Sidestepping the Sanctions

At least two provisions of the new law imposing sanctions against South Africa have already been bent if not broken, according to anti-apartheid activists.

The law, passed by Congress in early October over a veto by President Reagan, mandated a broad range of restrictions on U.S. relations with South Africa. Among the sanctions imposed were an end to landing rights in the United States for South African Airways, the state-owned airline, and a permanent extension of the one-year-old ban on the import of the South African krugerrand, a gold coin.

The sanctions required the Reagan administration to "revoke the right of any air carrier" belonging to the South African government, within 10 days after enactment of the Act. But South African Airways (SAA) continued to book direct flights from New York to Johannesburg as late as October 25, nearly two weeks after the end of the 10-day grace period allowed by law.

A State Department spokesman said SAA was permitted to continue flying in and out of New York because Reagan had not yet signed the Executive Order necessary to enforce the law.

Meanwhile, the Treasury Department has begun to mint U.S. gold coins to replace the banned krugerrands, and has awarded a multi-million dollar contract to supply gold bullion and coin blanks to a company partially owned by Anglo-American, South Africa's largest mining company. The contract was awarded to the Engelhard Mineral and Chemical Corporation, which is 30 percent owned by Minorco, a multinational at least 39 percent owned by Anglo-American.

The administration's apparent reluctance to uphold the new sanctions law was denounced by Rep. Mickey Leland, D-Texas, chairman of the Congressional Black Caucus. "The administration has clearly demonstrated its refusal to carry out a law mandated by the U.S. people," Leland said on October 17. "The administration has not only a moral obligation but a legal obligation to sever these illegal ties with South Africa."

- Samantha Sparks

Haiti Liens on Baby Doc

Following the lead of Philippine President Corazon Aquino, the Haitian government has hired the New York City law firm Stroock, Stroock & Lavan to recover money stolen by government officials. Under the 30-year Duvalier family rule, millions of dollars disappeared from the government's coffers.

Deposed President-for-Life Jean-Claude Duvalier, is rumored to have emptied at least $200 million from the National Bank just hours before fleeing to France. During his 14-year rule, Duvalier stole hundreds of millions of dollars, funneling at least $6 million a month to the palace for his personal use, says current Finance Minister Leslie Delatour. Much of that money left the country, and investigators suspect two former presidential aides, Jean Sambour, the presidential couple's interior decorator, and George Derenoncourt, a U.N. adviser, of taking more than $45 million out of the country for Duvalier.

The New York law firm is checking bank accounts and tracing real estate held by the entire Duvalier clan, including Duvalier's mother, Simone Ovide, his older sister, Marie-Denise, and his wife, Michele. Duvalier's father-in-law, Ernest Bennett, Haiti's import-export tycoon who made millions by selling Mercedes to the government, is also being investigated. Roberto Estame, the former foreign minister who investigators believe may have stolen up to $5 million in his short four-year tenure, is also under investigation.

Estame, dubbed "Mr. Ten Percent" by Haitians, for regularly skimming a flat 10 percent off each transaction he conducted, held the cash for many unfinished development projects in Haiti, including a fleet of fishing boats, a sugar mill, and an oil refinery. Estame withdrew millions of dollars from the national treasury in the last days before Duvalier's fall, according to an investigator.

Former Minister of Finance, Economy, and Industry Frantz Merceron is also high on the firm's list of officials to investigate. Merceron earned only a few thousand dollars a month in his official post, yet his numerous homes and apartments in Paris and other cities are valued at more than $20 million.

So far the firm has frozen one Duvalier bank account in Switzerland, one in Florida and four New York accounts. Several family yachts docked in Florida have also been recovered.

Trading in the Middle East

U.S. trade with the Middle East and North Africa has undergone a major shift in the past two years-for the first time since the dramatic oil price increases of the early 1970s, the United States may soon have a negative net balance of trade.

According to a recent report by the Commerce Department, the $3 billion trade surplus enjoyed by the United States in 1984 could shrink to $300 million this year. A deficit could appear next year.

Despite record declines in oil prices, hoivever. U.S. imports from the Middle East and North African oilexporting countries rose from $3.7 billion in 1985 to $4.9 billion in the first half of 1986, according to the Commerce Department.

This sharp increase in petroleum imports comes at a time when domestic U.S. oil producers are experiencing record losses, prompting calls in many `oil belt' states for import quotas.

Surprisingly, Iran is supplying a growing proportion of the oil exported to the United States. According to Commerce Department reports, imports from Iran in the first half of 1986 reached $418 million, up from only $262 million in the same period for 1985. Ironically, in the process, Iran edged out Iraq to become the fourth largest source for U.S. imports in the region, behind Saudi Arabia, Israel and Algeria.

But as U.S, oil imports from the Middle East have increased, the value of U.S. exports to the region have not kept pace.

Japanese and European companies are rapidly moving to claim a lion's share of key markets in the Middle East, long dominated by American firms.

U.S. analysts say the Japanese and Europeans are succeeding because they are offering services and goods now needed by the maturing oil-fueled economies in the region. American traders have seen their market share shrink because many of the goods they offered to help build an economic infrastructure, are no longer in demand.

"American companies can't just rely on past performance," warns Richard H. Hittle, president of the U.S.-Arab Chamber of Commerce. "Business opportunities in the Middle East have changed."

Unlike many American exporters, the Japanese have studied the changing oil state economies. Where U.S. firms still promote heavy industrial equipment, the Japanese are selling computers and cars.

Their success has businessmen like Richard Hittle clearly worried. "If the substitution of American products and services continues," he says, "it will be very hard to regain those markets."

- Josh Martin