The Truce Pact between Bolivia and Chile was signed on April 4. 1884, in Santiago, while the Peace Treaty between them was subscribed on October 20, 1904, also in Santiago. It is peculiar that between these two legal instruments there is a span of little more than 20 years. This substantial lapse shows Bolivia's reluctance to accept the land-locked status imposed by Chile through force of arms.

During this time the United States did not play an important role and American diplomacy did not become officially involved in the conflict between Bolivia and Chile. However, American diplomatic correspondence of the period shows three important facts. First, Bolivia's reluctance to accept its confinement; second, the Chilean efforts to enforce Bolivian dependence of Chilean ports keeping the commercial traffic at a minimum; and third, the ambiguous role of the United States, which although recognizing Bolivia's moral rights, accepted the decisions imposed by the stronger nation, Chile.


Bolivia is locked

The State Department instructed its representatives to send a periodic report to be completed annually, with information on the economic activities of the countries they were assigned. In October 1885, which corresponded to the American fiscal year 1884-1885, the American consulate in La Paz sent an annual report and referred to the Bolivian problem as follows:

"Since the recent war between Peru and Bolivia on one side and Chile on the other, the outcome of which was disastrous for the allies, Bolivia has adjusted again to her peaceful habits, dedicating her efforts to repairing losses, without neglecting to keep an eye on Chile. whose conquering aims are very clear and open.

As a result of that struggle, Bolivia has been severed from part of her territory. including her people... Bolivia is now completely landlocked and isolated. Her commerce must now be carried out through the ports of neighboring countries."(l)


Antofagasta: Bolivia’s Port

After the War of the Pacific, the American government was worried at the lack of a consular authority that could properly serve and promote commercial interchange between the United States and Bolivia. The American consulate in Cobija, the Bolivian maritime capital, was closed and this port had become a ghost city. The American consulate in La Paz reported repeatedly about the lack of Bolivian communication with world trade due to the lack of sea ports.

In 1890, the American mission in Santiago began proceedings at the State Department for the establishment of a consular office in Antofagasta, partly in order to supervise trade with Bolivia. In December of 1892, the State Department constituted a vice-consulate in the light of the importance of this port as a center for mineral resources, but mainly because of the railroad that linked it to Bolivia, making Antofagasta "Bolivia's main port". The State Department appointed Charles Greene as vice-consul due to the fact that he was an old resident of Antofagasta who had settled in the city before the Chilean occupation, and had good relations with the Bolivian citizens and authorities.(2)

Mr. Greene accepted the appointment of vice-consul temporarily, insisting several times on the fact that Antofagasta's importance demanded a proper rank of consulate. This importance was based on the relations of Antofagasta with Bolivia and not with Chile. In this respect, Mr. Greene wrote a letter dated August 15, 1893 to the secretary of state in which he enclosed a map of Bolivia that showed Antofagasta, as the main port for imports and exports for Bolivia.

On the same subject, the American minister, J.D. Porter, wrote to the secretary of state on November 14, 1893 requesting the promotion of the vice-consular office in Antofagasta arguing that Antofagasta is the most important terminal for a railway that soon will link her with Bolivia." (3)

The same concepts were reiterated once more by Greene in a letter dated February 12, 1898 to the secretary of state. (4) The State Department finally accepted the request and raised the rank of the American representation in Antofagasta to the consulate level.


The 1895 Treaties

Bolivia and Chile were very close to a final peace agreement in 1895, when both governments signed five interrelated pacts. The first treaty stipulated the consolidation of the Chilean domination over Bolivian occupied territories, which was referred to in the Truce Pact of 1884, and the financial obligations consequent to the war and the Chilean occupation. The second determined the surrender by Chile to Bolivia, of either Arica or the Caleta Vitor once the dispute between Chile and Peru was solved. The third treaty set up commercial regulations and the other two were protocols that regulated credits and economic obligations. These five treaties stipulated that they formed an "integral package" and therefore they were indivisible.

The treaties were never effective because on the one side, Bolivia's Congress did not approve the fourth protocol regarding the credits, and on the other side, the Chilean Congress did not approve the fifth protocol referring to the indivisibility of the two protocols with the transfer of territories and re-establishment of the peace.(4)

The American minister in Santiago, Edward H. Strobel, reported to the State Department on the negotiations and observed how surprised he was that Bolivia would be granted a port on the Pacific in the territory of the old Peruvian provinces of Tacna and Arica, which were now under Chile's occupation, without signing a previous agreement between Chile and Peru to resolve the dominance of Tacna and Arica as per Article III of the Treaty of Ancon of 1883. The American minister also thought Chile could, at the end, consolidate her legal dominance in Tacna and Arica, and that consequently, Bolivia could have access to the Pacific through that zone.(5)

One year later, in 1896, Minister Strobel informed the secretary of state that the 1895 negotiations had ended and that the government of Chile had published in the "Diario Oficial" copies of the Treaties of Peace, Friendship and Commerce. He pointed out that curiously, there was no reference to Chile's obligation to relinquish in favor of Bolivia any outlet to the sea through Arica, while Chile, on the contrary, was benefiting from the acquisition of Bolivian territories occupied by Chile as stipulated in the Truce Pact of 1884.

The Chilean government contacted the Peruvian government in August 1895 to discuss the Tacna-Arica issue, through a letter presented by his plenipotentiary to Lima, who proposed the formal annexation of Tacna and Arica to Chile, with the understanding that the latter would pay more than 20 million gold pesos. The Peruvian government rejected any discussion on the subject and even sent a letter through its envoy to La Paz protesting the agreements that the Bolivian government had signed with Chile, and reminded the Bolivian authorities that Tacna and Arica were Peruvian land and that Chile had no sovereignty over them.(6)

The 1895 treaties failed because both the Bolivian and Chilean parliaments did not enforce them, and also because public opinion in both countries did not think they responded to the best interests of either nation. There was always a significant feeling of loyalty towards Peru on the part of Bolivia that considered there couldn't be any agreement about Arica without previous and direct agreement with Peru. At the same time, Chile was starting one of many border crises with Argentina. Chilean press was therefore of the opinion that it was "preferable to be on bad terms with Bolivia than with the Argentina conflict...Bolivia, her ally does not have any military power..." and it suggested that the Chilean Senate did not approve the 1895 treaties signed with Bolivia.(7)


Argentina and the Atacama’s Puna

Earlier we saw that the Atacama region belonged to the La Plata Viceroyship and it was under the jurisdiction of the Potosí administration, under the Charcas Audience. When Upper Peru became independent and formed the Republic of Bolivia, her first border disagreement was with the Argentinean Confederation on the, status of Atacama and on the Tarija situation. This proved once again the historical fact that Atacama was under Charcas and not under the Chilean captainship. Marshal Sucre, as Bolivian president negotiated with the Argentinean envoys and obtained for Bolivia, based on the "uti-possidetis" of 1810. the ruling over Atacama and also the incorporation of Tarija, based on the "self-determination" of its citizens.

During the War of the Pacific, Chile militarily occupied part of the Atacama's Puna and later brought up the problem of the indefinability of borders between Chile and Argentina in this region. The Truce Pact of 1884 had not granted Chile any administrative rights over Atacama's Puna; yet, as the conqueror, Chile maintained its occupation. Bolivia had started a policy of rapprochement with Argentina in 1889 which finally ended in 1893 with the relinquishing of Bolivia's rights over the Atacama's Puna in favor of Argentina.

Argentina emphasized strongly to Chile the need to delineate the undefined borders, among the Atacama's Puna. The relations between these two countries deteriorated for many years to the point of even threatening a possible war to which Bolivia and maybe Peru might be parties.(8)

The American consul in Antofagasta wrote to the assistant secretary of state mentioning the possibility of an Argentinean-Chilean conflict and the close role Bolivia played, explaining also the consequences that this conflict could have on Antofagasta's future. Consul Greene referred to the Bolivian reaction as follows:

"The failure on the part of Chile to satisfy the Bolivian aspirations, in addition to the memories of the 1879 events, have increased the bitter feelings that Bolivians have towards Chile."

Then, the consul revealed his knowledge and personal experience in the area in the following manner:

"I know this people very well since 1878, when I moved here as supervisor of the Saltpeter Company and the Antofagasta Railway. And I repeat that I am sure that the people of Bolivia are ready and anxious for an alliance with Argentina, with the certainty that the war results will be favorable to that country. Argentina is said to have secretly guaranteed Bolivia the restoration of her old littoral...therefore, you must understand why Bolivia is a strong partisan of Argentina. I know what I say because I came here when the littoral was in Bolivia's hands. I have personally witnessed the Chilean occupation and the organization of the Chilean army to manipulate Peru and you know what followed later."


The consul discussed probable Argentinean military plans and ended his report reinforcing the fact that Antofagasta would be the main area of operations, and that if Chile lost its possession to a stronger Argentina, Chile would also lose its position as one of the first powers in South America.(9)

With the international situation very tense, the presidents of Chile and Argentina decided in 1898 to come to a conciliatory agreement in which part of the border dispute would be subject to arbitration by his British majesty, and the zone of the Atacama's Puna would be discussed at a conference in Buenos Aires. Each country would name a five-member delegation and in case of disagreement, the delegation presidents would resolve the controversy in a committee formed by both under the direction of the American minister in Buenos Aires, William J. Buchanan.(10)

On June 19, 1898 the State Department instructed Minister Buchanan to express to the Argentinean government Washington's preoccupation over the possible armed conflict between Chile and Argentina. (11) Because of this, Argentina informed the secretary of state, Mr. Hay, through its Washington ambassador, Garcia-Merou, of the basis for a diplomatic agreement over the Atacama's Puna which could he settled at the latest by March 10, 1899 under the arbitration of Minister Buchanan. At the same time, Minister Buchanan requested from the American president permission to act as arbitrator; this was granted on February 23, 1899.(12)

Obviously, the two delegations did not come to an agreement and it was Minister Buchanan who delineated the border in Atacama's Puna on the basis of official arguments from Chile, presented by Enrique McIver, and arguments from Argentina, presented by Jose Evaristo de Uriburu. The verdict was in favor of Argentina. It is important to point out here that the American minister recognized Bolivia's rights and her historic position in the Atacama's Puna, as well as the fact that Chile's arguments had no juridical or historical basis in the disputed area, as its ministers had claimed.(13)


Köning’s ultimatum

At the end of the l9th century, Chile's international situation had improved considerably, and there was therefore no need to grant any more concessions to Bolivia in the final arrangements of the War of the Pacific. On April 8, 1898 Peru and Chile had signed the Billinshurst-Latorre Protocol, which was directed to end the Tacna and Arica question. In Argentina the question of Atacama's Puna had been finished with the verdict of March 10, 1899, by the American Minister Buchanan. Chile only needed now to enforce the truce pact signed with Bolivia with a peace agreement. At the same time, Bolivia found itself in a very difficult situation with several of her neighbors and was in no position to resist Chile.

Such a situation was illustrated by a note of March 3, 1899, from the American minister in La Paz, Mr. George Bridgman, to the secretary of state denouncing the "imminent danger of Bolivia's disappearance as it would be divided between Chile, which would keep the main part, Argentina and Peru." (14)

A few days later, Minister Bridgman reaffirmed this contention and added that "Chilean troops were concentrated at the border" and that "the Chilean president had entertained secret and prolonged conferences on the subject with a diplomat posted in La Paz." (15)

With Bolivia under such pressure, President Errazuris sent to Bolivia the radical politician Abraham Köning as plenipotentiary minister. He had been known in the Senate for his intransigent line in defense of Chilean rights over the conquered territories in the War of the Pacific. President Errazuris chose to disregard the agreements of 1895 and attempted to act upon the position of former President Balmaceda, who had already made known the impossibility of ceding to Bolivia a port in exchange for the littoral, and the need to make Bolivia understand that it had lost the war, and therefore also lost its littoral; on the other hand, Chile would build a railroad from Arica to La Paz in compensation to Bolivia for the final transfer of the Litoral Department.

The new Minister Köning arrived in Bolivia in 1900 with some basic instructions which Chile considered important when dealing with Bolivia. According to the American minister in Santiago, the appointment of Köning to go to the Bolivian capital meant the "intention of the Chilean government to bring the differences with Bolivia to a definite conclusion; a conclusion which would dispose forever of Bolivia’s assertions of her right to a sea port..." It was understood that Mr. Köning carried with him his instructions to communicate to the Bolivian government, in clear and unmistakable terms, the intentions of the Chilean government. (16)

As soon as he arrived in La Paz, Minister Köning initiated conversations with the Bolivian government which reiterated its opposition to the Chilean bases for negotiation.

The American minister in La Paz, George Bridgman, sent a note to the secretary of state, John Hay, enclosing a memorandum from the Bolivian minister of foreign relations dated June 30, 1900 in which he analyzed the Bolivian littoral situation under Chilean occupation. It presented the Chilean basis proposed by Minister Köning, which established that Chile would make the following concessions in exchange for the Bolivian littoral:

"1. A free port for Bolivian commerce, which meant really free transit - a right recognized by all nations.

2. To pay the obligations weighing on the Littoral Department.

3. To pay the Chilean mining companies' indemnification for the losses that were caused by the war.

    1. To pay Bolivia the amount of 6 million Chilean pesos for the construction of a railroad in Chilean territory that would link the Chilean coast to the Bolivian interior."

The memorandum also indicated that "the Bolivian government was willing to relinquish the Littoral Department in exchange for an appropriate coastline over the Pacific, with an extension of 20 thousand square kilometers and a population of at least three thousand inhabitants." He considered that this small extension of land would not demand any other sacrifice, or cause any damage to Chile or Peru, since they both still had a considerable coastline. Also, the Bolivian minister of foreign affairs established Bolivia's unquestionable need for a port, and the rightful and necessary fact that any agreement with Chile would have to guarantee her own and sovereign outlet to the Pacific. (17)

The American legation in La Paz sent a note to the secretary of state transcribing the note from the minister of foreign relations in which the diplomat Fernando E. Guachalla was appointed as extraordinary envoy and plenipotentiary minister in Washington. He was also appointed as delegate to the Pan-American Conference which was to meet shortly. This note said that the Bolivian minister also had instructions to let it be known that "...there is the pending question between Bolivia and Chile, on which state and under which conditions it should remain in control of the Bolivian littoral, which comprises 158 thousand square kilometers with a population of 32,000 inhabitants. four ports, several inlets, abundant mineral riches and an official income of Bs.7.500.000 (pesos)" He added that Chile already owned an immense coastline and nevertheless intended to keep these territories under the excuse of conquest, depriving Bolivia of her ports and consequently of every political and commercial connection, free or independent, with any state of the world, and that Bolivia should resist this condition that would cause her extinction and should demand at least a port for her commercial needs.

In the same letter, it is mentioned that the Bolivian envoy "in view of the Bolivian impossibility of opposing and making her rights respected, it would, according to the international laws, legally request the mediation of the most powerful state in America with the sole purpose of settling the dispute fairly." (18)

After several conversations with the Bolivian authorities, showing his impatience (especially to what he called the lack of realism of the Bolivian Parliament, who, as seen before, did not accept the idea of enclosure), Minister Abraham Köning sent a famous ultimatum dated August 13, 1900 reiterating the final position of the Chilean government.(19)

Minister Köning conveyed the Chilean bases for the peace treaty. They were the same that reflected the instructions from Errazuris and, as mentioned above, practically the same ones that supported Balmaceda's government in 1890. Köning said:

"Public opinion in Chile has changed, and now desires to retain Tacna and Arica as a reasonable compensation for her sacrifices. To the north of Arica a port might be ceded, but this coast as far as the river Sama is inhospitable, and landing would be almost impossible...There is no port to cede, and therefore this request on the part of Bolivia must be set aside".

The Bolivian government shuddered before the arrogant tone of the note. The Ministry of Foreign Affairs chose to keep silent and confidentially distributed copies of the note to other foreign ministers of the hemisphere, in an effort to seek advice to obtain an idea of continental opinion on the note. The American minister transcribed to the State Department a translation of the ultimatum from Köning in note of September 18, 1900.(20)

The Bolivian-Chilean situation was considered critical by North American public and diplomatic opinion, as evidenced by a specialized publication, which read:

"The Congress of Bolivia, in secret session, has rejected proposals from Chile for a settlement of the long-standing dispute over the Bolivian littoral occupied by Chile after the last war...It is feared that the refusal of Bolivia to accept these terms may lead to a renewal of hostilities. The fact that Chile has recently adopted the Prussian system of compulsory military service gives color to this suggestion." (21)

The Bolivian Ministry of Foreign Affairs instructed its envoy in Washington, Fernando Guachalla, to seek American mediation in order to reach a fair solution to the Bolivian-Chilean dispute. Minister Guachalla spoke with Secretary of State John Hay regarding the problem and gave him a note dated December 4, 1900.

In order to support his claim, Minister Guachalla enclosed with his note a memorandum listing Bolivia's reasons for seeking the United States mediation in the dispute with Chile. Minister Guachalla also sent to the secretary of state, on the same day, a copy of the note from Köning with its respective English translation.(22)

The Bolivian request for American mediation was based on the interest showed by that country in promoting the Pan-American movement brewing since Blaine's effort, a movement that was rejected by Chile, as it contradicted its foreign policy, which was only directed towards consolidating territorial conquests. The State Department used the Bolivian proposal to obtain Chilean participation and support to the Pan-American Congress, which had been called by the United States. Chile rejected any possibility of an American mediation, maintaining that it could settle its differences with Bolivia without the help of a third party. At the same time Chile consolidated its position for participation in the Pan-American movement under the condition that no reference or rejection would be made regarding the use of force, and that the question of territorial conquest in the hemisphere would refer only to the future and would not specifically apply to the War of the Pacific or to Chile's territorial disputes with Peru or Bolivia. Chile's argument was also that the United States already had an impartial and important role in judging the solution to the Tacna and Arica Question, and should not, therefore, become involved with the Chilean-Bolivian dispute.

Bolivia based its request for American mediation on the moral leadership that the United States should have in the area. At the beginning of the 2Oth century the United States did not have any economic or political interests in Bolivia, but it had such interests in Chile, although Bolivian diplomacy ignored or pretended to ignore this fact. The State Department decided not to intervene in the controversy so as to guarantee its independence in the Pan-American Conference it was preparing, and because it also considered that all mediation should be requested by and should have the approval of both parties. Chile was opposed to the mediation, and American diplomacy apparently had no interest in antagonizing that country at the time.

The secretary of state therefore declined the mediation with a note indicating that the government of the United States had expressed on several occasions its ardent wish for peace and harmony between the countries with which it had friendly relations, especially the republics of the American continent, however, regarding the controversies between states of this hemisphere, the attitude of the United States has been abundantly clear. He added that based on these lines of political action and in the interest of equity, it was not compatible for the United States to examine at that moment the merits of the controversy to which Bolivia had called its attention. The pretense of impartiality on the part of the American government in fact only favored Chile and left Bolivia at the total mercy of the conqueror. One should keep in mind that in those days US diplomacy was fully involved with events in Central America and the Caribbean, and perhaps the State Department was afraid of meddling in other disputes that did not affect it greatly.

A few months later, the Peruvian government protested to the State Department by circular note of May 1901 a proposal from the Chilean government to polonize Bolivia. Foreign Minister Felipe de Osma said that the Chilean minister in Lima, Angel Custodio Vicuńa, had proposed to the Peruvian President Eduardo Romańa on September 21, 1900, that Tacna and Arica remain under Chile's sovereignty in exchange for the division of Bolivian territories between Chile and Peru in a joint action from the two countries. (23)

The Chilean proposal, presented by Minister Vicuna to the Peruvian government five weeks after the Köning note to Bolivia, showed the real dimension of the problem and of the combined action by the Chilean diplomats to force Bolivia to accept her landlocked status. The State Department merely received the Peruvian note and did not take any action. At that time, the assassination of President William McKinley, and therefore the sudden inauguration of the new administration of President Theodore Roosevelt, may have precluded the State Department of taking any action regarding this threat to Bolivia's existence.(24) However, the American Congress and diplomatic circles showed concern over "the Chilean proposal to divide Bolivia" which they said had come to their knowledge from official sources (State Department) and which had become public on June 19, 1901. At the same time, they pointed out Peru's strong rejection of the Chilean proposal manifested in the decision to ask for the removal of the Chilean minister in Lima.(25)


The United States advises Chile on freedom of transit for Bolivia

As was mentioned earlier, the American consulate in Antofagasta had as one of its main functions the duty to observe and report on the exterior commerce of Bolivia, this in view of the fact that Antofagasta was the principal port of importation and exportation of that nation. As part of this routine, the American consul reported annually on the data of freight that passed through Antofagasta and other ports to and from Bolivia. Similarly, information was given on the Bolivian collection of customs through different ports and on different types of merchandise. The figures sent by the American consul, apart from giving information, were evidence of the value of this port in relation to the economic development of Bolivia.(26)

At the beginning of the 2Oth century,, the government of the United States decided to actively promote in the rest of the world the use of free ports, as a means of supporting the expansion of commerce and free exchange. The State Department instructed its consulates in this regard, requesting information on the existence of free ports with free transit or the possibilities of promoting them in their respective areas.

The Antogasta’s American consul informed the State Department that in his consular district there were no free ports; there might perhaps be a possibility of Antofagasta turning into a free port with a common customs department of Binacional character benefiting Chile and Bolivia, which at the time did not have any formal customs duty service. Some time later, the American consul, Mr. Greene, wrote again to the State Department recounting the conditions of Antofagasta and the possibilities of obtaining a free port or of promoting free transit in that port. Mr. Greene said:

"The majority of the merchandise for Bolivia was unloaded here. The methods used in the handling of the Bolivian cargo ‘in transit’ are unsatisfactory and a reform has been proposed. In view of that, the chief of customs in Antofagasta is preparing a project to present to the government."

The consul refers then to his conversation with the customs chief about the American circular and said:

"I have been asked to request from the State Department copies of the laws and methods of ‘modus operandi’ that regulate the system of free transit available to them."

Consul Greene reaffirmed that before the protocol of arrangement between Chile and Argentina in 1903 submitting their dispute to arbitration, Bolivia had delayed the arrangement with Chile awaiting an Argentinean military intervention to get the return of Antofagasta. Bolivia had no option but to accept an arrangement with Chile, and free transit was the only solution to compensate Bolivia for its lack of ports. Consequently, he recommended that the request of the chief of customs in Antofagasta be accommodated, as he was very much interested in the documentation and material necessary to design a system of free transit.

Therefore the State Department sent relevant documentation immediately to the American consul in Antofagasta to be delivered to the Chilean authorities.(27) Consul Greene informed the Secretary of State on September 27, 1902 that he had met with the Chilean plenipotentiary, Beltran Mathieu, who was on his way to La Paz via Antofagasta. The Chilean diplomat had revealed to him that he was carrying a draft of the peace treaty with Bolivia. This draft envisaged the construction of a railroad from Arica to La Paz or the extension of the railway from Antofagasta to La Paz in compensation for Bolivia's loss of the Littoral Province. The draft of the treaty also took into account the use of free transit.

Consul Greene managed to match the interest of the United States in promoting worldwide free ports of free transit systems with those of Chile to enforce a system of free transit for Bolivia as an integral part of a peace treaty. In short, Mr. Greene, the first American consul in Antofagasta, a city to which he arrived when it was under Bolivian sovereignty, always showed his interest in confirming the close relationship of this port with Bolivia.


The 1904 Treaty

At the beginning of the 2Oth century, Bolivia's situation was very difficult. In the international field, Bolivia was in disagreement with Peru on the limits of some border areas; Bolivia confronted Brazil militarily over the possession of the Acre region; and Chile was in possession of its ports' customs. It was also around this time that the United States had taken over the customs in the Dominican Republic and Haiti. The Chilean administration of Bolivian customs meant that Chile was not only benefiting from the revenues from services, but mainly it was paying itself for the indemnification that the Bolivian government was obliged to pay because of the War of the Pacific. (28)

The Köning mission, although criticized by many, had established the Chilean bases for peace in 1900, which as we saw earlier, already had been delineated by the administration of President Balmaceda in 1890. It was up to the Chilean foreign minister, Bello Codecido, who was married to Balmaceda's daughter, to make this a reality in 1904.

Bolivia finally had to accept those bases and signed the Treaty of Peace and Friendship in Santiago, on October 20, 1904. This treaty had twelve articles, of which five basic substantial points were included in the Köning ultimatum, five articles referred to the regulations of free transit (we have seen that they were suggested by the American government through its consul in Antofagasta) and the other two referred to formal aspects, such as the preamble and naming of the arbitrator to solve disagreements that might occur in the execution or interpretation of the treaty. The commercial attaché from the United States in Santiago notified the State Department of the subscription of this treaty and sent an English translation with a note of March 28, 1905.(29)

The American Minister in La Paz, William B. Sorsby, sent in 1905 several notes, one of them with a copy of the treaty and two others with information on all commercial agreements between Chile and Bolivia, as well as some considerations on the implication of those instruments over commercial treaties signed previously by Bolivia and Peru. The diplomatic letter sent to Washington by the American legations in La Paz and Lima showed in detail the impasse between Bolivia and Peru in their commercial relations and reiterated the Peruvian rejection of the Treaty of 1904, especially regarding the clause pertinent to the Arica-La Paz Railroad. Peru strongly denied any Chilean sovereignty over Arica as well as any obligation or bondage that this railroad might enjoy in legally Peruvian territories. (30)

The favorable effects of the Peace Treaty of 1904 were felt immediately in Chile as much as in Antofagasta. Frank D. Aller informed the State Department through a note of December 19, 1905 that the arrangement between Bolivia and Chile had produced a "boom" in Antofagasta, that the population of the city had doubled in less than three years, and the value of real estate had increased spectacularly.(31)

The legal possession of all the province permitted Chile also to benefit from the exploitation of the great cupriferous deposit of Chuquicamata, the same that is located a few miles from Calama, the Bolivian town heroically defended by Eduardo Avaroa and his compatriots who offered their own lives in defending the Bolivian sovereignty over the region in 1879. The American correspondence did not mention, as in the Chilean case, any benefit obtained by Bolivia from the subscription of the Treaty of 1904.(32)


Alsop & Co. claim

The firm Alsop & Co., with legal address in Valparaiso and partners and capital from the United States, operated on the coasts of Peru, Bolivia and Chile since 1830. Among their most important activities was the exploitation of mining resources of the Bolivian littoral and the project for the construction of a railroad from the coast to the interior of the country. The firm was always considered to be North American, and its managers and administrators were also North American citizens.

As a result of the Pacific War, the operations of Alsop & Co. on the Bolivian littoral were enormously damaged. The officers of the firm approached the Department of State and the American Congress demanding their intervention, since, they argued, Chile had violated their rights, conceded by the government of Bolivia. American diplomacy intervened from the very years of the war and represented, in the Ministry of Foreign Relations of Santiago, the Alsop & Co. cause. Since then, the claims of this firm came to constitute a motive of conflict between the governments of Chile and the United States.(33)

This claim, even though it was one of private international rights between the firm Alsop and the government of Chile, had acquired very important elements which went beyond the implications between the parties, since it constituted a legal controversy based upon the actions of Chile on the Bolivian territories, i.e. parallel to the cause of Alsop & Co. The degree of inconvenience reached such a high level that on November 17, 1909 the American government formulated an ultimatum to the government of Chile, to solve the claim of Alsop & Co. The government of Chile responded through its minister of foreign relations, Agustin Edwards, that "their government never imagined that such a small pecuniary claim could reach such proportions as those of bringing the suspension of diplomatic relations." (34)

In consideration of this delicate situation, the Brazilian minister in Washington, Mr. Joaquin Nabuco, visited the Secretary of State personally and emphasized the necessity of avoiding a conflict between Chile and the United States, especially before the celebration of a Pan-American Conference in Buenos Aires, and requested the Secretary of State not to close the US legation in Santiago. (35)

The Department of State continued to pressure very strongly in such a way that Chile, without any other possibility, accepted the arbitration of the King of England.

The American exposition was presented in a detailed memorial, including three volumes of appendixes. The government of Chile presented its exposition in a short memorial and a brief appendix of documents. The Chilean memorial exposed an argument of major importance for Bolivia, as Chile sustained before a "Court of Arbitration" that Bolivia did have its own littoral and that Chile, as a result of its annexation of Peruvian territories and therefore, in defense of its territorial continuity, imposed on Bolivia the cession of what Chile considered a small strip of territory. King George V was bestowed the responsibility of dictating the award, on July 5, 191l. This sentence was of transcendental value, since it not only bound Chile to fulfill its obligation with the firm Alsop & Co., but also, in its juridical arguments it qualified Chile as the "assaulting country and conqueror of Bolivian territories and properties." (36)

In this regard, the award indicated:

"It is perhaps worthwhile to point out that the liability which Chile assumed by those notes was not dependent on the merits of the claim. She did not undertake to pay the claim because she considered it a just claim; she agreed to it as part of the price which she was willing to pay for securing the recognition and acceptance by Bolivia of her title to the territory which Chile had wrested from that republic by force of arms; and even if she may consider the sum your majesty may be pleased to award large, having regard to all the circumstances, it is certainly small as compared with the advantages of a sure title to a valuable territory."

In this case, as can be observed in the documentation, it is very important to point out that since the time of the war, the United States maintained a clear position of showing the actions of Chile upon the Bolivian territories as pure and unjustifiable territorial conquest, and that Chile, also a conqueror, had violated the private rights of individuals residing in the department of Littoral. In other words, Chile had violated international law in its relations with Bolivia as well as in its treatment with individuals resident in the Bolivian seacoast.

This case also indicates the Chilean plea as a juridical proof which Chile recognizes, before the Arbitral Tribunal of His British Majesty, that Bolivia did have coastal territory which was annexed due to Chile's need for territorial continuity with Tarapaca, the Peruvian province that had also been conquered by force of arms. It must also be remembered that in this juridical plea, Chile recognized that it disowned - for its own convenience - the treaties of 1886 and 1874 signed with Bolivia; and that in 1879 it declared unilaterally the vindication of the territories located up to the 23rd degree. Another matter that must be pointed out in the case of the Alsop Company is that of its extended duration from 1879 until 1911. This lapse shows in part Bolivia's tenacity in not accepting the loss of its Littoral Department, its sovereign access to the Pacific Ocean.

From this chapter it can be appreciated that during this period the diplomatic correspondence, as much as the actions of the State Department, reflected an ambiguous position regarding the Bolivian-Chilean problem. On the one hand, the official documentation and the judicial testimonies in which the State Department participated ratified and/or recognized the Bolivian right over the Littoral Department, as well as the fact that Chile had obtained possession by force and that the Chilean arguments to justify this occupation did not have juridical value. On the other hand, the United States accepted the occupation of the Bolivian littoral pragmatically, and her diplomacy indirectly helped in the elaboration of the instruments to enforce it. The United States also avoided intervening in the Chilean-Bolivian controversy in order not to hurt Chile's interests, in spite of the reiterated requests from Bolivia. By deciding not to interfere they implicitly favored Chile, the stronger nation, where their larger interests laid. In a few words, even though the littoral had rightfully belonged to Bolivia, Chile, by occupying it, had the upper hand. For the United States this was a reality that according to its commercial and political designs it was appropriate to accept. This reality not only accepted, but also helped to perfect a free transit system, through legal and technical instruments, which in turn would open world trade to an otherwise secluded Bolivia.

The role of the United States in this period was very clear. It accepted and used Bolivia's rights in defending American private interests against Chile's unlawful actions. Nevertheless, it also accepted Chile's attempts to play a semiperipheral role in the region, which would help to better link Atacama's and Tarapaca's nitrates and other minerals to the world markets.

Furthermore, the United States in helping Chile to introduce a free transit system for Bolivia, also helped Chile to consolidate its semiperipheral role linking Bolivia to the world system.




1. Dispatches from the United States consuls in La Paz, Bolivia, T338 r. l.

          2. Dispatches from United States Ministers to Chile, 10 rs. 36-42.

          3. Dispatches, op. cit., M 10 r.43.

          4. Dispatches, op. cit., T 505 r. 1.

5. See: Valentin Abecia B: Las Relaciones Internacionales en la Historia de Bolivia, La Paz/Cochabamba, Los Amigos del Libro, 1979. Tomo II pp. 247-277; and Alberto Crespo Gutierrez: Los Tratados Suscritos con Chile en 1895., La Paz, Los Amigos del Libro, 1975. F. Encina, op. cit. and C., Rios Gallardo op. cit.

          6. Dispatches, op.cit., M10 r. 44 Note 22.

7. Dispatches, op.cit. M10 v. 44 Note 85. Also in US Foreign Relations, 1896, Government Printing Office, Washington, D.C.

8. Carlos Rey de Castro, El Articulo III del Tratado de Ancon. Paris 1919.

          9. Valentin Abecia B., op. cit. and F. Encina op. cit.

          10. Dispatches, op. cit., T505 r. 1

11. Frederik Pike: Chile and the United States, 1880-1962. Indiana, University of Notre Dame Press, 1963, pp. 123-139.

          12. US Foreign Relations, 1898, Washington D.C. 1900.

          13. US Foreign Relations, op. cit. pp. 1-4.

14. Buchanan Award on the limits of Puna de Atacama Border: El acta de delimitacion de la frontera de la Puna de Atacama, official publications of Argentina and Chile, and Dispatches, op. cit.

          15. Dispatches, March 3, 1899.

          16. Dispatches, March 8, 1899.

          17. Dispatches, May 15, 1900 and November 22, 1900.

          18. Dispatches, July 2, 1900.

          19. Dispatches, August 1, 1900.

20. On the Köning ultimatum see: V. Abecia, Vol. II op. cit. and Miguel Mercado Moreira, Historia Internacional de Bolivia., La Paz, 1972.

          21. Dispatches, Note No 228 of September 18, 1900.

22. The Cyclopedic Review of Current History, Vol. 10, January 1901, p. 1037.

23. Notes from Bolivian Legation in the United States to the Department of State, T. 795 r. l.


24. Dispatches from United States Ministers to Peru, t52 r.61 and also Notes from the Peruvian Legation in the United States to the Department of State, T8O2 r.6.

          25. The Cyclopedic Review of Current History Vol. 11, March 1901, p.50.

26. Consular Letters of April 13, and November 30, 1901 on customs revenues, op. cit. T505 r. l.

          27. Dispatches, op. cit Note 44 and 84.

28. US Foreign Relations. 1905. Washington D.C. Government Printing Office, 1906. The US took control over Dominican Republic customs in 1905, practice that lasted until 1941. Ten years later, the US applied the same practice to Haiti. In both cases, American taxcollectors were preceded by US Marines. (See Encyclopedia Americana, International Edition, New York, 1984).

          29. Foreign Relations, 1905, op. cit.

          30. Dispatches, op. cit. T505 r. 1.

          31. Frederick B. Pike, op. cit. pp. 139-144.

32. Dispatches, o. cit. T505 r. 1., Mining operation began in Chuquicamata during the year 1912.

33. The Alsop case is presented in US Department of State, Foreign Relations, 1910, Washington D.C., pp. 139-189

          34. Frederick Pike, op. cit. p. 114.

35. Foreign Relations, 1910 Washington DC, op. cit., there is a Spanish version published in Santiago, Chile. Imprenta Cervantes 1910

36. The Award was published by US Department of State, Foreign Papers, 1911, Washington D.C. 1918.

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