San José, Costa Rica, since 1956

Intel’s Impact on Economy Huge, Report Says

Nearly a decade ago, it came to this small country to manufacture tiny computer chips. The results have been enormous.

Government officials, non-governmental organizations and economists gave microchip processor Intel a well-researched pat on the back last Friday when the private research group Consejeros Económicos y Financieros S.A. (CEFSA) released the results of a study on the company’s social and economic impact in the country.

Intel’s impact “is clearly positive, and is showing big numbers,” said former Foreign Trade Minister and CEFSA researcher Alberto Trejos.

In its nearly 10 years in Costa Rica, Intel has set off a boom in foreign direct investment, been largely responsible for diversifying the economy and its exports, provided thousands of quality jobs and training, and is said to account for more than 5% of Costa Rica’s GDP, according to the report.

“If any of you want to start up a business, take a look at what these guys are doing,” said Edna Camacho, general director of the private nonprofit Costa Rican Investment Promotion Agency (CINDE).

Despite the fact that Intel is located in a tax-free zone in La Ribera de Belén in Heredia, north of San José, and thus doesn’t have to pay national taxes, the company has dumped millions of dollars into educational, environmental and social programs here.As government officials, including President Oscar Arias, sat down in a conference room in the San José restaurant Chateau 1525 Oct. 6 to reflect on the producer of the country’s number one export, the company showed no sign of slowing operations in Costa Rica.

Last week, the microchip processing company announced the introduction of its “new generation” of microprocessors into the Costa Rican market.

Intel Central America representative Gerardo Rodríguez called the new Core 2 Duo microprocessor “the best processor in the world.”

The smaller, faster, more energy-efficient Core 2 Duo, which was introduced in the United States earlier this year, marks the retirement of Intel’s Pentium brand name that has been used since 1993, Rodríguez explained.

Like the Intel Core processors that they supersede, the Core 2 products so far are all dual core, with future plans for single and quad core varieties.

A New Kind of Investment

Intel has not only invested more than $700 million directly into the country since 1997, it has also helped attract other investors and manufacturers to Costa Rica.

Additionally, the company played a major role in developing a high-tech, capitalintensive sector in the country’s free zones.

“In 2005, Intel and Wal-mart began to change investment,” said Foreign Trade Minister Marco Vinicio Ruiz. “They channeled it to the free zones.”

Ruiz said more than half of the foreign direct investment that Costa Rica has received during the past six years has gone to the free zones.

Now, Costa Rica has the highest foreign direct investment per capita in Latin America, second to only Mexico, Ruiz said.

Camacho added that Intel brings in a certain type of investment.

“We’re talking about the most soughtafter investment in the world,” she said.

Intel has grown to employ 3,000 workers, and Camacho said the company’s suppliers employ another 2,500.

Intel employees earn an average salary of $836 per month, almost double the national average monthly salary of $438, according to the study.

In 2005 alone, Intel invested $7 million in human capital and training in Costa Rica.

“But (Intel) has also transformed the corporate culture,” said Camacho, adding that the company emphasizes corporate values such as creativity, innovation, job safety, teamwork and social responsibility.

Costa Ricans “see the impact when their sons and daughters wake up in a safer environment,” said Bill Abraham, Intel’s General Manager in Costa Rica.

Camacho said the company has also driven the development of technological institutes and research institutes in Costa Rica in recent years.

Not only do Intel’s employees produce benefits for the country, they also spend their income in Costa Rica. The CEFSA study estimated this had a $150 million impact in the economy just last year.

Abraham said Intel has spent $700,000 each year during the past eight years on education programs in Costa Rica.

The company has also given money to protect turtles in Las Baulas National Marine Park; sent volunteers to tutor kids at local schools and orphanages; launched seven recycling programs around the country; and donated equipment and training to modernize the Dialysis Unit at the public Hospital México (TT, Sept. 15), among other recent projects.


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