Costa Rica Call Center Blog

Yesterday, the average price of the currency on the wholesale market was ¢510.56.

In this market, participating financial institutions, businesses and anyone who negotiates a minimum amount of $1,000.

Window, the average purchase price of ¢505.20 yesterday and the sale was ¢515.46.

In the currency band system the Central Bank buys all the dollars at the floor price – currently stands at ¢500 -, and sell all the dollars at the ceiling price, which currently stands at ¢642.05.

However, this week the Central served a year without buying and selling foreign currency to defend the band limits, so movements in the dollar due to changes in supply and demand.

The Central Bank continues to participate as an agent to buy or sell more dollars for public sector entities.

The price of the dollar is trending lower since 4 June. From then until yesterday, has dropped almost ¢41.  The downward trend reflects a larger dollar supply than demand.

This excess is reflected in foreign exchange reserves of U.S. commercial banks, which reached a new record of $1.184 million in June.

Source: La Nacion

Costa Rica currency had a strong currency appreciation of 13.2% between September of  2009 and May 2010 when the exchange rate hit the low of 500 colones to a US dollar on May 3.

Whats ahead, I don’t know.  What I know is that today we are about 30 colones from the lower band of the exchange rate and about 100 colones from the upper band of the exchange rate.

Laura Chinchilla, the first woman president of Costa Rica, is expected to continue many of the policies of Oscar Arias, but with her own nuances. Given the country’s strong new economic team, growing FDI inflows, the dynamism and diversification of the export sector, and responsible anti-cyclical fiscal and monetary policy, we recommend overweighting Costa Rica in the short part of the curve.

The key to success is the country’s qualified workforce; Costa Rica’s educational system ranked twenty-sixth worldwide, the highest in Latin America according to the World Economic Forum.

Some of the country economic indicators:

Source: CINDE

• 10 years ago two companies hired people with multilingual skills, today they are 14
• Portuguese, German and Mandarin, among others, are becoming stronger to provide services

Mastering English is not enough to get a job. Service Companies in the country are increasingly looking for professionals with different language skills.

Ten years ago, only Western Union and Sykes hired multilingual staff to provide services. Currently there are 14.

“The biggest challenge is to find the academic preparation combined with language proficiency,”  said Ericka Mora, human resources manager for DHL.

According to the CINDE, the 14 companies located in Costa Rica provide from services to financial and technical support in seven languages.

Companies like Intel, Sykes, Concentrix, Baxter and British American Tobacco SS Americas offer technical and financial support in English, Spanish, French, Portuguese, German, Italian and Mandarin.

Even the multinational DHL announced that, shortly, will offer financial services in Czech, Dutch, Swedish and Danish.

CINDE statistics indicate that 100% of service operations, 80% are in English, Spanish 8%, 7% in Portugal and the remaining 5% in other languages.

In line with the increased demand for multilingual personnel, Universities report a 235% growth in the number of people studying other languages besides English.

The Alliance Française also recorded a 20% increase in the number of new students.

Executives of seven companies surveyed said that to stay ahead, the country needs to keep up with supply of people.  They recommended not only graduating more professional in finance or engineering, but also encouraging them to be multilingual.

“Costa Rica has a very good level of training in general, however, the labor market demand has increased considerably in recent years,” said Arturo Barboza, director of public relations for Sykes.

Of the 2,800 employees working at its headquarters in Heredia and Moravia, 90% (2520) does in English-Spanish and the remaining 10% (280) does in German, French, Italian and Portuguese.

Another example: Intel has a global service center in Heredia where 45 people offer marketing assistance in Spanish, English and Portuguese.

“For us, the main challenge is to maintain the high standards of productivity, education and availability of languages to ensure that the model is sustainable over time,” said Rudy Sanchez, manager of British American Tobacco SS.

British American Tobacco, Hall employs 90 people for financial support: 70% Spanish, 20% English and the remaining 10% French-speaking markets.

CINDE has recorded 95 service companies here, which generate little more than 28,500 jobs.

Source: La Nacion

As imports came to a near halt during the economic crisis, the Costa Rica trade deficit was reduced.  A huge drop in oil prices helped this reduction of imports.  While this happened, Costa Rican exports, FDI and tourism did relatively well during the recession.  So pressure was taken off for the colon to remain pegged on the upper band of the exchange rate.

Now there are increasingly clear signs that the appreciation that the colon has been experiencing in recent weeks has been driven to some extent by speculative capital inflows entering the country lured by high interest rates and the upward trend of the colon.  This phenomenon cannot last long.  Should the Colon continue to appreciate, the Central Bank will have to intervene in the exchange market by buying the excess dollars.

Related:  El Financiero

• Provide Customer Services to 80,000 employees of the corporation
• Also since the country produces high-tech corporation

From Costa Rica, Intel not only designs, produce and export computer and server processors, but also provides technical support to over 50 countries and provides financial support throughout the Americas.

The company, which started operations in Heredia in 1997 alone with a chip assembly plant today makes 17 processes.

These include the production technology of the corporation and variety of financial services and engineering.

Michael Forrest, general manager of Intel general Costa Rica, said the country has exceeded the expectations of the multinational.

Proof of this is that in 2000 fewer than 50 people were charged with providing services in engineering and finance.

Currently there are about 1,000 employees who work in those fields, in addition to processor design and software, accounting, financial analysis and management, logistics, human resources and information technology. These areas are part of the global call center services. Just to give you an idea, from that center support is given to the corporation’s 80,000 employees in 50 countries worldwide.

Also from here, workers of the company are responsible for making the payroll of its employees in the US.

The 1,000 employees of the Centre for Global Services are part of the work force of nearly 3,000 people that the multinational has in the country, distributed in Heredia.

In an activity with the media, yesterday morning at the headquarters, Michael Forrest called the operation of Intel in Costa Rica as one of the most diversified global corporation. This site of “honor” he said, is shared with a site in Malaysia.

“The talent in Costa Rica is phenomenal. Here we have the best professionals and we are proud of that, “said Forrest.

Karla Blanco, manager of corporate affairs at Intel, announced that his contract represented just over 100 people, soon, for reasons of expansion in different areas of the company.

“That’s why I said that this is the footprint of Costa Rica in the world, because the operation of country covers the world and the operation of services has become increasingly important,” said Blanco, who noted some challenges of the country to remain competitive in attracting investment.

“Costa Rica should continue to invest in the generation of quality employment and creating a friendly business environment.

“Also in the issue of competitiveness, for example, in the areas of electricity and telecommunications. And talk about education and access to technology, and I must admit this is a vital point. ”

However, the executive assessed as positive the highly educated population.

Source: La Nacion

By Christopher Heine, ClickZ, Mar 5, 2010

Seventy-eight percent of Fortune 1000 companies are not employing social media sites to market to Latinos, according to survey results released yesterday by Hispanics-focused agency Orci. Hector Orci, co-founder of the Los Angeles-based firm, said some advertisers “are leaving money on the table” while stating that 80 percent of Hispanics use social sites and collectively total $1 trillion in buying power.

Orci pointed to the Spanish-language capabilities of Facebook, Twitter, and MySpace as potential messaging opportunities gone amiss. From his work for companies like Honda and Jack in the Box, he suggested that developing dialogue between a brand and Latinos on social sites is an excellent means to capturing some of the demo’s market share.

“What we have found is Latinos are extremely social,” Orci said. “So they are very eager to communicate with whoever wants to communicate with them.”

Of the companies utilizing social media to reach Hispanics, the survey found Facebook was the preferred site to focus efforts upon, with Twitter coming in a close second.

Orci surveyed 9,300 senior marketing and advertising executives from Fortune 1000 brands in consumer and business-to-business verticals. Fifty-one percent of the respondents indicated they do no marketing at all towards the Hispanic demo, which is expected to total 50 million – or 15 percent of the U.S. population – in the 2010 Census, according to the agency’s prepared release.

Depending on the individual product categories, between 78 and 89 percent of the respondents said they believe Hispanics will dramatically impact the following areas in the next five years: food, fashion, beauty, entertainment, and technology/communications.

Still, Orci said the survey data showed that the biggest advertisers were among those targeting Latinos the least. “About 50 of the Fortune 500 firms are not marketing to Latinos at all, via cyberspace, TV, or radio,” he said.

As the survey results clearly indicate, the practice of online marketing to Hispanics seems to be at a nascent-but-curious stage. Dedicated efforts by big-budgeted companies like Ford and the National Football League last year didn’t exactly go gangbusters, seeing only decent-to-somewhat-encouraging results.

Source: Click Z

“Costa Rica is a leader in Central and Latin America for its democratic and economic stability, with opportunities for many of its residents. It is a valuable partner to share our values of democracy and economic prosperity”

Source: La Nacion

News reports say that Indian outsourcing giants, Infosys, TCS and Wipro are likely to fall prey to nearshore rivals, like Israel-based Ness Technologies, Softtek of Mexico, and CPM Braxis of Brazil.

Major outsourcers like Citibank and GEO are now leaning toward nearshore, specialized vendors instead of offshoring work to distant locations like India. These clients are now looking at emerging outsourcing centers like Latin America that is closer to home as favored destinations for outsourcing, reports the Times of India.

Jimit Arora, Research director at Everest Group was quoted as saying, “Some customers having 70-80 per cent of their offshore resources in India are realizing that they need to look at the third category of suppliers that are local and niche,” in an online report by SourcingFocus.com.

In order to contain nearshoring major IT service suppliers like TCS, Wipro and India are expanding their own units and staff in Asia, Latin America and Eastern Europe so they can tap into this new trend.  According to experts in the industry, the recession is likely to take shape into a recovery phase later in the year, and outsourcing firms are getting ready for a growth in the sector. Hence, the scurry in these emerging markets is a last ditch attempt to gain market share in the wake of intense competition in global outsourcing. Incidentally, Indian appears to be losing its stronghold in the outsourcing sector with several new regions like Mexico and China offering similar cost savings and convenience.

An official at Wipro, Suresh Vaswani, explained that the Indian outsourcing giant is seeking to widen its reach into niche markets,  such as  China and Europe. China offers a superior cost advantage to India and other locations, but leaves some firms dissatisfied with the level of skills in the country. Some companies see the weaker skills in emerging locations as eventually costing the company more, since most of the work that is outsourced in IT. Moreover, Wipro’s move to expand into China is seen as a means of tapping into the Japanese market as well. Wipro has posted increases in revenues in Latin America and the Middle East, tow emerging hotspots in the industry.

Whatever the trend that is likely to follow in the recovery phase, the sector is witnessing a new wave in outsourcing. Most likely, the pattern of offshoring is likely to shift to centers closer to home, with fewer players like India taking a big chunk of the market share. Furthermore, cost savings and efficiency among outsourced projects is expected to improve post recession.

Source: Nearshore Americas

Today Presidential elections were held in Costa Rica.  Laura Chinchilla, former Vice President from the Arias administration won by a landslide 47% versus 25% of the socialist Otton Solis and 21% of libertarian Otto Guevara.  Chinchilla is the first female president of the country.

This vote represents the desire by a majority to continue with 4 more years on the current policies.  Some of the achievements of the Arias administration have been:

• Approved CAFTA (free trade agreement with the US)
• Brought back credibility and trust to the government therefore stimulating investment and growth
• Restarted a stalled concession of the San Jose airport to a world class operator
• Build the highway to the Pacific Ocean (road on the drawing board for > 30 years)
• Did a good handling of the world economic crisis therefore minimizing negative effects on the country
• Set a guide and engaged on actions to allow the country to reach carbon neutrality by 2021
• Approved the new FTZ laws
• Started diplomatic relations with China
• Started and may end negotiation of a Free Trade Agreement with Europe, China and Singapore
• Started a very successful program to allow High School students to continue their studies (Avancemos)
• Had a fiscal surplus for the first years reducing the public debt significantly

On the negative side on the export driven economy of Costa Rica, the policies have brought a new strength on the Costa Rican currency.