend to have a smaller percentage of their workforce involved in primary activities, instead having a higher percentage involved in the secondary and tertiary sectors.[4]

Developed countries are allowed to maintain and develop their primary industries even further due to the excess wealth. For instance, EU subsidies in Europe provide buffers for the fluctuating inflation rates and prices of agricultural produce. This allows developed countries to be able to export their agricultural products at extraordinarily low prices, making them extremely competitive against those of poor or underdeveloped countries that maintain free market policies and low or inexistent tariffs to counter them.[5][6][7]

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