This will only make the interest in international matches less while it will give birth to more franchises to conduct their private tournaments by mixing the players from different countries. In Pakistan, we have already two leagues, PSL and KPL. I fear, more countries will follow it too.
The justification being given is that the TV broadcasters only want 8-10 teams to participate in the ICC events. But I suspect that the real reason is to divert ICC funds to a small number of nations, thereby increasing the share of revenue to the big-3 teams. "Globalization" of cricket was the brainchild of Jagmohan Dalmiya, who dominated both the BCCI and ICC before he was overthrown by a combined trans-national cabal of politicians and businessmen (Dalmiya was also a businessman, but he had a passion for cricket). The other camp wanted to reverse all the decisions made by Dalmiya and that was also one of the reasons why the funding for associates were reduced.
Again if all the funds are divided among the big three teams then they won't have much competition. How long can the big 3 teams can play with each other and keep the interest of the audience.
If they lose the audience, they will not be able to generate funds and hence it will be a disaster in the long run. A good example of this that India Pakistan matches generate most revenue but if the Pakistani team loses the form due to no funds, no one will like to see one sided encounter between two teams.