The Washington Diplomats staged an elaborate press conference yesterday to announce the signing of Juan Jose Lozano, a Spanish midfielder who has been playing professionally in Belgium.

Lozano, 24, was signed to a three-year contract that will make him the higest-paid player in Dip history, a contract that could be worth more than $200,000 annually with incentive bonuses. Lozano was purchased from his Belgian club, Beerschot, for about $500,000, almost double the $260,000 the Dips paid a year ago for Allan Green, then their most expensive purchase.

"Juan can play for any major league team in the world," said Coach Gordon Bradley. "I expect him to be our playmaker, to be our field general out there."

The club is involved in heated negotiations with a Dutch club for the rights to World Cup player. Wim Jansen, 32, also a midfielder. The Dips are also seeking Chilean striker Carlos Caszely and Carlos Bianchi, an Argentine currently playing in France.

European sources said last week that Lozano is a good player, solid and talented. But, they said, he is in no way a Kevin Keegan, a Johan Cruyff or a Daniel Passarella, all names that Madison Square Garden has waved under Washington's nose, since buying the Dips 18 months ago.

Lozano was also described as an excellent technical player, capable of getting the ball to players like Joe Horvath and Green, the Dips' leading scorers last season.

"The best thing about this is that we're signing an excellent player while he is still in his prime," Bradley said. "In the past the tendency in the North American Soccer League has been sign players after they've reached their 30s."

Lozano, speaking through an interperter, said that he looked upon playing in the U.S. as a great adventure.

Garden President Sonny Werblin, apparently defending MSG's decision that he believed there were two philosophies about building a team.

"One way" he said, "is to do something even if its wrong. That's what appears to be going on in the NBA today. The other is to go out and acquire the best possible talent you can get. That's what we feel we're doing now."

Lorzano, who played in Belgium because his family moved there when he was 10 years old, is 5-feet-8, 155 pounds. He was known in Belgium as "The Little Spanish Devil." He was a good enough player that Belgian officials tried to convince him to become a citizen so he could play on their national team.

An offensive-minded player, Lozano is noted for his quickness and for his ability to score on free kicks. He will travel to Jacksonville, Fla., next week with the Dips to begin training for the season that begins March 29.