European business and defense interests. In 1948, Britain, the former colo-
nial power, had far the largest foreign stake in the South African economy,
but in the 195os and, particularly, during the boom years of the 1960s and
ea.rly 1970s, American and continental European trade and investments
grew spectacularly. By 1978, the United States had surpassed Britain as
South Africa's principal trading partner and the Japanese as well as the
Europeans were trading with South Africa on an increasing scale. Bythen,
too, $26.3 billion of foreign capital was invested in South Africa. About 40
percent of the total was British capital, 20 percent was American, and 10
percent was West German, while the Swiss and the French contributed
about 5 percent each. About 40 percent of the total consisted of direct
investment in the South African subsidiaries or affiliatesof American com-
panies, such as Ford, General Motors, Mobil, and Caltex Oil, and 60
p<:~rcent of the total consisted of indirect investment-American
and Euro-
pean bank loans, and shares in South African gold-mining and other stock.
The returns on foreign investment were high. American returns averaged
over 15 percent in 1970-74, declined to 9 percent in I 975, and rose again
to 14 percent in I976-78.78