Some South Koreans see the hoopla unfolding this week and next in Seoul as the "financial Olympics," a prelude to the glory and world acclaim they hope their country will win by hosting the 1988 Olympic Games.

The annual meeting of the boards of governors of the World Bank and International Monetary Fund is bringing close to 8,000 foreigners to town, the largest such influx since the arrival of troops during the Korean War.

Besides reaping an expected $20 million for the local economy, it is giving the South a chance to court the outside world and tweak the nose of North Korea by hosting dignitaries from 148 of the world's 156 countries.

"In the competition between South and North," said South Korean First Assistant Foreign Minister Han Woo Suk, "one of the main themes is the very legitimacy of the country in the international arena." South Korea now has diplomatic ties at some level with 122 countries, while the North has relations with 101, according to officials here.

Thirty of the countries that are sending delegations here have no diplomatic ties with Seoul. The South hopes that their visit will help counter the North's depiction of it as an American colony peopled by beggars and orphans and ultimately encourage diplomatic ties. "We can introduce the reality, the real image of Korea," says Ministry of Trade and Industry official Jin Kim.

Few efforts have been spared to give delegates a comfortable stay. They are whisked through customs at Kimpo airport. Buses carrying them into the city of 9 million pass countless welcoming posters and have special permission to make illegal turns on the clogged thoroughfares to speed the trips.

Twelve of the best hotels are housing delegates, who include IMF and World Bank officials, central bankers, finance ministers and officials, private bankers and about 500 journalists.

Tours are available to the Olympic stadium complex, Cheju Island resort, an auto factory and the mammoth steel production complex at Pohang. There are shopping and nightlife tours and fashion shows.

To underline its view of the threat from the North, the government is also arranging tours to Panmunjom, the truce village in the demilitarized zone that divides the Korean peninsula. North and South hold discussions there periodically.

Delegates will get scant appreciation of the hovels where many Seoul residents live and the tiny sweatshop factories that contribute to the vaunted growth economy.

As the country with the fourth largest debt, the government is also doing its best to hide the political unrest that has plagued President Chun Doo Hwan in recent months.

Thousands of police and security guards have been mobilized to ring the hotels and conference site at the Seoul Hilton International. To avoid alarming the delegates, riot police seated in parked buses have traded their usual military fatigues for civilian clothes.

Security men sit by the elevators on each floor of the conference hotels. They have choked off, on grounds of security, the usual traffic in prostitutes.

The government is on guard against disruption from a small but radical student movement. Many of its members say the IMF and World Bank are symbols of what they call American oppression.

Demonstrations so far have been small and invisible to delegates, but a rally is rumored for Tuesday, formal opening day of the conference.