'Welcome To Kurdistan'

Rebel-held territory" has rarely, if ever, looked so good as the Kurdish region of northern Iraq. The Franso Hariri football stadium stands in downtown Arbil among a forest of construction cranes, the rising skeletons of new buildings and a vast new mosque. Across the road is a large marble-floored LG electronics showroom and Internet center, and the traffic out front is packed with BMWs, Land Cruisers and Mercedeses. Above the stadium gates is a large, hand-painted advertisement for McDonald's featuring the golden arches. "We don't actually have a McDonald's here yet," says Fawzi Hariri, son of the stadium's founder, "but we pretend we do."

Iraqi Kurdistan is a place in a hurry. The 11 years since the Kurds won de facto independence from Baghdad has been the longest experience of pseudo statehood in their history, and they're determined to make a success of it. It may not have McDonald's, but Arbil already boasts a marble Central Bank building (designed by a Kurdish woman), a Kurdish-studies academy, an Institute of Democracy and a vast new park with amphitheaters, where local musicians perform Bach and Kurdish traditional music. Given that 4,000 of 5,000 Kurdish villages and towns were ruined by the Iraqi Army in a quarter-century of intermittent war, the achievements are remarkable. Inevitably, success engenders ambivalence about prospects for a new war with Saddam. "We have really created something here, against all the odds," says Nasreen Barwari, the female, Harvard-educated minister of Reconstruction and Development. "We have a lot to lose."

But the Kurds have a lot to gain, too. The current Kurdish statelet, which makes up about 15 percent of Iraq's population and land area, depends on a single road crossing to Turkey and another to Iran for all its trade. Turkey recently cut down on the number of trucks crossing the border, a reminder that it can strangle Kurdistan if it chooses. Saddam's Army is dug in just 12 miles from Kurdistan's two largest cities, and could easily hit them with artillery. Only the U.S. and British enforcement of the no-flight zone prevents Saddam from driving the Kurds into the mountains, as he did in 1991, killing 180,000.

"We are not in a secure situation," says Masoud Barzani, leader of the Kurdish Democratic Party, or KDP, which controls two thirds of Iraqi Kurdistan. "Our future lies with Iraq--but a democratic, federal Iraq where we are not second-class citizens." In some ways, Kurdistan is just a declaration away from independence--it has its own army, flag, TV stations, school curriculum and language, plus a Welcome to Kurdistan sign on the border. But at the same time, Kurds use Iraqi money--albeit pre-Saddam dinars, printed in Switzerland--and carry Iraqi passports drawn from a dwindling stock of pre-1991 blanks.

Kurdistan isn't a full-fledged democracy--the KDP and rivals from the Patriotic Union of Kurdistan control the government and the Army. The parties claim to have made up after four years of civil war, but some tensions remain. Still, there is an elected Parliament that includes opposition parties, such as the Communist Party of Kurdistan. Minorities like the Turkmens and the Christian Assyrians have their own TV programs and guaranteed seats in Parliament. "Imagine what a place Iraq could be if it were like Kurdistan," says Refiq, a retired schoolteacher from Baghdad who moved to Kurdistan in 1992. Some war planners in Washington are doing just that.