The War of the Pacific resulted from a dispute between Bolivia and Chile over sovereignty of the mineral-rich coastal area of the Atacama Desert. Under an 1866 treaty, Chile and Bolivia divided the disputed area encompassing the Atacama Desert at 24? south latitude (located just south of the port of Antofagasta) in the understanding that the nationals of both nations could freely exploit mineral deposits in the region. Both nations, however, would share equally all the revenue generated by mining activities in the region.
In 1874 Chile agreed to fix the border at 24? south latitude in return for Bolivia's promise not to increase taxes on Chilean nitrate enterprises for twenty-five years. But Bolivia soon repudiated the treaty, and its subsequent levying of taxes on a Chilean company operating in the area led to an arms race between Chile and its northern neighbors of Bolivia and Peru.
In 1876 Hilari?n Daza Groselle (1876- 79) seized power in Bolivia, and became a military caudillo, as brutal and incompetent as his predecessors. He faced many insurrections, a massive demonstration by artisans in Sucre, and widespread opposition. Hoping to gather the support of nationalist Bolivians to strengthen his internal position, Daza involved his country in the disastrous War of the Pacific.
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