BBC Tuesday, December 8, 1998 Published at 22:48 GMT

World: Americas

Utopia encounters

stormy waters

A tax haven aiming to "out Cayman" the Cayman Islands

By Malcolm Brabant in Miami Hurricane Mitch

which killed thousands of people in Central

America has claimed another little-known casualty:

It has delayed the construction of a new Caribbean

country.

However the American tycoon who dreams of

creating a tax haven on a reef nearly 200 miles

east of Honduras says he expects to start building

in the New Year.

From his office in Tulsa, Oklahoma, entrepreneur

Lazarus Long insists that his plans to create the

world's next nation, called New Utopia, are not a

hoax.

Mr Long - who styles himself as "His Royal

Highness Prince Lazarus" - and his backers

simply laid claim to a 450 sq.km. chain of

underwater reefs in international waters near

Honduras.

He wants to secure a treaty with Honduras to

ensure that the new nation will not be annexed in

years to come. But Mr Long says Honduras is far

too busy with post-hurricane restoration to deal

with the treaty just yet.

Hurricane proof island

Plans for New Utopia are laid out on the Internet.

The tax-free principality is modelled on Monaco

and would enable businessmen and

wheeler-dealers to operate without being

restrained by red tape.

Mr Long promises a non-intrusive government that

would allow the use of marijuana for medical

purposes and would be tolerant of prostitution and

polygamy. He envisages an island of steel and

concrete constructed on stilts that could withstand

the strongest hurricanes.

He says it will eventually boast hotels, apartment

blocks, a casino, an airport and an economy

based on offshore finance, tourism and

world-class medicine.

But everything depends on that treaty with

Honduras, and Mr Long hopes that workmen can

begin sinking the foundations of the new state in

January - honestly.