US billionaires are trying to establish a libertarian city-state in Honduras to evade democratic constraints. As progressive president Xiomara Castro resists their efforts, the Peter Thiel–backed firm Próspera is suing the country for constraining its profits.
Castro kept her promise to repeal the ZEDE laws that allowed Honduras Próspera to establish its private libertarian city-state on the island of Roatán. Congress unanimously agreed that the ZEDEs represented a breach of Honduras’s sovereignty.
Thiel and his band of libertarian ideologues weren’t going to go down without a fight. Honduras Próspera launched an $11 billion ISDS case against the government of Honduras, claiming that its repeal of the ZEDE laws violated the terms of existing international treaties. That amount, $11 billion, represents about two-thirds of the government’s annual budget.
Honduras Próspera’s case has been roundly condemned all over the world. Elizabeth Warren and thirty-three other Democratic representatives wrote a letter denouncing the proceedings and calling for the elimination of ISDSs. The US magazine the Atlantic described the case as “neocolonial.”
Despite this condemnation, the case has not made international headlines. With the ISDS system so riggedly in favor of wealthy nations and powerful corporations, Castro’s government faces a difficult road ahead.
The ZEDE's which as I understand it, is like a free trade area/zone in the west but on steroids. Basically, investors can buy their own miniature nation to govern within Honduras, protected by Honduras but can't be repealed for at least 50 years. Now that Honduras is ousting their corrupt government officials, they obviously repealed the law establishing ZEDEs.
So now, investors are suing Honduras in what is going to be essentially a "court" of investors (ICSID, UNCITRAL or whoever) that will likely rule in the investors' favor (as they usually do).
It's like this was taken out of a dystopian novel.
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