How Erick Brimen Helped Launch a Honduran Charter City

Honduras gave a charter to a private corporation in 2017. This allowed it to manage a special governing zone called Zones for Economic Development and Employment within Honduras.

Advocates believe the zones, with their regulatory and governance innovations, will create greater security, prosperity, and stability than any other country in trouble, notoriously mired by crime and corruption.

The first ZEDE is run by a company called Próspera, which launched its website publicly in spring 2020 and began operating in a 58-acre area of the Honduran island of Roatan; the company is now also operating a ZEDE on the mainland, in La Ceiba. Its main selling point is the absence of tariffs and trade barriers that prohibit non-hazardous items from entering or leaving the country.

This October: Reason‘s Brian Doherty interviewed Próspera’s Venezuelan-born CEO, Erick Brimen, about the project via Zoom.

Q: There have been many attempts to obtain a ZEDE Charter. Why was Próspera the first to succeed?

A: It was my ability to put the virtues of ZEDE laws in theory and tie them with economic development. Rather than trying to make a libertopia, economic liberty is what creates job opportunities and prosperity. That’s why I want to continue to pursue it. The conversation has shifted away from the advancement of a political ideology to, yes, liberty but instead towards development.

Q: What is the reason for Roatan’s island?

A: Our goal is to be a regional financial hub and attract foreign investors and entrepreneurs. In Roatan [residents]Use the dollar instead of English. Roatan, a Caribbean island paradise. It is safe from crime. You can find flights from Atlanta, Houston, Miami and Atlanta at the international airport. Roatan was once a British colony. The rest of Honduras, however, is an ex-Spanish colony. They have two very distinct cultures.

Q: Do the current population need to be in agreement with the ZEDE?

A: If there’s a population to consider, a referendum must be held. However, if there isn’t – then no one can consult. This applies to residents only. Property owners must opt in to the ZEDE if they are property owners. Próspera thus far has incorporated on lands with no residents, all privately acquired at fair market prices, with no government intervention.

Q: Why would a person or company value being in Próspera?

A: What makes Próspera as a platform for government services unique is, instead of being structured as itself a provider of government services, it is a platform for others to provide dispute resolution, security. Each regulatory framework is in place. [Organization for Economic Cooperation and Development]Is already legally compliant within our jurisdiction. One company may petition the internal governance structure for a change in regulatory guidelines. It can use an already existing or adopted framework.

Health care is one industry that we intend to empower. The area of stem cells is one where doctors can perform any procedure approved by the FDA, provided they have adequate insurance that covers legitimate risks and get patient consent. It will allow any physician licensed to treat medical devices or drugs anywhere on the planet to practice medicine in this area.

Q: What tax advantages are available?

A: No matter what land value, income or sales are concerned taxes cannot exceed 7.5 percent within the ZEDE. Honduran governments receive 15% from the ZEDE. Rest of the 85 percent can be obtained [Próspera]If expenses for managing the territory allow, up to 50 percent of this revenue may be made available as private dividends.

If the holding company becomes publicly traded eventually, then we allow shareholders to become shareholders in publicly traded companies that derive their value from the economic activity within its jurisdiction. We believe that liberty is the best form of economic value. A publicly traded company will allow investors to make money from economic freedom and liberty.

This interview was condensed to ensure clarity and style.