In the primary sector South Africa's abundant natural resources, especially in the mining and agriculture-based categories, provide noteworthy opportunities for companies to add value prior to export. Export earnings associated with the value added to primary products represented 29 percent of total exports in 1995, as compared to 21 percent in 1988, indicating that South African companies are learning to extract more economic value from their natural resources. On average, the contribution of the primary sector to the GDP grew at less than 1 percent per year from 1960 to 1985, and at a negative rate
The secondary sector had stronger growth than the primary sector in the period after 1960. However, due to economic adversity during the struggle against apartheid, the average annual growth rate was only 0.5 percent. This sector (manufacturing electricity, gas, water, and construction) contributed 31 percent to GDP in 1997. Although the tertiary sector showed slower growth than the primary and secondary sectors in the entire period since 1960, its growth was higher after 1980, propped up by government spending. It is expected that this sector will grow at an average rate of about 3.0 percent per year to 2005.
The tertiary sector (trade, catering, accommodation, transport, storage, and communications) is expected to grow at roughly the same rate. The lackluster domestic demand should be countered by the rapidly expanding tourist industry. Rising tourism should boost passenger transport, while technological improvements should continue providing impetus to the communications industry.
Financial and business services have been growing at above-average rates and should continue to do so as the traditional and informal sectors become more formalized and make use of these services. Community and social services and general government services are unlikely to show high real growth, due to the expected tight fiscal situation.