Give Change a Chance

By Guillermo Peña Panting



The Zones for Employment and Economic Development (ZEDEs) have been hotly debated both in and out of Honduras. Most of the negative, however, is due to either a lack of information (not reading or misinterpreting the law) or the project’s association with the current president.

If the readers of this brief summary who disagree with ZEDEs are able to put aside their emotions for the moment, they will find a project with great potential for positive change in politics, economics, and the lives of ordinary Hondurans.

Living in Honduras, there is a tendency to distrust everything, especially the government. However, this project will in fact reduce the power of the state, and pass it on to local authorities under the supervision of its beneficiaries: residents and those who work in the zone.

Our Constitution establishes a tripartite model of government, divided into departments, municipalities, and a National Congress with the authority to create special zones subject to their own regulations. ZEDEs are an inalienable part of the Honduran state, and operate in compliance with international commitments and the law that creates them.

Existing international treaties, the Honduran Constitution, the Penal Code, and all other criminal laws are in full effect within each ZEDE. Moreover, the 25 conventions on labor protection from the International Labor Organization (ILO) are also in force, and all internal ZEDE regulations must comply with existing human-rights laws.

Twelve percent of all tax revenues that ZEDEs collect will be delivered to the national government to strengthen the judiciary, fund community projects, infrastructure, and social security. The money will also go toward municipal projects and national defense. In order to earn the support of the people both within and around the area, ZEDEs must be socially inclusive and free of the original sin of forced expropriation, ethnic oppression, or physical threats to their neighbors.

The Constitution states that sovereignty and state power is derived from the people. ZEDEs represent a decentralization of decision making in governance, in which the power to establish rules of coexistence resides in the people and their local communities. Far from losing sovereignty, the ZEDEs give it back to who it really belongs: the Honduran people.

As Nassim Taleb’s writings suggest, decentralized countries have the most “antifragile” governments, which are strengthened when stress is applied to them. When the central government’s power is limited, there is less uncertainty about the next head of state. In Honduras, the struggle is for control of the government, without asking why someone would want this power. When the central government’s budget surpasses 50 percent of GDP, it becomes clear why they fight for the throne.

The notion that ZEDEs have the potential to improve the quality of life of Hondurans is based on the economic theories of various Nobel Prize Laureates*, whose work has explored the role of institutions and incentives on human behavior and, consequently, the economic and cultural development of societies.

It’s true that “Nobels don’t put food on the table,” as some critics say. However, several countries have already implemented many of these theories and begun to solve their economic problems. Unlike the siren song we hear from populist politicians, these economists present well-grounded ideas.

Let’s give change a chance to fix our broken system and the impunity it has bred. While it may not be perfect, this alternative is many times better than where we are now and where we’ve been for the last 50 years.

Guillermo Peña Panting is a political analyst and economist. He currently works as the executive director of Eléutera, a public policy think-tank based in San Pedro Sula, Honduras. He received his BA in Political Science at North Carolina State University. Follow @GuillermoP_HN.