U.S. Trade Representative William E. Brock said tonight the Reagan administration is thinking of relaxing quotas on products from Caribbean nations as part of its Caribbean development program.

Brock provided a closer glimpse of the administration's evolving policies in the region in a keynote speech to about 600 Caribbean governmental and business leaders at the fifth annual Conference on Caribbean Trade, Investment and Development.

He said the administration is exploring changes in tax laws, a multilateral political risk insurance institution as a guarantee to investors in politically unstable nations and short-term commercial credit to aid production.

All this is part of the administration's long-heralded Caribbean Basin Initiative which broadly emphasizes investment, trade and aid, in that order. Private sector initiatives, rather than massive governmental aid, is the focus.

Reagan, in a live telephone address to the conference, called Caribbean development "one of my highest priorities."

"We seek to form a regional approach which is genuinely cooperative," the president said in his five-minute message. He said the administration has begun discussing the program with Congress.

Brock conceded in a press conference that persuading Congress to approve a Caribbean free-trade zone would be "difficult" because of traditional protectionist legislation, such as a pending bill to set tariffs and fees on sugar imports from the Caribbean.

But, Brock said, "The more we can open up markets for the products of these countries in the U.S., not only do we open up jobs, but we help them become magnets for new investments."

In July, the United States, Canada, Mexico and Venezuela vowed in the Bahamas to help their smaller, poorer neighbors who vary greatly in size, politics and culture but share poverty, unemployment and underdevelopment.

Nevertheless, the Caribbean Basin Initiative is perceived in much of the area as carrying a made-in-Washington label.

Brock reiterated the administration's desire not to impose a "grand design" but to join the nations "to energize the spirit of self-help which already exists in the area."

It is no secret that the evolution of Reagan's Caribbean policy stems from the administration's announced intention to "draw the line" against Communist expansion in the hemisphere.

Yet Brock said, "I think we'd need this program whether Cuba was there or not."

In what could result in a series of many summits, one president and seven prime ministers are scheduled speakers during the two-day conference sponsored by the Caribbean/Central American Action Committee in cooperation with the State Department.

As participants were gathering at the Sonesta Beach Hotel on Key Biscayne, a crowd of 250 demonstrators, mostly Haitians, were protesting outside against the appearance of Haitian and El Salvadoran officials and against U.S. policies toward those two countries.

The keynote speaker Monday night is Jose Napoleon Duarte, the El Salvadoran president who is a symbol of Washington's hope for a middle-of-the-road settlement of the civil strife in his country.