CINDE: Their FDI Journey

Fabiola Dominguez - OCT 31, 2019
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CINDE’s FDI Journey in Costa Rica: Costa Rica: From Wildlife to Life Sciences and High-Tech.

The ever-changing faces of economic growth in Costa Rica are attracting wider worldwide attention all the time. A driving force over the past four decades has been the organization known as CINDE, which stands for Costa Rican Investment Promotion Agency.

Founded in 1982 and declared of public interest in 1984, CINDE is mandated — as its name suggests — to promote foreign direct investment (FDI) in Costa Rica. Since its inception, the private, non-profit, non-political organization has helped hundreds of companies set up operations here, contributing major benefits to the country in the process.

“CINDE adds value to Costa Rica by being a change agent for growth and enhanced employment options in the country,” says Jorge Sequeira, Managing Director. “Last year, we attracted 48 new investment projects and 12,961 new high-quality jobs. This strengthens the economy and creates new opportunities for Costa Ricans.”

Multinational companies attracted by CINDE
have generated 106,707 jobs, at last count.

 

Economic transformation

Once known primarily for its agricultural exports of bananas, coffee and pineapples, and increasingly as a favorite tourist destination, Costa Rica has a well-established place on the map for reasons common to other tropical paradises. Millions of visitors and relocated expats find tranquility and adventure in this biodiverse wonderland of lush rainforests, beautiful beaches and mountain landscapes. They also appreciate the warmth of Tico hospitality and cultural enrichment.

But starting in the 1980s, Costa Rica’s economic transformation on multiple frontiers has been impressive. Cutting-edge growth has occurred in specialty areas of the industrial and service sectors.

The country has become a hub for IT software development, smart-tech electronics manufacturing and superfoods development. From tier 3 data centers to R&D initiatives, the range of medical technology activities has also widened.

Value proposition

CINDE’s compelling FDI value proposition has helped make this small Central American country one of the top investment destinations in the world. Costa Rica’s qualified workforce, strategic location, excellent business climate, robust utilities infrastructure and quality of life are all persuasive factors in its proven FDI track record. Multinational companies attracted by CINDE have generated 106,707 jobs, at last count.

Green-field investment — occurring when a parent company creates a ground-level subsidiary operation in another country — has been integral to this success story. Startups have been undertaken in varied sectors including corporate services, life sciences, advanced manufacturing, light manufacturing and the food industry.

More than 300 high-tech companies — 24 percent with Fortune 100 status — have established successful operations in Costa Rica and continue to grow. Prominent examples include GSK, McKinsey & Company, Procter & Gamble, Zollner, Emerson, Microsoft and Intel.

Over the years, Costa Rica has consistently moved forward in achieving production value chain goals, with emphasis on R&D activities.

Export dynamics

Costa Rica now exports some 4,355 different products and services to more than 151 countries. Preferential connections are with trading partners accounting for two-thirds of the world’s GDP. This is made possible through a strong network of free trade agreements with the European Union and countries such as the United States, Canada, China and Singapore.

The life sciences and services sectors lead the pack when it comes to Costa Rican exports, as well as job creation at home.

In 2018, medical devices topped the country’s list of industrial export products, valued at US $3.3 billion. As Latin America’s second largest exporter in this sector, Costa Rica is where six leading global producers of cardiovascular equipment have a strong presence.

Value-added business services exports, including telecommunications, computer and information services, represent 7.3 percent of the GDP. Economic growth created a sixfold increase between 2000 to 2018.

A Few Facts About CINDE’s Impact

Currently, the country’s workforce includes:

• 65,904 in the services sector
• 26,417 in the life sciences sector
• 10,157 in advanced manufacturing
• 4,229 in light manufacturing and the food industry

In 2018, CINDE-generated FDI from multinational companies accounted for:

• 31 percent of Costa Rica’s overall employment
• a female job occupancy rate of 57 percent
• 850 people finding new jobs outside the San José Greater Metropolitan Area — 600 of them in Amazon’s virtual work centers