STUPID BUSINESSES, DON'T THEY KNOW THIS PLACE IS A QUAGMIRE?

Pepsi is rebuilding its bottling plant. Mitsubishi is planning a dealership. A Kuwaiti firm envisions a $500-million hotel and shopping complex in the heart of Baghdad.

Nearly a year after bombs and looters wrought devastation on Iraq's already awful economy, the country is teeming with commerce, real and anticipated. Stores are filled with new products, foreign investors are circling, and unemployment -- while painfully high -- has fallen by more than half.

"It may not be palpable, but Iraq is booming," said Maria Khoury, chief of research for Atlas Investment Group, a Jordanian investment bank. "We're seeing a big increase in consumer goods flowing into the country."

Though still very low, Iraqi living standards are higher than at any time since the 1991 Persian Gulf War, economists say, despite the ongoing bombings and killings. Oil revenues, which fund the government and its social safety net, are near prewar levels.