"Intel Inside," the advertising jingle for the world's largest chip manufacturer, has become more than just a slogan in Costa Rica.
Ever since Intel installed its first South American manufacturing plant three years ago near San Jose, microprocessors have replaced bananas and coffee as the exports fuelling this Central American country.
The presence of Intel, which boasts a yearly world revenue more than one and one-half times that of the entire country's gross national product, has shaped the life of this nation of 3.5 million.
The three mammoth halls of Intel de Costa Rica are sited not far from the San Jose airport. Between 20 and 25 percent of the world production of Pentium4 and Xeon processors are made at this plant, according to the plant's spokesman, Danilo Arias.
Some 2,000 Costa Ricans are employed by Intel, the majority of them engineers and technicians. Key factors in the selection of Costa Rica for a major Intel plant included the high level of education among Costa Ricans, the stabile legal system, and the guarantee of uninterrupted electricity, Arias says. Costa Rica edged out Mexico, Brazil, and Chili in what Arias calls a very close contest.
From the point of view of the Costa Rican government, Intel helps the country distinguish itself as a high-tech hub.
Costa Rica is already called the "Central American Switzerland" by some, largely because of its stable government and relatively high standard of living.
"The most important thing is that Intel has put us on the map of places where such large firms can be found," says Costa Rican Foreign Minister Roberto Rojas.
Intel is a magnet for other large firms, he claims, such as the consumer goods giant Proctor and Gamble, which has built a logistics centre in Costa Rica intended to serve all of Latin America.
"We are not competing with the rest of Latin America for the role as high-tech hub, but with Singapore, Chili, or South Korea. We're playing in another league," Rojas says.
Costa Rica has in fact long distinguished itself from its neighbours.
Primary education has been mandatory since the 19th century, illiteracy is below five percent, and the public universities are better than the private ones, a rarity in Latin America.
"Their curriculum fits the needs of Intel very well," says Intel's Arias.
In its first full production year, 1999, Intel contributed around five percentage points to the country's 8.5 percent economic growth.
Intel's US$2.7 billion of exports corresponded to approximately 40 percent of total exports and was three times as much as bananas and coffee combined.
Still, plant renovations and the poor world economy have sunk chip exports by approximately 900 million dollars this year.
The employees' jobs are safe, however.
"We have invested a lot of money in their education, because the chipmaking processes are getting more and more complex," says Arias.
Intel's high export figures exist alongside high import rates. Products necessary for making chips and other microelectronics worth approximately 50 percent to 60 percent of the total production are currently brought in from outside.
But critics charge that Intel needs to become more integrated in the national economy and purchase more locally.
"Intel has pulled in a few other firms, but it is still a kind of high-tech island," says Costa Rican Attorney General Miguel Gitierrez.
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