Andrew Young began his controversial visit here today with an appeal to the self-interest of white-dominated South Africa and urged a sharing of economic and political power with its disenfranchised black majority soon.

"You have no real alternative," he warned.

At a multiracial businessmens' dinner organized by multimillionaire industrialist Harry Oppenheimer, the U.S. ambassador to the United Nations used the moderate language of the Chamber of Commerce and avoided sharpening the controversy that the very announcement of his visit touched off here weeks ago.

Flying in at Midday from Mozambique, where he attended a U.N.-sponsored conference on southern Africa, Young broke the chilly atmosphre by shaking hands with both black airport workers and white officials there to greet him. Blacks gave him a warm welcome and Young gave the black power handshake in return.

No local press was allowed to greet him at the far end of the airport where his U.S. Air Force plane was parked.

Security was tight at the downtown Carlton Hotel, where the dinner was held. The only incident involved a young white man detained in the lobby for distributing mimeograped slips of paper reading "Young insulted us. Kick him out. Hated Young is our enemy."

In his address, Young avoided any suggestions that South Africa's blacks should organize economic boycotts. He touched only briefly on his frequently expressed distaste, on moral and humanitarian grounds, for the regime's policy of apatheid, or racial discrimination.

Rather, he argued that time was running out for South Africa - that apartheid had deprived the domestic market of potential sales, had closed markets in economically properous black African countries and the economic trend was running against it.

He said that at least four to five million of South Africa's 18 million blacks had to become "full participants in the economy" for the country to continue to prosper and persuade them they had a stake in the economic system.

Already the trend in Nigeria, whose $5.5 billion volume of trade with the United States is twice as large as America's commerce with South Africa, was pointing the way toward declining Western interests here and growing involvement with black Africa, he said.

"Don't get mad - get smart," he said, echoing the old civil rights slogan that he had dusted off during his current African mission. "We too have a heritage of shame that in many ways surpasses yours."

"As at least this outsider sees it, you have no real alternative - except to go this route of change through the market place," He added. "South Africa has an impressive military defense system, but is defending itself against the wrong threat."

"The problems bearing down on you are not military, but economic: shrinking markets, shrinking investments, a largely unused productive capacity without your own society."

"You cannot fight points in the money market and there is no army within 2,000 miles to challenge South Africa militarily what is the value of an atomic bomb where there is no one to drop it on?"

Alluding to South Africa's status as the richest African nation, he warned that wealth alone was not enough, 'for wealth that is inefficiently created and unjustly distributed through a system built on denial will not produce a cohesive, productive society."

"As long as the 11 million blacks in the American South were held down, the South itself was held down," Young said. But the civil rights movement had involved the blacks in the economic system and "transformed the South from a depressed area to the most dynamic and rapidly growing region of the United States," he said.

He pointed to the late Martin Luther King's experience in Birmingham, La., with the President of a big corporation who typified the business community's response to black demands.

"Through their contacts, they lined up about 100 business of all sizes around town who gradually; introduced a deliberate program of phased desegregation in employment and business operations," he recalled.

"It seems to me that the market potential of the blacks in this country is far greater in relative terms than it was in the United States."

(The Soviet news agency, Tass, today attacked Young as a "zealous defender of the interest of the imperialist monopolies in southern Africa," (Ruther reported.)

Meanwhile, Reuter reported from Maputo, Mozambique.

A United Nations conference on southern Africa ended here today with Western nations refusing to endorse parts of Third World-backed declarations containing sweeping measures to isolate white minority governments.

The Western nations did not specify which provisions they rejected, but sources said the main obstacles to agreement were a call on the U.N. Security Council to impose a mandatory arms embargo against South Africa and extension of sanctions against Rhodesia to include a total communications embargo.