Jamaican Prime Minister Edward Seaga received the American Friendship Medal in a White House ceremony yesterday and was praised by President Reagan for his support of democratic government in Jamaica.

Reagan, who has voiced concern over communist influence in the area, said Seaga's success in reviving Jamaica's economy and political system is an example to other Caribbean nations that capitalism and respect for basic human rights open the way to prosperity and peace.

"Before Prime Minister Seaga there was violence and lawlessness," Reagan said in a ceremony in the State Dining Room. "Now there's peace and growing respect for the law.

"Before there was despair about the future. Now, there is hope and expectation of better times ahead. In the recent past, the economy was declining. And now, through free enterprise, it is growing . . . ."

Reagan met with Seaga in the Oval Office for half an hour before Seaga received the medal. The award, which honors non-Americans for major contributions to the ideals of democracy and freedom, is conferred by the private, nonprofit Freedom Foundation of Valley Forge, Pa.

The two leaders discussed Reagan's Caribbean Basin Initiative, which would offer Caribbean countries duty-free acess to the United States for most goods. Although $350 million in emergency economic aid was approved for the area last year, the Reagan plan did not get congressional approval.

Seaga thanked Reagan for acts of "support" that have helped to rebuild "some of the bridges that had been torn down between our two peoples."

"There are differences between the United States and Jamaica because we are not clones of each other," Seaga said. But he noted that one of every four Jamaicans lives in the United States, that the countries share a common political system and that such "commonalities far outweigh these differences."

"I emphasize this point," he said, "because too often our friendship is seen and described in terms of the personal relationship that may exist between myself and your president or politicial expediency without understanding that . . . this broad span of natural common interests and common design is bigger than the prime minister of Jamaica. It is bigger than the president of the United States. It is a people thing . . . ."