Return of the City-State?

While not technically 'Small Wars', an interesting consequence of weak government and failing infrastructure. Can we expect to see this elsewhere, as more nations teeter on the edge of being 'Failed States'?

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TEGUCIGALPA, Honduras (AP) -- Investors can begin construction in six months on three privately run cities in Honduras that will have their own police, laws, government and tax systems now that the government has signed a memorandum of agreement approving the project.

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The project's aim is to strengthen Honduras' weak government and failing infrastructure, overwhelmed by corruption, drug-related crime and lingering political instability after a 2009 coup.

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The "model cities" will have their own judiciary, laws, governments and police forces. They also will be empowered to sign international agreements on trade and investment and set their own immigration policy.

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http://hosted.ap.org/dynamic/stories...09-05-22-36-19

Historical footnote

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A city-state is an independent or autonomous entity whose territory consists of a city which is not administered as a part of another local government. A city-state can also be defined as a central city and its surrounding villages, which together follow the same law, have one form of government, and share languages, religious beliefs, and ways of life. Today, only three independent, sovereign city-states exist: Monaco, Singapore, and the Vatican City.

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http://en.wikipedia.org/wiki/City-state

See also
http://pics3441.upmf-grenoble.fr/art...City-State.pdf

Save for the immigration policy this sounds a lot like a federalisation of Honduras, for German states (btw, 3 of them are city states, and a 4th is close) already have such competences - including some treaties with foreign countries and their own embassies to the EU (Brussels).

The model cities do also sound a lot like the special economic zones for foreign investment that were so successful in Asia.
Their success depends on political stability, though. Low capital crime rates would help as well, and Honduras has a problem in this regard.

Extra-territoriality is a common feature of the international scene, whether a Free Port, Special Economic Zone; even basing agreements, for example the rather unusual IMO Sovereign Base Areas in Cyprus:http://en.wikipedia.org/wiki/Sovereign_Base_Areas

Not to overlook what happened in China, notably the Shanghai International Settlements (1843-1943):http://en.wikipedia.org/wiki/Shangha...nal_Settlement

I recall a portion of a BBC travelogue programme in DR Congo and the astonishment of the reporter when they came across an oasis of order in the middle of the jungle, run by an international mining company and no sign of the DRC.

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..Mr. Romer, an expert on economic growth, is out of his own project..

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Link:http://www.nytimes.com/2012/10/01/wo...r.html?hp&_r=0