Businessmen Warn Botha on Need for Reform

President Pieter W. Botha was warned Friday by South Africa’s top businessmen that the country’s stagnant economy cannot improve until he offers a clear program of political reform capable of ending the continuing civil unrest here.

“There is a general need for a clearer indication of the direction that is to be followed with political reform and the maintenance of law and order,” the country’s Economic Advisory Council said in a report endorsed by 200 business leaders during a daylong meeting with Botha and his Cabinet.

The report lays out a long-term national economic strategy, aimed at pulling South Africa out of its deepest recession in more than 50 years, that its architects hope will bring renewed business confidence, encourage investment, create jobs, cut inflation and reduce government involvement in the economy.

Seeking Stepped-Up Reforms

The businessmen also hope that their firmly restated demands for further political reforms, including full black participation in national politics and the repeal of laws that segregate residential areas by race, will encourage the government to accelerate and broaden its reforms.

“The mood was that this reform process must continue at a much faster pace than in the past,” Warren Clewlow, chief executive of Barlow Rand Ltd., a major South African conglomerate, told reporters after the conference, saying that political issues cannot be divorced from any national economic strategy. “Look at our plan, and you will see that it begins from the position of saying that apartheid is out--and that we will move forward from there.”

Meyer Kahn, general manager of South African Breweries Ltd. and another member of the Economic Advisory Council, added, “We made it clear that we want a free and open society for all.”

Botha Won’t Be Pushed

Botha opened the meeting at the state guest house here by telling his invited guests that this conference was to deal with economic, not political, issues and that he would not be pushed into political concessions.

“When we do reform, then the foreigners say sanctions are working, impose some more,” he said, “and the domestic radicals say the government is capitulating, so keep up the pressure, and the (right-wing) Conservative Party says throw out the government, it is yielding to pressure.”

Botha also rejected criticism that his program of step-by-step reforms is not proceeding fast enough. “Show me a country that has found an instant solution along the constitutional path,” he said.

But at the end of the conference, the government’s third since 1979, Botha told reporters that the discussions had been characterized by “good will and openheartedness.”

“I want to give the assurance that, where there were differences, the criticism was of such a nature that we could work together to solve our problems,” he said. “We did not scream at each other, we did not berate each other, we parted as friends.”

Political Solutions

Zac de Beer, a director of the giant Anglo American Corp., the country’s biggest company, commented, “There is a widespread perception among businessmen that the solution to the country’s problems are politically linked, and we have to await the government’s response on the key political questions.”

De Beer was one of half a dozen businessmen who were publicly scolded by Botha last year for meeting with the exiled leadership of the African National Congress, the principal guerrilla group fighting to end minority white rule here.

Anti-apartheid groups had asked the businessmen to use Friday’s conference to challenge Botha not only to speed up reforms but to bring an immediate end to apartheid, South Africa’s system of racial separation and minority white rule.

Many Critics Absent

Many of the government’s most outspoken critics in the business community were absent, however, and Botha and his ministers emerged almost unscathed from the panel discussions.

Despite some recent signs that South Africa is beginning to pull out of the three-year recession, the country still has serious economic troubles. Inflation is running at nearly 20% a year, urban black unemployment is estimated at 30% nationwide and more than 60% in some areas, interest rates are too high to encourage new business investment and the South African rand is worth less than half of its value three years ago.

“Our principal economic problem is business confidence,” Gerhard de Kock, governor of South Africa’s Reserve Bank, said in a brief interview after the conference, “and most of our discussions were about what it would take to restore that confidence, which would be the first step to rebuilding the economy. . . . It was quite clear that, for most businessmen, political reforms are part of that process and must be combined with any economic strategy.”

In other developments, seven prominent white anti-apartheid activists from Johannesburg were barred by police under the country’s five-month-old national state of emergency from taking part in protests against government policies and from participating in the activities of certain groups, including the United Democratic Front, the End Conscription Campaign and the Johannesburg Democratic Action Committee.

In Port Elizabeth, General Motors Corp. confirmed that it has fired 567 workers, about a fifth of its work force, when they refused to end a sit-in at its plants and had to be removed by police. The workers are protesting GM’s announced plans to sell its operations there to its senior managers and demanding severance pay and a refund of their pension contributions.

About 6,000 black miners went on strike Friday at the Kinross Gold Mine, the scene of a fire that killed 176 miners, most of them black, to demand reinstatement of a union leader who was fired by the company and settlement of other outstanding grievances.