Today the country of Bolivia, in South America, is landlocked. This was not always the case. Before 1879 the Pacific coast province of Antofagasta was part of Bolivia. As a result of the War of the Pacific (1879-1883), however, Bolivia lost Antofagasta to Chile and became a landlocked country.
Treaties and Disputes Over Nitrate Deposits (1865-1879):
The war that caused Bolivia to lose its access to the sea was precipitated by a dispute between Bolivia, Chile, and Peru over control of nitrate deposits near the Pacific coast. In the 1870s Chile faced an economic crisis as the prices of its major exports, wheat and copper, declined. As other exports declined, Chile became increasingly dependent on the growth of nitrate mining in the Atacama Desert. Nitrate production doubled between 1865 and 1875.
The area of nitrate deposits straddled what were then the Chilean, Peruvian, and Bolivian borders, including the Bolivian Pacific province of Antofagasta and the Peruvian province of Tarapaca. Most of the nitrate deposits lay in Bolivian and Peruvian territory, but the major nitrate mining companies that operated in these areas were owned by British and/or Chilean nationals.
An 1866 treaty between Chile and Bolivia had stipulated that the border between the two nations would be along the 24th parallel in the Atacama Desert. This treaty also gave Chile and Bolivia equal rights to exploit resources between the 23rd and 25th parallels and guaranteed that both governments would share equally in the revenues from the export of minerals from either side of the border area.
This border region was soon developed as a major nitrate producing region by Anglo-Chilean investors and companies. In 1874 Bolivia and Chile signed another treaty. Under the terms of the new treaty Chile gave up its rights to its share of tax revenues from mineral exports on the Bolivian side of the border. In return Bolivia promised that it would not increase taxes on Chilean companies in its province of Antofagasta for the next 25 years.
Chilean mining interests soon extended their operations into the Peruvian province of Tarapaca. By 1875 Chilean companies in Peruvian nitrate fields were employing more than 10,000 people. At this time, however, the Peruvian government decided to intervene and expropriate foreign companies in Tarapaca, replacing them with a state monopoly over the production and sale of nitrates. At the time the Peruvian government was on the brink of bankruptcy and desperate for money.
Shortly before nationalizing its nitrate industry, Peru had formed a secret military alliance with Bolivia against Chile. In this 1874 treaty both nations agreed to support each other in the event of a war with Chile.
In 1878, Bolivia, bolstered by its secret alliance with Peru, imposed higher taxes on nitrate exports from Antofagasta. This violated its 1874 treaty with Chile, in which Bolivia had promised not to increase taxes for a 25 year period. Chilean companies refused to pay the new taxes and the Bolivian government threatened to expropriate the companies.
The Bolivian government proceeded to reject two Chilean offers to submit the dispute to arbitration. In February 1879 the Bolivian government ordered the seizure of Chilean properties in Antofagasta. On the day set for the seizure of the properties, however, Chilean troops invaded and occupied Antofagasta without any resistance.
At this time Peru was completely unprepared for war, and made a failed attempt to mediate between Chile and Bolivia. The Chileans, however, became aware of the secret Peruvian-Bolivian military alliance against them and declared war on both Peru and Bolivia on April 5, 1879.
The War of the Pacific and its Aftermath (1879-1913):
Although Peru and Bolivia’s combined population was more than twice that of Chile, they faced some serious disadvantages. Compared to Peru and Bolivia, Chile had a fairly stable national government. The Chilean population had a far stronger sense of national identity than their Peruvian or Bolivian counterparts. Chile’s military was also better trained and disciplined than those of its rivals.
Chile also enjoyed the geographic advantage of being closer to the war zone. Peru’s army had to cross the Atacama Desert and the Bolivian army had to cross the Andes Mountains to reach the theater of operations.
Economically all three nations were facing serious difficulties, but Chile was slightly better off in this regard as well. Chile also enjoyed the support of influential British economic interests. British capitalists had cooperated closely with Chileans in the exploitation of the Pacific nitrate deposits. Bolivia and Peru, on the other hand, were not on as good terms with British economic interests. The Peruvian expropriation of Anglo-Chilean nitrate companies had hurt British investors, and both Peru and Bolivia had suspended the repayment of British loans.
With British help, then, Chile defeated Peru and Bolivia in 1883. Under the Treaty of Ancon, which ended the War of the Pacific on October 20, 1883, Peru ceded the province of Tarapaca to Chile. In April 1884 Bolivia and Chile signed an armistice that gave Chile control over the Bolivian province of Antofagasta. The loss of the coastal Pacific province of Antofagasta made Bolivia a landlocked country.
It was not until 1904, however, that the Bolivians formally acknowledged Chilean control over Antofagasta. In return Chile agreed to pay an indemnity and build a railroad connecting the Bolivian capital of La Paz with the port of Arica. This railroad was completed in 1913.
Benjamin Keens and Keith Haynes. A History of Latin America. Volume 2: Independence to the Present. 7th Ed. Boston: Houghton Mifflin Company, 2004., p. 230-231.