Reagan Bans Imports of S. Africa Krugerrand

President Reagan on Tuesday banned imports of Krugerrands, formally denying South Africa its most lucrative market for the gold coins while satisfying a key demand of lawmakers pressing to punish the white-run Pretoria government for its racial policies.

The ban goes into effect Oct. 11 and is a follow-up to a package of economic sanctions Reagan reluctantly ordered last month to prevent Congress from acting on its own against South Africa.

At the time, Reagan promised to add the Krugerrand ban to the sanctions if such an action met with little resistance from America’s key partners in the General Agreement on Tariffs and Trade, the Swiss-based body that monitors world trading rules.

Democrats immediately doubted that the President would keep the promise, but Reagan said Tuesday that the way was cleared for banning the coins when Secretary of State George P. Shultz and Special Trade Representative Clayton K. Yeutter completed the GATT consultation.

Leaders of the congressional push for sanctions applauded Reagan’s action. Rep. Stephen J. Solarz (D-N.Y.), a key sponsor of sanctions legislation in the House, said that the ban represents “a significant step forward in terms of maximizing the pressure against the government of South Africa to force it to abandon its apartheid policies.”

Blunt Democratic Moves

Solarz also predicted that the move would blunt, for the time being, threatened Democratic attempts to revive the sanctions measure.

In a message to Congress explaining the ban, Reagan stressed that all of the sanctions he has ordered over the last month were “directed at apartheid and the South African government” and not designed to undermine its people or its economy.

But of all the sanctions, the Krugerrand ban was designed to have the most economic bite: South Africa derives half of its foreign exchange earnings from Krugerrand sales, and the United States historically has been the biggest market.

Last year more than $600 million worth of Krugerrands were marketed in the United States, but sales have plummeted both here and abroad in recent months in reaction to growing racial strife in South Africa and a mounting worldwide protest against apartheid.

But in explaining his decision to ban the gold coins, Reagan declared: “The Krugerrand is perceived in the Congress as an important symbol of apartheid. This view is widely shared by the U.S. public. I am directing this prohibition in recognition of these public and congressional sentiments.”

Reagan’s order last month also barred the sale of American computers and computer equipment to South African government agencies that enforce apartheid, such as the police and military; curbed most American bank loans to the Pretoria government, and halted the export of nuclear technology.

Similar restrictions, as well as the Krugerrand ban, were part of a legislative package that breezed through the House and was on the verge of passage in the Republican-controlled Senate until Reagan acted.