A little slice of Canada in Honduras?

A little slice of Canada in Honduras?

Honduras is currently at work setting up a free-enterprise zone modeled on economist Paul Romer‘s "charter cities" concept. The controversial idea is basically that developing countries will set aside a parcel of land to be operated under its economic rules and judicial system with the assistance of a foreign government, essentially a Honduran Hong Kong. 

Or perhaps a Honduran Vancouver. Romer was in Ottawa this week  trying to win Canadian support for Honduras’s Región Especial de Desarrollo. He has co-authored an op-ed in the Globe and Mail with President Porfirio Lobo’s chief of staff, calling for Canada to play a role in the administration of the zone: 

Many people from around the world would like access to the security and opportunity that Canadian governance makes possible. According to Gallup, the number of adults worldwide who would move permanently to Canada if given the chance is about 45 million. Although Canada can’t accommodate everyone who’d like to move here, it can help to bring stronger governance to many new places that could accept millions of new residents. The RED in Honduras is the place to start.[…]

By participating in RED governance, Canada can make the new city a more attractive place for would-be residents and investors. It can help immediately by appointing a representative to a commission that has the power to ensure that RED leadership remains transparent and accountable. It also can assist by training police officers.

The courts in the RED will be independent from those in the rest of Honduras. The Mauritian Supreme Court has agreed in principle to serve as a court of final appeal for the RED, but Canada can play a strong complementary role. Because the RED can appoint judges from foreign jurisdictions, Canadian justices could hear RED cases from Canada and help train local jurists.

Oversight, policing and jurisprudence are just a few of the ways in which Canada can help. Effective public involvement will also be required in education, health care, environmental management and tax administration. Such co-operation can be based on a fee-for-service arrangement in which the RED pays Canada using gains in the value of the land in the new reform zone.

The world does not need more aid. As the Gallup numbers show, it needs more Canada – more of the norms and know-how that lead to the rule of law, true inclusion and real opportunity for all.


The notion of Honduran citizens accepting the jurisdiction of a Canadian court, or a Mauritian one for that matter, still feels a bit far-fetched. But as Alex Tabarrok points out,  Romer has already taken this idea a lot farther than anyone expected.