Luxury hotels and golf: welcome to the Green Zone

Picture, if you will, a tree-lined plaza in Baghdad's International Village, flanked by fashion boutiques, swanky cafes, and shiny glass office towers. Nearby a golf course nestles agreeably, where a chip over the water to the final green is but a prelude to cocktails in the club house and a soothing massage in a luxury hotel, which would not look out of place in Sydney harbour. Then, as twilight falls, a pre-prandial stroll, perhaps, amid the cool of the Tigris Riverfront Park, where the peace is broken only by the soulful cries of egrets fishing.

Improbable though it all may seem, this is how some imaginative types in the US military are envisaging the future of Baghdad's Green Zone, the much-pummelled redoubt of the Iraqi capital where a bunker shot has until now had very different connotations.

A $5bn (£2.5bn) tourism and development scheme for the Green Zone being hatched by the Pentagon and an international investment consortium would give the heavily fortified area on the banks of the Tigris a "dream" makeover that will become a magnet for Iraqis, tourists, business people and investors. About half of the area is now occupied by coalition forces, the US state department or private foreign companies.

The US military released the first tentative artists' impression yesterday. An army source said the barbed wire, concrete blast barriers and checkpoints that currently disfigure the 5 sq mile area would be replaced by shopping malls, hotels, elegant apartment blocks and leisure parks. "This is at the end of the day an Iraqi-owned area and we will give it back to them with added value," said the source, who requested anonymity.

Potential investors are being encouraged to take a punt that years ahead, Baghdad's fortunes may mirror former war-torn cities such as Sarajevo and Beirut that have risen from the ashes.

Marriott International has already signed a deal to build a hotel in the Green Zone, according to Navy Captain Thomas Karnowski, the chief US liaison. Also in the pipeline is a possible $1bn investment from MBI International, a hotel and resorts specialist led by Saudi sheikh, Mohamed Bin Issa Al Jaber.

One Los Angeles-based firm, C3, has said it wants to build an amusement park on the Green Zone's outskirts. As part of the first phase, a skateboard park is due to open this summer.