French Presidential Hopefuls Stay Quiet About Algeria as War Roars

IN the campaign for this Sunday's vote for a new president, most French candidates are avoiding one of the biggest issues facing France -- how to deal with the fallout of a bloody conflict in its former colony, Algeria.

Far-right candidate Jean-Marie Le Pen is the only candidate to regularly invoke the dangers of Algeria's deepening civil conflict. More than 30,000 people have died in Algeria since the Army-backed government canceled elections Islamic fundamentalists appeared likely to win in 1992.

The stakes are high for France. Victory by armed Islamic groups in Algeria could spark a massive exodus from Algeria to France, as well as heat up ethnic tensions with the 700,000 Algerians who now live in France.

But for mainstream politicians, Algeria is the issue they would most like to forget. France annexed Algeria in 1842, retaining control over it until 1962.

Prime Minister Edouard Balladur's conservative government has been deeply split over how to respond to Algeria's war. Interior Minister Charles Pasqua backs the Algerian military's strategy of eradicating armed Islamic groups.

But his foreign minister, Alain Juppe, the likely choice for prime minister should front-runner Jacques Chirac win the presidency, has backed calls for a political dialogue in Algeria.

Mr. Le Pen's solution -- to seal the borders and organize the departure of immigrants back to Algeria -- attracted enough political support to harden the political debate in France over policy toward Algeria. A Socialist government began tightening conditions for French visas to Algerians in 1992, and conservative governments since have restricted access further.

''France's policy of restricting visas is seen as a complete abandonment of Algerian society by the French,'' says a French official who follows Algerian policy closely and writes under the pseudonym Lucile Provost. ''Until 1992, any Algerian who wanted to visit France had a visa. Now it's almost impossible.''

WHILE political debate over Algeria's war is at a minimum, France remains the main international sponsor of Algeria's military-backed government in its bid to restructure the nation's $26 billion foreign debt.

With French backing, Algeria reached a $1 billion stand-by agreement with the International Monetary Fund last April, restructured about $5 billion in debt with public-sector creditors last June, and is close to agreement with private bankers over about $2.6 billion in commercial debt. The IMF is expected to approve a new $500-million aid program to Algeria next month.

An IMF report released last week praised Algerian authorities for a ''bold'' economic-reform program that liberalized trade, cut food subsidies, and reduced the budget deficit.

In a brief comment on the clashes between Algeria's military and armed Islamic opponents, the report concludes: ''Similar questions about Algeria's domestic security situation were raised in April 1994 at the beginning of the stand-by program, but the existing uncertainties did not prevent or slow down the implementation of the program.''

The IMF is missing the point, says France's Provost and other critics. ''The violence has driven off or killed those who could manage a business.''

France and international creditors should have used debt negotiations as an occasion to pressure the Algerian government to negotiate with Islamic groups or at least improve its own record on human rights, critics charge.

''No one is pushing for political conditions on these loans, either in negotiations over private debt or within the IMF,'' Provost says. ''There is too much fear over the prospects of an Islamic victory in Algeria.''

IMF officials insist that they are explicitly barred from interfering in the domestic affairs of member countries by the organization's articles of agreement. And France may be in no stronger position to pressure Algeria's military to negotiate.

''There have been calls to cut off aid to Algeria, or scrutinize how it is used,'' said a spokesman for French Prime Minister Balladur.

''We know some of what is earmarked for the people of Algeria will be used for weapons or wind up in Swiss bank accounts. But if we insist on looking into how the money is used, we will be accused of neo-colonialism.

''For now, there's no question of cutting off aid,'' added the spokesman. ''We have to help Algeria, but its leaders have to understand that they must begin to introduce a political dialogue.''