Who Wants to Buy Honduras?

Shortly after 2009 coup that overthrew Manuel Zelaya, Honduras’s newly elected president, Porfirio Lobo, asked his aides to think big, really big. How could Honduras, original banana republic, reform a political and economic system that kept nearly two-thirds of its people in grim poverty? One young aide, Octavio Rubén Sánchez Barrientos, had no idea how to undo entrenched power networks. Honduras’s economy is dominated by a handful of wealthy families; two American conglomerates, Dole and Chiquita, have controlled its agricultural exports; and desperately poor farmers barely eke out subsistence wages. Then, a friend showed him a video lecture of the economist Paul Romer, which got Sánchez thinking of a ridiculously big idea: What if Honduras just started all over again? Romer, in a series of papers in the 1980s, fundamentally changed the way economists think about the role of technology in economic growth. Since then, he has studied why some countries stay poor even when they have access to the same technology as wealthier ones. He eventually realized something that seems obvious to any nonacademic, poor countries are saddled with laws and, crucially, customs that prevent new ideas from taking shape. He concluded that if they want to be rich, poor countries need to somehow undo their invidious systems (corruption, oppression of minorities, bureaucracy) and create an environment more conducive to business. Or they could just start from scratch. Then he decided to put the theory into practice. In 2009, Romer developed the idea of charter cities, economic zones founded on land of poor countries but governed with the legal and political system of, often, rich ones. There were a couple of interested parties. (The president of Madagascar was intrigued by a preliminary version of the idea, Romer said, but he was soon ousted in a coup.) Then, in late 2010, Sánchez met with Romer, and the two hurriedly persuaded President Lobo to make Honduras the site of an economic experiment. The country quickly passed a constitutional amendment that allowed for the creation of a separately ruled Special Development Region. According to Paul Romer, becoming a wealthy country requires better-run cities because that’s where people are headed. Cities might offer horribly paying jobs in factories and domestic service, but many families make the move because they’re still earning far more than they can make by farming. In 1900, nearly 90% of the world’s population was rural. By 2000, three-quarters of people in the United States, Western Europe and other wealthy countries were city dwellers. In the next 40 years, United Nations estimates, the world’s urban population will grow by nearly three billion, largely in poor countries (…..)

Link: http://www.nytimes.com/2012/05/13/magazine/who-wants-to-buy-honduras.html?pagewanted=1&src=rechp

Acerca de ignaciocovelo
Consultor Internacional

One Response to Who Wants to Buy Honduras?

  1. Professor Uziel Nogueira says: An intriguing and worth idea to be debated in certain emerging countries. Brazil -my own country — is a good case study to test Romer’s idea on how to create secure, crime-free charter cities. Lack of internal security is THE most clear and present danger facing the Brazilian population today. From an economic and income distribution standpoint, Brazil is a much better country today. For millions of poor Brazilians, the country of the future became the country of the present. However, the country’s economic and social success has a dark side. Brazilians are living under increasing fear of becoming victims of criminal activity. There is NOT a single city in the country, big or small, that its citizens feel safer and protected. The security forces are under equipped, under trained and under paid. The judicial system is over paid, corrupt and incompetent. Crime goes unpunished as the rule. Brazil is having its own version of a civil war: organized crime criminals and drug addicts against unarmed and unprotected population. Time has come to apply Romer’s idea on internal security in Brazil. What is needed is a charismatic politician to rally the population behind his proposal. Former pres Lula had the vision to “discover” millions of poor people, left out by the traditional political parties, and helped them. His party will be in power for a long time. A new visionary politician on how to provide security to the population is what is needed now.

    http://www.nytimes.com/2012/05/13/magazine/who-wants-to-buy-honduras.html?pagewanted=1&src=rechp

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