The government in Honduras is convinced that a charter city could be the safe playing field, with new rules, where Hondurans of all backgrounds can come together and put their skills to work with the financial resources, expertise, and technology available in the rest of the world.
To implement this vision, the Honduran National Congress has already passed an amendment to the constitution that gives the government the power to create special development regions (which based on the name in Spanish, are abbreviated as REDs). The amendment passed with 126 votes in favor from a total of 128 members of Congress (one abstention and one vote against.) The nearly unanimous vote sends a strong signal about the breadth of support for this new initiative. The National Party, the party of the government and the President (who is elected separately), has about 70 seats in Congress. Members of all parties supported the amendment, including members from rival factions within the opposition Liberal Party.
To become a part of the constitution, the amendment must be passed again in the new Congressional session, which has already begun.
Here are the key points in the amendment:
- The government of Honduras has the option to create one or more REDs, but in no way locks them into to doing so.
- To create an RED and establish its basic system of governance, the amendment requires that the Congress pass a piece of enabling legislation that they call a Constitutional Statute. This requires a two-thirds majority to pass. A subsequent Congress can change this enabling legislation only with the same two-thirds majority and approval by referendum from the citizens living in the RED.
- The REDs would be areas with their own legal personality and jurisdiction, their own administrative systems and laws. An RED can also negotiate international treaties with partner countries or organizations. Congress would need to ratify these international treaties with a simple majority.
- Judges for its judicial system will be nominated by the governing authority in the RED but subject to approval by a 2/3rds majority in the Congress. The judicial arrangement would allow the use of an external body that acts as the court of final appeal for judicial decisions from the zone.
- Laws developed by the governing authority of the RED require a ratifying vote by the Congress. This vote would be a simple vote to approve or reject. Approval requires only a simple majority. (This is similar to the BRAC rules that govern military base closures in the United States.)
Most important among the immediate next steps is a public discussion about the merits of establishing the first RED, its location, and the specifics about how foreign governments can assist in its governance. The government is already working to raise awareness of the effort both in Honduras and internationally. The international efforts will focus on potential partner countries, major investors, firms and individuals with special expertise, and influential supporters in the broad community of people concerned with economic development.
Charter Cities will continue to play an independent advisory role. As a 501( c )(3) we rely exclusively on philanthropic support. We do not accept consulting fees or expense reimbursement from the Honduran government or any other government. Nor will the organization or anyone who works for it have any financial stake in the development of a new city.
A new city in Honduras could create important opportunities. Each year, roughly 75,000 people leave Honduras in search of jobs in the United States. Many go without their families. Around 10,000 of them are kidnapped along the way and held for ransom. Many who reach the United States live in fear of deportation.
The total number of people who incur these risks and deprivations to seek out opportunity is very large. Before the most recent slump, estimates suggest that about 1 million migrants from Latin America reached the United States each year and that at least two-thirds of them do not have legal status.
The passage of the amendment is a decisive first step toward creating in Honduras the kinds of opportunities that migrants seek up north, but in a place where families can stay together, be safe, and enjoy the full protection of the law. The specifics have yet to be determined, but discussions have centered on a site large enough to accommodate a city that could eventually grow to 10 million people. As large as this sounds, it is small compared to the annual flow of migrants from the region into the United States.
This bold step did not go unnoticed—several major international investors have already expressed interest in the project. President Lobo will soon travel abroad to build more public and private support. We hope that the rest of the world will respond in kind, working with the Honduran people to establish a new city—a city that could become an important hub for the Western hemisphere and a driver of growth and development in the region.
About
read the article in the WSJ with interest. Would be willing to invest and help with building a strong business community in such a city. Put me on your list of interested parties. Ken Smalley Tucson Az. Could such a system work on the border( on US side) here in Arizona? No Federal or state laws to follow, only those of designated area that lead to jobs and a strong economy for immigrants and citizens alike.
— ken smalley · Feb 3, 10:50 AM · #
Dr. Romer,
I am a Honduran Industrial Engineer (GPA of 92%/100%) who has a masters in Environmental Studies from the University of Pennsylvania (GPA of 3.92, 2006). I am currently working at the GAUREE 2 project (A treaty between the Honduran Government and the European Commission about Energy Efficiency and Autonomous Generation) from the Empresa Nacional de Energia Electrica (National Electric Energy Utility,ENEE) since 1997. I have gone to Hong Kong (China) and Incheon (South Korea) and have eyewitnessed the success of charter cities and know about how these cities collaborated with the development in South Korea.
I am interested in studying a graduate study in Political Science related to the environment and energy sector.I am particular interested in your paper about “Endogenous Technological Change” because a Charter City, like you are proposing to Honduras, will bring nonconventional technology to us, and some bussinesses will step in and form monopolies.ENEE used to be a monopoly in the electricity sector 20 years ago, but the introduction of the Electricity Subsector law has made possible to private electricity generators to cover part of the national supply. At the beginning of the process there was resistance from many people because private generators showed in their majority were taking advantage of their political influence to charge expensive fees to the government. Now many of them have switched to Renewable Energy generators and therefore have a better social responsability and cheaper tariff prices, but many still believe that the government and the private sector should join efforst together and not allow the private sector to cause damage to the government.
I am currently working in energy efficiency, especially education, Climate Change and attending the Taiwanese Technical Assistance in the development of the Patuca 3 project (a hydroelectric project to supply 104 MW). I visualize that the coming Charter Cities could bring cultural resistance to new technology (ie smart grid, setting up international energy standards), therefore I am interested in studying policies related to the energy and technolody issue and how can culture and education be introduced to help the process easier. Therefore, I would want to know which graduate program can work with my particular interests and research with you the possible tendencies to be need to solve through the following years whe setting up Charter Cities and how can I help to become their implementation to be successful. I have taken few courses in the economic sector (microeconomics and probabilities during my undergraduate years), but I am willing to take the courses needed in order to learn the basic knowledge a research student needs from you.
— Jose Jorge Canales Martinez · Feb 3, 11:03 AM · #
“As a 501( c )(3) we rely exclusively on philanthropic support.”
Is there a “donate” link, info about fund-raising events, etc?
— anon · Feb 3, 04:26 PM · #
1) How is this different from the wonderful neoliberal human experiment of “Free Trade Zones” of the 80s and 90s?
2) Do you realize that the “voluntary” host country of Honduras is considered to have one of the most corrupt Judiciary systems in the world? has decided to continually “turn the page” on (ongoing) political assasinations?
3) can you please publish the specific labor “rights” that would be allowed in this “charter” cities?
4) Why a simple majority and not a 2/3 majority?
5) How many votes necessary to revoke the “charter city” project after congressional approval
— manolo · Feb 3, 09:38 PM · #
1) This has nothing to do with FTZs, those were little more than some tax exemptions for companies in those zones. They were wonderful in a way since they are a major source of income for people, the cities near where they’re settled have experienced tremendous economic growth and the have also contributed to the emancipation of women in Honduras since most of their workers are women.
2) Judicial system in Honduras is far from being just and its indeed very corrupt, but its not very different than most Latin American countries and far better than some African and Middle-east countries (according to transparency.org http://www.transparency.org/content/download/19093/263155). Also, you should provide some sort of evidence or at least a credible source before accusing Honduras of having “on-going political assasination”.
Moreover, the idea of the charter cities is to have a city where current laws don’t hinder its growth so whether the judicial system in Honduras is corrupt or not is only marginally-relevant.
3) That’s for the founders of the city to decide, obviously you haven’t bother to inform yourself on Dr. Romer’s proposal so here: http://chartercities.org/video
4) That’s honduran law so no sense to ask it here.
5) Also honduran law.
— xatrucho · Feb 4, 04:30 AM · #
10 million people? That concerns me because the population of Honduras is only 7 million. You are talking about a a huge demographic upheaval with unpredictable results on the culture.
— Gayle Ramsay · Feb 4, 10:14 AM · #
I would like to know more about the sites you are considering and the potential sponsoring countries.
— Gayle Ramsay · Feb 4, 10:16 AM · #
I’ve been excited about this idea since you presented it at MIT in 2008, but I thought it would never happen. Now it seems plausible.
— Steve · Feb 4, 02:50 PM · #
When and where can we get more details about the actual plans for Honduras? This is just a tease.
I have so many questions, like what sort of products would be produced? I really hope that ’10 million people’ was just a theoretical maximum, not an actual goal, as in this case I think it would be destructive of the habitat and the culture, practically an invasion. The possibilities are frightening. Catrachos…be careful what you wish for!— Gayle Ramsay · Feb 4, 03:02 PM · #
I was wondering how long it would take for you get on the radar screen of the Resistence. Well, now you are. Just letting you know. If you succeed at lifting the Hondurenos out of poverty, you will steal their issue from them and make them irrelevant. Cacaeres said,‘Next to futbol, marching and protesting is the national sport.’ or something like that.
— Gayle Ramsay · Feb 6, 03:40 PM · #
Back to the 10 million people. Next to family, land is the most important thing to the people. For years, the Salvadoreans have been looking over the fence at the greener grass and saying, ‘Look at all that land they’ve got. They don’t even have that many people.’ El Salvador is very small and densely populated. People from Nicaragua are looked on as communist agitators (I wonder why?) These invasions are not taken lightly.
There are already some land reform issues festering over agribusiness farming and resort planning that deprive the indigeneous people and campesinos. I hope this opportunity can take place without making Hondurans feel invaded. The government should be encouraged to make good on the land reform to keep peace and stability.
Just so you will know where I stand, I believe stability is a requirement for successful improvement. But a little justice to the farmers would help a lot.
— Gayle Ramsay · Feb 6, 03:51 PM · #
Ongoing human rights reppression in Honduras.
http://www.amnesty.org/en/region/honduras
oh well their judicial system is just as bad as many other countries so its ok.
I saw the video. anyone can go up on stage and talk about the need for “good rules” and rail against “weak governments”. his assessment that haiti’s problem was a weak government and not a murdering, raping, torturing authoritarian regime spoke plenty.
we’re seeing the same thing in Honduras, where like in Colombia, the murder of union organizers from teachers to oil just doesn’t get on the news.
here comes the north with its first post-modern proposal to rearticulate the ongoing economic and political colonization of millions of latin americans legitimized by the local elite.
bravo.
— loco · Feb 9, 02:58 PM · #
What you have is a seriously underfunded police department overwhelmed with many crimes, not only the ones The sarcastic writer above is concerned about. Some people love to toss about accusations of ‘impunity’ when it really amounts to a poor country with a small budget stretched too thin. Comparing Honduras to Haiti is just plain ignorant. If there were no local elite, you would have no one whatsoever with the education to be a leader. You would have no jobs, no commerce, no infrastructure.
— Gayle Ramsay · Feb 9, 03:59 PM · #
Wonderful news.
I’d like to see greater sovereignty, but you can’t have everything and this definitely looks like a step in the right direction.
— Markus Pfister · Feb 10, 04:23 AM · #
Reference the World Bank Study “Where is the Wealth of Nations: Measuring Capital for the 21st Century” and Intangible Wealth. US per capita wealth is $513,000 (2006) of that $238,260 is attributed ti the ability to follow the Rule of Law.
Finding: Human capital and the value of institutions (As measured by the Rule of Law) constitute the largest share of wealth in virtually all countries.
“If all conditions for development other than capital are present, capital will soon be generated locally or or will be available….If, however, the conditions for development are not present, then aid…. Will be necessarily unproductive and therefore be ineffective. Thus if the mainsprings of development are present, material progress will occur even without foreign aid. If they are absent, it will not occur even with aid.” Peter Bauer in his 1972 Book “Dissent on Development”
— John Tomich · Feb 14, 07:49 PM · #
Written by a Canadian, this new book has a chapter in it called Honduras Central America. The content of this new book is VERY crucial to development of ‘charters and constitutions’ for matters such as ‘charter cities’ in Honduras and across the globe: www.clairvauxmanifesto.com
— Lorne Parsons · Feb 16, 08:15 PM · #
The only place for a charter city is between two countries, so both countries will pertect and guartee the charter. Also a true international airport would service all three. Possible a true outside party should be contracted to supply the police and judisory.
— Mike Fitzpatrick · Feb 26, 11:43 AM · #
Arbitrarily designating a large population for a city of undefined proportions is to leave the natural capital base out of the equation. Deciding how many people can live in a designated place would require a carrying capacity analysis. I can only visualize a community (whatever its size) as a success if it meets the Living Building Challenge, which is to obtain the energy, water and food it needs from within its boundaries. Dr Romer has not authored peer-reviewed papers on the fact of physical resource limits. Rather, he advocates for ingenuity: “Every generation has perceived the limits to growth that finite resources and undesirable side effects would pose if no new recipes or ideas were discovered. And every generation has underestimated the potential for finding new recipes and ideas.”
I appreciate the optimism. I would be a lot more comfortable in this case taking cues from an ecologist rather than an economist.
Thermodynamics rules. Economics is but an instrument of policy.
— Ron Swenson · Mar 1, 12:58 AM · #
A look at Ethnologue’s entry (the website I linked)suggests a few possibilities as far as a location for one of these REDs.
1 Most of Honduras’s coastline is occupied by Native tribes. Constructing cities there would give them a chance to teach their language and culture (via larger schools) to more of their youth. As some of these tribal areas are split between Honduras and one of its neighbors, Mike Fitzgerald’s concerns, above, would also be cared for.
2. An island group off the north coast has an English-speaking population. This makes life easier for any anglophile countries that wind up participating.
— Michael · Mar 9, 03:26 PM · #
Two possibilities:
1) This city will be placed on truly virgen land that doesn’t have inhabitants.
2) This city will be imposed on an existing population.
If number two is the case, what possible business do you, some business leaders, and some foreign government (which, given that it is made up of human beings, can never be ‘neutral’ as you claim they will be) have telling those people they will no longer have any say over the rules governing their land, and if they don’t like it, ‘they have the freedom to leave’. For the record, the locations being suggested by the Honduran government thus far (Trujillo, Ocotepeque, and Valle de Agalta) are all populated. The proposed map for the Trujillo charter city will actually include the old CREM, where the US Military trained Nicaraguan, Salvadoran and Guatemalan death squads during the 1980s. The former base has been occupied by landless farmers for more than 10 years, who now produce dairy and african palm. Those farmers are now accusing Romer and the government of colluding to take away their land through the Charter City plan.
If number one is the case, that there are no existing communities within the city’s borders, then you have to explain why any company invest in the clearing of the land and the building of required ‘public’ infrastructure for a functional city, unless they were promised a level of labor and natural resource exploitation never before seen, which would cover these immense start-up costs. You talk a lot about ‘good rules’, but what specific rules are actually going to attract the kind of incredible investment you’re talking about? It can’t just be eliminating taxes and tariffs, the combination of Export Processing Zones and CAFTA have made that a reality for foreign businesses in Honduras for quite a while. (not to mention the loophole where US fast food chains don’t have to pay taxes because they have been classified as tourist attractions). So it’s gotta be either zero minimum wage and/or free to almost free access to natural resources.
Right??
Please help me understand.
— Winston Joad · Mar 21, 02:31 AM · #
@Winston Joad:
The issue of labor coming in is non-existent. People are always trying to flee a wide variety of poor countries. If you setup the infrastructure and companies should themselves to be willing to setup shop, you will easily see many people coming in.
As for the issue of people currently living there, that is also easily resolved. The charter city could simply compensate them for the burden of having to leave. (If they chose to) Since what you are describing is people living in abject poverty, it would not be very expensive to make them a very attractive offer.
— PrometheeFeu · Mar 23, 10:22 AM · #
This is a feasible plan if the “host country” is potentially leasing a ceded area with the caveat of residual sovereignty.
In other words, such a Honduran “canal zone” is a longterm lease to the USA with “residual sovereignty” under a treaty reservation. The area becomes an insular area to allow for a U.S. judiciary but then there is an executive and legislative function legally designed for more professional urbanite controls by third country nationals. The Hong Kong Legco model has a “U.S. High Commissioner” but new city executive agents are quite similar to Anglo-American governing boards of the rather old “International Settlement” of Shanghai. Any Norwegians and Canadians can be used on the municipal levels, but there is an American legal paradigm for insular territorial-type governing.
Hondurans are given rights of habitual abode, but they are excluded under INA 202(b) first sentence for U.S. immigration laws (e.g. not allowed to enter the U.S. mainland).
— Jeff G. · Apr 15, 01:12 PM · #
To Paul Romer, if you are reading these comments, I was very happy to hear that you will be attending the ‘Honduras is Open for Business’ conference in May. I hope you will bring us back an update from your experience. The ‘inter-oceanic railway’ sounds like a great idea. I am waiting with much anticipation to hear that the charter cities project is going forward.
If you stay at the Princess Hilton, the ‘Desayuna Ranchero’ is great.
— Gayle Ramsay · Apr 28, 01:57 PM · #
for critical information
— mario · Jun 30, 02:18 PM · #
where can we get more details about the actual plans for Honduras please ?
Regards
— Humour · Aug 27, 09:36 AM · #
watch this video, and know how many questions Paul Romer can’t answer to Carlos Sabillon about the true of charters cities
http://www.youtube.com/watch?v=FLk32uBkCzk
— Byron Ventura · Oct 29, 11:35 PM · #
Trackback
[..]…the Honduran National Congress has already passed an amendment to the constitution.[..]
— best Nerf Gun · Nov 13, 01:17 PM · #
I believe if this is going to be done EVERY Honduran citizen should be able to freely enter and exit the city, as well as live in the city without needing any special documents or permission. If someone lives 5 hours away and decides to buy a house in the city and move there, they should be able to without needing to do anything and without needing to get any type of permission AT ALL. This city should benefit the people of Honduras, and therefore the Honduran borders must be secured. The Honduran borders, NOT the city borders. Once inside Honduras people should be able to go in and out of the city as if it were any other city in the country. No registration required to move within Honduras, and this city will be part of Honduras. If you want to restrict residents of neighboring countries from coming in then secure the entire Honduras border, do not secure the city from the rest of Honduras or you will have failed the people of Honduras.
— GG · Dec 15, 10:03 PM · #
This could be a transformational project. With the help and cooperation of international agencies and the HG. This is an exciting project include me in.
— Omar Salinero · Jan 18, 01:03 AM · #