The China primary sector involves cultivation and acquiring raw materials. Common examples are oil extraction, farming and fishing. The China secondary sector relates to the manufacturing and assembly process. Raw materials are transformed into components and assembled in the China secondary sector. Finally, there is the China tertiary sector which relates to commercial services like insurance, sales and teaching. These Chinese primary, secondary, and tertiary industries sectors support the production and distribution of goods.
Primary Sector in China
Through joining the World Trade Organization (WTO) in 2001, many tariffs that were placed on China’s agricultural exports were reduced or eliminated completely. This change in China’s primary industry opened up international markets to China’s primary sector, allowing for an increase in exports.
Secondary Sector in China
Substantial demand for exports, coupled with China’s government decreasing regulations, make it relatively easy for foreign investment in China’s secondary sector.
Tertiary Sector in China
By shifting to a consumption-driven economy, China’s independence on the service sector will grow. In contrast to the export-driven growth, profits can be directly reinvested in the country.
The growing middle class is driving growth in the service industry sector in China. Although this industry sector in China sector is much smaller than those of first-world countries it still makes up 50.5% of the country’s GDP and employs 40% of the Chinese workforce.
Industry Sectors China: Industry Classifications
The SIC relates specifically to classifying rather than products, and gives each industry a four-digit code. The first two digits identify the broad industry, the third digit shows the industry category, and the fourth one identifies the specific industry sector in China.
For example, “25-2-1” (written 2521) shows the broad group as furniture and fixtures. The third digit relates to office furniture and the final one completes the code to mean wood office furniture. To access a full list, click here.
Originally developed by the United States, it is currently used in many countries across the globe including China. The purpose of the SIC is to allow for easy comparing of metrics across different industry sectors in China.
This method is slightly outdated as it fails to get updated quick enough to meet the emerging trend of the rise of service companies and only really accurately reflects manufacturing companies. For China, it is still applicable as it is a heavy manufacturing country.
North American Industry Classification System (NAICS)
This system, also used to classify industry sectors in China, uses a 5 or 6 digit code to differentiate between China’s primary, secondary and tertiary industries. Digit one and two signifies the general business sector, with the third signifying the subsector. The 4th digit designates the industry group, while digit 5 designates the NAICS industries. The last digit designates national industries. More information can be found here.
International Standard Industrial Classification of All Economic Activities (ISIC)
If the code is 1393, it would represent the following hierarchy:
Manufacturing >manufacture of textiles> manufacture of carpets and rugs
A full list of ISIC classifications can be found here.
Global Industry Classification Standard (GICS)
For example, the code 25301010 means the sector is consumer discretionary, the industry group is consumer services, the industry is hotels, restaurants & leisure, and finally, the sub-industry is casinos and gaming. A full list can be found here.
