Islamic Party Wins Power in Algeria : Election: Experts expect the fundamentalists to control Parliament after next month's runoffs. Reaction ranges from euphoria to alarm.

TIMES STAFF WRITER

Muslim fundamentalists swept to power in Algeria on Friday, gaining almost half the seats in the country's first multi-party National Assembly as crowds of chanting supporters filled the streets.

Political analysts predicted the popular Islamic Salvation Front will easily gain control of Parliament during runoff elections next month, setting the stage for the Arab world's first freely elected Islamic fundamentalist government--and a potential showdown with the army, if the transition does not go smoothly.

"Don't be afraid, people of Algeria. This is the march of history," Imam Abu Kheireiddine exhorted an estimated 20,000 followers at the Kouba Mosque in the hills above Algiers. "Step by step, first we get into Parliament, and in the end we will constitute an Islamic republic. . . . The time has come to put into action all that we have promised. Until now, we have been talking. Now, we must act."

Other Islamic Front leaders called for immediate presidential elections, for an end to alcohol sales and "ostentation," and encouraged Algerian women to wear the conservative veil dictated by the Koran.

"The Algerian woman never wanted to show her body or fight the law of God," Kheireiddine declared. "I call upon our sisters who have taken the veil off, who have become merchandise to be bought and sold, to return to Islam."

The reaction to the election results in this old colonial seaside city ranged from euphoria to alarm. Crowds of young men gathered in the streets, shouting the name of the Islamic party and their willingness to die for their faith.

Ali, a 32-year-old cabdriver, bounded from his taxi to join Friday prayers at Kouba Mosque and declared that the days of Algeria's old ruling party, the National Liberation Front, are over, after three decades of one-party rule. "For 30 years they ate alone, and now it's our turn," he asserted.

Another young man grabbed a Western woman by the arm and said joyously, referring to Algeria's old colonial patron, France, and its president: "Please give my condolences to Mr. (Francois) Mitterrand."

But a 35-year-old businesswoman who travels abroad often and wears tight skirts at work, shuddered at the news, saying: "I'm destroyed. It's incredible. I'm sick. We have two choices. We can either leave, because it will be another Iran, or we can pray and pray and pray that the army takes over."

The apparent Islamic victory is likely to be worrisome not only to Europe, which has acted for years as an escape valve for Algeria's poverty and unemployment, but to nearby Arab regimes, which have been flirting with democracy but fear Islamic fundamentalism as the price.

"Oh, my God! This is the worst!" said a Moroccan government official who flew to Algiers to observe the elections. He spoke after Interior Minister Larbi Belkheir announced that the Islamic Front had gained more than 40% of the seats in Parliament and stood to gain many more during the runoffs.

According to incomplete returns, the Islamic Front had won at least 183 of the assembly's 430 seats outright, needing to win only 33 more next month to take control of Parliament.

The swiftness of the victory was stunning. The government had predicted two days before the election that all but 15% of the National Assembly seats would be left to be decided in the runoffs.

For its part, the National Front, increasingly discredited among the huge numbers of unemployed youths who stand listlessly around the streets of Algiers, won only 18 seats outright in incomplete returns.

While the stage was set for a showdown between the Islamic Front and the National Front next month for about 180 undecided seats, most diplomats--and privately, many government officials--predicted that the fundamentalists would easily gain a 60% majority or more.

"It seems that the scale with which this happened, though perhaps unexpected, is just a reflection of the continued unpopularity of the (National Front) in the eyes of ordinary people," said a Western diplomat in the Algerian capital.

A National Front official who works in the Foreign Ministry said that demographics, not religion or politics, was largely to blame. More than 70% of the population is younger than 25; they have little hope for marriage, an apartment or a job under Algeria's present economic circumstances, he said. "All of us, our time is over," he said. "I'm over 40. Do you know that only 25% of the population is over 40? Our time is finished.

"This is a tidal wave and, after it, there will be no democracy," he added. "They will come to power, and everyone else will be finished."

The National Front has urged Algerians to be patient with 20% inflation and 25% unemployment rates as the country struggles under the burden of a $23-billion foreign debt. Prime Minister Sid Ahmed Ghozali recently succeeded in passing legislation to allow foreign participation in exploring the country's vast petroleum reserves. But the party old guard has been slow to agree to other economic reforms aimed at dismantling three decades of public management of the economy.

The Islamic Front's political program calls for Algerian initiative to take over where the public sector has failed, declaring private charitable contributions required by the Koran to be public assets in place of taxes, opening Islamic banks that do not charge interest and ending the corruption that it claims has siphoned much of the life out of the Algerian economy.

Diplomats here are skeptical, but they also say that the National Front may have a hard time proceeding with its own program, with perhaps only a third of the seats in Parliament when the balloting is over. Even a coalition with a liberal party such as the Socialist Forces Front, they say, may not be enough to challenge the power of the fundamentalists.

Analysts predicted that the Islamic Front will immediately seek most or all Cabinet positions after the Jan. 16 runoffs, setting the stage for a confrontation with President Chadli Bendjedid. He will undoubtedly be reluctant to hand over the Interior, Defense and Foreign ministries.

"They will push for all the seats in the government, and they will get 99%," predicted one diplomat.

Most analysts predicted that Bendjedid will be reluctant to intervene with the army, as he did when fundamentalists took to the streets last May and the government moved in troops and tanks, killing at least 55 and leaving the country under a state of siege for three months. But any sign that the fundamentalists are seeking to abolish other political parties will eliminate any hesitation, several diplomats and government officials predicted privately.

Abdelkadir Hachani, the Islamic Front's acting leader, has gone out of his way to present a moderate face, asserting that the front will tolerate opposing political currents and meeting privately with Western envoys to assure them that trade with Europe, upon which Algeria is heavily dependent, will continue.

But Hachani, a petrochemical engineer, is perceived as more moderate than the front's two imprisoned chiefs, the fiery preacher Ali Belhaj and Prof. Abassi Madani. They have been jailed since early summer on charges of trying to overthrow the government by violence; the government was said to have struck a private deal with Hachani to persuade the Islamic Front to participate in the elections, pledging to try Belhaj and Madani in civilian courts.

This week's election results make it likely that Belhaj and Madani, revered by the Islamic Front's rank-and-file, will be released without a substantial trial or any sentence, several Western diplomats predicted. "With an (Islamic Front) government, it would be inconceivable to try them and hand down stiff sentences," said one envoy.

BACKGROUND (Southland Edition, A15)

Morocco, Tunisia, Egypt and Jordan all have been battling the rising political influence of Muslim fundamentalist groups--some of them accused of trying to overthrow existing regimes--and Sudan's military regime has installed an Islamic government in Khartoum. Nearly all have shuddered at Algeria's decision to legalize Islamic parties, then to open the way for free elections.

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