Next Step : Hope Rises in ‘Bloody Belfast’ : Even before IRA cease-fire, optimistic residents were planning for a better future.

Not long ago, parts of this great port lay burned and bombed out, a vast security fence encircled the central shopping area and the populace--both Catholic and Protestant--was grim and dispirited.

People were calling the capital of Northern Ireland “the Beirut of Western Europe” and “Bloody Belfast.”

Today, there’s a spirit of hope in the air. The 300,000 residents talk of a new Belfast.

The upbeat mood began even before the Irish Republican Army announced its cease-fire in the quarter-century of conflict with the province’s British rulers. While the stunning IRA move of Aug. 31 has not been reciprocated by unionist Protestant paramilitaries, it has increased the sense that better times lie ahead.

“The mood here is more optimistic than it’s ever been,” said Joris Manne, a Belfast tourism official.

“The recession is over,” added a journalist. “Now if the war were over, the city could take off. There’s a good quality of life here--when they’re not shooting.”

Belfast is no Eden. Neighborhoods along the mainly Catholic Falls Road remain rundown and shabby, and the mood in the nearby Protestant areas along Shankill Road is dour and suspicious. In both districts where, as residents say, “the hard men live,” no bar door is opened to a stranger without a close inspection.

The graffiti of loyalists and Republicans mark the sectarian sections of town. Sample in the unionist Sandy Row: “Death to all Irish nationalists. Better to die on your feet than lie on your knees in a united Ireland. UFF.”

The initials stand for Ulster Freedom Fighters, one of the shadowy Protestant groups that want to keep the province of Northern Ireland, or Ulster, part of the United Kingdom. They are the unionists. The IRA, meanwhile, advocates joining the province with the republic of Ireland, which occupies the rest of the island.

In a deeper, negative sense, the city seems to be ethnically divided in the working-class, westside Protestant and Catholic districts. “Hard-core Catholics and Protestants don’t want to live together,” said one resident, speaking anonymously in a city where voices are often kept low. “It’s as if Belfast’s west side has become voluntarily ethnically cleansed,” each group clustering with its own.

But to the east, in the business district near the River Lagan as it runs to the port and the Irish Sea beyond, the view of many workers, business people and investors is to the future. New buildings have gone up in the central area of Belfast, an old city surrounded by dark green hills. Old structures have been freshly painted; some of the monumental stone buildings, like the neo-classical City Hall, have been cleaned; security fencing has been removed; pedestrian malls have been built. Along the residential areas, Georgian and Victorian houses are being restored. The newly scrubbed St. Anne’s Cathedral is equal to the Romanesque treasures found on the Continent.

In middle-class neighborhoods, Protestant and Catholic professionals have learned to live together in apparent harmony. Pubs are crowded in the central and southern neighborhoods, particularly those featuring music. At Clarke’s Studios off Royal Avenue, students have booked up dancing classes six nights a week.

“We’ve had our troubles,” said Heather McCrory, who was dancing to a traditional Irish tune in a pub, “but you never worry about getting raped, robbed or mugged.”

The Grand Opera House, a handsome beige and white structure, is featuring an autumn season with “Eugene Onegin” by Tchaikovsky and Mozart’s “Don Giovanni.”

A venerable institution called The Crown Liquor Saloon, once bombed by the IRA, has been restored--courtesy of Britain’s National Trust--as a historic site. Its fine mahogany woodwork, stained glass and tiles denote a better past than the recent one. Customers down Guinness stout and Bushmills Irish whiskey.

On a mile-long strip stretching south down Dublin and University Roads called, promotionally, the Golden Mile, there are some 60 restaurants and cafes, with prices considerably lower than London’s. They include Roscoff’s, which boasts a Michelin Guide star. Specialties include local smoked salmon with avocado and a sesame and ginger vinaigrette and crispy duck confit with port and Irish cheeses. Paul Rankin of County Down and his wife, Jeanne, opened Roscoff’s in 1989 and have seen their patronage rise with the spirit of Belfast.

The bombed-out Europa Hotel, a landmark of what both Catholics and Protestants call succinctly “The Troubles,” is back in business with a new facade faintly reminiscent of Las Vegas. Again, it is a lively center for news and gossip. Its former manager was awarded a British medal for keeping the hotel’s doors open under fire.

The Europa will be joined by a 187-bed Hilton hotel in the Laganside, a new development area by the river. The $25-million project is expected to bring 250 badly needed jobs to the city.

All these things are changing Belfast. As a nurse in the emergency ward at Queen Victoria Hospital put it: “I wouldn’t live anywhere else.”

Unemployment, though high, is down. The official figure is about 14%, though officials admit it can run much higher in poor Catholic neighborhoods. Government money is encouraging private investors to involve themselves in projects like Laganside, where the old docks along the river are being redeveloped into a conference site with a convention hall and concert auditorium.

A new city airport, seven minutes from downtown, has been opened to complement the international runway at Aldergrove, 45 minutes west of Belfast. And a high-speed train link between Belfast and Dublin is being planned--a $132-million project, 75% of which is underwritten by the European Union.

“We haven’t decided what the train’s colors should be,” said Northern Ireland Railways executive Stan Myers, without mentioning unionist orange or Republican green. “But it could be contentious. Maybe we should go for something neutral like battleship gray.”

“Partly because of British government subsidies, which did not end during the recession, and because of low housing costs, Belfast people had a higher disposable income than most British cities,” said Manne, the tourism official. “For instance, Marks & Spencer, the big department store chain, makes more profit in Belfast than in London’s Oxford Street.”

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The British government has underwritten various projects of urban regeneration, geared toward encouraging investment. In Belfast, urban development grants totaling $80 million have generated $330 million of private sector investment since 1983, said a government official.

The government projects include low-income housing intended to take some of the sting out of life in Belfast’s poorer sections, where sectarian violence is highest and where the hard men of the paramilitaries are recruited.

In its golden days, Belfast was a busy industrial Victorian city. As a port on the Irish Sea, it was a major shipbuilder. Harlan & Wolff, which built the Titanic, even today boasts two of the world’s largest cranes, named Samson and Goliath, which tower over the docklands.

It was also a world center for manufacturing Irish linen and for bookbinding.

“We’ve always had a skilled work force here,” said one official, “so that we can offer firms trained and educated employees.”

Tourism official Manne says: “Belfast wants to be part of the European renaissance. We have traditionally been provincial, but all that is changing.” He points out that tourism adds only 2% to the Northern Ireland economy compared with 6% in the Republic of Ireland, and believes there is opportunity for growth in the North.

“It’s the same countryside,” he says, “with golf courses and salmon rivers here. Take a place like Armagh, the ancient capital. It’s the Camelot of Ireland.”

In Belfast, itself, there are large areas in the eastern part of the city that contain the sorts of middle-class homes common in any American city. South Belfast has equally fine residences plus quarters for the 10,000 students at Queen’s University.

In the university area, Catholic and Protestant students go about their business amid pleasant surroundings that seem far removed from violence.

“Around the university,” said a former student, “they don’t want to get involved. Basically, 10% of the population is scaring the rest of us.”

Two 16-year-old Castlereagh High School students wearing jeans and jackets--Rhoda Fox, a Protestant, and Julie Fitzsimmons, a Catholic--were browsing in the University Student Union bookstore before heading back to the student quarters they shared.

“We hope to study teaching at the university,” said Julie. “Around here you can be Catholic or Protestant and nobody notices or cares. You never see any soldiers.”

They have occasionally heard bombs in the distance, but they said it did not seriously bother them.

Of Belfast, Rhoda said: “I don’t think I could ever leave it.”