The Reagan administration, seeking to contain pressure in Congress from both Republicans and Democrats for economic measures against South Africa, yesterday submitted a bill that would increase aid to that country's majority black population but put off any decision on sanctions for two years.
The bill marks the start of a major battle between the administration and Congress over foreign policy, this time toward South Africa and its system of racial segregation, apartheid, just as the highly emotional and divisive debate over aid to the "contras" in Nicaragua is ending.
The administration is taking action to preempt growing momentum for sanctions -- even among some conservative Republicans -- by presenting an alternative to its own widely criticized policy of "constructive engagement" with the South African government.
At the same time, the administration sent the chief architect of this policy, Assistant Secretary of State for African Affairs Chester A. Crocker, before the Senate Foreign Relations Committee yesterday to present 12 reasons why economic sanctions would be "counterproductive" and the various bills being considered are all "misguided."
Crocker argued that sanctions were "precisely the wrong signal to send" at a time when South African policies are "changing more than ever."
It was immediately clear, however, that the administation and its critics are far apart in their assessments of South Africa's reform efforts. The disagreement was just as sharp at the committee hearing over whether "constructive engagement" has been "an unmitigated disaster," as Sen. Edward M. Kennedy (D-Mass.) called it, or one cause of recent South African reforms, as Crocker contended.
Meanwhile, Oliver Tambo, the exiled president of the African National Congress, was in Washington seeking support for the struggle to end white-minority rule in South Africa.
At a luncheon with editors and reporters of The Washington Post, he urged that economic pressure be exerted to hasten the end of apartheid. The ANC was banned in South Africa in 1960. Details, Page A29.
The administration's bill was introduced yesterday in the Senate by Sen. Richard G. Lugar (R-Ind.), chairman of the Foreign Relations Committee, Majority Leader Robert J. Dole (R-Kan.) and Charles McC. Mathias Jr.(R-Md.), sponsor of a bill the committee approved unanimously March 27.
The administration measure incorporates the Mathias bill, which would give the president until March 1987 to determine whether the South African government has made "significant progress" toward abolishing the pass laws restricting blacks' movement, allowing unrestricted labor-union rights for blacks, an end to the migrant labor system and an improvement in blacks' housing.
If the determination were negative, the president would have to recommend to Congress which of four possible sanctions should be taken.
These include bans on new commercial investment, bank loans, the importation of gold Krugerrands here or the sale of computers to the South African government.
The latest bill also would set up a $15 million scholarship fund for blacks, mandate that all U.S. companies operating in South Africa subscribe to the "Sullivan principles," ensuring equal treatment for Africans, and direct the Export-Import Bank and the Overseas Private Investment Corp. to help finance black-owned companies. It would also increase the Kassebaum Human Rights Fund, which provides aid to South African community groups for victims of apartheid, to $1.5 million.
Introducing his bill at the start of Senate hearings on an array of sanction proposals, Lugar called it "a step toward ending apartheid" and a warning that if no progress is made in two years, "it shall be the American policy to consider economic sanctions against the government of South Africa."
The bill stands in sharp contrast to another sponsored by Kennedy and Sen. Lowell P. Weicker Jr. (R-Conn.) that calls for a ban now on new U.S. bank loans to the South African government and any of its state corporations and on all new U.S. company investment. Importation of Krugerrands and computer sales to the Pretoria government also would be prohibited.
As a reform incentive, the president would be authorized to waive the ban on new investments or Krugerrands if any one of eight steps to end apartheid were taken by South Africa.
These include freedom for blacks to live and seek jobs in white areas, negotiations with black leaders, the release of all political prisoners and a political settlement in the neighboring territory of Namibia, which South Africa administers despite United Nations resolutions that it relinquish control.
A companion bill is being introduced on the House side by Rep. William H. Gray III (D-Pa.), with 145 cosponsors, including seven Republicans.