Two big US firms -- Bank of America and microchip giant Intel -- Tuesday announced closures in Costa Rica leading to nearly 3,000 layoffs, dealing a double blow to the Central American country`s economy.
It came two days after the election of third-party candidate Luis Guillermo Solis as the next president of the nation of under five million people and represents a significant setback to its bid to become a high-tech hub.
Outgoing President Laura Chinchilla tried to downplay the double impact.
"Some will leave, but others will take their place," she said.
But Foreign Trade Minister Anabel Gonzalez, who had taken part in negotiations with Intel, said that the computer chip giant`s presence had helped lure 200 multinationals to Costa Rica, most of them high-tech related.
"Intel was a landmark in our history. It put Costa Rica on the map as a place to invest and for high-tech firms. Their lead helped us become a player globally," she said.
Intel said it was reducing its assembly and testing operations in Costa Rica and will lay off 1,500 employees. About 2,700 people have been employed at an assembly plant set up in 1998.
Intel`s exports made up just over 20 percent of Costa Rica`s overall exports in 2013, though most of the material used to manufacture them had been imported.
"We are going to phase out our manufacturing operations in Costa Rica over the next six months. It is assembly test manufacturing. It will result in the loss of about 1,500 jobs," Intel spokesman Chuck Mulloy told AFP.
"We will continue to stay in Costa Rica with more than 1,000 employees in finance, information technology, engineering and research," Mulloy added, noting there were "200 more positions in those areas that may be added in the coming year, but that has yet to be determined."
"We need to be more effective and efficient in our business (and) the work done in Costa Rica will be moved to assembly testing sites in China, Malaysia and Vietnam," Mulloy said.
Gonzalez said the company "determined that since most of its buyers and suppliers are in Asia, it is more efficient."
The computer chip maker announced in mid-January it was going to lay off five percent of its worldwide workforce in 2014, cutting around 5,400 jobs, as it tries to combat the effects of the stagnating market for personal computers.
Intel saw its net income fall 13 percent to $9.6 billion last year.Hours later, in an unrelated move, Bank of America said it was shutting down operations in Costa Rica, where it employs 1,400 people in a technological unit.
The company said the closure would take place over the next nine to 12 months, and aims to concentrate on its activities in other countries.
"As a result of constant reviews we will close our technology and operations sites in San Jose de Costa Rica," the bank said in a statement, referring to the capital city.
Gabriela Llobet, director at the Costa Rican Development Plans Coalition, said Bank of America`s shutdown caught her by surprise.
But she believes it has nothing to do with Sunday`s presidential runoff. "It is just a bad coincidence," Llobet said.
Chinchilla said there would be news soon about more companies opening up shop in Costa Rica. But she could not say if there would be any before she hands over power to Solis on May 8.
Costa Rica`s economy, which includes a large tourism sector, grew at a solid 5.1 percent in 2012, World Bank data show.