What is an economic activity?
An economic activity is any human effort to produce goods and services to meet daily needs. In Malaysia, economic activities are divided into three main types: primary, secondary and tertiary. All three are linked and contribute to national income.
Key idea
Primary = obtaining raw materials from nature; Secondary = processing raw materials into finished goods; Tertiary = providing services.
Primary and secondary activities
Primary activities involve obtaining raw materials directly from nature. Examples include farming, fishing, mining and logging. Tapping rubber and catching fish are primary activities.
Secondary activities process raw materials into finished or semi-finished goods. Examples include palm-oil mills, car assembly and making furniture from timber. These activities add value to raw materials.
Tertiary activities
Tertiary activities provide services to people rather than producing goods. Examples include tourism, banking, transport, retail trade, telecommunications and education services. This sector is increasingly important and is now the largest contributor to Malaysia's economy because it offers many job opportunities.
The three sectors depend on one another. Raw materials from the primary sector are processed by the secondary sector, then distributed and sold through the tertiary sector. A country's progress is often measured by the growth of its secondary and tertiary sectors.
Example
Rubber is tapped (primary) → processed into tyres at a factory (secondary) → sold in shops and delivered to customers (tertiary).
Remember
If a material is taken straight from nature it is primary; if it is processed it is secondary; if it is a service it is tertiary.