The Algerian War is the dominating issue in current French politics, and the future of underdeveloped nations the central challenge to the Western World, Pierre Mendes-France, former premier of France, told a Quincy House audience yesterday.

In the final public appearance of his six-day stay at the University, Mendes-France said that all French domestic and foreign problems are directly or indirectly related to the Algerian Revolution. He pointed out that a large majority of the French people oppose continuation of the war.

Mendes-France maintained that the Algerian conflict has damaged France's relations with other former French colonies, but that the damage is not extensive. He recommended a full assault on the problems of such underdeveloped countries by all nations of the Western world.

Need for Common Policies

Emphasizing the need for common European policies toward the underdeveloped nations, he predicted that economic and social competition between the East and the West would increase, and that the West is not yet sufficiently organized for the required effort. He praised the recent establishment of the Organization for Economic Cooperation and Development.

While multilateral aid is theoretically the best approach to economic aid, the former premier said, a practical basis should decide the choice between bilateral and multilateral aid. The West should choose whichever technique offers the best chance of success in the individual case.

Mendes-France stated that, with the exception of the communists, there is no leftist group in France advocating the neutralism that has received wide support among elements of the British Labour Party. In his own party, the Unified Socialists, he added, there exists no tendency towards a policy of withdrawal from the western alliance.