Old Quito, the most venerable part of the venerable capital of Ecuador, had a close call several years ago. Certain local interests, perhaps equating "new" with their concept of "progress," proposed tearing down the old section of the city, intending to replace it with construction in the modern mode.

Fortunately, more moderate counsel prevailed. Restoration, it was reasoned, was preferable to replacement.

Just back from a visit to Ecuador, I am pleased to report that Old Quito is still there--that delightful medley of narrow streets, pastel-hued houses, wrought-iron balconies and window grilles, intimate patios, and busy craft shops--all to be savored and fondly remembered, much as a glass of vintage wine.

Of course Quito's architecture also boasts lines quite as modern as those to be found most anywhere, most notably in the new office buildings and luxury hotels. Yet for all such concessions to late 20th-century tastes in structural design, Quito prides itself the more on being called "The Florence of South America" for possessing what has been adjudged the continent's largest assemblage of colonial architecture and art.

Certainly UNESCO, in 1978, had sound justification for naming Quito a World Heritage Site. The Ecuadorean art heritage has drawn well on a variety of traditions over a span of centuries reaching back to the brief period of Incan rule prior to Ecuador's conquest by Spain in 1533 and the founding of Quito a year later.

The monks who followed the conquistadors, recognizing the quality of Indian art, introduced the most talented Indian artists to European art forms and recruited them for church ornamentation. It was only natural, then, that the renowned Escuela Quiteno, founded in the colonial period by the Indian sculptor Caspicara, should be characterized by a commingling of Indian, Spanish-Moorish, Flemish, and Italian influences. For three centuries Quito stood high in the arts on the South American continent, and it is also only natural that, for evidence of that high standing, one should go today to any of Quito's 57 churches, like La Compania de Jesus, the "Church of Gold"; to the cathedral, to the convents of La Merced and San Francisco, and to the monastery of San Augustin.

In Quito, it pays as well to go to the bank--the Banco Central del Ecuador, that is--to view a collection of more than 23,000 artifacts, maps, and exhibits tracing the country's history back 10,000 years. On a smaller scale, the home-studio-museum of painter/sculptor Oswaldo Guayasamin offers an essentially modern interpretation of Ecuadorean history, displaying the works of other contemporary artists as well as his own.

Although folk art has long enjoyed esteem in most cultures, often it has waited upon a particular individual's efforts to expand understanding and appreciation by a wider public.

Artist-designer Olga Fisch, a Hungarian refugee of the 1930s who came to Ecuador to live, now recalls: "I would have had to be blind not to see the folk art here, in the market, in the streets. People didn't appreciate the folk art then. Now there's a great interest."

Primarily through the determined action of Fisch over the past 40 years, Ecuadorean folk art has achieved recognition and fame, not only in Ecuador but well beyond its borders. In her Quito gallery, Fisch has assembled a distinguished collection of Indian folk arts, including wall hangings, carvings, paintings, and embroidery. The octogenarian artist, whose work is represented at the U.N. Building and the Museum of Modern Art in New York, will personally open an exhibit of her weaving skill at the Textile Museum in Washington on May 27.

Today, Indian folk art also serves to help support the Ecuadorean economy, appearing in the elegant shops along Quito's bustling Avenida Amazonas as well as in the Indian market towns, such as Otavalo, which specializes in woven art and embroideries; Pomasqui, a popular place to see handcrafted sisal sandals being made--and then purchase some; San Antonio de Ibarro, noted for its wood carvings; and Calderon, where one can watch women and girls form and paint masapan, brightly colored figurines of people, animals, and other objects made of simple bread dough that make delightfully different Christmas tree ornaments or decorations for other occasions.

Ecuador well appreciates the value of tourism to its economy, but the government has not been able to muster the funds for an all-out effort to promote the tourist industry. Self-sufficiency in oil has not materialized as once hoped--and may not. Meanwhile, officials realize that transportation, water, highway, and other basic resources must first be sufficiently developed lest existing accommodations be overtaxed by too great an influx of visitors.

Nonetheless, the country's hotels and other travel facilities could, I was told by private tourism leaders, take care of considerably more than the 350,000 visitors welcomed to Eucador in 1981. What may come as a surprise are the relatively reasonable rates at even the most luxurious hotels, not to mention the more modest inns located some distance from the capital.

The elegant 420-room hotel Colon Internac,ional in Quito, offering a variety of restaurants, a discotheque, a casino, sauna, Turkish and steam baths, beauty parlor, and a large indoor shopping mall, recently charged $59 for a double room, $50 for a single. At San Antonio de Ibarro, some 60 miles north of Quito, is the Hosteria Chorlavi, a former monastery converted into an up-to-date inn. Here a guest can stroll through beautiful, well-tended gardens, enjoy the pool and tennis courts, and stay overnight at the truly nominal cost of $11 for a double, $9 for a single. As for meals, in large city or rural community, prices proved about 30 percent below those at home.

The initial cost of reaching Ecuador must, of course, be reckoned with in planning a visit. For instance, a roundtrip ticket from Washington, D.C. (via Eastern to Miami, then by Ecuadoriana Air Lines, the government carrier, to Quito, 5 1/2 hours away) comes to about $550. Yet once in Ecuador, the American traveler finds transportation, meals, and lodging a comparative bargain, particularly considering the currently favorable exchange rate of the dollar.

And then, there is so much to see, both in Quito and within a day's roundtrip journey from the capital, for visitors who prefer daytime excursions while maintaining the same lodging.

An especially popular goal for most travelers to Eucador is the Equatorial Monument, near San Antonio de Pichincha, about an hour's ride north of Quito. Erected in memory of the French Geodetical Mission that came to Ecuador in 1735 to determine the exact dividing line of the Northern and Southern Hemispheres, the monument offers several pluses in addition to its essentially historical interest. It provides an opportunity to have one's photo taken astride two hemispheres (an excellent entry for the family album). The experience earns the visitor a "diploma" certifying his or her presence at this historic site, and, for travelers like this writer who are poor at remembering figures, it is no trouble at all to recall the one impressive coordinate of the monument--Latitude 0 degrees 0 minutes 0 seconds. (Heaven forbid anyone should also ask the degrees longitude!)

A few miles from the Equatorial Monument lie the ruins of the pucera, or fortress, of Rumicucho, dating to the sixth century. Rumicucho was one of a string of strategically placed stone fortifications designed to protect their pre-Incan builders from the encroachment of other tribes during a period of drought-induced wandering. The ruins, now a restoration project of Quito's Banco Central, offer a spectacular view from their elevated locations. This view includes a number of volcanoes, some of which are considered merely dormant (though giving no indication of waking up any time soon, it is comforting to know).

At present there are three large tourism promotion firms in Ecuador; the largest and oldest is Metropolitan Touring. Discussing the need for a moderate increase in tourism in his country, Metropolitan's tourism manager Luis Maldonado said: "We're trying to get the air lines to lower their fares and offer package tours in conjunction with hotels. As yet there are very few packages available."

Maldonado noted that, until a few years ago, Eucador was more often than not earmarked only for a day or so stopover on a seven-to-eight-country South American itinerary. More recently, two-country tours linking Ecuador with Peru or Colombia have been offered. Now, he says, the push is on to promote one- to two-week trips within Ecuador alone.

Specialized tours can be set up to fit specific interests: for example, photo safaris, archeology tours, birdwatching tours, hunting and fishing trips, and mountain-climbing expeditions. A minimum of 10 participants is necessary. Other opportunities to visit "Unseen Ecuador" include excursions to the Galapagos Islands (where Charles Darwin further developed his theory of evolution), and four- to five-day trips into the wilds of the upper Amazon Basin in a dugout canoe.

Any of these would prove more than sufficient to insure an eventful week or two.he Amazon Basin.