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Greece plays host to a Western Socialist summit

West Europe's Socialist prime ministers have been struggling here with what a diplomat recently called ''the crisis in the European Socialist movement.'' The Socialist leaders of France, Italy, Spain, and Portugal gathered in Athens Oct. 16 and 17 for informal talks hosted by Greece's prime minister, Andreas Papandreou.

The talks had no agenda and no one expected them to solve the array of political, economic, and ideological problems currently facing ruling Socialist parties. What the participants hoped to do was to:

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* Bolster the morale of embattled Socialist governments.

* Move the five leaders one step closer to the kind of cooperation needed to give the Socialist bloc within the West a degree of influence more in keeping with its size.

* Narrow some of the differences that up to now have divided the Socialists.

In a statement to the press, Mr. Papandreou asserted: ''What we have ascertained is a real identity of views. . . . We can now safely speak of a real , modern, Mediterranean European socialism. This does not mean that there are no differences.''

The last such meeting was held in Paris in May, shortly before the Williamsburg summit of major Western industrialized nations. The French had called the session, attended by seven Socialist heads of government, to bolster the position of French President Francois Mitterrand, who feared he would be isolated at Williams-burg, which was dominated by more conservative leaders such as Ronald Reagan, Margaret Thatcher, and Helmut Kohl.

The talks in Greece had a far more modest scope and objective than those in Paris. Nevertheless, they were considered important by the participants, especially the Greeks.

Papandreou has often advocated greater solidarity among southern European countries, which face similar economic problems and share certain common perspectives - perspectives that often differ from those of northern Europeans.

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He and other Socialist leaders, such as Mitterrand, have also stressed the need for greater solidarity among Socialist governments as a way of weakening, if not ending, the dominance of conservatives in the West. But local critics consider the meeting a political ploy designed to bolster Papan-dreou's image on the eve of the second anniversary of his accession to power.

They assert that Papandreou was able to bask in the spotlight provided by the high-level meeting as his four colleagues enjoyed a pleasant weekend by the sea. The meeting was held at a luxury hotel overlooking the Mediterranean.

All five Socialist leaders have taken office in the last three years in the midst of a severe international economic recession. As a result, all have been forced to put aside their Socialist programs - designed and nurtured during long years in opposition - and implement instead more or less tough austerity programs.

The meeting came at a time when Socialist ideology and programs seem particularly out of phase with the global economic situation. How to adjust has become a central problem for Socialist governments.

All five countries suffer high rates of inflation, low or negative growth rates, declining investments, and foreign exchange problems. Bettino Craxi of Italy and Mario Soares of Portugal have taken power in the last year at the head of shaky coalitions.

And all five face dissent within their own parties as a result of their starkly ''un-Socialist'' policies. ''Imagine the visceral discomfort they must feel, defending policies they have built a career attacking,'' said a sympathetic observer.

East-West tensions, the coming deployment of intermediate-range Pershing II and cruise missiles, and debate over the role of NATO have also created divisions among the Socialist leaders. The French have taken a hard line against the Soviets and endorsed the new missile deployments. The Italians will receive some of the new missiles on their territory, and Craxi recently decried Soviet influence on the West European peace movement.

Papandreou has cast himself as a leader of the antimissile forces, harshly denouncing the coming deployments and calling for a renewal of detente.

Greece, Spain, and to a lesser extent Portugal have been ambivalent toward their membership in NATO. For the moment, France has blocked the accession of Spain and Portugal into the EC because of fears of agricultural competition.

Of course, they do agree in many areas. The Socialists have led West European denunciations of US economic policies, notably high interest rates, which they claim are strangling their economies. All support international economic reform, more positive North-South dialogue, and a political solution to Central America's quagmire.

Whether the Socialist leaders attained their modest goals remains to be seen. What they did do was provide a fellow Socialist - Papandreou - with a suitable start for the extravagant birthday party he is throwing for his government today.

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