CENTRAL AMERICA is coming up to the day the five signers of the Arias plan are to say how they intend to live up to their peace pledges.

The key remains the response of the Sandinistas. They have not lifted the state of emergency or granted full press freedom and amnesty, lapses that leave them in flagrant violation. First, they say, the United States must end all aid to the contras, which President Reagan refuses to do. It looks like an impasse.

What is making a difference under the surface, however, is the performance of Costa Rica's president, Oscar Arias. His hand materially strengthened by the Nobel Peace Prize, he is pressing repeatedly to turn Nicaragua toward democracy -- by holding the Sandinistas to their August pledges and by demanding that they go on and enter talks with the contras, as El Salvador and Guatemala have done with their guerrillas.

President Arias, meanwhile, is working to change the form of pressure on the Sandinistas from the wasting military category to a sustainable political and economic category. There is simply no basis in Latin politics to keep the contras in the field. But increasingly Mr. Arias is committing his prestige to political and economic sanctions and to an appeal to the Organization of American States to start putting them into effect. If the Sandinistas do not comply, he says, ''the whole world should isolate them.''

President Reagan, meanwhile, has quietly agreed to slip the date of his request for new contra aid. He'll wait until after the day in early January when the five Central American heads of government are committed to make a final decision on whether the process can work. Mr. Reagan acted under Central American urging and under congressional pressure. He may well feel that every day of delay in refunding the contras is a nail in their political coffin. Still, he did what had to be done to deny Managua any feasible basis for using the contras as an excuse for not delivering on its promises of democracy.

In brief, the right question -- democracy in Nicaragua -- is now being debated by the right people: Oscar Arias and Daniel Ortega. On sanctions, moreover, the right people, the Latins, are taking responsibility to organize pressures -- pressures that they can apply and tighten and which the Sandinistas, desperate for economic and political ties, are vulnerable to.