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Botha's ruling party losing grip on whites. Today South Africans vote in segregated local elections, seen as crucial to the country's future. The ruling whites see the poll as a step toward limited power-sharing with blacks. But many blacks advocate a boycott - refusing to join what they deem an illegitimate system. At the same time, the ruling party is under attack from the right-wing Conservative Party for making concessions to blacks. In the end, the Conservatives may be today's real winner.

They're doing a brisk business at the yellow-striped Conservative Party tent down at city hall. People crowd inside, mingling among the photographs of candidates running in today's municipal elections. Some contenders are here in person, shaking hands and kissing babies. Women wearing flowery ``CP'' ribbons flit about, pressing partisans to have one more piece of cake.

It's another story at the government's National Party tent. There, volunteers sit glumly behind a long table. They watch the traffic going by. A few supporters drift in: party workers jump up, chat, crack jokes. Then they go back to watching traffic.

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The contrast couldn't be more stunning in a country where Nationals have reigned supreme for 40 years. But President Pieter Botha's party is losing its grip on the white electorate. Fears about a moribund economy and relatively radical changes to the segregationist system here are causing deep disaffection.

And along come the ultra-right wing Conservatives, with their tough talk and quick-fix remedy of returning to old-style apartheid. It's an appealing combination in a society where many whites feel beset by change and uncertainty. Which is why political analysts figure Conservatives could clean up in today's poll.

Even though the vote is only on the local level, it's significant for several reasons. If Conservatives take a critical number of municipalities, they could paralyze the Pretoria government's plan to pour millions of dollars into decaying black townships. Conservative chief Andries Treurnicht vows to halt white taxes going to improve black areas - a key component of Mr. Botha's counterinsurgency strategy to pacify blacks.

Perhaps more important, analysts see this ballot as a test run for the next general election - which Botha is expected to call by early 1990. A strong Conservative showing now, they say, could portend the same in a parliamentary poll - a prospect that alarms many people.

``The barbarians are at the gate,'' says David Welsh, a University of Cape Town political studies teacher. ``While it's unlikely the Conservatives will take over, they could capture enough seats to have considerable power over a government already reduced to quivering Jello by their advance.''

(In South Africa's 1987 election, the Conservative Party shocked the Nationals by picking up crucial parliamentary seats in Transvaal Province - the country's economic and population center - and thus becoming the official opposition.)

Many here attribute the Nationals' initial decline to demographics. For years after the party came to power in 1948, South Africa was small enough that widespread job reservation for whites didn't hinder growth. But by the 1970s, the white population alone couldn't sustain the economic spurt of the previous decade, when the economy grew an average 9 percent annually.

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(These days, whites total about 4.5 million, compared with 28 million blacks.)

With few other choices, the government opted to open the economy to blacks, says Andre du Toit, a University of Cape Town political scientist. That meant a drastic expansion of black secondary education, and the growth of black trade unions. Government spending on black education, for instance, jumped 30 percent in 1977 from 1976.

The losers were white workers - crucial members of the Nationals' coalition. They saw the competition from skilled black workers and unions as a serious betrayal, explains Mr. Du Toit, one they have not forgotten.

The Nationals' power base was eroded further by reforms introduced in the 1980s, especially those enacted after the 1984-86 black uprising. Laws controlling the flow of blacks to urban areas were lifted, some beaches integrated, black wages increased. (See chart.) And Botha began to push a plan to rewrite the country's Constitution and to work out a power-sharing agreement with blacks - who have no vote in national matters - without relinquishing total white control.

(The government is looking to use today's poll - in which blacks too are participating - to start that process.)

This would have been unnerving enough to whites fed a 40-year diet of ``separate development.'' But since 1984, the economy has grown only about 1.8 percent annually, due mostly to a loss of confidence and cutoff in foreign credit. And although the salary gap among races still is considerable, black inflation-adjusted wages jumped about 12 percent between 1980-1986 - while white wages rose only 1 percent, says University of Cape Town economist Charles Simkins.

Thus, many whites have come to equate political reform with economic hardship. And Conservatives are cashing in by playing to the frustration and fear. The tenor of their campaign tells it all: ``South Africa's cities are being swamped,'' cautions a pamphlet. ``Botha's reforms will lead to black rule,'' trumpets another. Other literature starkly warns that ``White survival is at stake.''

The solution, says the Conservative's leader, Mr. Treurnicht, is strict adherence to apartheid. That requires blacks to live in government-created tribal ``homelands,'' leaving South Africa for whites only. All reforms would be reversed. And places like Soweto, Johannesburg's sprawling black township, could be turned into independent city-states administered by the homelands.

Piet Coetzer, a National Party member of Parliament, calls it a formula for ``full scale civil war between blacks and whites.'' Nonetheless, the Nationals appear pretty powerless to counter the conservative onslaught. Political analysts - and some Nationals - chalk it up to a leadership problem. Scared by the far-right and stymied by a real lack of commitment to reform, they say, Botha's policies look contradictory and directionless.

Indeed, in what was seen as an attempt to woo white voters, Botha tried to push through Parliament legislation to crack down on blacks living in illegal areas. Last week, however, he apparently backed down - at least temporarily.

``The Nationals know what they don't want,'' says Richard Humphries, a University of Witwatersrand political scientist. ``They don't want whites to lose power. The problem is they don't know what they do want.''

Last in a series. Previous articles ran Oct. 14, 20, 21, and 25.

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