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DOC to implement new business classification system

Commerce Department director Keniseli Lafaele  [SN file photo]

Pago Pago, AMERICAN SAMOA — In about two weeks, the Commerce Department plans to implement a new standard classification when classifying local businesses in the American Samoa Business Registry (ASBR), which lists all registered businesses operating in the territory in accordance to the economic activity they perform.

DOC announced last Wednesday plans to implement the American Samoa Industrial Classification 2017 (ASIC 2017), which is the territory’s national classification of all productive activities currently being undertaken in the territory.

Responding to Samoa News inquiries, Commerce director Keniseli Lafaele explained that an industrial classification system is a necessary tool to begin collecting and analyzing industry-specific data.

“Once the territory is able to disaggregate businesses into explicitly defined industry classes, trends can be identified that are unique to specific industries,” said Lafaele adding that the ASIC 2017 will be implemented in two weeks.

“Additionally, certain financing programs are specific to industry. Using the ASIC 2017 to break current businesses into industries could open the door to these kinds of opportunities,” he pointed out.

DOC said in a news release that the ASIC 2017 is a subset of the Pacific Standard Industrial Classification 2014 (or PACSIC 2014) and thus follows a set of internationally agreed concepts, definitions, principles for use in the collection and reporting of statistics according to their economic designation.

Asked if ASIC helps with data provided to federal entities such as the US Labor Department, Lafaele said that while federal government agencies use the North American Industry Classification System (NAICS), the ASIC 2017 is based on almost the exact same subdivisions of industries, with only a few notable exceptions.

“Specifically, we include additional categories in some of the agricultural sectors, in order to account for businesses that specialize in crops that are unique to the South Pacific region - such as ulu,” he said. “This classification system is expected to be a valuable tool for federal economic data partners, though.”

He explained that previous efforts by federal agencies, and by ASG, to identify employment, income, and other economic data by sector “has been a labor-intensive process.”

“A full implementation of ASIC 2017 is expected to streamline future efforts to collect similar economic data,” Lafaele explained.

According to the DOC, the ASIC 2017 will be used for classifying data in fields of economic and social statistics, such as for statistics on national accounts, demography of enterprises, and the number of people engaged.

It will also “be used for non-statistical purposes such as in tax collection and issuing of business licenses. ASIC 2017 also includes guidance on data reporting on the informal sector and imputed rental services of owner-occupied dwellings as an analytical tool.”

When asked for clarification, Lafaele explained that the informal sector is an umbrella term used to cover all miscellaneous sources of revenue and/or employment.

“They are typically characterized as being small-production operations, having little-to-no division between labor and capital as a means of production, with the primary objective of providing employment and income for the owner/operator,” he said.

For example, he said, this could include things such as small-scale farming, handyman services, and owner/operator taxis, especially if such services operate outside of government regulation and taxation - whether legally or illegally.

As for “imputed rent of an owner-occupied home,” he said it’s the amount that a home owner might be willing to pay in rent for that home, if he or she was a renter instead of the owner.

“It is, essentially, a measure of value that home ownership contributes to the broader economy. This can be a tricky value to include within the framework of an industrial classification system,” he explained. “For ASIC 2017, our guidance is to define it as a real-estate activity in the informal sector.”

Besides listing all businesses operating in the territory, DOC said the ASBR also provides a range of scoping and sizing information about each business, which allows surveys to stratify and scope frames for use in conducting surveys across a range of subject matters.

For more information on ASBR and ASIC 2017 contact the DOC Statistics Division at 633-5155 or online: <>