A Charter City in Honduras – the ZEDE Effect

What if groups of Investors Ruled Cities? What if committees oversaw all management instead of politicians? Would it be any different?

– ZEDE –

Honduras is one of the poorest Latin American countries riddled with crime, corruption, gangs and violence. A US backed coup hailed in a new leader in 2009, Juan Hernandez, replacing the elected Zelaya. Hernandez, was the US choice as he would back a critical new concept, ZEDE. When the locals realized what the true concept meant to them, they took the case to the Supreme Court. Four of the five judges ruled against the ZEDE concept in favor of the people. Hernandez fired the four judges and replaced them with 4 new and approved ‘abiding ones’. And so the case for ZEDE was approved. Voila!

ZEDE = Zone for Employment and Economic Development.

Basically, a ZEDE is a privately owned and ruled city. It operates outside of the law of the land and is taxed at a significantly lower rate per a negotiated contract with the government of the country. Each ZEDE will nominate their own internal governing body as outlined by the 21 members of the “Committee for Adoption of Best Practices”. The governor will be called Secretary and the committee has full authority over the actions of the Secretary. The land necessary to create a ZEDE is bought by the group of investors from either the government, or from private parties, depending on ownership. However, if the private party does not want to sell, the land is appropriated by the government and sold anyway – something like ’eminent domain’.

Promoters of ZEDES claim they will reduce poverty and increase security. While opponents claim the cities are built for the uber wealthy elite and organized crime and will serve to take away their sovereignty and increase poverty through class status.

There are currently 14 potential locations for ZEDE’s in Honduras, coincidentally they are all either on the sea, or they are in places where there is known oil. These enclave cities being self governing will have some autonomy with the current government legally, economically, administratively or politically, but for the most part can adopt their own set of laws and regulations. They will have their own courts, police, prisons and security. And while human rights laws against sex trafficking, child abuse, money laundering and drugs are regulated according to Honduran law, they can change that with the approval of Congress.

But laws in Honduras are not as strident nor as punished as ours in the US. Drug trafficking is raging forward, human trafficking for slaves is not illegal, and although sex trafficking is illegal, there has been very little done to actually enforce the laws. ZEDES need only be compliant with similar human rights laws established and enforced by the government.

They are identified as LEAP zones and operate according to their own rule of law. Theoretically, ninety percent of the internal employment is supposed to come from local Hondurans. Technically, there are no restrictions on their self governing laws – however, a free market system is a requirement. All imports are free of taxes, fees, tariffs and any other charges. In addition, a major focus is the creation of a tax haven.

This is not a concept – this has already been signed and ratified in Honduras under the regime change president, Hernandez.

Who is behind the ZEDES?

According to their website, in order for projects to be considered for admission into the ZEDE Regime (their word not mine), the Committee for Adoption of Best Practices (CAMP) will make that decision. The members of this committee include; Grover Norquist, Mark Klugmann, Mark Skousen, Richard Rahn, Michael Reagan, Loren Smith, Lars Christensen, Morton Blackwell, Alex Cranberg, Barbara Kolm, Salem Ben Nassar Al-ismaily, Faith Ryan Whittlesley-Articulo, Ricardo Cardona Lopez, Ricardo Rodolpho Joest, Octavio Rubin Barrientos, Ebal Jair Lupian, Surse Pierpoint, Alejandra Chafuen, Enrique Ghersi and Kakha Bendukidze.

So who are these guys?

Cranberg = energy, Norquist = connections and money, Klugmann = developed LEAP, Skousen = investment analyst, Salem Ben Nassar Al-ismaily = written about mining and metallurgy exploration, from Oman (and there is insinuation of working for the intelligence department of Oman per Bob Carr a former Australian intelligensia), Enrique Ghersi = a lawyer and free market activist, Alejandro Chafuen = President of Atlas Network, an NGO promoting less government and free markets and Barbara Kolm = President of European Center for Economic Growth.

Given their stout support of economic freedom, market freedom, and an ‘altered’ government body, they represent the antithesis of the Socialist and Globalist agenda of Soros. Right? But wait. Grover Norquist actually appeared in a Soros funded ad tauting for more immigrants to come to the US and condemning Islamaphobia… Norquist also allegedly has links to the Muslim Brotherhood, Hamas and Hezbollah according to Frank Gaffney and Glenn Beck. He created the Islamic Free Market Institute and is married to a Palestinian woman.

His profile is oddly checkered. Given his hardline Republican stances, it is an odd that he supports some very liberal views – not to mention aligning with Soros. But Soros has been known to play ‘both sides of politics’. Paul Ryan, Grover Norquist and Rubio – the trilogy of immigration thought as in, “Sharia Law is compatible with the US Constitution.” ~ Grover Norquist. Could that be his intent in his Honduras ZEDE? Sharia Law? Unfortunately, I suppose we will have to wait and see as in – the ink is dry…

In totality – its that odd shift of who is right, who is wrong, who is the good guy and who the bad – that has now discombobulated our thoughts to the point – we don’t know. And that’s a bit scary.

4 thoughts on “A Charter City in Honduras – the ZEDE Effect

  1. “What if groups of Investors Ruled Cities? What if committees oversaw all management instead of politicians? Would it be any different?”

    You have an answer in the real world, already tested. The “free zones” in Honduras and in many other places are an example of the effect of low taxes and investors themselves having more flexibility in how they operate. Reason Magazine at http://www.reason.com did a video study of the ZEDE and they talked about this. They went to one of these zones, where just outside the boundaries a small community had built up of their workers. These employees reported they were much better off than most Hondurans, they were paid better, and had more care.

    But the ZEDE idea takes it further. They studied the examples of other nations that had emerged from the most abject poverty to current prosperity, and took the best of the strategies of each as applied to the situation in Honduras. That included South Korea, Hong Kong, the new economic zones in China, Dubai, Singapore.

    And they went to great pains, as much as possible, to avoid letting the taint of political corruption affect the implementation of these zones. That is one reason there is an advisory board that reviews the implementation, with contributions from known free-market advocates. It just occurred to me today that this may be one reason for the delay in implementation.

    I’m not placing any bets, but it is significant to me that Honduras may become the first such country in the region to have such zones, because of my ties to it. I’m not betting my life on the results but simply have hope. And I hope to be there when the dollar collapses the economy in the U. S.

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  2. One thing is sure, most Hondurans are enthusiastic about the ZEDE initiative,and are impatient to see them implemented, and disappointed at the slow pace in their actuation. (My wife is from Honduras)

    As a libertarian, it’s evident to me that this philosophy falls way short of letting the poor and rich alike reach the potential of what they are capable of, but it’s a good start. The rules for these zones were designed after exhaustive studies of areas elsewhere where they have worked.

    It’s funny how the self-appointed leftist Soros-financed political class denounces a Supreme Court when it argues against their pet control-freak projects, but cheers these courts when the courts throw out the laws passed by majority-elected legislators when they don’t fit socialist agendas.

    Too bad that in the United States they don’t believe in impeaching judges that rule against the US Constitution.

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    • Thank you for your response! I always appreciate the view of the citizen! It is also important to know the agenda. And then you can make an informed choice. That is all I propose. Given the climate of non-truth, I am a skeptic and try to report – a moderate view. The imperative – is – try. Help me.

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      • Just found this post again in a search for news and thought to add a couple of things. One, Honduras is building what they call a dry canal to move freight between the oceans by rail.

        No doubt the first research meetings between members of the Honduras the Congress found the need for same to handle spillover from the Panama Canal.

        That will need more services, the zones will hopefully be symbiotic with this transportation hub. We shall see.

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