Swiss lose out to Irish in jobs bonanza

Amgen considered Galmiz as a production base Keystone

The world's biggest biotech company, Amgen, has chosen an Irish location for its new production plant, dashing hopes of 1,100 jobs coming to Switzerland.

A greenfield site not far from the Swiss capital was in the running for the €1-billion (SFr1.55 billion) investment, despite protests from environmentalists.

Amgen, with headquarters in California, has been looking for a manufacturing base for some time and Ireland won out over competition from Switzerland and Singapore to secure the facility.

The authorities in Galmiz, western Switzerland, were keen to attract the factory and the jobs that would come with it.

The news that Switzerland had lost out was confirmed by a company statement and news conference in Cork, Ireland.

“The company considered several attractive sites in other countries, but chose Ireland due to its thriving biotechnology community, infrastructure to support biologics manufacturing and attractive business climate,” Fabrizio Bonanni of Amgen said in Tuesday’s statement.

Protest

But Amgen’s Swiss plans sparked outrage among environmentalists who were incensed that farming land might be used for such a centre.

Up to 2,000 people took part in a demonstration near the village of Galmiz in March. They accused the authorities of violating town and country planning regulations and destroying the natural habitat of the region.

The protest came after the Fribourg cantonal authorities reclassified 55 hectares of farmland as an industrial zone, in an effort to persuade Amgen to build its production plant there.

The Swiss environmental protection foundation expressed relief that the production facility was not going to Fribourg.

Amgen, which has its international headquarters in Zug, Switzerland, has selected a 150-acre site at Carrigtwohill in east Cork and expects to begin operating in 2009. The job total is expected to reach 1,100 by 2010.

Although Ireland’s corporate tax rate is higher than in other European countries, pharmaceutical companies benefit from a special rate of 12.5 per cent. Revenues from patents developed or improved in Ireland are tax free.

Inward investment

Commenting on the Amgen decision, Stephane Garelli of the Lausanne-based International Institute for Management Development (IMD) told swissinfo that Ireland had made a concerted effort to attract Amgen.

“They have an uncomplicated process for facilitating such a move. Amgen were probably put off by the weight of opposition to their development plans in canton Fribourg and by the complexity of investing in Switzerland,” Garelli said.

However, Switzerland has also been active in encouraging multi-national companies to locate in the country.

Last November, parliament approved a credit of SFr9.8 million for the next two years to encourage foreign investment in Switzerland.

Location Switzerland was set up in 1996 to assist foreign companies interested in setting up operations in the country.

The organisation’s key selling points are Switzerland’s central location in Europe, its highly qualified workforce and low corporate taxes. Its support includes providing advice on land acquisition, and work and residency permits.

The credit is limited until 2008 when the government is expected to restructure the various state-controlled organisations promoting Switzerland abroad and place them all under one roof.

swissinfo with agencies

Key facts

Amgen is based in Thousand Oaks, California.
Its international headquarters are located in Zug. The group employs over 14,000 people worldwide.
Total revenue in 2004: $10.6 billion.

In brief

Switzerland is an attractive location for foreign firms’ head offices, thanks in part to low corporate taxes.

But setting up factories is more complicated because of competition and differing rules among the 26 cantons, as well as the system of direct democracy, which allows local residents to influence planning proposals.

Foreign firms wanting to invest in Ireland, by contrast, need deal with only one central authority, and pharma companies in particular enjoy generous tax breaks.