Honduras is one of the poorest countries in Central and South America. It has the highest murder rate in the world, almost double the next closest contender. It’s a place ravaged by the drug trade and political instability, where as recently as 2009 the military ousted a president pushing to modify the constitution in order to extend his own term. It may seem like the last place on earth where businesses would want to invest, and people would want to move.

But there’s a new idea about to be tried in Honduras.

Some call it a Startup City or Free City, others a LEAP Zone, and in Honduran law it’s known as a ZEDE. They are politically autonomous, privately run zones that supporters believe could transform not only Honduras, but the entire developing world.

In “Company Towns,” the second episode in a four-part series, Honduran citizens explain how experiments in governance have already transformed parts of their country: There’s Los Castaños, a residential project underwritten by a business hoping to provide safe housing for its workers and offers them equity in the land and private security, as well as enforcing its own codes of conduct. Or there’s Altia Business Park, which provides a clear contrast between privately managed land and the giant squatter’s village sitting on the government-managed land across from it.

“In San Pedro, there is no place to go that is safe,” says Lordes Hernandez, a resident of Los Castaños, where she’s lived more than year. “These are the first safe neighborhoods in Honduras.”

Watch the video above, and check out the rest of the series here. Part I introduces the key players and concepts behind the Honduran ZEDEs and the broader startup cities movement. Part III delves into the history of the Honduran ZEDEs and highlights both past and current criticism of the project. And Part IV looks forward with some entrepreneurs who’ve already sketched out a business plan for what they hope will be one of the first Honduran startup cities. Or, watch the whole thing here.

Approximately 5 minutes. Produced by Zach Weissmueller and Ross Kenyon. Edited by Weissmueller. Music by Chris Zabriskie.

Visit http://reason.com/reasontv for downloadable versions of this video, and don’t forget to subscribe to Reason TV’s Youtube channel for more content like this. This project was co-produced with the Moving Picture Institute (http://www.thempi.org)