Dow Chemical said Tuesday it planned to cut 5% of its global workforce, or 2,400 people, and shut 20 plants in an effort to slash costs as the global economy slows.

Dow said it aimed to generate $500 million in savings on annual operating costs from the cuts by the end of 2014.

The company will also cut capital investment on programs it no longer sees as priorities, for another $50 million in savings, it said.

Two U.S. Plants will Close
The shuttered facilities will include plants in Tessenderlo, Belgium; Delfzijl, the Netherlands; Ribaforada, Spain; Birch Vale, UK; Kina Ura, Japan; and in the United States, in Midland, Mich., and Solon, Ohio.

"The reality is we are operating in a slow-growth environment in the near term," said CEO Andrew Liveris.

"While these actions are difficult, they demonstrate our resolve to tightly manage operations -- particularly in Europe -- and mitigate the impact of current market dynamics."

Liveris said the company will continue funding projects where it can make a strong market stand and grow margins despite the difficult macroeconomic environment, pointing to its Dow AgroSciences and Dow Electronic Materials divisions as well as its Sadara joint venture in Saudi Arabia and investments on the U.S. Gulf of Mexico coast.