Senegal: Impacts of COVID-19 on Production, Poverty and Food Systems
1. Senegal
Impacts of COVID-19 on Production,
Poverty & Food Systems
Cheickh Sadibou Fall1, Karl Pauw2,Josée Randriamamonjy2 and James Thurlow2
1 Institut Sénégalais de Recherches Agricoles 2 International Food Policy Research Institute
Updated: 2 December 2020
Contact: Josée Randriamamonjy (J.Randriamamonjy@cgiar.org)
Disclaimer: The analysis presented in this slide deck are the authors’ own
and do not necessarily reflect the view of the authors’ institutions.
Financial support from
2. Updated: Dec. 2, 2020
Lockdown Imposes Heavy Economic Costs
• National GDP is estimated to fall by
20% during the 4-week lockdown
(US$ 371 mil. in lost GDP)
• Food system is adversely affected by
falling consumer & export demand
(17% agri-food GDP decline, despite exemptions)
• Poverty rate increases by 15
percentage points during the
lockdown
(2.4 million more people temporarily living below
the national poverty line)
Source: Senegal SAM Multiplier Results
Economic impacts during
4-week lockdown period
20.3
16.5
15.0
Percentage decline
in national GDP
Percentage decline
in agri-food system
GDP
Percentage point
increase in national
poverty rate
3.7
2.4
Decline in national
GDP in US$ 100
millions
Increase in number
of poor people in
millions
3. Updated: Dec. 2, 2020
Costs Likely to Persist Throughout 2020
• Economy is reopening & some
restrictions are eased
• But economic losses remain,
even with a fast recovery
(GDP may be 5.5-7.5% lower in 2020
compared to a no-COVID scenario)
• Average GDP & poverty rates
for 2020 hide sharp mid-year
deteriorations
(many businesses & people will require
government support to cope & recover)
Change
in quarterly
GDP
Change
in national
poverty rate
(national poverty
line)
Quarterly national impacts under faster or
slower easing of lockdowns/recovery
(changes are relative to a no-COVID scenario)
-1.6%
-17.9%
-4.1%
-0.2%
-1.6%
-19.1%
-9.0%
-1.3%
Q1 Q2 Q3 Q4
Faster lifting of restrictions
Slower lifting of restrictions
0.6%
13.1%
1.9%
0.0%0.6%
14.0%
5.4%
0.5%
Q1 Q2 Q3 Q4
5. Updated: Dec. 2, 2020
COVID-19 Cases & Policy Timeline
First confirmed
case in Senegal
- Nationwide ban on all public events for 30
days
- Closure of all schools and universities for 3
weeks
- Restriction in land transport, prohibition of
travels between cities
- Closure of restaurants until further notice
- Restriction on fishing wharves opening days to
allow disinfection
- Restriction on Pikine Central Fish Market
opening days for disinfection
- Restriction on bakeries working hours from
8pm - 6am 3/14
- Closure of Diaobé market (Southern
Senegal)
- Closure of all mosques
- Closure of borders except for goods and
cargo, suspension of all flights to and
Europe and North African countries 3/19
- State of emergency declared
- Response and solidarity fund “FORCE-COVID-
19” created 3/23
Opening of all places of worship and
restaurants with social distancing
requirement 5/11
- Distribution of food kits worth 69 billions FCFA
- Obligation to pay at least 70% of salary for technical
unemployment, suspension of non-misconduct
dismissal (decree) 4/8
Launch of online platform
JaaymaMburu “sell me bread”
during month of Ramadan 4/28
Castor market (in Dakar,
and supplying most of the
city’s markets) closed for 15
days 4/27
- Launch of online platform by Ministry of
Trade for stock management and price
regulation
- Restriction on opening days and time of
supermarkets 5/03
Only vendors of essential products
are allowed to open 4/26
- End of curfew and state of emergency
- Rapid Entrepreneurship for Women and Youth (DER)
provides support for livestock and agricultural sectors
- DER support fish sector, co-financing of agricultural inputs,
distribution of 10 million masks, and trade of horticultural
products 6/30
Children in examination classes go to school to validate the year 6/2
- President decided to proceed with economic recovery, after 3
months of partial lockdown
- Lifting of restriction on public transport, restaurants, cafes,
casinos nationwide 6/4
0
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100
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250
2-Mar
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6-Apr
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27-Apr
4-May
11-May
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25-May
1-Jun
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15-Jun
22-Jun
29-Jun
6-Jul
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20-Jul
27-Jul
3-Aug
10-Aug
17-Aug
24-Aug
31-Aug
7-Sep
Confirmednewcases
6. Updated: Dec. 2, 2020
Sectors Affected by Lockdown Policies (1)
Sector Lockdown restrictions or exemptions nationwide Directly Affected?
Agriculture
• Movement restrictions occurring at start of planting season
• Ban on interstate passenger travel (labor & trade implications) None
Mining & crude oil
• Continuing to operate (essential sector)
• Lower oil prices & export demand (small supply effects to date) None
Manufacturing
• Food processing & medicines exempted (essential sector)
• Nonfood producing companies closed
• Port congestion constraining access to inputs
Some
Utilities • Electricity & water distribution exempted (essential sector) None
Construction
• Many public works programs reduced in affected areas
• Local curfews & border closures reducing activity elsewhere None
Wholesale & retail
trade services
Restrictions on retail and supermarket trading hours and operating days High
Transportation,
storage & cargo
• Rail & air travel closed; freight transport partly restricted
• Demand for urban passenger transit reduced
• Port cargo handling & storage exempted
• Ban on interstate passenger travel
High
Hotels & food
services
• Restaurant dining banned or severely limited
• Limited delivery options for food or other products High
7. Updated: Dec. 2, 2020
Sectors Affected by Lockdown Policies (2)
Sector Lockdown restrictions or exemptions - Nationwide Directly Affected?
Banking, finance &
insurance
• Money transfer services exempted (essential)
• Banks operating with essential staff only
• Other financial institutions closed or teleworking (e.g., insurance)
Some
Professional &
business services
• Almost all closed or teleworking (e.g., legal, accounting services)
• Activities involving in-person field visits affected (e.g., engineers) Some
Public admin &
law enforcement
• Public services & agencies remain open, but most staff teleworking
• Public & private security services exempted (essential) Some
Education services
• All public schools closed without much scope for online delivery
• Private schools closed with some online materials Some
Health services
• Health services exempted (essential)
• Elective operations reduced but rising number of COVID patients None
Sports &
entertainment
• Most sports & outdoor entertainment banned
• Some activities operating (e.g., newspapers, radio & TV) High
Other services
• Domestic workers cannot commute, but live-in workers less affected
• In-person religious gatherings banned
• Major disruptions to informal repair firms due to market closures
Some
8. Updated: Dec. 2, 2020
Global & Other Nationwide Shocks
Sector Lockdown restrictions or exemptions in targeted regions Directly Affected?
Export demand
Nationwide
Fresh and processed fish, and cement exports Some
Remittances
Nationwide
Declines in the value of remittances sent by national working abroad Some
Foreign Direct
Investment
Falling foreign direct investment in machinery, equipment, vehicles, and
construction activities Some
Government
revenues
Nationwide
• Fall in tax revenues due to decline in economic activity
• Lower trade tax collections due to reduced import demand
Some
See detailed sector-level assumptions about production &
demand shocks in Annex at the end of slide deck
10. Updated: Dec. 2, 2020
Economywide Multiplier Analysis
• Lockdown policies & shocks have direct impacts on the operation
of certain sectors
(e.g., closing businesses, restricting travel, etc.)
• But it also generates indirect impacts on other sectors involved in
supply chains
(i.e., input suppliers & downstream users)
• Multiplier analysis uses sector input-output data to measure
direct & indirect impacts throughout & across supply chains
(incl. impacts on GDP, jobs & household incomes)
• Senegal model based on 2018 SAM & 2011 household survey data
(results scaled to 2019 GDP & employment levels)
11. Updated: Dec. 2, 2020
Economywide
Impacts
GDP | Jobs
Incomes | Poverty
Direct
impacts
Framework for Analyzing COVID-19
GlobalImpact Channels
(Due to partial or full lockdowns in other countries)
Indirect
impacts
DomesticImpact Channels
(Due to partial or full lockdowns in own country)
• Export demand
• Remittances & migration
• Foreign direct investments
• Agriculture
• Mining & crude oil
• Manufacturing
• Utilities (energy, water)
• Construction
• Whole & retail trade services
• Transportation, storage & cargo
• Hotels & food services
• Banking, finance & insurance
• Professional & business services
• Public administration & law enforcement
• Education services
• Health & social services
• Sports & entertainment
• Community & other services
12. Updated: Dec. 2, 2020
Impact Channels & Shocks
• Lockdowns are simulated using a
range of impact channels
• Shocks to each channel are imposed on
the model & impacts are simultaneously
traced across all supply chains
• Multiplier model separates entire
Senegal economy into 86 sectors
(shocks are calculated bottom-up using
supply-use data for 101 goods & services)
• Size of shocks is estimated by IFPRI’s
staff & collaborators
(see Annex)
Impact channels used to replicate lockdowns
1 Restrictions on farming
2 Closing mining operations
3 Closing non-essential manufacturing operations
4 Restrictions on energy and water supply
5 Restrictions on construction activities
6 Closing non-essential wholesale/retail trade
7 Transport/travel restrictions
8 Closing hotels, bars and restaurants
9 Closing non-essential business services
10 Government work-from-home orders
11 Closing all schools in the country
12 Restrictions on hospitals and clinics
13 Banning sports & other entertainment
14 Domestic workers & other services
15 Reduced export demand
16 Falling foreign remittances
17 Falling government revenues
18 Falling foreign direct investment
×
×
×
×
×
× No direct losses via these channels in
Senegal (e.g., exempted or no information)
×
13. Updated: Dec. 2, 2020
Lockdown & Recovery Scenarios
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Q1 Q2 Q3 Q4
Full
lockdown
Easing some
restrictions
during rest of
Q2
Further
easing of
restrictions in
Q3
Final easing by
end of Q4
(possibly incomplete
recovery)
1
2
1. Impacts during the full lockdown period only
• Shocks weighted to reflect the geographic targeting of policies
2. Impacts for rest of 2020 as lockdowns are lifted each quarter
• We will compare a faster vs. slower easing of restrictions
• Analysis accounts for seasonality
14. Updated: Dec. 2, 2020
Economic Impacts During
the Lockdown Period3
15. Updated: Dec. 2, 2020
GDP Losses During Lockdown
National GDP drops 20% during 4-week lockdown
(most economic losses occur in the services sectors)
Assuming lockdowns are not expanded or reintroduced
Source: Senegal SAM Multiplier Results
Change in total GDP during
lockdown period (%)
Change in total GDP during
lockdown period (US$ mil.)
-20.3%
-12.6% -13.6%
-24.8%
Total Agriculture Industry Services
-$371.1
-$25.7
-$70.8
-$274.5
Total Agriculture Industry Services
16. Updated: Dec. 2, 2020
17.2%
14.7%
13.9%
13.6%
9.9%
9.8%
5.5%
4.7%
3.8%
3.5%
3.3%
Closing non-essential wholesale/retail trade
Limiting hotel and restaurant operations
Closing non-essential business services
Transport and passenger travel restrictions
Falling foreign private remittances
Decline in international travel
Falling foreign direct investments
Reduced export demand
Banning sports & other entertainment
Closing non-essential manufacturing…
Closing all schools in the country
Sources of GDP Losses
Domestic trade and hospitality restrictions account for a third of GDP losses
Contribution of lockdown restrictions & shocks to
loss in total GDP during lockdown (sums to 100%)
(limiting business and transport activities makes up about a quarter)
Large impact on food system (see
next slide)
Source: Senegal SAM Multiplier Results
Large knock-on effect on goods
producing sectors (incl. suppliers
of inputs to all sectors)
Large effect of financial service
restrictions on other services
Large impact on manufacture and
business service sectors
17. Updated: Dec. 2, 2020
Impacts on the Agri-Food System
Food supply is exempt from most restrictions, but it is still
indirectly affected by falling consumer incomes & other shocks
Change in agri-food GDP
during lockdown period (%)
Change in agri-food GDP during the
4-week lockdown period (US$ mil.)
(food services is directly affected by the closing of hotels, restaurants & bars,
but this is a small component of the overall agri-food system)
Source: Senegal SAM Multiplier Results
Share of
total GDP in
2018 (%)
-16.5%
-12.6%
-13.7%
-13.7%
-72.2%
Agri-food system (34.9%)
Agriculture (16.7%)
Agro-processing (8.7%)
Food trade and transport (8.1%)
Food services (1.4%)
-$90.4
-$25.7
-$23.3
-$19.9
-$21.4
Agri-food system (34.9%)
Agriculture (16.7%)
Agro-processing (8.7%)
Food trade and transport (8.1%)
Food services (1.4%)
18. Updated: Dec. 2, 2020
34.1%
20.1%
13.9%
10.5%
6.1%
5.5%
3.2%
3.1%
2.5%
0.5%
0.4%
Limiting hotel and restaurant operations
Decline in international travel
Falling foreign private remittances
Reduced export demand
Transport and passenger travel restrictions
Closing non-essential manufacturing operations
Closing non-essential wholesale/retail trade
Falling foreign direct investments
Closing non-essential business services
Banning sports & other entertainment
Closing all schools in the country
Sources of Agri-Food System GDP Losses
Restricting hotel and restaurant causes a third of agri-food GDP losses
Contribution of lockdown restrictions & shocks to
loss in agri-food GDP during lockdown (sums to 100%)
(suspending international travel makes up another quarter)
Falling remittances are also more
important for the food system
because households spend a large
share of their incomes on food
Source: Senegal SAM Multiplier Results
Closing food service providers is
more important for the food system
than for the overall economy
Limited demand for food services
Effects on fishing and fish
processing sectors
19. Updated: Dec. 2, 2020
-12.6%
-15.8%
-20.1%
-15.1%
-11.8%
-9.4%
-23.4%
-44.2%
-8.8%
-9.3%
-3.8%
-12.1%
-13.2%
Agriculture
Crops
Cereals
Pulses & oilseeds
Root crops
Fruits & vegetables
Sugarcane
Export crops
Livestock
Meat & eggs
Dairy
Forestry
Fishing
Unpacking Agricultural GDP Impacts
Change in GDP during
the lockdown (%)
Cereal crops are the largest food group and
agric. subsector in Senegal
Fishing agri-sub-sector supplies half of its
domestic output to fish processing sector
Share of agric. GDP
in 2018 (%)
(59.7%)
(14.1%)
(4.0%)
(18.2%)
(1.1%)
(1.5%)
(24.9%)
(22.5%)
(2.4%)
(3.2%)
(12.2%)
Export crops hurt by falling export
demand & input supply disruptions
(greater use of inputs than other crops)
Source: Senegal SAM Multiplier Results
(20.8%)
Groundnuts are also an important agri-subsector
in Senegal; it provides inputs to peanut oil sector
20. Updated: Dec. 2, 2020
Unpacking Agricultural GDP Impacts
Change in GDP during
the lockdown (%)
Processed foods are more intensively
consumed by urban households, who are
affected badly by lockdown (see later slides)
Fishing agri-sub-sector supplies half of its
domestic output to fish processing sector
Source: Senegal SAM Multiplier Results
Note: Agri-food processing is a subsector within manufacturing
-13.7%
-19.6%
-29.1%
-4.2%
-15.0%
-5.0%
-7.6%
-13.0%
-13.8%
Food procesing
Meat
Fish
Dairy
Fruits & vegetables
Fats & oils
Cereal milling
Other crops
Beverages and tobacco
21. Updated: Dec. 2, 2020
Impacts on Household Incomes
Source: Senegal SAM Multiplier Results
Change in household incomes during lockdown (%)
All households experience large income losses
Larger income losses for higher-income households
(smaller losses for rural households because lockdowns target cities)
(nonpoor more likely to work in manufacturing & services)
-20.0%
-14.5%
-20.7%
-14.6%
-13.6%
-19.5%
-22.1%
All households Quintiles 1-2 Quintiles 3-5 Rural Rural Farm Rural Nonfarm Urban
22. Updated: Dec. 2, 2020
Poverty Impacts During the Lockdown
National poverty rate increases by 15 percentage points during
lockdown period (2.4 mil. more poor Senegalese)
Increase in share of population living in
poverty during 4-weeks of lockdowns (%)
Increase in number of poor people in Senegal
during 4-weeks of lockdowns (mil.)
Source: Senegal SAM Multiplier Results
15.0%
11.6%
19.5%
National Rural Urban
2.4
1.0
1.4
National Rural Urban
23. Updated: Dec. 2, 2020
4
Economic Impacts Under Fast & Slow
Easing of Restrictions & Recovery
24. Updated: Dec. 2, 2020
Easing of Restrictions & Recovery
We consider two stylized scenarios:
Faster easing: Economy rebounds strongly in Q3 & largely returns to normal by Dec 2020
Slower easing: Modest rebound in Q3 with productivity in Q4 still below pre-lockdown levels
Faster easing Slower easing Global shocks
Q1
Jan
No shocks in pre-COVID-19 period
Feb
Mar
Full lockdown period starts in late March and lasts 4 weeks
Remittances & export demand decline by 10%Q2
Apr
May Shocks reduced by 10%
(trade by 50%, arts by 5%)
Shocks reduced by 50%
for trade onlyJun
Q3
Jul
Losses reduced by 80% (trade by 90%,
arts by 50%)
Losses reduced by 50%
(trade by 90%)
Shocks reduced by 80% and 50% under
faster and slower easing, respectively
Aug
Sep
Q4
Oct
Losses reduced by 99%
Losses reduced by 90%
(trade by 99%)
Shocks reduced by 99% and 90% under
faster and slower easing, respectively
Nov
Dec
25. Updated: Dec. 2, 2020
GDP Impacts with Recovery Scenarios
Source: Senegal SAM Multiplier Results
Change in quarterly & annual national GDP with fast or slow easing of restrictions
(changes are relative to a no-COVID growth scenario)
National GDP is 5.5-7.5% lower over 2020 as a result of COVID-19
-1.6%
-17.9%
-4.1%
-0.2%
-5.5%
-19.1%
-9.0%
-1.3%
-7.4%
Q1 Q2 Q3 Q4 2020
Quarterly averages Annual
Faster lifting of restrictions Slower lifting of restrictions
26. Updated: Dec. 2, 2020
Cumulative Quarterly GDP Losses
Even with faster recovery, Senegal ends 2020 with lower GDP
(GDP losses accumulate each quarter & will take time to recover to pre-COVID levels)
Cumulative changes in 2020 GDP from end of 2019
(pre-COVID expected growth rate for 2020 was 7% according to IMF’s 2019 Economic Outlook)
Source: Senegal SAM Multiplier Results
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
End of
2019
Q1 Q2 Q3 Q4
US$billions
Pre-COVID projected real
GDP growth (6.8% in 2020)
Lockdown + Faster easing
(1.3% in 2020)
Lockdown + Slower easing
(-0.6% in 2020)
27. Updated: Dec. 2, 2020
Poverty Impacts with Recovery Scenarios
Source: Senegal SAM Multiplier Results
Change in national poverty rate with fast or slow easing of restrictions
(changes are relative to a no-COVID growth scenario)
Poverty should stabilize by end-2020 as people return to work,
incomes recover & consumer demand resumes
(This hides sharp spike in mid-year poverty, when many households living close to the
poverty line may require government or other support to cope)
0.6%
13.1%
1.9%
0.0%
0.6%
14.0%
5.4%
0.5%
Q1 Q2 Q3 Q4
Faster lifting of restrictions Slower lifting of restrictions
28. Updated: Dec. 2, 2020
A
Detailed Assumptions About
Production & Demand Shocks
29. Updated: Dec. 2, 2020
Channels, Shocks & Affected Sectors (1)
Type of restriction or
global shock
Major sectors
affected2
Size of
shock
Detailed subsectors affected by shock2
Direct restrictions on
farming
Agriculture
(A)
0% Crop/animal production, hunting, related service activities (D01); forestry, logging (D02);
fishing, aquaculture (D03)
Limiting mining
operations
Mining, quarrying
(B)
0% Coal, lignite (D5); crude petroleum, natural gas (D06); metal ores (D07); quarrying (D08);
mining support service activities (D09)
Closing non-essential
manufacturing
operations
Manufacturing
(C)
0% Food products (D10); textiles, clothing, leather (D13-15); chemicals, rubber, plastics (D20-
21); metals (D24-25); electromedical equipment (G266)
-10% Beverages, tobacco (D11-12); coke, refined petroleum (D19); pharmaceuticals medicinal
chemicals (D21); wood, paper, printing (D16-18); non-metallic minerals (D23); equipment,
machinery (D26-28 excl. G266); vehicles, transport equipment (D29-30); furniture (D31),
other manufactures (D33)
Disruptions to energy
and water supply
Electricity, gas
(D); water supply
(E)
0% Electricity, gas, steam supply (D35); water collection, treatment, supply (D36); sewerage,
waste collection/remediation (D37-39)
Limiting construction
activities
Construction
(F)
0% Construction of buildings (D41); civil engineering (D42); specialized construction activities
(D43)
Closing non-essential
trading activities
Wholesale (G) 0% Agricultural raw materials, live animals (G462); agricultural machinery, equipment, supplies
(C4653); food, beverages, tobacco, incl. stalls & markets (G463 G471-472 C4781);
construction materials, hardware, plumbing, heating equipment (C4663); automotive fuels
(G473); wholesale trade (D46 excl. G462-463 C4653 C4663);
Retail trade (G) -40% Motor vehicle trade/repair (D45);
-50% Retail trade (D47 excl. G471-472 G47 C4781)
Transport/travel
restrictions
Transportation,
storage (H)
-20% Postal/courier activities (D53); transport via pipeline (G493)
-20% Sea/coastal/inland water transport (C5011-5012 C5022); transport support (G522)
-20% Freight rail/road/air transport (C4912 C4923 G512); warehousing/storage (G521)
-80% Urban/suburban passenger/other land transport (C4911 C4921-4922)
-95% Passenger air transport (G511)
Government work-from-
home orders
Public
administration,
defense (O)
-20% Public administration, defense, compulsory social security (D84)
Closing hotels, bars and
restaurants
Accommodation,
food services (I)
-80% Accommodation (D55); food/beverage service activities (D56)
30. Updated: Dec. 2, 2020
Channels, Shocks & Affected Sectors (2)
Type of restriction or
global shock
Major sectors
affected2
Size of
shock
Detailed subsectors affected by shock2
Closing non-essential
business services
Information,
communication
(J); finance,
insurance (K); real
estate (L);
professional/
scientific/technica
l activities (M);
administrative/
support services
(N)
-10% Publishing activities (D58); programming/broadcasting activities (D60);
telecommunications (D61); computer programming/consultancy activities (D62);
information service activities (D63); financial services, insurance, pension funding, auxiliary
services (D64-66); real estate activities (D68); security and investigation activities (D80)
-10% Accounting, bookkeeping, auditing, tax consultancy (G692); head offices, management
consultancy (D70); scientific research/development (D72); advertising, market research
(D73); other professional/scientific/technical activities (D74);
-10% Legal activities (G692); architectural/engineering activities (D71); veterinary activities (D75)
-10% Motion picture/video/television program production, etc. (D59); renting/leasing activities
(D77); employment activities (D78); travel agencies, tour operators (D79); building
services, landscape activities (D81); office administrative, office support, other business
support activities (D82)
Closing schools Education (P) -10% Pre-primary and primary education (G851)
-10% Secondary education (G852); Other education (G854)
-10% Higher education (G853); Educational support activities (G855)
Disruptions to hospitals
and clinics
Human health,
social work (Q)
0% Human health activities (D86); residential care activities (D87); social work activities
without accommodation (D88)
Banning sports & other
entertainment
Arts, recreation,
entertainment (R)
-90% Creative/arts/entertainment activities (D90); libraries, archives, museums, other cultural
activities (D91); gambling, betting activities (D92); sports, amusement/recreation activities
(D93)
Domestic workers &
other services
Other service
activities (S);
households as
employers (T);
extraterritorial
organizations (U)
0% Extraterritorial organizations/bodies (D99)
-20% Membership organizations (D94)
-20% Other personal services (D96); domestic workers/personnel (D97); Other production
activities of private households for own use (D98)
-20% Repairing computers & personal/household goods (D95)
Note: Numbers in parentheses are International Standard Industrial Classification (ISIC Revision 4) codes (by major section with detailed subsectors, D
is division, G is group and C is class).