SEOUL, JULY 21 (TUESDAY) -- Politicians from the ruling and opposition parties yesterday began talks aimed at agreement on a new constitution that will set the rules for South Korea's first genuinely contested election since 1971.

Disputes are expected. Already the ruling party has proposed presidential standards that would disqualify Kim Dae Jung, an opposition leader. The two sides disagree on several other key points, including minimum voting age and workers' rights.

Under the ruling party's proposal on the presidency, candidates for president would have to have lived in South Korea for the five years before an election. This would bar Kim Dae Jung because he was forced to live abroad under the current government.

The government gave in to the opposition's chief demand for free and direct presidential elections in the fall. Ruling party chairman Roh Tae Woo stunned the nation with that concession June 29 after 20 days of street protest rocked the country. But the ruling Democratic Justice Party (DJP) and the opposition Reunification Democratic Party (RDP) disagree on many lesser but still significant planks of a new constitution.

"The question is, can they sit down together and thrash it out," one longtime resident, a U.S. businessman, said yesterday. "They've never done so -- they've always started throwing furniture, throwing fists, blocking doors.

"It's not going to be easy, but this time everybody wants it to succeed," he said. "They've got a timetable, driven ultimately by the Olympics, and they'll probably go right to the brink before they agree."

Ruling party officials have said they hope to agree on a new constitution in time for an October referendum. A new president would then be elected by mid-December and would take over in February, giving a new administration six months to settle in before the scheduled start of the 1988 Olympics here.

To do so, however, the two camps must compromise on several key points despite a political tradition marked more by martial law than compromise:The opposition party wants to lower the minimum age from 20 to 18, thereby adding to the rolls more than 1 million voters who are believed to favor the RDP. Not surprisingly, the ruling party opposes the idea. The ruling party wants a single six-year presidential term and no vice president, while the opposing party wants one four-year term with the right to a subsequent candidacy and a two-person ticket. A vice presidency might help the opposition resolve its most pressing internal problem: that both its leaders, Kim Dae Jung and Kim Young Sam, want to be president. The RDP wants the constitution to guarantee workers' right to form unions, to strike and to have a say in management. Ruling party officials say the last demand threatens the capitalist system that has produced phenomenal economic growth.