A discussion with Cinde in Costa Rica

The Central American Group: Hello. Welcome to another installment of Central American groups. In these discussions with professionals from various realms, we talk about issues in Costa Rica, El Salvador, and the rest of the region. Today. We’re very fortunate to have with us Karin Lachner. She works for a very well-regarded economic development agency called CINDE in Costa Rica. Hello, Karim. How are you doing today? And please tell us a little bit about yourself and your organization.

Karin Lachner: Hi, Steven. So grateful to be invited here and share a little bit of information about CINDE in Costa Rica. My name is Karen Lachner. I’m the head of marketing and communications for CINDE. Cindy is a private, nonprofit and non-political organization. So, we’re a very rare breed within our kind as an investment promotion agency, which mostly and most of the time are part of the government. In our case, we work very closely with them, but our private nature has enabled us to work on long-term strategies for investment attraction into the country through ten different government administrations.

The Central American Group: Well, one of the things I think that would be very interesting to our listeners is that you recently won a very prestigious award, excuse me, that was given to CINDE in Costa Rica by the UN International Trade Center. And maybe you could tell us a little bit about that? And after that, if you could explain to us what potential investors could expect from your organization in terms of services to help them do their research on Costa Rica, of course.

Karin Lachner: Well, yes, we are very humbled by this recognition that the ITC from the United Nations has given us. I don’t know if some of the listeners are familiar with It, but the ITC is part of the UN. They work hand in hand also with the World Trade Organization. And they focus very much on providing service in a wide area of capabilities, for example, advisory services and capacity building for different countries. This is mostly to be able to leverage a lot of that trade intelligence and enhancement of policies, both to help attract investment into countries as well as create expert capacity. So, a lot has to do with that as well as creating and leveraging the momentum of digital tools to enhance, for example, eCommerce platforms for digital trade as well. So that’s a little bit of their vocational focus if you would call it that. CINDE in Costa Rica has been working hand in hand with them for several years, and we have gone through different evaluations. They have this tool. So, this is not what we would call a fashion contest. It’s actually a very thorough evaluation that we have undergone, and that goes on 225 separate indicators that were evaluated.

So, it’s a thorough process, as I said, and it’s very humbling to have earned 95 points. So, CINDE in Costa Rica is the highest-ranked institution in the world right now out of 85 different agencies that this century has evaluated thus far.

The Central American Group: What are some of the variables specifically that they assess?

Karin Lachner: Yes. Well, they have I would say four main pillars and these, of course, are broken down into more specific areas. But one has to do with the leadership and direction that the institution has. So, they oversee things like the vision and mandate, governance, strategy, planning, and development, as well as implementation or also a lot about risk management, of course, which is a newer or heftier area to assess more. So, with risk management of assessing things such as the Pandemic.

The other pillar has to do with resources and processes. This entails how the organization structures itself and the capacity building of its staff, as well as for example, the financial resources or physical assets or the quality and focus of the services that we provide to investors as well.

The third pillar has to do with products and services delivery. So, the relevance of the portfolio, how we manage and handle client experiences goes way deeper into this, the marketing and promotion of those services as well, how innovative we are able to be in that area, and a lot of the deployment of external communications, country branding and the like. And the final one has to do with measurement and results because of course all of this has to be reflected in solid outcomes.

The way we structure our areas for defining the scope or the quality of measurement of the things that we do. Client satisfaction is a huge thing for us. We measure it in several touchpoints that we have with investors, from initial agendas to our advice, even when we help them create their enabling or PR efforts to go once they do the landing in the country. We measure those through the NPS course, for example. This is part of the tools that they assess on achievement of results.

The Central American Group: Now what does this all mean for investors and how does it affect the site selection process?

Karin Lachner: Well, we had seen CINDE in Costa Rica has a philosophy of being completely client-centric focused and for us, the investing companies come first. Sometimes that means that it gets us into trickier relations even with some government instances. But that’s what we are here for to help investors. We see the site selection processes as just the initial part of our investor relations. At that stage, we help and provide all the data that is necessary with objective information. Of course, sometimes it’s public information, but we help do the number crunching or the tailoring towards the interest of the investor. There’s a lot of data we soak in data and in this day and age ever for so, but the value of it is how we process it and make it a compelling and relevant information gathering for business purposes. That’s how we see it does. And now we have strengthened that area focusing on true investment advisory. We had brought onboard profiles of business analysts, as well. We help companies assess. For example, we go into deeper analysis such as running P and L reports with the information that companies have and input, for example, what it could look like leveraging our free trade zone regime, which is part of the incentives program that Costa Rica We portray this on a five-year time frame or ten-year time frame and understand what your bottom line ROI would be on operations in the country.

So those parts are completely personalized experiences on how we help companies assess that site selection. We do benchmarks as well. We gather information from competing countries or other sites that the company might be assessing and do it objectively as you would with any other. And all our services are completely free of charge. That’s part of the benefit that companies can get, and having the excellence behind it to do that, get data gathering the most professional way.

The Central American Group: That’s very valuable given the description that you’ve just given about some of the services that you provide. I know that if one goes out to private consulting agencies, these are things that can cost upward of $100,000 if you’re paying companies to do that kind of research. What you offer is obviously is incredibly valuable. But beyond crunching numbers, what other things do you do?

Karin Lachner: Well, of course, that’s just the beginning part of it, because once companies are assessing that on paper, it’s not the same as being able to come into the country and look at things by themselves. When they do decide to do that, we provide business agendas with peer companies that are already operating in the country so that they can have peer-to-peer conversations with investing companies and objectively assess that. We even provide meetings with different academia to better understand the talent pools that they’re able to create, the curricula, and the skill sets that we are developing. As for talent building, we seem to have created a very strong network of strategic partners that help both in the understanding of what a landing into the country would be, but also once the decision is made to be able to have the softest lending into the country. We have right now a network of over 83 proven partners from tons of different categories. We have legal advisors, big firms, smaller firms, environmental agencies, which in Costa Rica is a very thorough process because we are very keen on sustainability. We have companies for helping you understand the ways around immigration or tax consultancy, HR and recruitment, even facilities.

We have firms related to architecture or office design, even furnishing. And once you’re operational, we have facility management or cafeteria services. These are all the things that investing companies need, we have that proven network of companies that already have worked with other multinationals and that are our partners to help that process be as streamlined, as self as possible.

The Central American Group: Well, again, these are things that are absolutely essential to being successful and bringing companies to your locale. And one of the things that are a testament to the quality of the work that you have done is that over the past couple of decades, Costa Rica has become the second-largest exporter of medical devices in Latin America. And that’s a pretty impressive accomplishment for a country that’s about the size of Massachusetts. Congratulations on your good work at CINDE in Costa Rica.

Karin Lachner: Thank you. It’s been a very interesting process of capacity building in the country. And if that figure and Medtech is interesting, what is most interesting is to see that we also export more services than goods. If that med-tech figure is relevant, our services, our knowledge-intensive services are in that mix. We’re the highest per capita exporter of knowledge-intensive services in the Americas. And it’s interesting to see because our processes there have also been growing quite a bit. We export cloud computing, cybersecurity more so right now. We have a combination of this creative ecosystem, converging Med-tech, digital tech, and, of course, long-standing industry and smart manufacturing and electronics, which are bread and butter right now. And in trend for maybe not all the good reasons that we would like to, but it’s a global challenge. Costa Rica is putting its part there in exporting electronics as well.

The Central American Group: I have one question that I’m curious about regarding electronics. We know how important microchips are to all the devices that we use on a daily basis. And there’s been a shortage of Silicon chips in the world, and there’s concern that Taiwan is a big producer. And if whatever happened with their security is negative, we’d be in a world of trouble with regard to the availability of chips. I’m just wondering, beyond Intel, are there other companies that are looking at doing that kind of activity in Costa Rica at the moment?

Karin Lachner: Of course, we have well, Intel which has the biggest mega lab of its kind outside of California. We have their R&D center here with over 900 engineers working on the new development of solutions for microprocessors. But we also have other companies and components such as Samtec, the customized electronics as well. Zollner Electronics is a huge German company as well, which provides components and smart components to the auto industry, which are leveraged for the US market. So, Costa Rica is in itself a nearshoring example. For years, it’s just now becoming a hotter topic now that their new nearshoring is taking place. But for us, nearshoring is our bread and butter companies come here to leverage the exports platform that we offer with a broad network of free trade agreements that we offer from here to reach different markets. We have had a free trade agreement with China for the last ten years, which is not new for us, but we also have a free trade agreement with the US and the rest of Central America.  We have one with Europe as well. We know that we are a compact economy and that we are open to trade and that’s what we offered a lot of the partner companies that are investing in the country.

The Central American Group: Now if somebody who is listening wants to get in contact with you to begin the process of exploring Costa Rica, how can individuals listening get in contact with you?

Karin Lachner: I think the best way would be through our website. We have tons of resources with every investing sector of interest we have listed there on our website, the leads, the persons that are in charge of every sector within our organization that are the specialized people for each of the sectors. We have med-tech and smart manufacturing. A very dynamic thing that we’re doing right now is new materials. We’re creating a new project with IDP on a new materials hub for Costa Rica.  We are also leveraging all the biodiversity that is in the country so that we also are working with that health and wellbeing area.

Listeners can find us on www.cinde.org, which is our website, and then for each investing sector or the contact us page, it’s a more traditional and if you can follow us, of course, on different social media as CINDE, the Costa Rican investment promotion agency, we have representation there on LinkedIn and Twitter as well.

The Central American Group: Okay. With your permission, of course. I’d like to be able to in the text below the box where the audio plays on our website, I’d like to put a link to your LinkedIn page. Would that be okay? Because I listeners may wish to contact you directly and that would be a way of doing it as well, I assume.

Karin Lachner: Wonderful. No, we would really appreciate that.

The Central American Group: Well, thanks a lot for accepting the invitation to talk about what you have going in your organization. CINDE in Costa Rica, as well as in your country. We know that things will just get better for you and that you have a great rest of the day and a nice Easter season. You take some time off and enjoy Costa Rica’s beautiful beaches.

Well, thank you. Yes, it’s going to be a lovely few weeks ahead of us, and thanks for the invitation of having us and be able to discuss this and so much more that we can offer to investors.