The Associated Press reports: “A plan to create special self-governing zones for foreign investors in Honduras has been thrown into limbo with the new government’s repeal of a law many criticized as surrendering sovereignty.”



“[The zones for employment and economic development known as ZEDEs are] free from import and export taxes, but could set up their own internal forms of government, as well as courts, security forces, schools and even social security systems.”

The article adds: “On Monday [April 25], [President Xiomara Castro] signed a measure passed by Honduras’ Congress [on April 21] to repeal it — though the permission for the zones still remains in the constitution.”

Rodolfo Pastor, a member of Castro’s cabinet, says: “With those that already (exist) there is going to be dialogue because autonomous zones are not going to be allowed.”

The article refers to the zones already being developed, including Prospera (a 58-acre development on the island of Roatan) and Orquidea (an agro-industrial park near the city of Choluteca that produces peppers and tomatoes for export).

The Próspera Group says: “Honduras Próspera, Inc., the Promoter & Organizer of Prospera ZEDE, is a U.S. company with rights under the Central American Free Trade Agreement (CAFTA-DR) and the U.S.-HN Bilateral Investment Treaty, which extend to investments made in Próspera ZEDE the highest degree of legal protection in Honduras. Many other investors from other countries likewise enjoy powerful treaty rights.”

The Center for Strategic and International Studies also cautions: “If the Honduran government insists on moving forward with abolishing the ZEDE law, investors have a number of legal mechanisms at their disposal [including] Chapter 10 of the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) to seek interim injunctive relief to preserve the status quo, as well as damages for any lost investment and future profits.”

PBI accompaniment

The Peace Brigades International-Honduras Project was present at town hall meetings – including in La Ceiba, Trujillo, Arizona, Quimistán, Intibucá, Tela, Masica and San Francisco – that declared themselves free from ZEDEs.