It was not a sudden loss of nerve that caused President P. W. Botha to fail to announce the reform package his lieutenants had been telling everyone he would present in his speech in Durban Thursday night. Nor was it pressure from hardliners in his Cabinet that made him back down, as some commentators are suggesting: Botha is as much boss of his Cabinet as de Gaulle and Salazar were of theirs. It was Botha's own decision to turn the speech into a demonstration to the world that the Iron Man of Afrikanerdom is not going to be pushed into anything by outside pressures, internal unrest or anything else on God's earth. And it was that which brought out what a newspaper that reflects the sentiments of Johannesburg's business community called "the hick politician" in him.

Perversely, it was the expectations his own ministers had deliberately raised that made him call the whole thing off and thumb his nose at the world instead. The expectations had been widely published abroad, causing Botha to fear that if he went through with what was being anticipated he would be seen to be following the dictates of outsiders. In a fit of recidivism the old machine politician of the '40s and '50s, whom South Africa's slick publicists have tried to retread as the modern reformist of the '80s, decided that was intolerable.

He strode into a Cabinet meeting on Wednesday morning and announced that he had changed his mind and was going to strike out the few reformist passages his prepared speech contained.

This was embarrassing for Pik Botha, his indefatigable Foreign Minister, who had flown to a meeting with British, American and West German diplomats in Vienna a week before to tell them to expect a dramatic statement. The word is that Pik Botha threatened to resign, but no one here expects him to do so. Cabinet posts are like life peerages in South Africa, and they are not readily relinquished.

Reconstructing how South Africa came to build up such high expectations only for its president to dash them, so making the situation much worse for it than if there had been no sales pitch in the first place, reveals a range of psychological distortions, both in South Africa and on the part of those who deal with it, that complicates the already intractable problem of apartheid.

Why did Pik Botha go to Vienna? The answer is that while South Africa wants to tell the world to go to hell and mind its own business, it also desperately wants the world to accept it.

It may thumb its nose at the world and say that international condemnation will make it more bloody-minded than ever, which was the point President Botha was trying to demonstrate on Thursday, but the condemnation hurts, and South Africa will go to great lengths to counter it. That is why the Vorster government launched the extravagant Muldergate information conspiracy.

It is also why Pik Botha went to Vienna. World criticism of Pretoria's handling of the unrest, and the recalling of ambassadors for "consultation," has had an effect. The foreign minister, aware that his president planned to announce some reforms, decided to make the most of them.

There can be little doubt that Pik Botha went in for some oversell in Vienna. The ambiguous language Pretoria has evolved to describe its policies enable it to say things in a manner that can be interpreted one way abroad and another at home.

It also seems clear that the Western diplomats who went to Vienna, especially the Americans who are anxious to have something to justify the Reagan administration's policy of "constructive engagement" with South Africa, heard what they wanted to hear. Back home they presented an exaggerated interpretation of an already exaggerated intention.

There followed yet another phase of magnification when the diplomats leaked the good news back in Washington to bolster their cause. With journalism's natural tendency to dramatize, some startling predictions began hitting the presses. President Botha, according to Time magazine, was about to make "the most important statement since Dutch settlers arrived at the Cape of Good Hope 300 years ago." Newsweek, drawing on the same diplomatic leaks, wrote that Botha was going to announce a "giant step" away from apartheid, including power-sharing with blacks, scrapping the tribal "homelands," granting common citizenship to everyone, repealing the influx control laws and inviting black leaders to a national convention to write a new constitution.

Heady stuff to anyone with some understanding of the glacier-like movement of reformist thinking in Pretoria.

New York Rep. Stephen Solarz was another who got carried away after being briefed by Pik Botha before the Vienna meeting. Solarz, an old South Africa hand who ought to have known better, said he expected President Botha to make a "declaration of intent" that would have "a considerable effect on attitudes towards South Africa in the United States."

The congressman's euphoria collapsed a few days later when he met the president. Solarz emerged saying the meeting had "made a cold shower seem warm" and that Botha had likened Nelson Mandela's imprisonment to that of Rudolph Hess. "I am not optimistic that he is going to announce any meaningful reforms in Durban," the congressman added. Clearly Botha had already undergone his change of mind.

What he was going to say was in any event not particularly dramatic: extending South African citizenship to all blacks, including homelanders, by drawing a semantic distinction between "citizenship" and "nationality"; modifying though not abolishing the influx control system; and declaring a willingness to negotiate on constitutional reforms with any black leaders prepared to renounce violence, which would preclude Mandela and the ANC.

Without the buildup, it would have been welcomed as a small step forward. Blacks would not have been greatly impressed, and it would have done little to defuse the unrest in the townships. But at least it would not have made things worse, which is what has happened now.

Botha will doubtless come back to these announcements some time in the future, but they will make no impact at all then. In the meantime he has revealed his lack of statesmanship for all to see and taught the West a sharp lesson -- not the one about Afrikaner determination, which he intended, but never again to be taken in by South Africa's political huckstering. It is a country to be judged by what it does rather than by what it says.

The writer is a special correspondent covering South Africa for The Post.