The sign on the airport wall said welcome, but the deserted streets told more of the violent and bloody decade that has seen more than a third of this West African nation's people either die or flee into exile.

There is no electricity because the capital's generator blew up a year ago and authorities did not have the funds to replace it.

The shops are shuttered because there is nothing to sell - no fish, no meat, no clothing, no medical supplies.

The local currency, the ekoule, has completely disappeared from circulation. Civil servants have not been paid for months and the gates to the Finance Ministry are held shut by a huge padlock. People get by on this lush, tropical island by the most primitive bartering.

Before he was overthrown last week, President for Life Francisco Macias Nguema held sway over one of the world's bloodiest governments.

The last American diplomats left here in 1976 after a visiting envoy was met at the airport with a diatribe from a local official and promptly got back on his plane and left. Five years before that an American at the small mission here killed a colleqgue in a quarrel.

Macias and a few loyal troops are now said to be holding out at Mengomo, in the center of the mainland province of Rio Muni, home of the predominant Fang tribe.

Observers here on the island where the country's capital is located say it is unlikely Macias will allow himself to be captured alive, given the violent and bloody history of the last decade. Macias Nguema Island, formerly Fernando Po, is home of the Buhl tribe. It is said to hold only a third of its former population of 60,000. Malabo is like a ghost town, with people glancing furtively from behind the windows of the capital's colonial-style houses.

"It is not the plague, but the result of 10 years of terror and dictatorship," said a member of the new leadership as he looked out on the total devastation that is the capital of this nation of 300,000 people.

"Everything has to be started from scratch again," the official said. "Everything has to be thought out and rebuilt."

It has been seven years since Western journalists have been allowed into Equatorial Guinea and few of the people one sees are willing to talk. Their eyes mirror the terror that has been their lives for these past 10 years under Macias' rule during which more than 40,000 are said to have died.

One Malabo resident said that Macias had lived totally isolated from the country for some time. "For a long time now," he said, "the country has been without government, administration, budget or the least planning. But if you think Malabo is deserted, just go and see the mainland chief town Bata - that's even worse."

The nation's new leader, Lt. Col. Teodoro Obianj Nguema Mbazago, a nephew of the deposed leader, reportedly is in Bata coordinating the fight against his uncle.

Here on this small island, the departure of Macias offers no immediate relief from the hunger that has been the peoples' lot. They are fishermen, but there are few if any fishing boats left because all were ordered destroyed by the former president to keep the remaining residents from following the thousands of others who already had fled.

The island's fishing became the monopoly of Soviet trawlers, authorized to work the territorial waters in return for 4,000 tons of their catch - much of it of such bad quality that residents reportedly refused to buy it. Even this has reportedly disappeared in recent months.

The islanders have resorted to makeshift rafts made from automobile tires to earn a precarious living, taking care not to be spotted by the numerous police informers. It was a stark comparison to Equitorial Guinea when it received its independence from Spain a dozen years ago. Then, it boasted a higher literacy rate than its Spanish coolonizers.

The only real asset of the country, cocoa, is in decline, with production now at 8,000 tons a year as compared to 45,000 tons a few years ago. The cocoa trees are old and poorly kept and the former work force of some 50,000 Nigerians left a couple of years ago during a period of particularly intense political turbulence.

Special correspondent Tom Burns reported from Madrid:

The confusion reigning in Equatorial Guinea since the Aug. 3 coup against the dictatorship of Francisco Macias Nguema was mirrored here today in disputes and conflicting reports among the Guinean exile community in Spain.

One group, the National Alliance for the Liberation of Equatorial Guinea, insisted that nothing had changed and that the new strongman, Col. Teodoro Nguema, had shown himself to be as bloodthirsty and ruthless as his uncle.

But a second group, which calls itself the Coordinating Committee for the Guinean Opposition in Spain, peacefully occupied the Equatorial Guinea legation in Madrid and pledged allegience to the new military Revoluntionary Council that has taken control of their homeland.

The legation, a spacious and empty flat in a run-down quarter of old Madrid, later was surrounded by police, and a promised ceremony to mark the transfer of power from Macias' charge d'affaires to the new occupants failed to materialize. A spokesman for the Coordinating Committee said the charge d'affaires had been detained in talks with Spanish Foreign Ministry officials.

The National Alliance group of exiles, which opposes the new government, said the estimated 100,000 Guinean exiles in Gabon had treated the coup with suspicion and were adopting a wait-and-see attitude. The group occupying the legation, however, said its contacts in Gabon spoke of exiles crowding back to Guinea to help in the reconstruction of the country from the devastation of Macias' police state.

The new leader, Teodoro Nguema, was alternately described as an unpolitical professional soldier who finally had been forced to act, and as an unscrupulous careerist who had fallen out with Macias in a family dispute.

[The Gabonese government newspaper L'Union said refugees coming from Guinea reported that troops loyal to Macias still controlled an area within a 75-mile radius of Mengomo, the former president's home town. "The confirmed that Macias Nguema nad his followers were resisting and that the new regime's army was making slow progress," the newspaper said.]

The Spanish government, in the meantime, strongly denied it had organized the coup. The statement came from Premier Adolfo Suarez, who is currently touring Brazil, and was released here by the Spanish Foreign Ministry.

While the Spanish government denied any hand in the overthrow of Macias, it did admit that it had prior knowledge of it. "The Spanish government knew in good time, as other governments did, that a military operation was under way in the country," the statement said.

Spain, which withdrew its ambassador from Equatorial Guinea in 1977 and pulled out its once-considerable colony of nationals, sent a diplomatic team to Guinea the day after the coup. CAPTION: Map, no caption