Pacific trade reignites Bolivia-Chile land dispute

Pacific trade reignites Bolivia-Chile land dispute

As Bolivia notes the TPP’s trade potential, La Paz has raised a 132 year old dispute with Chile; one that could give Bolivia access to the Pacific.

In March, Bolivian President Evo Morales announced that he would settle a 132-year-old land dispute with Chile at the International Court in The Hague. Bolivian Foreign Minister David Choquehaunca, on 25 April, filed suit to redeem 74,000 square miles of land that Bolivia lost to Chile at la Guerra del Pacifico, the War of the Pacific. Bolivia asserts that the 1904 treaty that allowed Chile to annex the disputed land was signed under pressure from Chile, and Foreign Minister Choquehaunca adds that the suit “assumes the historical mandate of the Bolivian people to revert to being a maritime nation.” Chilean President Sebastián Piñera vows to defend “every square foot” of territory and sea, because Bolivia has no legal basis for their claim.

Bolivia's lost territories

The area acquired by Chile after la Guerra del Pacifico 1904 would give landlocked Bolivia access to trans-pacific trade

Why is Bolivia pursuing the nullification of their 100-year-old peace treaty with Chile? The answer lies beyond a “historical mandate.” Four hundred kilometers of coastline would give the landlocked Bolivia more trade opportunities with Asia, where Latin American countries have enjoyed an annual growth rate of 20.5 percent for the last twelve years.

Chile is already enjoying free trade agreements with Asia-Pacific partners like Brunei, New Zealand, and Singapore.  Other Pacific coastal states in Latin America, like Peru and Mexico, have joined the Trans-Pacific Partnership (TPP), and Colombia and Costa Rica have declared their interest to join. The countries composing the Alianza del Pacifico, the Pacific Alliance, which includes Mexico, Colombia, Peru, and Chile, already have free trade agreements with China. A strip of Pacific coastline for Bolivia may grant it membership to the Alliance.

China’s import of natural gas is increasing exponentially, making it the fifth largest importer of liquefied natural gas, and Bolivia has plenty of natural gas to supply—natural gas is its second largest export. President Morales, who cemented relations with communist leaders like former President Hugo Chavez of Venezuela and Fidel and Raul Castro in Cuba, looks to take a page out of Chavez’s book. In 2012, Chavez increased Venezuela’s oil sales by 60% through trade with China, thereby realigning Venezuela’s dependency away from the United States market. Like Chavez, President Morales, who nationalized Bolivia’s oil fields after taking office, will need to look to other politically left-wing states, as his relationship with the United States is rapidly deteriorating.

Bolivia’s friction with Chile has emerged for economic reasons alongside a historically unresolved conflict. Chile pledges to respond to Bolivia’s demands at The Hague. However, the Chilean government is confident that the international community will not accept a country that unilaterally dismisses “a treaty which is in full force.”

Categories: Latin America, Politics

About Author