Yes, it's a negative trap.

You still earn the yields of an industrial city-state.

I don't understand the ability. It sounds like it's only a negative.

Just for fun, I decided to translate the mod to my native language (Brazilian Portuguese). In doing so, I found a mistranslation: "major thanks" should be "mainly thanks" (and in both the English and French localizations, there is a period before that part that should be a comma).