HABANIYA, Iraq, March 13 (Reuters) - Once a lovers' getaway, Habaniya Tourist Village in western Iraq became a refugee camp during some of the fiercest fighting since the fall of Baghdad. Now Amr al-Dulaimi hopes to turn it into a romantic haven again.
Dulaimi runs the crumbling tourist resort, formerly a favourite wedding and honeymoon destination for Iraqis. After the 2003 U.S.-led invasion, it found itself next to an al Qaeda stronghold and centre of a bloody Sunni insurgency.
But as security slowly improves in Anbar, potential investors plan to visit Habaniya this month to decide whether the village almost every Iraqi remembers as a place of love, romance and fun family days out, can be resurrected.
"It was beautiful. My wife and I would walk by the lake. I'm so sad about what it's become," said mechanic Alaa Naji, who got married in the village in 1999.
"Tourism is important because all we've seen is killing and bad news. We need somewhere to relax," he said.
Built in 1979, the tourist village is on the shores of Lake Habaniya in Anbar province, a former haven for al Qaeda and close to the city of Falluja, scene of some of the bloodiest battles between insurgents and U.S. and Iraqi forces.
"I tell you with certainty that the people for the last five years have gone through hell, and are looking for entertainment," said Dulaimi. "It really saddens me when I talk to officials and they say now is not the time for tourism."
Dulaimi has an ally in his quest. The U.S. military says the resort could provide jobs and dampen support for al Qaeda among the Sunni Arab region's poor.
There has been a remarkable improvement in security in Anbar since tribal leaders began turning against al Qaeda, a move which roughly coincided with the arrival of 30,000 extra U.S. troops, completed last June.
Despite the drop in violence, Dulaimi will struggle to lure many Iraqis, particularly those from the majority Shi'ite Muslim sect. They would be too afraid to visit the former al Qaeda stronghold. Sectarian violence between Sunni and Shi'ite Muslims has killed tens of thousands since 2006.
Security checkpoints, army convoys and insurgent attacks also make travel around Iraq difficult and dangerous.
After years of war and sanctions, all that remains of the village's once lush gardens is dirt and scrub. Rusted carousel horses seem suspended in the air, and eerie headless elephants are all that's left of another fairground ride.
Some 400 people who fled fighting in Falluja and Baghdad now live among the village's 565 chalets, and children scramble among the playground's twisted metal and flaking paint.
Captain Leroy Butler, who is part of a U.S. military team responsible for security in Habaniya and the surrounding area, has been trying to help the refugees return home, and his team has started small projects to employ some of the resort's staff.
They are also trying to get top officials to support the reconstruction of Habaniya, initially for use as a conference centre. But despite pledges of support, Butler has had no luck so far in securing funds for the project.
Butler estimated that it could cost up to $80 million to restore the site, which in the 1980s won a best tourist resort in the Middle East award, to a basic standard.
"If you ask leaders in Anbar, or people who've lived in Baghdad, they will tell you that they have great memories of the village. 'I honeymooned there, or took my family there'. You'll hear this resounding message over and over again," Butler said.
During peak holiday periods in the village's heyday up to 5,000 people -- family groups from around the world as well as newlyweds -- would visit. Iraqis say almost all of their countrymen have been to the village and have fond memories.
Butler has met potential investors for the village, currently state-owned, and they are due to visit the site this month. The Arab investors include Iraqis and foreigners, he said.
"The feeling among the investors was pretty good ... Some of them either got married or honeymooned there and they really had a feeling that this is important to the Iraqi people and very much want to be a part of Iraq's revitalisation," Butler said.
Back in Falluja, at a council meeting where officials were discussing projects to rehabilitate the devastated city, Dulaimi made an impassioned plea for cash.
"Iraq is a country for tourism. It has pilgrimage sites, lakes, forests, mountains and history. It must take advantage of this. If you ignore tourism, you cut half of Iraq's humanity."
Writing by Mohammed Abbas; Editing by Clar Ni Chonghaile
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