Two of South Africa's most prominent church leaders -- Bishop Desmond Tutu and C. F. Beyers Naude, general secretary of the South African Council of Churches -- have called on U.S. and European banks to demand the resignation of the government of President P. W. Botha as a condition for rescheduling that country's bank debt.
The specific call for the resignation of the South African government and its replacement with leaders "responsive to the needs of all South Africa's people" is believed to be the strongest request for economic sanctions yet made by major church leaders in that country. It also prompted fears among some antiapartheid activists here that it could lead to the arrest of Tutu, the 1984 Nobel Peace Prize winner.
The statement was privately delivered in London on Oct. 22 to Fritz Leutwiler, a Swiss banker who is acting as an independent mediator between the South Africans and representatives of 29 U.S. and Western European banks, according to the office of Rep. Howard Wolpe (D-Mich.), chairman of the House Africa subcommittee, which released the statement yesterday.
"This is the first I've ever seen anyone inside South Africa calling for the resignation of the government," said Wolpe. "For people of their stature to say that is significant."
The statement was signed by Tutu and Naude, among the most prominent critics of apartheid, but has also been endorsed by the Rev. Allan Boesak, another nonwhite religious leader who was arrested on Aug. 27, according to one knowledgeable source.
The statement comes in the midst of a South African financial crisis that was triggered last August when U.S. banks, reacting to escalating violence and social chaos in that country, began cutting off credit to that country by refusing to renew maturing short-term loans. This, in turn, produced a collapse of the South African rand on the international currency markets and lead the Pretoria government to impose a unilateral four-month moratorium on debt repayment.
The current negotiations are designed to negotiate a new schedule for repayment of South Africa's short-term debt, estimated at about $14 billion. In an initial meeting at an office of the accounting firm of Price Waterhouse in London on Oct. 22, South African officials reportedly told the bankers that their country's underlying economy is essentially strong and is only suffering from a "political debt problem, nothing like the LDCs," or less-developed countries, whose growth and potential for repayment are minimal.
But U.S. banks have been under increasing pressure from South African critics here to use their leverage in the debt negotiations to force reforms on the government in Pretoria. Already, some banks have said they have privately informed government officials that the country's political problems were closely linked to the overall perception of South Africa's in the financial markets and the country must therefore move more rapidly toward reform.
But most U.S. banks have been reluctant to make the connection publicly. Spokesmen for two leading U.S. banks represented in London -- Citibank and Chase Manhattan -- declined to comment yesterday on the joint statement by Botha and Naude.
"It goes without saying that signficant and meaningful political reforms are going to be a prerequisite to a rescheduling of the debt and resumption of credit," one official of a U.S. bank said yesterday. "But nobody wants to make a loud public statement about that because this is really a political issue."