Greek Prime Minister Andreas Papandreou today revived the idea of an international conference to discuss Cyprus and suggested that there is new interest in Western Europe in a solution to the problems of the divided island.

Concluding a landmark three-day visit here--the first by a Greek prime minister--that greatly boosted the morale of the island's Greek Cypriot majority, Papandreou declared at a press conference that he and Cyprus President Spyros Kyprianou "agree on the idea of a move toward an international conference."

Papandreou's presence served to focus new attention on Cyprus, whose divisions have been more quietly addressed in U.N.-sponsored intercommunal talks that have continued intermittently since the 1974 invasion of the island by Turkey. Those talks have been backed by the United States and Western Europe, and it was not clear from Papandreou's remarks if any shift by Western European nations is involved.

Though he explicitly rejected the idea of a "package settlement" for the war-torn Eastern Mediterranean island, Papandreou made clear that any settlement of what he called the key problem--the Turkish occupation of the northern part of the island--will set a precedent for settling other disputes with its rival and fellow NATO ally.

Turkey dispatched troops to Cyprus eight years ago to defend the Turkish minority after a coup widely believed to have been inspired by the Greek junta of the day against the government of Archbishop Makarios. It did so as a guarantor of the 1960 independence agreement that ended British rule.

Turkish troops still hold the northern 36 percent of the island in a de facto partition that has segregated the Greek Cypriot majority from the 18 percent Turkish minority community.

Papandreou today voiced pessimism over the chances for progress in the intercommunal talks. They "must continue until it is quite clear that they cannot lead to a solution," he said. "But my own view of their outcome is a pessimistic one. The key problem is the occupation of northern Cyprus by Turkey," he said. "We will therefore not wait for an end to the talks to launch an internationalization effort."

The idea of an international conference was first proposed by the Soviet Union in 1974 and rejected at that time by Turkey and the West.

Papandreou arrived in Cyprus Saturday to an emotional and enthusiastic welcome from the Greek Cypriots, who saw in his presence a physical affirmation of Athens' support for their interests.

His visit was officially sanctioned by all the political elements in Cyprus, from the powerful Cyprus Communist Party to the pro-Western National Rally party of Glafkos Clerides.

Papandreou suggested today that his hopes for internationalizing the problem rested with a shift in the attitude of Western Europe toward the conflict, and he said he was cautiously optimistic that some of Greece's partners in the 10-nation European Community would propose initiatives on the issue.

He specifically named West German's former chancellor, Willy Brandt, head of the Socialist International, as a figure of sufficient international stature to play a role in settling the crisis. Brandt, who recently made a lengthy visit to the island, fulfills "all the requirements for acting as a catalyst" toward progress on Cyprus, he said.

His remarks today on a new European focus on Cyprus followed reports during talks last week in Athens between Papandreou and Kyprianou of interest from Bonn, Paris and Rome in the idea of an international conference. If such interest exists, it would reflect an important shift in the Western attitude.

In Washington, a State Department spokesman said there would be no official comment on the proposed conference until officials had studied Papandreou's comments in detail.

In an arrival statement Saturday, Papandreou made a clear bid to absolve his visit from any charges of chauvinism by declaring that Turkish Cypriots as much as Greek Cypriots are being harmed by the continued Turkish military presence. He also moved to rebut accusations that he was on the island to revive old ideas of political union with Greece, which prevailed during the Greek Cypriot struggle to end British rule in the 1950s.

His visit nevertheless had a highly nationalistic cast. He repeatedly accused Turkey of harboring expansionist designs not only in Cyprus, but also in the Aegean Sea, "at least half of which," he said, was being claimed by Ankara.

The reaction of the Turkish press and at an official level to Papandreou's visit was relatively low key.