CAPE TOWN, FEB. 5 -- President Pieter W. Botha announced today a sweeping program of privatization of state-owned industries and utilities designed to put South Africa on a sound economic footing in the face of international sanctions.
The proceeds of the switch, Botha said, would be used in part to upgrade living and education standards for blacks and to develop black entrepreneurship, as well as for the redemption of public debt.
In a speech opening the 1988 session of Parliament, however, Botha virtually ignored the issue of reform of the apartheid system of racial separation and suggested no new proposals for bringing the black majority into national politics.
Instead, he vowed to maintain internal order and said that security forces would "neutralize those forces that are still actively involved in undermining authority and stability."
His passing treatment of the reform issue underscored fears expressed by antiapartheid activists that, in a year during which three important parliamentary by-elections and nationwide voting for municipal offices are to be held, the ruling National Party plans to put the question of black equality on the back burner.
Some of Botha's senior advisers sought to play down the emphasis given to issues unrelated to racial reform, saying that the announced economic changes would help promote political and social reform.
"In order to reform, one needs a sound economy. Reform costs money. It has become imperative to restructure the economy in order to proceed with reform," Stoffel van der Merwe, Botha's deputy minister for information and constitutional planning, said.
Finance Minister Barend du Plessis also said that social goals such as building low-cost housing and alleviating unemployment will require the government to mobilize capital.
"With sanctions, we have had to look elsewhere for capital investment," du Plessis said, adding that a main goal of the new program is also to reduce the 14.7 percent annual inflation rate by curbing state spending.
Botha announced that the government plans to privatize parts or all of the state-owned electric supply company, the national transportation system, the postal and telecommunications system and state-run industries such as Iscor, the huge iron and steel manufacturing conglomorate.
The state companies would be sold to private interests and through issuance of public stock, and the revenues would be applied both to paying off the public debt and to upgrading infastructure and services in underdeveloped areas, the president said.
Botha specifically mentioned the use of the capital funds for the development of small industries and businesses by the Industrial Development Corp. and the Small Business Development Corp., which has been active in promoting black entrepreneurship.
The shift away from long-entrenched Afrikaner socialism toward the kind of free market takeover promoted by British Prime Minister Margaret Thatcher appears to take into account the long- held contention by many economists that South Africa can never achieve stability without bringing the black majority into the economic mainstream.
Botha said the government also is considering expanding trading licenses for black businessmen and opening up more central business districts to black merchants.
Since the declaration of a state of emergency in June 1986, following unprecedented social and political upheaval, the government has stressed that its top three priorities are a restoration of order, improving the quality of life for blacks in segregated townships and implementing gradual political reform through negotiations with the black majority.
Van der Merwe today denied suggestions that the government had retreated on its commitment to reform in the face of a growing challenge by the far-right Conservative Party, which in last year's whites-only election became the official opposition in Parliament.
Such reform proposals as amendments to the 1950 Group Areas Act, which segregates living areas, are "still on course," van der Merwe insisted, and will be formally introduced in Parliament this session.
The proposed Group Areas Act reforms would allow communities that want to be integrated to accept nonwhites. However, government officials conceded that the practical effect would be that the vast majority of communities would remain racially segregated.
Van der Merwe said that repeal of the Population Registration Act, which classifies all South Africans by race and is the foundation of the apartheid system, was "not on the cards at this moment."
He also said the state of emergency would remain in force for the foreseeable future, adding, "If one were to lift the emergency right now, the consequence would be an escalation of the loss of life."