The Boundary Treaty of 1881 (Spanish: Tratado de Límites de 1881) between Argentina and Chile was signed on 23 July 1881 in Buenos Aires by Bernardo de Irigoyen, for Argentina, and Francisco de Borja Echeverría, for Chile, with the aim of establishing a precise border between the two countries based on the uti possidetis juris principle. Despite dividing largely unexplored lands, the treaty laid the groundwork for nearly all of Chile's and Argentina's 5600 km current border.
Argentina declared its independence from Spain in 1816 and Chile did so in 1818. Once the Spaniards had been expelled, relations between the two nations soured primarily due to a border dispute: both claimed to have inherited overlapping parts of Patagonia.
The Chilean constitution of 1833 established the Andes as its eastern boundary. That was challenged in 1853 by Miguel Luis Amunategui's book Titles of the Republic of Chile to Sovereignty and Dominion of the Extreme South of the American Continent in which he put forward that Chile had valid arguments to claim all of Patagonia. This started an academic debate with Argentine counterparts. These claims traced Chilean claims back to the conquest of Chile in the 16th century by Pedro de Valdivia, arguing that Pedro de Valdivia obtained rights from the Spanish crown to establish a captaincy limited by the Strait of Magellan to the south. Pedro de Valdivia subsequently founded several cities through southern Chile with the goal of reaching the Strait of Magellan. However, the remoteness of the region and the Mapuche in the War of Arauco limited further expansion to the south.
Chilean takeover of the Strait of Magellan
The Republic of Chile founded Fuerte Bulnes in 1843, and later moved that settlement to the site of Punta Arenas in 1847, giving a strong impulse to steam navigation through the Strait of Magellan and probably averted the occupation of the strategically crucial strait by the European powers or the United States. As stated in a book about the Strait of Magellan:
An 1837 French expedition of Dumont D'Urville surveyed navigational conditions in the Strait of Magellan and recommended that a French colony be established at the strait to support future traffic along the route.
The 1855/1856 treaty's Article 40 established a 12-year sunset for its commerce and navigation articles.
Interests of Chile, Argentina, and the great powers
Chilean trade and culture were oriented towards Europe and therefore the complete control of the strait was a core Chilean interest. In contrast the rest of Patagonia was seen by influential Chilean politicians as a worthless desert. This view was shared by Diego Barros Arana and was inspired by Charles Darwin's description of the area as a useless moorland.
The possession of the Straits of Magellan in all its length is of such great importance for Chile, that in that possession she sees linked not only her progress and development, but also her very existence as an independent nation. – Adolfo Ibáñez
Mapuches and araucanized Indians had for a long time ranged the Argentine southern frontier in search for cattle that were later taken to Chile through the Camino de los chilenos. The cattle were sometimes traded in Chile for weapons and alcoholic beverages. These tribes had strong connections with Chile and therefore gave Chile influence over the pampas. Argentine authorities feared an eventual war with Chile over the region where the natives would side with the Chileans, and that the war would be therefore fought in the vicinities of Buenos Aires.
In the 1870s, Argentina built a more than 500-km long trench called Zanja de Alsina, which Argentina had undertaken during the Conquest of the Desert from 1876 to 1878 to defeat the araucanized Indians occupying northern Patagonia and which aspired to control the eastern third or, at a minimum, the eastern mouth of the strait.
The United Kingdom and the United States did not directly intervene in the distribution of land and maritime areas, but the U.S. ambassadors in Santiago de Chile and Buenos Aires, Thomas A. Osborn and Thomas O. Osborn, did serve as mediators. The concern of the great powers was free navigation through the strait. The U.S. administration declared immediately before the negotiations leading to the treaty:
The Government of the United States will not tolerate exclusive claims by any nation whatsoever to the Straits of Magellan, and will hold responsible any Government that undertakes, no matter on what pretext, to lay or impost or check on United States commerce through the Straits.
Prior to the U.S. statement, in 1873, via a diplomatic letter to major shipping nations, Chile had already promised freedom of navigation through and neutralization in the strait.
The colonial powers, United Kingdom and France, viewed Patagonia and Tierra del Fuego as Terra nullius. Jules Verne described in The Survivors of the "Jonathan" his view of Tierra del Fuego:
The separated geographic location had as consequence that this part of the new world had not been incorporated to any civilized state up to the year 1881 even not by its nearest neighbour Chile and the Republic of Argentina, which were still disputing the pampas of Patagonia. The Magalhães archipelago belonged to nobody ...
Regarding the position of the USA towards the region, on 28 December 1831, the US Navy Captain Silas Duncan with the USS Lexington destroyed the Port Louis, Falkland Islands settlement in response to Argentine activities. The captain declared the islands to be free of government. The United Kingdom established effective control over the Falklands in 1833.