Peace Amid the `Pawpaws'. West Indies paradise boasts mountains and beaches. TRAVEL: GRENADA IS OPEN FOR BUSINESS

MORE than five years have passed since the United States's intervention in Grenada. The barbed wire is gone; weapons remain - as museum pieces; and cruise ships and tourists are back again. The island of Grenada is the top of a volcano at the southernmost end of the Windward Island chain. It rises 2,757 feet from the water to Mt. St. Catherine.

St. George's, the capital and economic center, has low-slung architecture and narrow streets that spill down the steep hillsides on the southwest side of the island.

St. George's looks out onto the transparent turquoise Caribbean Sea, over a harbor where banana boats, interisland freighters, and small cruise ships dock. South of St. George's is Grand Anse Beach, beckoning beach bums with its white sand, sea grape trees, coconut palms, and tropical sun - perfect for those with more sunscreen than ambition.

A drive through the island reveals lush tropical foliage, bananas, papayas (``pawpaw'' to the islanders), nutmeg, and breadfruit. Hibiscus, red-flowered flamboyant trees, bougainvillea, hibiscus, and oleander add color in season.

Vividly clad Grenadians - a friendly people - bustle about their business. Coastal areas thrive on fishing, and farther inland agriculture and light industry coexist between natural attractions and mountains.

Tourism in Grenada is in a bull market. Blessed with daily temperatures in the 80s F. and constant trade winds, the island is becoming a year-round vacation destination.

According to public relations officer Ann Marie Marecheau of the Grenada Department of Tourism, the island has experienced ``unprecedented'' growth, with tourism nearly doubling since 1983. Cruise-ship visits have more than tripled. Grenada still isn't overrun with tourists, though.

Ms. Marecheau adds that Grenada tourism officials are ``trying to decentralize the whole tourism product by offering other things to see.'' They are also ``trying to get tourism into other parts of the island,'' not just the southern end.

A lot has changed in five years. Foreign aid has come to the rescue. Old potholes have been covered with new roads. The phone system is now digital; television has finally arrived. Power outages and water shortages are largely events of the past.

The airport begun by the Cubans has been finished by the Americans. There is now scheduled direct air service on British West Indies Airways from New York and Miami, and weekly service from London on British Airways. Leeward Islands Air Transport provides connections with Pan American, American, Eastern, and Air Canada in Barbados.

Where to stay

Most hotels are interspersed among coconut palms near St. George's and south on Grand Anse Beach and in L'Anse aux Epines. Room prices usually don't include meals.

Grenada has 1,034 rooms, according to Elizabeth Gormon of the Grenada Hotel Association, including guest cottages, apartments, and hotels. She estimates that approximately 300 rooms are under construction.

If you want to be pampered, the Spice Island Inn on Grand Anse Beach is a good choice. Twenty beach suites offer oceanside luxury just 60 feet from the water. There are also 14 new whirlpool-equipped suites, and 10 others with their own private pools, for true seclusion and luxury.

The Ramada Renaissance (formerly the Holiday Inn), also on Grand Anse, should be noted for its US-standard rooms, each equipped with the amenities associated with a Holiday Inn. Other hotels of note include the new Coyaba Hotel, also on the beach; Calabash in Prickly Bay; and 12 Degrees North, known for its Grenadian hospitality and for the meals prepared in each cottage's kitchen by a maid.

Eating out

The hardest part of eating in Grenada can be deciding on what type of food you want.

The Spice Island Inn has an open-sided dining room, serving traditional US and European fare. On Friday nights, you can dine on a barbecued-steak and chicken buffet as you listen to live steel-band music.

Rudolf's on the Carenage has good local and seafood cuisine, even if service is a bit slow. This popular restaurant fills up quickly at noon.

The oft-touted Mamma's serves what some consider the most authentic (and spiciest) Grenadian cuisine. Reservations are recommended.

What to do

One of the best ways to tour the island and catch a glimpse of local color is by taxi. Drivers are always willing to show the island's highlights, with a constant commentary in Grenadian dialect. Be prepared to spend at least $60 for a full day trip.

At the highest part of the island is the Grand Etang Lake. A visit is worth the effort, if just for the experience of careening along the steep twisting road up to the lake.

Annandale Falls, though not the most spectacular spot, is among the best-landscaped areas, with its tropical plants and flowers. The effect is one of serenity and beauty, fulfilling anybody's expectations of what a tropical island paradise should be like.

Grenada offers plenty to do in and on the water. HMC Diving Centre, on Grand Anse Beach at the Ramada, offers sailboards, Sunfish, three-wheeled paddle boats called aqua trikes, and jet ski-like wave runners for rent. The center organizes snorkeling trips to reefs, and scuba diving trips with dive masters, including visits to the Bianca C., the largest wreck in the Caribbean.

Day-sailing trips can be arranged through Go Vacations at Spice Island Marine Services, Prickly Bay.

Shopping

Shopping fanatics in search of duty-free bargains may be disappointed. But if you enjoy local crafts, artwork, and products, then Grenada will provide some treasures. The island didn't get its nickname, ``the Isle of Spice,'' by accident. Street vendors and shops have a constant supply of little bundles of locally grown spices.

On the beach or in town, friendly street vendors will likely approach and politely introduce themselves by name. If you like their wares, show interest and bargain if the price seems too high. Some browsing in stores can give you a feel for prevailing prices. There is no bargaining in stores, however.

One shop worth a visit is Tikal, up the street from the Grenada National Museum. It has local and imported South American crafts, batik, spice baskets, and wood objects. The Yellow Poui art gallery off Granby Street has a selection of artwork from all over the Caribbean, with an emphasis on local artists.

If you go

For more details, contact a travel agent or the Grenada Tourism Office at 141 East 44th St., Suite 701, New York, NY 10017; phone 800-638-0852 or, in New York, (212) 687-9554.

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