Five days before South Africa rejected the United Nation's peace-keeping proposals for Namibia, Richard Moose, assistant secretary of state for African Affairs sat back in his chair at the Faculty Club and termed the prognosis for a settlement this week, "guarded."

"It's come down to a crunch, but we've had other crunches before," Moose said last week, explaining that the South African government's greatest concern has to do with the prospects of the concentration of South-West Africa Peoples Organization (SWAPO) bases in Namibia. The South African government would like to see a provision for monitoring SWAPO forces included in the U.N. plan, he added.

The South African government has ruled Namibia for more than 60 years. It agreed last year to a U.N. proposal for independence later this year. The U.N. plan calls for a cease fire and supervised elections to precede independence.

Asked what course the U.S. would pursue if Pretoria rejected the latest cease fire plan, Moose said the U.S. will "play out every card possible" before terming the negotiations a complete failure.

"If one thinks in terms of additional U.N. action--hardly any of those (sanctions) are going to be productive of a solution to the problem--then we get to dealing with consequences of failure rather than trying to find a solution."

Moose said the greatest U.S. leverage at this point lies in convincing the South African government that a settlement in Namibia is in its own interest. With a Namibian settlement, Moose said, the South Africans can be assured that "at least on that border they aren't going to be faced with a growing military confrontation, and these won't be the spillover effect of that into South Africa itself."

Despite some analysts predictions that SWAPO is the dominant party in Namibia, Moose said that a coalition government will probably result from a "genuinely free election."

Terming U.S.-South Africa relations "worse than they have ever been before" Moose said the South African government believes the U.S. has taken a hostile attitude towards it. The U.S.-supported U.N. arms embargo and the continued psychological pressure against South Africa has hurt the South African government considerably, he said.

"At the same time, when the South Africans do play a constructive role as they have at various times with regard to Namibia, I think we can't fail to give some recognition to that fact," he said, adding "that doesn't mean that they are relieved of any expectation on our part that they have to improve their internal situation."

Moose said last week that the outcome of the Namibia settlement may have an "important bearing" on a U.S. decision to recognize Angola. He said the U.S. is pleased with the Angolans for their effort to get a settlement in Namibia, but he cautioned that Angolan help in achieving a settlement in Namibia is not a condition of recognition.

The U.S. is no longer so concerned about the possible threat of Angola to the stability of the region, Moose said. Many of the differences between the two countries no longer exist, he said, adding however, that "there are still many more Cubans there than we see any justification for."

Stressing President Carter's strong opposition to the apartheid system in South Africa, Moose said that at this point he does not see "any dramatic new departure" in U.S. government action since that would be unlikely to produce the desired changes.

Moose said U.S. corporate withdrawal from South Africa would have little influence on the internal situation. The U.S. government has not reached the point of ruling out evolutionary change within South Africa, he said, adding U.S. corporations can have more of an impact within the country implementing programs such as the Sullivan principles.

Although he credited the Ethiopian Dergue (revolutionary government) with considerable military success in Eritrea, Moose said the Eritrean liberation groups still have control over much of the countryside.

He said the Soviet Union has already committed over a billion dollars in arms to Ethiopia, adding the East Germans are beginning to supply the economic assistance necessary to carry out the Dergue's development goals