In the late nineteenth and early twentieth centuries, the South American nations of Argentina and Chile engaged in an expensive naval arms race to ensure the other would not gain supremacy in the Southern Cone.
The naval arms race unfolded over the next several years, with each country buying and ordering vessels that were slightly better than the previous ship, but the Argentines eventually pulled ahead with the acquisition of four Garibaldi-class cruisers.
[2] These attitudes quickly changed when the circumstances warranted; when Chile joined Peru against Spain in the Chincha Islands War, the Spaniards bombarded and blockaded Valparaíso, leading the Chilean government to strengthen the navy.
[3] Patagonian tensions heightened in 1872 and 1878, when Chilean warships seized merchant ships which had been licensed to operate in the disputed area by the Argentine government.
[4] Both countries were incapable of enforcing these claims with a seaborne force in the next few years, as the Argentines were occupied with internal military operations against the indigenous population (1870–84), and the Chileans involved in the War of the Pacific (Guerra del Pacífico, 1879–83) against Bolivia and Peru.
[5] For their part, the Chileans ordered a protected cruiser, Esmeralda, to bolster its fleet, which was centered on two central battery ironclads, Almirante Cochrane and Blanco Encalada.
Bought with a £3,129,500 appropriation in the 1887 budget, the ships would have upset the balance of naval power in Latin America—while the Argentines had more vessels, the Chileans had larger warships with far more experienced crewmen.
This purchase was made worse, from the Argentine perspective, by a large order for rifles, field guns, sabers, and carbines, enough to arm an 80,000-strong army.
The resulting victory of the congressional side and subsequent presidency of Admiral Jorge Montt led to a large increase in prestige and consequent funding for the navy.
[13] As historian Jonathan Grant writes, the Argentines may have moved first to secure a definite, if momentarily tenuous, advantage over the Chilean Navy.
Both Argentina and Chile enjoyed a period of lessened tensions, leaving the near state of war they were in, and the pacts ended their expensive naval buildups.
However, the third major country in South America, Brazil, brought this to a crashing halt in 1904, when its congress passed a large naval construction plan.
This culminated in 1907 with a Brazilian order for three "dreadnoughts", a new form of warship whose advanced armament and propulsion capabilities far outstripped older vessels in the world's navies.
The Argentine and Chilean governments quickly moved to cancel the remaining months of the naval-limiting Pacts of May, and both eventually responded with orders for their own dreadnoughts.