Weekly Report - 11 October 2012 (WR-12-40)

HONDURAS | Ruling against Model Cities. The constitutional chamber of Honduras’s supreme court of justice has ruled against the proposal to establish three “special development zones” or “model cities”, as per a memorandum of understanding (MOU) signed by the Comisión para la Promoción de Alianzas Público-Privadas (Coalianza), which is attached to the finance ministry, and a US private business consortium NKG last month [WR-12-35]. Because the ruling, which followed more than 50 appeals against the controversial initiative, was not unanimous (approved by four of the five justices), the case now goes to the full 15-member supreme court. According to the ruling, the details of which were reported in the local and international press, “the foreign investment expected to be received by the state of Honduras implies transferring national territory, which is expressly prohibited in the constitution.” With the supreme court expected to take up the issue within the next 10 days, this is not the only obstacle facing the project. Last month the oversight and transparency commission for the scheme, headed by the Stanford University economist and model cities advocate, Paul Romer, quit, claiming it had been kept out of the talks between the government of President Porfirio Lobo and MGK group, and had not been privy to the MOU.

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