Monday 20 September 2021

Intel Denies Closing Costa Rica Plant

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Intel Costa Rica announced last week the closing of 40 jobs in its technical support and information call centre. But, it announced the opening of 50 positions in central engineering, human resources and information services.

Video wall displays Intel's logos at the unveiling of its second generation Intel Core processor family during news conference at CES in Las VegasHowever, rumours indicate that the giant technology firm may leave Costa Rica in short notice. But, it is only that, rumours.

For now the company is denying any plans to close shop. Intel’s Corporate Affairs Manager for Central America and the Caribbean, Karla Blanco, assures that the multinational is committed to Costa Rica and expects a positive future.

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With the respect to the head office’s announcement last year of a global restructuring, Blanco denied the possibility of Intel leaving Costa Rica any time soon, insisting that it will keep its presence in the country.

According to Blanco, the 40 employees with job cuts are not being laid-off, they are being given the option to apply for the available positions. However, they must meet the requirements and follow the internal recruitment process., posed the question of the possibility of an Intel closing to Costa Rica’s vice-president, Luis Liberman, who headed one of Costa Rica’s largest private banks before entering politics and who has been the Chinchilla government’s spokesman on economic issues, said he has no information about the Intel case and questions should be referred to the Ministerio de Comercio Exterior (COMEX) – Ministry of Foreign Trade.

At the COMEX,  minister Anabel Gonzalez, is mum on the subject. Gonzalez did not answer media questions, the government agency preferring to reply through the press office that the question should be directed to the company (Intel).

At the Coalición Costarricense de Iniciativas de Desarrollo (CINDE) – Costa Rican Coalition for Development Initiatives – the director, Gabriela Llobet, also deferred the questions be put to Intel.

Intel has been invested in Costa Rica since 1997 when it built a US$300 million semiconductor assembly and test plant as the country’s free-trade zone regime helped attract other multinational companies.

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In January this year Intel announced plans to reduce its global workforce of 107,000 by about 5% this year as the chipmaker, struggling with falling personal-computer sales, shifts focus to faster-growing areas, according to Reuters.

The announcement, equivalent to over 5,000 positions, comes a day after Intel posted a fourth-quarter earnings report that did little to dispel concerns about a slowing PC industry. “This is part of aligning our human resources to meet business needs,” spokesman Chris Kraeuter said.

Also in January this year, Intel Corp told Reuters it expects to make a decision this year on the location of a new multi-billion dollar semiconductor plant using new 10 nanometer technology. Israel is one of a number of countries competing to host the new plant.

In October 2011, Michael Forrest, Intel Costa Rica’s general manager, told Bloomberg the world’s biggest chipmaker decided against a large investment in Costa Rica in 2010 due to “uncertain fiscal policies”.

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“Intel makes future investments on a long-term horizon, and one of the things we consider very seriously is fiscal policy stability and consistency,” said Forrest, who participated in panel discussion of foreign business owners and managers in San José. “If there are fluctuations and instability of fiscal policies in certain countries, those countries are removed from investment consideration.”

Intel exports about US$2 billion dollars, representing about 20% of the total exports of goods in the country and the equivalent of 6% of the Gross Domestic Product.

According to COMEX, in 2013,  the largest category of goods exported was processors and controllers for over US$2.37 billion dollars.

In January this year, the Promotora de Comercio Exterior (PROCOMER) – Foreign Trade Promoter – estimated that the export of electronic components for microprocessors will be US$2.388 billion dollars.

Currently, Intel employs 2.700 in Costa Rica, this after last November’s elimination of about 100 positions in the production department.

With notes from, El Finaciero, Reuters, Bloomberg, CINDE, PROCOMER and COMEX

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