Money on the Move: The Modern International Capital Market, and: The Money Lenders: Bankers and the World in Turmoil (review)

234 SAIS REVIEW itself be fated to collapse under a barrage of charges that it had betrayed Afrikaner vital interests. Faced with fervent resistance to his modest reform efforts within South Africa proper, Prime Minister Pieter W. Botha may appraise the situation similarly. Whether he does or not, however, he is nonetheless able to deflect pressure, avoid the SWAPO issue, and gain time by making Cuban troops in Angola the issue. But, should South Africa finally wish to cut the costs of protracted guerrilla warfare and diplomatic friction, it would have an available fallback position. It possesses a remarkably little-heralded asset that might enable it to tether even a SWAPO government. Namibia's only major port and railhead, Walvis Bay, is legally a part of South Africa. The 434-square-mile enclave was annexed to Cape Colony in 1884. Should it insist on the right to remain in Walvis Bay as the United States has remained at Guantanamo Bay, South Africa might continue militarily to control Namibia's access to the world outside. Were the South African government desirous of generating domestic political support or tolerance for an international settlement, it would presumably lay stress on this Walvis Bay factor—albeit at the risk of engendering a conflicting international demand that Walvis Bay be treated as integral to Namibia. In the final count, it is South Africa that will decide whether there is or is not to be an internationally negotiated settlement in Namibia. It will do so within the framework of a larger strategy. Based on its fear of a "total onslaught" by hostile, Communist-linked forces determined to overthrow white rule, this strategy increasingly features both Israeli-like preemptive and retaliatory strikes into Angola, Mozambique, Lesotho, and other neighboring states, and support for "destabilizing" political forces within those countries. It remains to be seen if this strategy will tame the regional political environment or only further internationalize and aggravate South Africa's problems. Given the sobering complexity and intractability of the Namibian issue, one must wonder whether the Reagan administration might not wish that it had been a little more charitable toward those who strove to achieve a Namibian settlement before it. Whether justified or not, this administration may find itself judged with equal severity should its "constructive engagement" with South Africa not succeed in bringing peace to the southwest corner of Africa. Money on the Move: The Modern International Capital Market. By M. S. Mendelsohn. New York: McGraw Hill, 1980. 291 pp. $16.50. The Money Lenders: Bankers and the World in Turmoil. By Anthony Sampson. New York: Viking Press, 1981. 336 pp. $16.95 Reviewed by Roger Leeds, a senior investment officer and economist at the International Finance Corporation of the World Bank and a professorial lecturer at the School of Advanced International Studies, theJohns Hopkins University. Any useful chronicle of the growth of contemporary international banking and financial markets must begin with an account ofthe unexpected surge of the 3. The old German coastal resort town of Swakopmund, just north of Walvis Bay, has no harbor. BOOK REVIEWS 235 international price of oil during the winter months of 1973—74, the unprecedented international payments imbalances that were triggered by this event, and the subsequent role played by private banks in recycling previously unimaginable sums of money through the international financial markets from surplus to deficit countries. For individuals without day-to-day involvement in the international financial marketplace, it may be difficult to grasp the meaning of these events and relate them to broader issues of public policy. Both Anthony Sampson and M. S. Mendelsohn are useful in this regard. They write in an entertaining, journalistic style that will appeal as much to laymen as to informed professionals. Their books confirm that there is no need to be a financial genius or numbers wizard to understand the dynamics of international financial markets, or the interdependence of international financial affairs and other factors that, blended together, comprise the "national interest." It is important to bear in mind that the current profiles of international debt result from the relative ease with which nations today can borrow in the international financial markets, as contrasted to earlier periods...