The value of sugar imported rose between 1914 and 1920 from 9,000,000 to

25,000,000 pesos, but this movement indicates soaring prices rather than

increased Chilean consumption. Purchases of yarns for weaving, of

textiles, bags and sacks, and ready-made clothes, all displayed rises in

the same period from 48,000,000 to 123,000,000 pesos; so also did crude

chemicals, particularly essences for nationally elaborated and bottled

perfumes. Imports of machinery, checked during the war period, followed

the same curve as electrical goods, doubling their values in 1919 as

compared with 1914.

Chilean purchases of tools and implements have shown steady increases,

but the whole group of machinery for mining, agriculture and industry,

including motors, boilers and electrical goods, does not far exceed

38,000,000 pesos (less than £2,000,000 at 20 pesos to the pound

sterling), while material for railways and other transport services

costs some 20,000,000 pesos, or about £1,000,000 sterling annually. A

fair average for Chilean purchases abroad may be calculated at

£20,000,000 or inside $100,000,000 U. S. currency, at normal exchange.

_Sales to Foreign Countries_

When one turns to the other side of the ledger, to see what Chilean

merchandise is exchanged for these imports, the dangerously dominant

position of nitrate becomes evident. The total exports rose from

300,000,000 pesos in 1914 progressively to nearly 764,000,000 in 1918

(subsequently suffering violent fluctuations) and of the latter amount

nitrate and iodine accounted for over 532,000,000, with another

109,000,000 placed to the credit of “minerales metálicos en bruto,” of

which the chief if not the sole representative was copper.

Products of livestock farming, chiefly hides and wool, have risen in

export value during the last few years, and may be reckoned as worth an

average of 35,000,000 pesos; vegetable products shipped out, with

cereals predominating, have varied lately between 14,000,000 and

42,000,000 pesos; manufactured foodstuffs (dried or frozen meat, sugar,

cheese, flour) have grown in value since 1914 from 7,000,000 to nearly

24,000,000 pesos; 1,000,000 pesos’ worth of wine is exported; some

pottery, glass and leather; and an increasing quantity of unworked

lumber. But none of the farming, metallic, forestal or manufactured

merchandise groups show signs of growing ability to equal nitrate in

export values. Fortunately, the world needs Chilean nitrate, and there

is no prospect of the rise of a rival which could meet the naturally

produced chemical in price if drastic and feasible cuts were made in

export taxes.

Disorganization of world markets since 1914 has affected the imports of

Chile not only as regards bulk but also origin of supplies. It will

probably not be possible for a judgment to be formed concerning the

trend of trade until after 1922, when the flow of commerce may have

resettled into regular channels. The general effect of the war years was

to send merchandise north and south instead of east and west: a big

increase occurred in the trade relations between North and South

America, while the stride in commerce between the different South

American nations was perhaps even more remarkable.

Intercourse amongst the sister nations has been delayed in the past by

lack of coastal shipping and international railways as much as by laws

of supply and demand. It has been frequently said that the different

Latin-American states have nothing to sell to each other because they

all produce the same class of goods, needing similar commodities only to

be obtained from the advanced manufacturing countries. The latter part

of the contention has a great deal more force than the first; South

America must buy certain classes of goods afield, but a careful scrutiny

of production lists brought to light, after 1914, many prime materials

that could be exchanged, the impetus given to a coastwise traffic

(_cabotaje_) along both Atlantic and Pacific Coasts proving the success

of the new efforts. Several Latin-American states own maritime lines,

but Chile and Brazil in particular aid the new inter-American trade

development with excellent steamship and sail services under national

flags.

Brazil doubled her sales to Chile between 1914 and 1919; Argentina

increased the value of her shipments from under 6,000,000 pesos (Chilean

gold, of eighteen pence each) in 1914 to 31,000,000 four years later;

Colombia and Costa Rica increased their sales of fine coffee (via

Panama); Ecuador sent more cocoa and Peru more fruit and sugar—Peru’s

sales, worth 14,000,000 pesos in pre-war years rising to over 32,000,000

in 1919. Mexico’s sales to Chile rose from a few thousand pesos in value

to over 7,000,000, during the last six years.

Chile at the same time made big increases in her own shipments to

Latin-American countries. Her sales to Argentina rose from 4,500,000 to

26,000,000 pesos at eighteen pence; to Bolivia, from 4,000,000 to

8,000,000; to Peru, from 3,000,000 to 18,000,000; to Mexico sales were

doubled during war years. In some cases, as those of Uruguay and Brazil,

there have been fluctuations so marked that no conclusions can be drawn:

but on the whole the stimulus to inter-American trade has been well

sustained.

With the United States a tremendous development of traffic took place.

Exports from Chile rose from 86,000,000 pesos in 1914 to 489,000,000 in

1918; at the same time Chile’s purchases from the United States,

totalling about 55,000,000 pesos in 1914, soared to more than

203,000,000 four years later. In the case of both exports and imports,

values were inflated and have not been sustained, although the

development of the North American mercantile marine since 1914 is likely

to promote a greater share of commerce with South America than was

normal before the conflict. It is interesting to note that despite the

huge expansion of North American trade with Latin America during war

years, inflation in all directions was so great that the proportion of

business done by the United States with South America remained the same

as it has been for a hundred years—5 per cent of the total exterior

commerce.

A remarkable series of changes has been experienced in the export lists

of Chile during her economic life. In early days one of the most

important exports appeared on shipping invoices as “Bezoar stones,”

those curious concretions, forming in the bodies of certain

vegetable-feeding animals, which were considered medicinally potent in

the Middle Ages. Faith in the Bezoar stone and supplies came from the

East to Europe, but after the discovery of the Americas it was found

that the llama and guanaco also formed the precious object, and trade

grew brisk.

Once upon a time Chile shipped the bulk of her copper to India, taking

Oriental cottons and other merchandise in exchange; this trade has long

been discontinued, although Hindu as well as Japanese retailers are

reviving business with Chile. Up to 1887 Chile was still exporting the

skins of vicuña, now vanished from her confines, and the beautiful

chinchilla, also practically extinct in Chilean uplands.

The trade with the eastern side of the Andes in Yerba Maté received a

blow when with Independence it was possible for freer commerce to offer

Indian and China teas to the former colonies of Spain; but the peasant

classes of Chile are still faithful to the maté and the bombilla, and a

decreased but steady import continues.

_Foreign Firms in Chile_

Commercial conditions upon the West Coast of South America are sharply

distinguished from those of the Atlantic and the Caribbean by the

establishment of a number of powerful firms doing both import and export

businesses, owning and operating factories, and possessing widely

extended branches.

Several of these houses are British, their foundation dating back to the

early days of Chilean independence more than a hundred years ago; much

of the mercantile enterprise, as well as the milling and nitrate

refining industry, is indebted to these companies for capital and

inspiration. With European alliances also is a strong North American

firm, interested in general business, factory development and nitrate,

and running a line of steamers between North and South America, while

still more recent newcomers are the important Jugo-Slav firms operating

all the way from Punta Arenas to Antofagasta, and rapidly increasing

their interests in nitrate and other extractive industries.

The largest of the British firms operates sixty branches or agencies

throughout Chile, and while importing machinery, tools and agricultural

implements, hardware, sacks, rice, coffee, etc., also buys and ships

country produce. Another house deals largely in textiles, and a third is

chiefly although not exclusively interested in the nitrate country,

where in addition to refining and exporting the _salitre_, the firm is a

big supplier of machinery, foodstuffs, and all supplies for the

town-camps in the nitrate fields.

These large houses do not secure a monopoly of business; side by side

are numbers of smaller local firms of various nationalities: but their

existence and system of operation is a salient fact in the foreign trade

of Chile. The repute of the majority of these strongly entrenched houses

stands high; their representatives are men of character and ability, and

the organizations have not only created and built up Chilean commerce in

the past, but are of great value today. Their services are never more

strikingly proved than in such times of stress as those of 1921, when

small and inexperienced firms broke under the storm that the big

organizations were able to meet with all the strength of long usage and

wide credit.

It is sometimes complained against this array of impregnable commercial

castles that their influence tends to render the West Coast a territory

offering but a cold welcome to the newcomer in trade. I have heard the

establishment of the heavy tax upon commercial travellers in Chile

charged against the suggestion of the big houses. But even if there is

foundation for these complaints, there is something to be said on the

other side—for instance, that the old-established firms, having sown for

several generations, are not likely to be enthusiastic when a brand-new

reaping hook makes an appearance. Thinking of their long cultivation of

the soil, big investment, and big overhead charges, they are apt to

regard the débutant travelling salesman as a raider, and are not

extraordinary in looking askance at comprehensive plans launched during

the last few years for direct selling to consumers by groups of home

manufacturers.

As a matter of fact Chile is not singular in levying a heavy tax upon

the commercial traveller, and its assessment may be regarded as partly

due to the pressing need of Latin America during recent years to

discover new sources of revenue. Few American countries have even

attempted to face the difficulties of the direct tax, and with their

chief source of revenue derived from import and export dues, are

affected immediately by every change in the commercial barometer. In

times of stress all possible founts are examined and in the course of

this search the foreign commercial traveller himself has come to be

regarded as amongst the imports. It is true that he is still rather a

necessity than an article of luxury, and it is recognition of this fact

that may help to account for the frequent evasion of payments of the

tax.

Chilean law requires travellers representing foreign firms to buy in

each province visited a _patente_ (licence) costing 1000 pesos; with the

paper peso at an exchange value of one shilling, this is equal to £50,

so that in order to traverse Chilean commercial towns from Valdivia to

Coquimbo the traveller would have to spend £400 or £500 on licences. The

consequence is that visits are either confined to a strictly limited

number of cities—perhaps, to Santiago and Valparaiso only—or an

arrangement is made by which the trade representative carries the

business card of a local house, and is thus not subject to taxation, or

rents an office in Valparaiso, pays the normal trading tax imposed on

all businesses, and operates freely from that central point. Chile does

not trouble the temporary visitor with the host of small charges and

restrictions that exhibit local ingenuity in many parts of South America

during the last few years, and which include prohibitions against the

entry of a typewriter except under a heavy tax; permits to depart from

the police or port captains; demands for new vaccination and other

medical certificates; inspection and re-stamping of passports; charges

upon samples and catalogues, and, worst trial of all, removal of baggage

to customs houses for leisurely future inspection. In Chile one is as

free of this bureaucracy as in England before the war.

From commercial rivalry, whether between different groups of foreigners

or between foreigners and the Chileans who have for the last twenty-five

years taken so vivacious an interest in trade, Chile in general is bound

to benefit. The effect of time tends to take retail business more

conspicuously than wholesale or big import and export trade from foreign

hands and into Chilean, not only on account of ability but because a

house beginning life as an exotic has often become Chilean through the

domestic ties of its founders. The children of an enterprising foreigner

who marries, as so many foreigners have done, a Chilean wife, are

generally Chilean-born and educated, and cling in later life to the

pleasant land of their birth; a rapid naturalization of blood and of

capital is one of the outstanding features of Chile’s economic history.

_Trade-marks_

The question of trade-marks in Chile is attended by the same

difficulties which merchants offering goods from manufacturing countries

encounter in many young lands where national rights in discoveries and

inventions present few home problems. Broadly, Chilean law gives rights

in a trade-mark to the first person registering the mark; and it is not

unusual for a foreign maker or agent, entering the country with some

special product for sale, to find that his emblem has been already

registered by some enterprising and unscrupulous person, who must be

bought out if any business is to be done by the original owner.

Litigation has raged about this matter, but the only safeguard consists

in speedy registration in Chile—and all other parts of the Americas

where no international convention is in force—of the trade-marks of any

article which is likely to be sent here for sale.

Chile has had a patent law since 1840, but that in force today was

decreed by Barros Luco in 1911; it is modelled upon similar laws in

other lands, but there is a time limit of two years within which the

patent must be “worked.” In practice, however, the patentee as a rule

obtains a ten-year extension of the term within which his rights are not

liable to forfeit in case no active use is made of them.

[Illustration: The Post Office, Santiago.]

[Illustration: Santiago, with the Snow-capped Andes in the Eastern

Distance.]

[Illustration: Subercaseaux Palace, Santiago.]

CHAPTER XI

TRANSPORT SYSTEMS

_Railroads.—The Transandine Line.—Sea Transport.—Rivers and

Lakes.—Roads._

Chile possesses 8600 kilometres or 5375 miles of railways, of state and

private ownership that, running throughout her main territorial length

north and south, and connected with the sea by a number of transverse

lines, serve her better than any other South American country is served.

The rule all over the continent is that the seaports are the chief

points where population is grouped and that from these ports railways

have been driven inland as pioneers opening new country. Many of the

regions thus served are immense, as a glance at the map shows; great

fans of steel rails spread from Buenos Aires, S. Paulo and Montevideo,

for example. But these lines were built to serve, and do almost

exclusively serve, the needs of special localities lying inland from a

coastal point, and only in a few instances are these regions

systematically linked to the rest of the country.

The construction of Chile’s great longitudinal services was forced upon

her, luckily, by the peculiar topographical form of this part of South

America. All the long folded ribbon of the Central Valley is a natural

highroad, and the railways follow very ancient trails.

From Tacna, in 18° of south latitude, lines run almost continuously to

Puerto Montt at the edge of the Gulf of Reloncaví in 41′ 50″ of south

latitude, a distance of about 1500 miles. From this great main artery of

traffic touching all the important producing regions of the Central

Valley, branches run west from thirty different points to the Pacific;

the length of these connecting links is short, averaging 30 to 50 miles.

To the east a number of small lines extend to serve mining or

agricultural regions, and three long arms have been flung across the

mountain barrier of the Andes. One of these, the Transandine line, forms

the only existing railway system connecting the Atlantic and Pacific

Coasts of South America, the distance from Valparaiso to Buenos Aires

totalling 1444 kilometres, or 896 miles, the journey taking two days.

The second line climbing the Andes is that extending from Antofagasta to

La Paz in Bolivia, 863 kilometres or 518 miles. The third also runs to

La Paz, from the former Peruvian port of Arica, a distance of 433

kilometres or 260 miles.

The policy of the Chilean Government as regards railways had its

beginning in 1852, when President Manual Montt inaugurated construction

of a line to unite Santiago and Valparaiso, a cart road built by Ambrose

O’Higgins then serving these two important and growing cities. In a

straight line the distance between Santiago and the port does not exceed

55 miles, but the coastal range rises in this region to unusual heights,

and in order to negotiate the crest a curve was made northward passing

by Limache, Quillota and Llai-Llai, the length totalling 187 kilometres,

inclusive of the section now forming a part of the great longitudinal

system. The first part of the line completed, between Valparaiso and

Viña del Mar, was opened to traffic in 1855; the extension to Limache,

in 1856; to Quillota, in 1857; construction of the San Pedro tunnel,

together with delays resulting from the revolutionary troubles of 1859,

held back completion of the extension to Calera until 1861; Llai-Llai

was reached in 1862, and the whole line opened to traffic through from

Valparaiso to Santiago in September, 1863. A new line is now planned to

follow a shorter route via Casablanca.

At the same time that this sea-to-capital link was commenced the

Government authorised the construction of a main line running south by a

private company, the Ferrocarril del Sur, while in the north a number of

railway enterprises were also undertaken by individuals or companies,

chiefly with the object of serving mineral regions. The majority of

these companies were capitalised in London, although the concessions

were in some cases obtained by American promoters such as Henry Meiggs,

afterwards well known in connection with Peruvian railroad building, and

the genial William Wheelwright. Hundreds of young British and American

engineers entered Chile at this period of early construction, while

native-born Chileans still lacked technical training, and scores of them

remained in the country permanently, settling and founding families. It

was a tremendous era of building which lacked coherence but nevertheless

was intelligent and forceful; every strip of line had its sound _raison

d’être_, served its immediate purpose, and not only marked an industrial

movement but remains today as a permanent contribution to the transport

needs of Chile.

Actually the first railway line to operate in Chile was the Copiapó line

running from that celebrated and then flourishing copper mining centre

to the little port of Caldera, 55 kilometres distant. Construction was

begun in 1850 and the line was opened to traffic in 1852, the Copiapó

railway thus achieving its place as the second oldest railroad in South

America. First place belongs to the Demarara line in British Guiana.

By the time that the Valparaiso-Santiago railway was completed the

southerly trunk line had been pushed as far as San Fernando, with

extensions surveyed to Curicó and Talca. Curicó was reached in 1867 and

was promptly sold by the private constructors to the Government of

Chile, already marking out its continued policy of state ownership of

transportation systems. Until about 1870, when both imported and native

coal began to come into use, the fuel burnt by the locomotives of the

central sections was Chilean wood, a circumstance which was material in

helping to destroy the woodland of Central Chile.

To the north, Carrizal had a mule tramway running thirty miles from the

copper mines to the sea; it was superseded in 1863 by a steam line. The

Coquimbo railway was begun in 1856, afterwards taken into the state

system but originally a mining line; as also was the Chañaral strip,

linking Pueblo Hundido, another of the early pioneers; the Tongoy

railway, begun in 1867, and running to Ovalle; the line connecting Vilos

and Illapel, and that joining Huasco and Vallenar.

By the year 1885 the Chilean Government owned 950 kilometres of railway,

while private companies owned 1254 kilometres. The result of the War of

the Pacific gave a spurt to extension of nitrate railways, several of

which had been begun in the great salitre regions, while the developing

industry brought public revenues to the Moneda, permitting the

acquisition or extension of state lines. Twelve years later the Chilean

Government was operating 2000 kilometres of railways, while private

owners operated about 2300 kilometres.

In 1910 the Government had extended its lines to Puerto Montt in the

south, and ran north to meet the nitrate railways, a gap remaining in

the latter section between Cabildo and Pintados, where the lines serving

the Tarapacá fields reached their farthest southern point. An

arrangement was reached for completion with two British syndicates. The

Government now controls over 4600 kilometres of line, while private

owners control about 4000 kilometres.

The state lines provide comfortable and cheap passenger transport,

carrying goods also at reasonable rates. Travel is an inexpensive

pleasure, the service is punctual, and equipment good. It is doubtful if

more exquisite scenery can be enjoyed anywhere in the world at a like

cost. But, like many richer and more experienced governments, that of

Chile consistently loses money on her national lines. Only during the

busy years of 1915, 1916 and 1917, when depleted steamship service sent

more traffic to the railways, did the state lines show a profit. Since

the Armistice, losses have been increased, 1919 ending with deficits

variously computed at 14,000,000 and 40,000,000 pesos.

Previous to 1918 the private lines always earned profits, but

disorganisation of the nitrate and copper industries, together with the

low rates sustained, caused considerable entries on the wrong side of

the ledger during 1918 and 1919.

With two exceptions the Government lines form a homogeneous network

extending north and south and flinging out arms to vital points. But

there are two isolated lines. One is the strip on the Island of Chiloé,

connecting Ancud with Castro, 98 kilometres long; the second is the

Arica to La Paz railway, 438 kilometres in length, joining this old

Peruvian port to the capital of Bolivia.

This line is of special political interest, besides presenting a fine

engineering feat—for it reaches an altitude of 13,000 feet above sea

level. Forty kilometres are on the rack system. The line was built in

accord with an agreement made with Bolivia after the War of the Pacific,

the same Treaty that deprived Bolivia of her coastal belt promising her

a new outlet to the sea as a seal of peace. The Arica-La Paz railway

cost £2,900,000, was opened to traffic in 1914, and the section

traversing Bolivian soil, 238 kilometres long, is to become the property

of Bolivia in 1928.

The private lines represent an investment of 238,000,000 pesos of

eighteen pence, or £16,800,000, as against the State’s capital

expenditure of 394,000,000 pesos, or £29,550,000. The most important

group of private lines are those serving the great nitrate pampas, and

the largest operators are the Antofagasta and Bolivia Railway Company.

The lines of this English system date their inauguration from 1873,

extend over 925 kilometres, of which 482 lie within Bolivian territory,

and carry traffic from Antofagasta to La Paz at the same time serving a

great nitrate area. Branches run to the salitre of Boquete, to

Chuquicamata, to Conchi Viejo and the Collahuasi mines, within Chilean

confines. Equipment and management upon this line, with its excellent

dining and sleeping cars, are of a high order; total capital invested,

£8,550,000. In addition to this system, the company has since 1916

operated the northern section of the Government’s longitudinal railway,

about 800 kilometres long. Next in importance of the private railways is

a network connecting the nitrate fields of Tarapacá with the ports of

Iquique and Pisagua, owned and operated by the Nitrate Railways Company

Ltd. (London). The first concession for building the line was obtained

in 1860, the total investment amounts to over £2,000,000, and the

company operates 578 miles of line, of 1.43 metres gauge. The services

rendered by this well-equipped line are best realised when the number of

nitrate oficinas utilising the railroad are added up and found to total

sixty-nine.

The Taltal Railway Company, Ltd., is another British line, operates 298

kilometres of track of 1.06 gauge, and links the salitre pampas of that

part of the Atacama desert lying within Antofagasta province with the

port of Taltal. The investment totals £1,050,000.

Also British is the railway connecting a large group of nitrate fields

with the port of Caleta Coloso, the Cia. del Ferrocarril de Aguas

Blancas, with 221 kilometres of track of 1 metre gauge; the network

belonging to the Compañia de Salitres y Ferrocarril de Junin, operating

89 kilometres of 0.76 gauge track and serving oficinas near the coast of

Tarapacá; the lines of the Cia. de Salitres y Ferrocarril de Agua Santa,

uniting nitrate works at Agua Santa, Negreiros and Huara with the port

of Caleta Buena, 109 kilometres; and the Anglo-Chilean Nitrate and

Railway Company, Ltd., linking the nitrate pampas of Toco with the port

of Tocopilla, 122 kilometres in length.

Also of British construction, capitalisation and operation is a short

line, dating from 1855, connecting the city of Tacna with the port of

Arica, 63 kilometres of 1.43 metre gauge track; and formerly British,

but sold in 1920 to the Lota Coal-mining Company is the railway

connecting the city of Concepción with the ports of Coronel and Lota and

with the flourishing coal mine of Curanilahue. The British owners were

the Arauco Company, Ltd., operating 103 kilometres of 1.68 metre gauge

track. The line from Los Sauces to Lebu, whose construction was

suspended during war years, is also a British enterprise.

Chilean capital and enterprise is responsible for several private lines,

as the Ferrocarril de Copiapó, whose first conception was due to Juan

Mouat of Valparaiso, in 1845. The original line connected Copiapó with

Caldera Port, 81 kilometres, but extensions were afterwards added to

Pabellón, and thence, after acquiring a mule tramway to the Chañarcillo

mines, to Chañarcillo, another ramification running northeast towards

the Argentine border but terminating at Puquios. The gauge of the line

is 1.43 metres, and the length 231 kilometres. Also Chilean is the

Ferrocarril de Carrizal y Cerro Blanco, uniting Carrizal Port to the

copper mines of Cerro Blanco, due east, with a southerly branch to

manganese deposits near Chañar Quemada and Astillas and another to the

copper mines of Jarilla, the line terminating at Merceditas. The line

with its branches has a gauge of 1.27 metres and a length of 184

kilometres.

The Ferrocarril del Llano de Maipo, running between Santiago and Puente

Alto, 22 kilometres, is Chilean; so also is the electric line between

Santiago and San Bernardo, 15 kilometres, and a similar link between

Concepción and Talcahuano, as well as the short railway connecting

Concepción and Penco. A new Chilean railway runs between Quintero Port

and Cousiño, while the lines serving coal regions of the south are

practically all Chilean today, but their length and direction is subject

to change according to need.

The Ferrocarril Transandino por Antuco is the beginning of an ambitious

Chilean project to cross the Andean barrier into Argentina at a

low-level pass. The line starts from the station of Monte Aguilar on the

state longitudinal railway, in the province of Concepción, runs almost

due east towards the volcano Antuco and Lake Laja, and has a present

extension of about 85 kilometres. It has a metre gauge track, will have

a length of 129 kilometres when it reaches the Argentine frontier, the

mountain pass which it is planned to traverse having a height of but

1862 metres above sea level, or not much more than 3000 feet. Within

sight of this pass the river Neuquen has its rise, and it has been

contemplated to follow its valley southeastward to connection with the

line running from Bahia Blanca.

A Chilean trading and cattle company with headquarters in Valdivia is

constructing a new southerly line, running eastward from the

longitudinal station of Collilelfu, about forty miles from Valdivia, to

Lake Riñihue: here a line of connecting steamers will carry passengers

farther to the east, and a second strip of railway will connect with the

lake of Pirihuaico, whose easterly point almost touches the Argentine

border. About 40 kilometres of this line is open to traffic.

Far south, running from Punta Arenas to the coal mines of Loreto, is

another small Chilean line of nine kilometres.

Of North American construction and operation is a 25 kilometre

ore-carrying line between Caleta Cruz Grande and the Tofo iron mines; a

narrow-gauge private line of 70 kilometres joining the copper mines of

El Teniente (Braden Copper Co.) to Rancagua town; and a link between

Pueblo Hundido and the copper beds of Potrerillos. German interests

(Gildemeister & Co.) constructed a small line, for the exclusive use of

a related copper mining company, from Challocollo to Cerro Gordo, in

Tarapacá, with an extension to La Granja, in 1897, 36 miles of

narrow-gauge track.

Investment in private lines (most of which are open to the public, but

are distinguished from the state-owned railways) is reckoned at a total

of 238,000,000 Chilean pesos of eighteen pence, divided amongst British

companies, 209,000,000 pesos; Chilean, 24,000,000; and North American,

5,000,000. The German investment of two or three millions does not

appear in statistics of Chile since 1916. The former German-operated

tramways of Santiago and Valparaiso have passed into British hands and

are now controlled by S. Pearson & Son, Ltd.

Three new Andes-crossing lines are contemplated in Chile. Two are

planned to the north of Santiago, the third to the south. The latter is

already in construction as part of the state system, running from Cajón

station, just above Temuco, through Cautín province eastwards. The

mountain barrier is here below 5000 feet in height, and negotiation of

the Andean section, plus extension to the Argentine line running west

from Bahia Blanca, presents no difficulties beyond that of finding

sufficient capital for construction. Chile’s eastward extension will

traverse the green fields of the Lonquimay Valley, crossing by the Pass

of Maullin Chileno.

To the north, one project indicates a line extending east from

Antofagasta through Boquete and Huitiquina on the Argentine frontier,

and joining with Argentine systems at Salta; another plans a railway to

continue the branch running out from Coquimbo along the Elqui Valley to

Algarrobal and Rivadavia. Crossing the Andes by the Tortolas pass, the

line would link with the Argentine system of Rioja province. Regarding

the two first-named lines, the Argentine and Chilean Governments have

agreed upon a close mutual policy, and work upon unified plans is being

rapidly advanced.

_The Transandine Line_

Railway lines crossing the South American continent are sometimes said

to be of less pressing importance since the opening of the Panama Canal

rendered the West Coast more readily accessible from the western

seaports of Europe and the eastern coasts of both North and South

America. It is true that certain overseas commerce is served by the

Panama route, exactly as it was encouraged when steam navigation made it

possible for seamen to face the Magellanic Strait without misgiving, yet

no one with knowledge of the internal needs of South America doubts the

necessity for strengthened transcontinental links. Canada, with

8,000,000 inhabitants, built two transcontinental railroads: South

America, with 75,000,000 people, has but one direct cross-country line

completed.

This single railway from sea to sea—connecting Santiago de Chile with

Buenos Aires by a two days’ journey of 900 miles—is a remarkable piece

of work, owing inspiration and accomplishment to the Anglo-Chilean

engineer brothers, Juan and Mateo Clark. It has been open to

international traffic as a through line since 1910, its operation

stimulating not only the commerce of Western Europe and Chile, but

aiding the development of brisk trade between Chile and Argentina. It

was a reopening of ancient paths. Before and to a lessened extent during

colonial times a score of passes over the Andes were in common use and

the interchange of persons and goods continuous. Following Independence

and the creation of sharp and sometimes jealous divisions between the

republics, the countries were separated as never previously; old

transcontinental trails were neglected. This neglect was increased by

the interest taken in South America by the rich countries of Europe, the

establishment of shipping lines to all the ports of the young

communities, and the stream of gold and people directed towards the

development of commerce and public services. For a century each South

American state turned its face to the sea, economically and

intellectually. The creation of the Transandine railway was the first

deliberate conquest of the Andean barrier between eastern and western

nations of the continent. A few miles of construction only are needed to

connect up Bolivian railways with the northerly Argentine system.

Ecuador is planning a link with the Amazonian headwaters to create a

route for merchandise similar to that of North Bolivia, with outlet at

Pará; but lack of population and production through vast interior

regions has acted as a deterrent against transcontinental plans even

more than engineering difficulties. These have been surmounted in South

America in a number of instances, the mountain-climbing lines of Brazil

on the east and of each of the four countries to the west offering

famous instances of response to industrial need. But without the sound

_raison d’être_ of Mendoza’s flourishing existence at the eastern foot

of the Andes the present Transandine line would have waited longer for

its creation.

Juan and Mateo Clark, planning the line, obtained a concession from the

Argentine Government in 1872, and from the Chilean in 1874. Money was

scarce and engineering problems many, so with a view to lightening the

burden the route was divided into four sections, and construction

performed by the group of corresponding companies. The longitudinal line

built by the Chilean Government already had run a branch from Llai-Llai

in an easterly direction towards the mountains, culminating in the

station of Los Andes at 2733 feet above sea level—the old Santa Rosa de

los Andes. This railway followed the ancient mule road towards Juncal

and the Uspallata pass en route for Mendoza and Buenos Aires, and the

eventual construction of the Chilean Transandine practically adopted the

same course from Los Andes to the Argentine frontier in the heights. But

this section, although but 70 kilometres in length, presented the worst

difficulties and was the last completed.[7]

Footnote 7:

On the Chilean side a rack system is employed for 23 kilometres; the

maximum grade is 8 per cent. On the Argentine Transandine the rack

system is employed for 14 kilometres, with grades nowhere reaching

more than 6½ per cent.

Three companies undertook construction of the strip between the

Argentine frontier and Buenos Aires, 1373 kilometres long. The mountain

section to Mendoza (2481 feet altitude) was built by the Argentine

Transandine Company; Mendoza to Villa Mercedes (with a branch running

north to San Juan, site of an ancient post-house), by the Argentine

Great Western Company; and Villa Mercedes to Buenos Aires by a company

subsequently called the Buenos Aires and Pacific Company. Money supplies

came from London, where the companies are domiciled.

The Villa Mercedes-Mendoza link of 356 kilometres was completed and

opened in 1886; the pampas-crossing section between Villa Mercedes and

Buenos Aires, 692 kilometres, in 1888. This was all plain sailing, but

serious difficulties were encountered in the mountain sections. Work

began on the Argentine side in 1887, and upon the Chilean in 1889; in

the latter case the indefatigable Clark brothers gave not only devoted

energy but their own funds, suspending operations in 1892, after 27

kilometres were built, when their capital was exhausted. A year later

part of the Argentine Transandine section was opened to traffic, but the

operation of completed lines on the east had the effect of diverting all

traffic from Mendoza to Buenos Aires instead of promoting international

commerce as had been contemplated.

In 1904 a new firm, the Transandine Construction Company, London

domiciled and financed, took over the Chilean section from the Clark

brothers and their creditors, and finally joined the Argentine

Transandine at the frontier station of Las Cuevas in 1910.

The old cart and mule road crossing the Cumbre rose to an altitude of

14,500 feet, and was, during the period of snow-storms, usually due

between April and October, shut to all but the hardiest travellers. To

obviate this ascent the builders of the Transandine drove a tunnel

through the head of the Andean barrier, at an altitude of 10,521 feet

above sea level; the tunnel “de la Cumbre” traverses a length of more

than 3000 metres, the two Transandine lines meeting within its length,

at an altitude of 10,515 feet. With greater capital to spend, the

Chilean Transandine constructors would have driven the tunnel through

the mountains at a level about 3000 feet lower to avoid the storms

raging about the higher regions, and ultimately this work will probably

be performed: but it entails construction of a tunnel four times the

length of that in existence.

Below the tunnel on the Chilean side the company shields the line with

strong snow sheds, but here again lack of sufficient capital prevents

the additions necessary if the line is to be safeguarded all the year

round; at present there is danger of enforced stoppage as soon as the

first heavy snows fall, blocking the line with twenty or thirty feet of

drift and avalanches. More than once traffic has been suspended for

three or four months.

[Illustration: On the Chilean Transandine Railway.]

[Illustration: Laguna del Portillo: near the Transandine line.]

[Illustration: Santa Rosa de Los Andes: Chilean Terminus of the

Transandine Railway.]

In spite of difficulties, however, the line has proved to be of immense

value to international traffic, has shortened the distance between West

European ports and Valparaiso by over 2000 miles as compared with the

Magellanic route, and 500 miles as compared with the Panama journey.

With the operation of the Panama Canal the route between New York or

Halifax and Valparaiso was shortened so much that it is a saving of time

for a traveller wishing to reach Buenos Aires from a North American

point on the eastern side to journey via the Canal and the Transandine.

Buenos Aires has also been brought into closer touch with the Orient and

Australasia, while Chilean towns are in quick communication with the

markets of Argentina, Uruguay and Brazil.

Brisker traffic in both passengers and merchandise will be developed

when unity in administration is in working order. But this has been long

delayed, owing to the troubles connected with construction days. In 1894

the Argentine Transandine, observing with misgiving the remote prospect

of completion of the Chilean link, formed an agreement by which the

Argentine Great Western operated the section open to traffic, this

arrangement being renewed in 1901 and 1905. In 1907, after some

skirmishing and the commencement of a competitive line to Mendoza, the

Buenos Aires and Pacific Company obtained control of the Argentine Great

Western, and at the same time of the agreement controlling the Argentine

Transandine, which line it guarantees from losses threatened by blocking

of traffic through snow. Thus for many years the Buenos Aires and

Pacific held the reins of all rail operations between the capital of the

Argentine and the frontier of Chile, and was frequently charged with so

arranging freight prices as to send all Mendoza traffic eastwards, while

discouraging commercial interchange between Chilean markets and the

prosperous Mendoza vicinity. The Chilean Transandine constantly pressed

for a revision of management, proposing that the Argentine Transandine

should be separated from the Buenos Aires and Pacific and united with

the Chilean mountain-climbing link, so that a single administration

should operate the line between Los Andes and Mendoza, the terms of the

lease held by the Buenos Aires & Pacific Line allowing of cancellation

at twelve months’ notice.

Chilean and Argentine public opinion agreed upon the matter, the help of

the two Governments was enlisted, special meetings held under the

auspices of the Sub-Committee on Railway Transport of the Pan-American

Conference held in Buenos Aires in 1916, an International Commission

appointed to arbitrate upon goods rates between the two countries, in

1917, and a draft proposition approved in early 1918 between the

diplomatic representatives of Argentina and Chile in London, acting in

consultation with the directorates of the two Transandine companies.

Chile agreed in August of 1918, and, in amicable agreement, the

Government of Argentina, in December, 1919, accepted the proposal in

principle; arrangements were made by which the new contracts with the

Transandine lines should be simultaneously discussed in the Congresses

of both countries. In early 1922 agreements were complete, details of

unification of the railways was decided, provision made for new

financing of the improved system, and tentative arrangements outlined

with a view to new and liberal tariffs between the two countries,

tending to encourage traffic not only via Mendoza, but also between

North Chile and the Salta region, as well as between South Chile and

Eastern Patagonia when the projected new Transandine links are

completed.

_Sea Transport_

As regards sea transport Chile is in an enviable situation with her

immense coastline giving speedy access to all inhabited parts of her

territory. It is true that with a few exceptions, of which Talcahuano is

the most notable, Chilean ports are little more than open roadsteads,

exposed both to the southwesterly gales and to the dreaded “northers”;

but modern engineering is doing much to solve the problem of safe havens

where visiting vessels may anchor in safety. The same difficulty applies

to almost the whole of the South American West Coast, and for centuries

sailing vessels feared the region; during Spanish colonial times it was

so common a thing for a ship to spend from six to twelve months on the

passage between Callao and South Chile that when Captain Juan Fernández,

running out southwest for a thousand miles, and afterwards turning

almost due east for Chilean ports, managed to avoid the cruel coastal

gales and made the passage in thirty days, he was haled before the

Inquisition as a wizard. The Inquisitors, however, after careful

examination of the captain’s papers, set him free, applauding his

sagacity. From that day the group of islands named to commemorate the

navigator’s skill became the beacon for vessels sailing to Valparaiso

from the North, although ships returning to Peru still hugged the coast.

It is not uncommon for sailing vessels to be wrecked off the difficult

southerly coast, with its innumerable indentations and furious storms,

but the worst year of the present century was 1911, when 37 steamers as

well as, by a strange coincidence, an exactly equal number of sailing

ships, were cast away off Chile. That was a year of exceptional storms,

but out of 32 years between 1887 and 1919, only seven passed without a

record of wrecks; it is to the credit of the excellent surveying and

charting work of the Hydrographic Department of the Chilean Navy that

the path of the navigator has been rendered plainer, while the Chilean

Government has in hand a series of plans for the better protection of

ports—lacking only the financial sinews of war against wind and tide.

Of Chile’s fifty-four ports of major and minor importance, perhaps

thirty are visited by international shipping. But of these only about

fifteen display brisk commerce. Arica, visited by 400 foreign ships

annually and over 300 Chilean vessels, connects directly with Bolivia;

Pisagua, Junin, Caleta Buena, Iquique, Tocopilla, Mejillones and its

younger sister Antofagasta, Coloso and Taltal, are nitrate ports,

bustling when nitrate markets prosper and almost idle during the most

depressed period of 1921. The copper ports of Chañaral, Caldera and

Carrizal Bajo have suffered more than Coquimbo, with fruit and other

farm exports to add to her diminished list of minerals. Valparaiso,

chief port of Chile, receives about one thousand national and three

hundred foreign ships yearly, one-third of the whole exports entering

here, although Antofagasta and Iquique are the big exporters. In normal

years, Valparaiso receives 1,400,000 tons of cargo, of which nearly half

is coal. Farther south, Talcahuano, the chief naval base and the port

for flourishing Concepción, receives about 400 vessels annually;

Coronel, exporting and bunkering Chilean coal, receives about 700;

Corral, the port for Valdivia, is visited by some 200 ships yearly; and

Punta Arenas in the Strait of Magellan, does business with twelve

hundred Chilean and about one hundred and thirty foreign vessels each

year.

[Illustration: Coquimbo, the “Capital of North Chile.”]

[Illustration: Ancud, the Port of Chiloé Island.]

[Illustration: Zapallar, a beautiful Chilean Watering Place.]

These ports will probably continue to be the great outlets for Chile’s

most thriving regions, but they are insufficient to serve the needs of a

long list of growing districts, and in spite of much good planning are

still inadequately equipped for the increasing work required. A special

Government Commission, lately considering the question of more sea

gateways, has decided that forty or so of the points along the Chilean

coast should be improved for the reception of international shipping.

The Commission’s recommendations necessitate the expenditure of at least

six million pounds sterling, or let us say the whole of the taxes upon

nitrate exports during one prosperous year. The sum will in all

probability be raised, according to need, year by year, by means of

exterior loans.

According to the projects, Valparaiso will be allotted a further million

and a half pounds; Valdivia, Lebu, Talcahuano and Constitución, about

one million each; Puerto Montt, a preliminary £150,000; Tomé (at the

north of Concepción Bay) and Pichilemu, £40,000 each; with smaller sums

for Iquique and Puerto Saavedra (Imperial Bajo).

Valparaiso port works have been since 1912 in the hands of a British

engineering firm, and have given a good deal of trouble, storms more

than once undoing part of the construction work; in the early months of

1922 there were completed two quays totalling 840 metres in length, a

breakwater of 288 metres, and a coal wharf 200 metres long by 30 metres

wide; work upon the mooring jetty, the extension of the old Fiscal Mole

(dating from 1883, and the only means for transferring passengers and

cargo until the new quays were constructed), the Prat Quay, warehouses

and railway is also well advanced, in spite of long delays caused by the

European War. There is plenty of water—in fact, too much for facile

construction of jetties or breakwaters, the bottom shelving rapidly from

39 feet at the mooring jetty, and offering, less than 200 feet from

shore, nothing but mud as foundation. In consequence, the outer section

of the breakwater cost £560 per linear foot to build. Since 1906

Valparaiso has suffered from no serious earthquake, but slight shocks

are not infrequent and must be taken into consideration in the case of

construction in the sea as well as upon the land. Rise and fall of the

tide at Valparaiso does not exceed three feet.

The Nitrate Ports have earned more money than any other points of

outflow for Chilean products, but safe, adequate modern havens for

shipping are not to be created in a day or even in a decade; and the

same difficulties of the open roadstead and prevailing winds have

delayed the completion of adequate facilities even at that busy

commercial stronghold, Antofagasta. Comprehensive plans are, however, in

course of development, and work has only been delayed by the depression

of 1921.

Port improvements at Talcahuano are being carried out by a French

company, and the main work is unlikely to be completed for a few years,

although it has been attacked. Talcahuano lies within the deeply

indented Bay of Concepción, the best naturally-protected haven upon the

West Coast, and is further shielded from the effects of northerly winds

by the pretty island of Quiriquina, once a rendezvous for pirates, and

during the War the place of internment for several hundred Germans,

including sailors from the _Dresden_. Talcahuano possesses a floating

dock and equipment as the first naval base of Chile, and when the

present plans have been developed this port will be one of the best in

South America.

The creation of a secure port at the mouth of the fine river Imperial,

Puerto Saavedra, will be comparatively easy when the projected cut is

made from Budi Bay through a sandy bank into the river, safe from all

storms. From this point the stream is to be dredged for 20 miles up to

the town of Carahue, where a branch railway connects with Temuco and the

Longitudinal system. Another important dredging work is projected along

the stream of the Valdivia from Corral port. This haven of old

foundation, nestling under its cliffs, has been for centuries of

necessity the stopping-place for vessels with cargo and passengers for

Valdivia City, twelve miles inland, all traffic being transshipped up

river by small steamers, barges, etc. By the new plans a channel will be

deepened to permit the passage of ocean-going steamers to the

beautifully placed riverine city, whence rail connection opens the most

fertile agricultural country, immense forestal zones and a large

coal-mining region.

At pretty Constitución, where the dangerous bar is so much dreaded that

its condition is always signalled to vessels before they venture to

approach, plans include the dredging of a channel and construction of

breakwaters to prevent silting-up.

Puerto Montt, at the end of the Longitudinal, and lying within the Gulf

of Reloncaví, is a recent creation whose equipment as a port receiving

international vessels is still only on paper; this Llanquihue region,

with its lumber and sheep industries, is fast developing, and will

invite a great deal of tourist traffic when its transport facilities are

equal to its glorious scenery. Port construction problems are chiefly

due to the 25-foot rise and fall of the tide. At Punta Arenas, another

new port of remarkably rapid and vigorous growth, vessels are still

obliged to lie out in the Strait while cargo and passengers are

transferred by lighters and small boats, but the steady prosperity of

this zone as well as its position as a port of call for international

steamers render imperative the creation of modern port facilities.

_Rivers and Lakes_

Chile has one hundred and twenty rivers, but can count no more than five

hundred miles as navigable. This navigability is again limited to small

vessels only, to which another five hundred miles of lake waterways are

also open; motor boats and canoes are able to traverse another four

hundred or so of rivers, but these are frequently broken by cascades and

falls.

In pre-Spanish times the lakes and rivers of Chile leading towards the

Andes undoubtedly served as channels for Indian traffic; the Rio Blanco,

Juncal and Aconcagua led towards the mountains into what is today

Argentine territory from the populous Central region of Chile, while the

lower passes were crossed to the south by way of many river valleys and

by such lakes as Llanquihue and Todos los Santos, a short strip only

intervening between the latter beautiful water and the lovely Nahuel

Huapi in East Patagonia. During colonial times, with the depopulation of

the wilder country and the concentration of towns upon the seaboard,

this traffic diminished and commercial exchange was limited to ocean

transport, with, however, an increasing intercourse with Argentina when

the then Chilean provinces of Mendoza, San Luis and San Juan developed

trade with the new colonies of Buenos Aires. But below Chiloé the

territory remained unknown, and it has only been within recent years

that the southern lakes have been visited and surveyed.

[Illustration: Taltal, a Nitrate Port of North Chile.]

[Illustration: Puerto Corral, the Port of Valdivia, South Chile.]

As to the rivers during colonial times, if they were not treated with

equal neglect, their capricious ways were permitted to absolve them from

any great usefulness, and it has only been within the last twenty years

that serious studies have been made with a view to restraining,

preserving and freeing the torrential streams characteristic of the

short, steep slope of Chile. All Chilean rivers are snow-fed, and are

extraordinarily and violently augmented when the Andean snows melt; the

northern floods are more uncontrolled than those of the south, tearing

down from greater heights through open country where nothing but,

eventually, heat and sand offer a check. Many disappear in the desert

while still far away from the sea. The southerly rivers, flowing from

lesser heights and passing through long forestal areas, are more

constant in volume. It is only below Lebu, in 38 degrees of south

latitude, that any Chilean river becomes even nominally “navigable,”

with the sole exception of a dozen miles of the Rapel.

Nevertheless, the longest Chilean river is in the north, flowing across

Chile’s widest province, Antofagasta; this is the Loa, fertilising oases

in the desert and sheltering little groups of people today just as it

offered a livelihood to indigenous folk in pre-Spanish days. The Loa,

sometimes called the Calama, is three hundred miles long, but for half

the year is not more than a thread at the bottom of a wide gully. Its

nearest northerly rival is the Copiapó, about 170 miles, watering

fruitful valleys like the capricious but equally invaluable streams the

Huasco, Elqui, Hurtado, Limari and Petorca. A succession of rivers in

the Central Region are untamed floods in the rainy season—the Aconcagua,

Juncal, Blanco, Volcán, Colorado, Maipo, Mapocho, Cachapoal and

Rapel—none more than 125 miles long. Three or four of these rivers will

be harnessed in the near future to yield hydro-electric force. Below to

the southward, the Mataquito, the Maule of ancient fame, the Itata and

the exquisite Bio-Bio are all outside the navigable list, and the latter

is distinguished by its exceptional length of about 200 miles as well as

its beauty.

First among navigable rivers as one goes from north to south is the fine

Imperial, with a watershed of about five thousand square miles, and a

length of one hundred miles; it has a magnificent and constant flow, but

only fifteen miles are navigable. The Toltén owns six navigable miles;

the Valdivia, 125 for small boats and about 25 for larger craft; the

Bueno is in a different category, for, with a length of not much more

than one hundred miles, it has about 50 miles of navigable channel. The

Bueno, in fact, is the outflow of two lovely lakes, Ranco and Maihue,

and discharges 600 cubic metres of water per second, a flow second to

none among Chilean rivers.

Still farther southward, the Maullín has thirty navigable miles; the

Palena about twenty; the Aysen, no more than twelve. And next comes that

fine and little-known river the Baker, whose length is said to be equal

to that of the Loa in the far north, about two hundred and eighty miles,

of which nearly fifty are navigable. Outside that list are the Bravo,

Pascua and Serrano, except for the canoes of the south-dwelling Indians.

Of Chilean lakes, Llanquihue is the largest, with a superficial area of

1400 square miles; its great depth, averaging 360 feet near the shore,

suggests that this is the crater of an old volcano. Skirted by the south

end of the Longitudinal railway, Llanquihue counts several ports, with

Varas as the oldest-established and the largest. This lake, with its

near companion, Todos los Santos, is traversed by Chilean steamers; and

there is regular traffic upon Riñihue and Ranco. The former lake is

reached by rail to Los Lagos station, horses taking travellers thence to

the edge of Riñihue, about 25 miles; a wild but glorious stretch of

typical Chilean woodland, clothing the sides of a lovely valley, lies

between Riñihue and Ranco, with its brilliant turquoise blue waters, and

abrupt sides covered with ferns, foxgloves, fuchsias and a close growth

of trees of bright green foliage. Small steamers cross the lake to

Llifen, where there are famous curative sulphur baths.

From Puerto Montt southward is a long series of fiords, islands,

indentations and inland channels whose intricacy and extent are

unequalled even by the famous fiords of Norway. For natural beauty the

Norwegian complex cannot compare with that of Chile, for no woodland

exists in Europe that rivals the pathless, luxuriant, flower-hung

forests of Chiloé Island, the Andean spurs of Western Patagonia, the

broken archipelago of Chonos, and the noble mountains of the Strait of

Magellan. Rich ferns and flowering shrubs, wild bamboo and pines and

beeches, reach to the water’s edge. Through the thousand miles of this

complicated chain of inlets and islands between Puerto Montt and Punta

Arenas runs an almost continuous channel, continuation of the long

depression which creates the deep fold of the great Chilean central

valley. Steamers seeking sheltered waters from the Strait of Magellan

northward need not emerge into the open Pacific, but turn north by Smyth

Channel and run inside the barrier formed by Hanover and Wellington

Islands. But at the Gulf of Peñas vessels are forced out to the

turbulent ocean, a thin strip of land barring the way to the calmer

waters of the Moraleda Canal. Chilean engineers have long projected a

cut through this Ofqui bar, joining the mainland to Taitao peninsula;

for it is only 7000 feet wide; no doubt this necessary help to

navigation will be given before long. With this opening effected, small

vessels will be able to pass from Puerto Montt to Punta Arenas and

Tierra del Fuego by a sheltered waterway, passing great forests,

majestic glaciers, frowning snow-capped mountains, stark headlands and a

thousand inlets and islands, a long panorama of splendid beauty.

Vessels of all nations visit Chile, Australasia and Japan sending

regular lines to compete with the shipping of Europe, North America and

Chile’s sister South American republics, the total tonnage of visiting

ships amounting on an average to over twelve million, of which less than

five hundred thousand tons represent sailing vessels. Sea transport on

the Chilean coast has undergone an immense transformation since Cochrane

brought the first steamer ever seen upon the West Coast, the little

_Rising Star_, in 1818. Traffic from North America and Europe comes

today in a considerable proportion through the Panama Canal, but the

next few years will probably witness a development of tourist traffic

through the Magellanic waterway and to such beautiful Chilean islands as

Juan Fernández, with its romantic history and wild beauty—undiminished

by the local lobster “factory” supplying the tables of Valparaiso and

Santiago.

Chile herself performs a fair share of maritime service. About one

hundred large and small steamers fly the Chilean flag, with about 35

sailing vessels chiefly engaged in fishing and the transport of coal and

lumber, the total representing some 75,000 tons. Over 40 per cent of

“maritime movement” of Chilean ports is recorded by Chilean vessels, and

strong support of national traffic was afforded in early 1922 by the

passage of a new law restricting coastwise trade to ships registered in

Chile.

The largest and most important of Chilean steamship companies is the

Compañia Sud Americana de Vapores, Government-supported, with

headoffices in Valparaiso, operating a fine and excellently-equipped

fleet of ten vessels serving Chilean and Peruvian ports, and, since the

War, extending its international service through the Panama Canal to New

York and European ports. Two new vessels of 7000 tons each were added in

1922 to the company’s fleet: the _Aconcagua_ and her sister ship were

built at Greenock, and bring the Sud Americana’s first-class passenger

service to a high standard.

_Roads_

Chilean highways, placed though they are in scenery so lovely that the

traveller’s eyes are directed to mountains and tall trees rather than to

the morass at his feet, need the improvement projected by the Road Law

of 1920, arranging for special taxes to be devoted to the construction

and upkeep of first-class country roads.

Reasons for the long neglect of this means of transport include the fact

that farmers and countryfolk in Chile commonly ride horseback—this is a

land of good horsemen and well-trained animals—and the condition of the

surface if not a matter of indifference is of less concern than if

vehicles were more common. Next, country produce has been in the past,

and in many regions is yet, brought from the farms by heavy ox-carts,

pulled by teams for whose convenience, again, a smooth surface is not

considered a necessity. The third reason, which perhaps should have

foremost place, is the nature of a great part of the Chilean soil.

As soon as one enters the Central Valley of Chile, one recognises a

characteristic of the Pacific Coast, the fertile and extremely fine

soil, as light as face-powder, with its slightly pungent scent. Much of

this soil is volcanic ash, with a mixture of vegetable detritus; it is

extraordinarily fertile, with almost every virtue in the eyes of the

farmer, and undoubtedly this genial soil produces the best food in the

world. But it is difficult to reduce fine dust to the consistency of a

road with a surface hard enough to resist the disintegrating effects of

an eight-months’ drought, followed by tremendous and violent rains.

Between the double row of blackberry hedges, backed by lines of poplars,

a typical road of Central Chile is a deep trough of shifting, floating

dust in the dry season, and a swamp after the rains set in. Once upon a

day in May the writer with a party of friends tried to reach Los Andes

from Santiago in a motor-car: the Chilean chauffeur and the car both did

their excellent best, but a mile or two outside the capital the highway

became a sea of mud, and we finally gave it up when the car skidded upon

the top of the Chacabuco Pass. During the fifty or sixty miles traversed

before we reached a railway station, the only strip of really hard

foundation for the wheels was encountered when we ran in the gravelly

bed of a shallow stream.

This test, however, was not quite fair to Chilean roads; the season and

the route were not chosen with discretion. For even in Central Chile

there are well-made, wide roads, a few hundred miles in each province,

over which motors may pass. The coming of the automobile renders the

creation of better highways an urgent necessity, in fact, the motor

lorry promising a means for getting farm produce to market that is badly

needed in the developing districts.

Antofagasta, with its hard-surfaced nitrate fields, owns about six

hundred miles of first-class roads; a record equalled only by the big

Territory of Magellanes in the far south, where the sheep-farmers of the

newly developed estates have made roads across Western Patagonia. In

each of these two regions the climate, although in the North almost

unbrokenly dry and in the South almost unbrokenly humid, is equable,

lacking the sharp and destructive changes of the Central region. It must

be owned, however, that the proportion of roads to area in great

southern territory is one mile in length to each fifty square miles of

land.

Altogether, Chile is officially stated to have between six and seven

thousand miles of highway in first-class condition, with Coquimbo,

Atacama, Aconcagua, Santiago and Tarapacá following the two provinces

named above in length of highways in good condition. The new law aims at

putting another six thousand miles of road into the same category within

the next few years, out of the total of all classes reaching a mileage

of nearly twenty thousand.

CHAPTER XII

FINANCE

_Conversion Fund.—Currency.—Debts.—Public Revenues._

When the war in Europe broke out Chile was on the point of establishing

a Conversion Office upon lines similar to those followed by Argentina

and Brazil. The object was fixation of the exchange value of paper

currency by the creation of strong gold reserves, and under normal

circumstances Chile’s office would have begun its work in 1915. It has

not been possible, up to the end of 1922, to open the “Caja de

Conversión,” although funds are maintained on deposit with this purpose

in view in Chile, England and, upon a much smaller scale, in the United

States. Funds amounting to over 30,000,000 pesos of eighteen pence were

also lying in Germany when war broke out, but these were, by special

arrangements with the Allies, withdrawn during war years.

The total amount in the Conversion Fund in 1914 was over 108,000,000

pesos of eighteen pence. Of this less than 4,000,000 was held in Chile,

and more than 74,000,000 in the Bank of England, besides the deposit in

Germany. The reserve was increased during the following year, standing

at 111,000,000 pesos at the end of 1915, or about £8,300,000, but was

reduced to 88,000,000 in the following year when the National Congress

authorised the utilisation of £2,000,000. This money was drawn upon to

pay off Treasury Bills issued in conformity with the decree of January,

1914, for the purchase of vessels for the Chilean Navy and the

construction of port works, but has been gradually replaced until in

1919 the total Fund amounted to over 114,000,000 pesos, of which

67,000,000 were banked in Chile and the remainder in England. At the

beginning of 1921 Chile possessed £2,300,000 on deposit in the Bank of

England, or nearly 31,000,000 pesos of eighteen pence; and to the credit

of the Conversion Fund in the Casa de Moneda in Santiago had bar gold,

$400,000 United States gold money, £78,845 of English money, and other

specie, amounting in all to nearly 84,000,000 of pesos.

The withdrawal of funds from the Conversion reserves for special

purposes was not unprecedented. Three years after the inauguration of

the Fund in 1899 (when it was hoped to begin conversion operations in

ten years’ time) 20,000,000 pesos were used for military expenditure,

this sum being practically replaced in 1904 by proceeds of the sale of

certain old cruisers.

Gallant efforts made to bring up the Fund to a point justifying the

opening of the Conversion Office have been rendered abortive by the hard

times of late 1920 continued throughout 1921, but the intention of

Chile’s financial advisers is maintained and appears only to await the

accumulation of sufficient gold.

At the same time the fact that credit and not gold is the true basis of

economic prosperity has been forcibly impressed upon South America since

1914. Countries possessing big reserves of gold have been observed to

suffer from depreciation of their paper currency, and, what is worse

than depreciation, from constant fluctuation in every economic breeze,

despite all the efforts of experienced financial experts; and on the

other hand countries which were able to trade advantageously during the

war and thus to pile up immense stocks of the precious metal have been

seen to experience a demoralising paralysis of their markets—to be

choked with their own gold.

The fact that those countries whose fiduciary issues have sunk to an

apparently ruinous level are on that very account able to export their

merchandise with profit, taking payments in comparatively valuable

currencies and paying their way at home in depreciated paper, is

illuminated by the lesson of the territories with currency maintained at

a high exchange rate by gold backing, which are unable to find buyers of

their products because no outsider can afford to pay the exaggerated

rates of exchange. However, exporters are not the only persons to be

considered, and the general uncertainty of commerce, together with the

natural timidity of foreign capital when invited to lands with

persistently variable currencies, will undoubtedly act as an incentive

towards establishment of the Conversion Office in Chile.

_Currency_

Exchange values of Chilean currency, as well as several other forms of

financial statistics, are officially given in sterling, the use of

English monetary terms resulting from the establishment of financial and

commercial relations with the United Kingdom in the earliest days of

Independence, and from the fact that Chile’s first exterior loan was

obtained from London. The “gold peso” is fixed in exchange value at

eighteen pence, while the paper peso reflects economic conditions from

day to day.

Since 1871 the average value of the Chilean peso in comparison with

sterling has fluctuated from just over forty-six pence in 1872 to seven

pence in the worst days of 1915 and a drop to nearly sixpence in the

slump of 1921–2. For the last fifty years the exchange value has tended

to decrease, due chiefly to repeated issues of the paper money which

replaced the gold and silver coinage of the Spanish colonial régime,

when a peso was worth (1800) the equivalent of four English shillings.

The creation of paper money was, however, unavoidable in the

circumstances, and so long as a country possesses a sufficient quantity

of some recognised form of currency, the material of which it is

composed is not a matter of local importance, although exchange values

may be grievously affected.

All the gold minted into Chilean money has disappeared from circulation,

the finely designed little coins being retained only as curios or

mementos since 1875, when severe depreciation of silver values rendered

gold higher priced as bullion than as currency. The gold peso is today

no more than a financial term. Officially, gold coin has an existence,

as the condor, of 20 pesos; the doblón, of 10; and the escudo, of 5, but

the currency actually in use is paper, well printed, in denominations

from one peso upwards, with silver coins of 1 peso, 20, 10 and 5

centavos, and nickel coins of 20, 10 and 5 centavos. From more than one

country of the Americas, silver has disappeared entirely when the

depreciation of paper has borne down the purchasing power of the peso or

other unit to a point below the market price of the metal, but Chile has

so far escaped this denudation in difficult times. At the beginning of

the present century the value of the Chilean peso stood at 15 to 16

pence until 1906, when the tragic effects of the earthquake that

temporarily destroyed Valparaiso reduced credit.

Between 1907 and 1914 it fluctuated about ten pence, went down to an

average of eight pence during 1915, rose to nine pence in 1916 when

demands for nitrate increased, to about thirteen pence in 1917 and

nearly fifteen pence as the average in 1918; in June of 1918 the peso

soared to an exchange value of over seventeen pence, but dropped quickly

when the Central Powers signed the Armistice. During 1919 the average

remained at about eleven pence, rose to over fifteen pence during the

early part of 1920, and subsequently experienced the falls that

disturbed the Chilean market in 1921, when the peso touched an exchange

value of between six and seven pence.

Despite, or perhaps on account of, the wealth of Chile in copper ores,

no coins made of this metal are actually in use, although they make an

appearance in official records. The reason for this abstention is found

in popular prejudice against a commonly known metal. During the

sixteenth century an attempt was made to introduce copper coinage, a

large quantity of the metal was minted in Santiago, and the objections

of the peasantry were so strong that more than a million piastres’ worth

of the coins were buried or thrown into the rivers in contempt.

Employés in most of the nitrate fields receive at least a proportion of

their wages in special token-money, distributed by various companies

with the chief object of circumventing the underground liquor traffic.

These large discs, specially tinted, and stamped with the name of the

issuing oficina, pass as currency in camp stores and upon the contiguous

railroads, but are without more than curio values outside the nitrate

areas. Such tokens help to relieve the need for quantities of small

money, for Chile, like every other land with a paper currency making

conscientious efforts to reduce inflation, is perennially short of

change in industrial regions.

Chile has in circulation about 4,000,000 pesos in silver coinage, and a

Government note issue of 150,000,000 pesos, which on the basis of

eighteen pence to the gold peso is covered to the extent of 75 per cent

by the Conversion Fund; at twelve pence, the issue is fully covered. But

there is other paper outstanding—treasury “vales,” to the amount issued

to banks and nitrate producers, totalling at the beginning of 1921 about

107,000,000 pesos, as well as 45,000,000 pesos in round numbers, issued

against the gold guarantee. The total paper currency of Chile is

therefore over 300,000,000 pesos, or 75 pesos to each inhabitant, with

one peso of silver and with a quantity of nickel: let us say, about four

pounds sterling, or $20 U. S. currency.

No one is more acutely aware of the dangers of inflation than Chileans,

a people with a marked aptitude for finance. That fine journalist and

courageous editor, Carlos Silva Vildósola of the _Mercurio_, has

repeatedly drawn public attention to important aspects of the monetary

situation, and has declared that Chile is “desperately ill of the

disease of paper money”; a comprehensive study of fiduciary issues has

also been made by Dr. Guillermo Subercaseaux, a Chilean economic expert,

and one of the planks of the Alessandri platform was a promise to

proceed with the fixation of exchange, “so that we can know what we

really possess, and how much we can buy tomorrow with the money we

earned yesterday.”

_Debts_

Chile’s public debt was augmented in early 1921 when $24,000,000 United

States currency was borrowed in New York, but prior to this loan the

exterior obligations of the country had not been heavy in comparison

with its vigorous economic growth; later in the year, another

$20,000,000 (U. S.) was borrowed in New York, and in the first weeks of

1922 the financial markets of London readily took up a Chilean loan of

£1,657,000.

The first Chilean loan was made in 1822, after Independence, by the

Supreme Director, Don Bernardo O’Higgins, through his representative in

London, Don Antonio de Yrisarri. One million pounds sterling was

obtained through the medium of Hullett Bros. & Co., the loan bearing

interest at six per cent; a Sinking Fund of £20,000 the first year, and

£10,000 in succeeding years was arranged for, any bonds remaining

unredeemed in thirty years to be paid off at par. The security agreed

upon was a mortgage upon all revenues of the State, estimated at

4,000,000 pesos or £800,000 annually; also specially pledged were the

net revenues from the Mint and from the Diezmos or Land Tax, expected to

yield 250,000 pesos annually.

Of this premier loan Peru had a share amounting to three-tenths of the

total, or 1,500,000 pesos.

Successive borrowings brought Chile’s exterior debt to £1,500,000 in

round numbers by 1850, and £5,500,000 by 1870. Between 1876 and 1893,

when the war with Peru and Bolivia had been followed by the revolution

against Balmaceda, these obligations rose to nearly £12,000,000

sterling. In 1901 the account had mounted to £17,000,000, and to

£23,000,000 in 1909.

Two years later external loans stood at £35,000,000, but were reduced to

about £34,000,000 in 1913; by the middle of 1921, according to the

Official Message of President Alessandri, this debt had been brought

down to about £28,000,000. The detailed history of Chile’s financial

years since 1884 shows new loans, although as a rule of extremely

moderate sums, occurring almost annually with the exception of a gap of

eight years between 1896 and 1905, when not a penny was borrowed; nor

was any fresh exterior debt incurred between 1912 and 1921. Most of the

Chilean loans bore the modest interest of 4½ per cent.

In 1919 Chile began to negotiate for a new loan, to cover the needs of

the State railways; there was a deficit of 40,000,000 pesos upon the

operation of these lines in 1918, and in addition to another large

deficit, expected in 1919, money was wanted for supplies and equipment

for new work upon the lines, and especially for construction on the

southern part of the “Red Central.” The law passed by the National

Congress authorising the loan also permitted the State railroads to

raise tariffs by 20 per cent. Eventually, in February, 1921, the first

New York loan was made through the agency of the Guaranty Trust for

$24,000,000 United States currency; it bears interest at 8 per cent, and

was issued at 99, a considerable proportion of the sum raised being

spent by arrangement in the United States.

_Public Revenues_

Public revenues in Chile are large in proportion to the population, the

great bulk of the national income coming from import and export dues

and, since the acquisition of Antofagasta and Tarapacá, especially from

the nitrate industry, in the form of exportation taxes, and leases of

deposits, as well as less directly from the entry of immense quantities

of machinery, stores and personnel. In considering the statistics of

Chilean revenues, it must be remembered that taxes are partly paid in

“paper” and partly in “gold”; no gold coin, nor, necessarily,

gold-backed paper actually passes, but what happens is that a proportion

of the dues are paid in paper of a fluctuating exchange value, while the

remainder is paid at the fixed exchange rate of eighteen pence to the

peso.

Since the Chilean Government’s excellent statistical departments figure

out the totals reduced all together in pesos of eighteen pence, however,

or in pounds sterling, the student of Chilean economics is considerably

aided; but in surveying past years one is confronted with the fact that

between 1885 and 1897 the peso was reckoned as being worth thirty-eight

pence. For the reason, therefore, that comparisons with external

currencies would frequently be misleading, it is preferable to retain

the majority of revenue and trade figures in Chilean denominations only.

In 1850 Chile’s national income was still below 5,000,000 pesos yearly:

there was almost invariably a small balance over expenditure in these

early years, and in 1865 this excess rose to the respectable figure of

6,000,000 pesos. It was not until 1868, when revenues had grown to

13,000,000 pesos, that a deficit so large as a million pesos was

recorded, and this was the fourth occasion only, in 65 years, that

expenses had exceeded income.

In the stormy period of the ’seventies, when expenditure on public

services was heavy, and, also, railroad building was developed, deficits

were common; but by 1880 receipts had risen to over 40,000,000 pesos,

and a balance of nearly 13,000,000 over expenditures was left in the

treasury.

In 1891 the public revenues of Chile for the first time reached—and

exceeded by 5,000,000 pesos—the hundred million mark. In 1895 receipts

reached 127,000,000 pesos, with 93,000,000 expenditure, in round

numbers; next year, with an income of nearly 163,000,000 pesos, there

was a surplus of 47,000,000, an agreeable record exceeded in 1901 when,

with revenues of nearly 186,000,000, the balance left in public coffers

amounted to more than 50,000,000 pesos. Both receipts and surplus rose

in the next year, and in 1903 official statistics showed the remarkable

figures of 210,000,000 income, with 91,000,000 on the right side of the

ledger after expenses were paid. A slight drop was experienced in 1904,

but in 1905 receipts went up to nearly 257,000,000 pesos, rising to

373,000,000 in 1907 and 458,000,000 in 1908. In 1911 a tremendous jump

in public income was made, to 796,000,000 pesos: in this year the

surplus rose to nearly 457,000,000 pesos. In the three following years

there was a falling off from this satisfactory record, but the balance

remaining in the treasury was always substantial, and until Chile was

adversely affected by the international upheavals following the European

War her treasury was in a condition that many wealthier nations might

envy. But in 1919 the Government was obliged to record a deficit of over

60,000,000 paper, and in 1920 estimated a deficit of 89,000,000 paper

pesos. The result of these unprecedented difficulties is to bring about

a somewhat hasty series of plans for changing the tax system, with a

view to obtaining larger revenues, and while heavy dues were placed upon

the importation of luxuries, remodelling of the inheritance and land

laws, and of the imposts upon industry and commerce was outlined. The

fall of nitrate prices, and paralysation of the market, emphasised the

fact that this industry is taxed to a disproportionate degree, while

many other forms of activity are exempt. In 1915, for example, out of

134,000,000 paper pesos received in the customs houses, 85,000,000 were

paid for nitrate exports and 1,000,000 for its by-product iodine, while

of the gold receipts, amounting to 30,000,000 pesos, 29,000,000 were

paid for the same output from the salitre fields.

CHAPTER XIII

CHILE’S NAVAL POSITION

_Chile and the World War.—Strength of the Chilean Navy.—The Army._

The geographical situation of Chile, giving her a strip of coast

twenty-eight hundred miles long, renders her acutely interested in the

future of the Pacific. Command of the Strait of Magellan and the

possession of an excellent fleet are guarantees of her ability to

protect this interest.

In the wide affairs of this ocean, destined apparently to be the scene

for the next trials of political if not of physical strength, the

nations of the South American west coast have as yet had no voice, for

while it is accepted as a matter of course that certain European

countries, the United States and Canada, as well as Japan, Australia and

New Zealand, should insist upon having their views heard, neither Mexico

nor the countries of Central and South America are generally regarded as

parties to the questions involved. With the development of national

consciousness and the creation of well-equipped navies, a number of

these countries will figure as coadjutors of increasing importance, and

in the forefront of them Chile will, I am convinced, be found, ready and

able to assume her share in the working out of a common problem.

Chile was physically affected by the great war. Not only was Easter

Island used as a naval base by the German fleet, but her ports were used

as refuges or supply stations by the ships of several belligerents.

German shipping lay in Chilean ports, many German sailors were interned

during the war period in Chile, and although her position was a passive

one it cannot be doubted that the deep interest with which she watched

events in the Pacific and the Magellanic archipelagos was much more than

passive. So far as the Allies were concerned, their cause would have

been little, if at all, served by the entry of Chile into the conflict

against the Central Powers; it was Chile herself, with a possible

post-war claim upon some of the steamers of the Kosmos line lying

interned during the war in her ports, who stood to gain by a belated

entry, and it is to the credit of her scrupulously correct neutrality

that she refrained. A distinguished Chilean writer, Dr. Enrique Rocuant,

published in 1919 a comprehensive study upon “The Neutrality of Chile:

the grounds that prompted and justified it.” I think that no one who

understood the situation, or the feeling that Chile sincerely exhibited,

needed this explanation, however lucid and kindly, detailing as it does

the absence of any such motive as brought Brazil, with her list of

torpedoed vessels, to the Allies’ side, and setting forth the equity of

Chile’s actions when faced by the acts of the belligerents in her

territorial waters. There were, for example, violations of Chilean

neutrality by various units of the German fleet at Easter Island and the

Port of Papudo as well as in Cumberland Bay (Juan Fernandez); against

these violations Chile vigorously protested; when the British _Glasgow_

followed the _Dresden_, escaped from the battle of the Falklands into

Cumberland Bay, found that vessel with flags flying and guns pointed and

promptly sank her, Chile made similar forcible protests. But she

accepted the British regrets and offer of satisfaction with very ready

graciousness.

Two years after the close of the great war Chile became, as a direct

result of her old and cordial relations with the British navy, in an

unprecedentedly strong naval condition.

_Strength of the Chilean Navy_

In August, 1914, two dreadnoughts were building at Elswick for the

Chilean Government, the _Almirante Latorre_ and the _Almirante

Cochrane_, the price of each vessel being £2,800,000. A number of fast

destroyers, also constructed by the Armstrong Whitworth Company, formed

part of the Chilean naval developments, two of these, the _Lynch_ and

the _Condell_, being already in Pacific waters when hostilities broke

out. The dreadnought _Almirante Latorre_ was completed speedily, taken

over for British Government service, and did good work under the name of

H. M. S. _Canada_ during the four and a half years of the conflict; in

April, 1920, she was repurchased by the Chilean Government, which

obtained for the comparatively modest sum of £1,400,000 not only this

fine vessel but three more destroyers, sister ships of the _Lynch_ (the

_Williams Rebolledo_, _Simpson_ and _Uribe_) and a naval tug. About the

same time the British Government also presented to Chile six submarines

and fifty aircraft, a gift associated with British appreciation of the

sympathetic attitude of Chile at the time when the exigencies of war

brought about detention of the vessels under construction.

The dreadnought _Latorre_ displaces 28,000 tons, has a length of 125

feet, beam of 92 feet, and draws 28 feet of water. She carries 30 guns

of 14 inches, 3 inches and 4 inches, as well as a number of machine-guns

and four torpedo tubes. Her speed is 23 knots, and her full crew 1075

men. She burns coal and has a bunker capacity of 1200 tons. The five new

destroyers each displace 1850 tons, are 320 feet long, are armed with

six 4-inch guns, and have a speed of over 31 knots; bunker capacity, 507

tons of coal; crew, 176. These vessels were laid down in accord with the

plans created for the modernisation of the Chilean fleet in 1910, and

their incorporation into the navy of Chile renders this country the

possessor of an excellent fighting squadron, equipped in consonance with

the experiences of the great war.

The possession of good modern vessels of war is one thing; adequate

operation of them is quite another, as more than one young nation has

discovered to her cost. In Chile, however, a traditional naval feeling

has existed for a century, aided by the inheritance of a considerable

proportion of blood from British seamen, and the work of a group of

British naval instructors who were mainly responsible for efficient

development in the service—as the German military instructors moulded at

least the exterior of the army in the years before the war.

When I had the pleasure of visiting Chilean naval vessels in Talcahuano

in 1920 at the invitation of the genial Admiral Fontaine, it was

difficult to realise that the sturdy and well-groomed young officers,

many of them bearers of British names, clad in replicas of the British

uniform, were going to a foreign country when they set out, a few days

later, to fetch back from Britain the new Chilean ships of war.

The Chilean fleet in early 1922 consisted of two battleships, the

French-built _Prat_ (acquired 1890), with a war strength of 466 men, and

the British-built _Latorre_ (1913–20) carrying about 1100 crew; the two

armoured cruisers, the _O’Higgins_ and the _Esmeralda_, were constructed

at Elswick in 1897, carrying nearly 600 men each; three cruisers of

another type, the _Blanco_, _Chacabuco_ and _Zenteno_, were built in the

same yards following the acquisition in 1890 of the French-built

_Errazuriz_. In addition to these large vessels, Chile has two torpedo

cruisers built by Laird in 1890; the _Tomé_ and _Talcahuano_; five

modern destroyers (flotilla leaders) constructed between 1912 and 1914;

seven older destroyers (the _Thompson_, _O’Brien_, _Jarpa Gamero_,

_Orella_, _Riquelme_ and _Serrano_, carrying 88 men each) built at

Laird’s; five torpedo-boats (_Contreras_, _Hyatt_, _Mutilla_, _Rodrigue_

and _Videla_) built in 1896 in the Yarrow yards, carrying 36 men each,

war strength; the six new submarines referred to above, built by the

Electric Boat Company, Ltd., in 1915, needing a total war strength of

108 men; one training ship, the _General Baquedano_, built at Elswick in

1898, a schooner with auxiliary engines, carrying 253 men; three

transports, the _Rancagua_, _Maipo_ and _Angamos_, with a complement of

86 men each; one sailing ship, the _Lautaro_, built in Glasgow in 1896;

ten patrol boats, of which six older vessels were built on the Seine

between 1890 and 1905, while four boats acquired in 1919 were built in

Helsingfors. There is also still upon the list an old ironclad, the

ex-_Cochrane_, built at Elswick in 1875, carrying a crew of 132 men.

Chile reckons the peace strength of her navy afloat and ashore at 8377

men, while the naval expenses amount to about 14,000,000 Chilean pesos;

in war times the personnel would be increased by 1020 men, costs being

brought up to 15,200,000 pesos. Naval reserves are calculated as 35 per

cent over the war footing, as regards personnel, while in the event of

hostilities aid of great practical value exists in the steamers of the

Government-controlled Compañia Sud Americana, transformable into

auxiliary cruisers.

A certain number of men are annually recruited compulsorily for one

year’s service, but as these conscripts only amount to three or four

hundred, the naval forces are chiefly made up of volunteers who enlist

for three to ten years; many conscripts after serving their initial year

elect to remain under this system. In a maritime country such as Chile

seamanship is popular, and the navy never has difficulty in filling the

lists with young men who are developed rapidly into smart and

well-disciplined sailors. The naval schools of Chile are adequate and

well equipped: in Valparaiso is a fine establishment training 200

cadets, of whom 20 to 30 are annually passed as junior naval officers;

the Naval Academy, part of the same building, trains twelve higher rank

officers. Also in Valparaiso is the Navigation School, passing about six

officers yearly, and the School of Mechanics training 120 pupils is

supplying yearly 30 to 40 petty officers. Cadets of the Naval School

receive a second-class midshipman’s certificate after five years’

instruction, and are then sent to the _Baquedano_ for advanced technical

training and a 2000-mile sailing trip, before the first-class

certificate is granted. It is significant of Chile’s high repute as a

trainer of young sailors that cadets from several other South American

countries are to be seen in Chilean naval schools.

Besides the Valparaiso establishments, Talcahuano has a Mechanical

School for naval engineers, with 200 cadets in training; here also young

officers obtain instruction in torpedo work and radiotelegraphy; this

school turns out about 120 seamen, 30 wireless operators, and 20

midshipmen, as well as qualifying an average of 10 officers. On board

the ex-_Cochrane_ is a gunnery school, training 120 men every year; on

the sailing-ship _Lautaro_ is a school for training pilots of the

Chilean merchant marine, as well as for the navy; the corvette _Abtao_

is used as a training school for boys, and here 150 lads are prepared

yearly, with the obligation of serving five years in the navy. The

_Baquedano_ corvette receives boys from the _Abtao_ and midshipmen

qualified from the Valparaiso school for a year’s voyage of instruction

before they assume duty in the regular service.

Chile has four naval bases, at Arica, Valparaiso, Talcahuano, and Punta

Arenas; the latter has none but mobile defences, since the Treaty made

with Argentina at the time when boundary limits were settled stipulates

that the Strait of Magellan shall not be fortified, a decision which

will probably be modified in view of Chile’s undoubted right to protect

the property and lives of her nationals in the rapidly developing

district of Punta Arenas and a number of inlets and islands. No

belligerent or other vessel would be prevented by Chilean fortifications

from passing from Pacific to Atlantic waters or _vice-versa_, since the

Cape Horn route offers open waters.

The Hydrographic Bureau attached to the Chilean navy has been

responsible since its inception in 1874 for constant exploration and

surveying work directed to all parts of the coast, but particularly to

the intricate waterways of the south. Over 150 maps and charts have been

published by this Bureau, constantly in communication with the

equivalent services in the most advanced countries.

The three first-named naval bases possess fixed land defences, as well

as movable and submarine defences; at the chief station, Talcahuano, are

two dry docks, one of 45,000 tons and the older of 15,000 tons capacity,

as well as a floating dock of 1200 tons. Arrangements are also made with

private dockowners in Mejillones (Antofagasta) and Valparaiso for

repairs when needed, the shipyards of Punta Arenas, Chiloé, Valdivia,

and Constitución also offering useful help both as regards construction

and repair work. In point of numerical strength, the Chilean navy is

second only to that of Brazil, while as a matter of fighting record this

service has been conspicuously successful on the three occasions when

Chile has been at war during the last hundred years. Her history is

firmly bound to her maritime tradition, and her political influence in

the future will undoubtedly be considerably affected by her vigorous

command of the sea.

The army of Chile is a citizen army; its strength, year by year, is

under 20,000 men, of whom about half are newly conscripted; but every

healthy man over twenty-one years old is due to receive a year’s

training, and is as a matter of fact very rapidly made into good

fighting material. I have seen extremely smart soldiers turned out in

six months’ time in the training camps of Chile.

There is no doubt that in case of need the country could raise and equip

a hundred thousand men at least partly trained to arms in a few weeks’

time. Discipline is good, the uniform neat, weapons of modern pattern

and well kept. The cavalry is conspicuous for first-class condition in

particular; horses and horsemanship are of a remarkably high quality.

The aircraft branch of Chile’s service is being steadily developed; the

daring and skill of the Chilean aviator was displayed when Lieutenant

Godoy crossed the Andes into the Argentine—the pioneer to perform this

hazardous feat.

CHAPTER XIV

IMMIGRATION

_The First Immigrants of the South.—Araucanian Lands._

Organised immigration efforts began in Chile just before the middle of

the nineteenth century, during the régime of President Bulnes; they

ceased within a few years, and recommenced between 1881 and the end of

the century: thenceforth the flow has been regulated by a series of laws

of strict tendencies. For a number of years the largest contributor of

blood to Chile has been Spain, but there are no colonies such as those

created by the Brazilian system, newcomers of today usually finding

industrial employment in cities, or the coal, nitrate and copper camps.

For several years before 1914, when immigration practically ceased, the

average entry was less than 2000, of whom at least 75 per cent were

Spaniards. Chile’s first batch of regular immigrants arrived in 1850,

following the efforts of an energetic agent in Europe. There were 70

German men, 10 women and 5 children in the party, who sailed round the

Horn, had a passage of 120 days and were landed at Corral. Both Valdivia

and Corral were economically dead at this period; it would perhaps be

more exact to say that they had never lived. The sea-port and the

riverine city had been maintained as frontier posts against pirates on

the ocean and Indians on land during the Spanish colonial days; a small

mixed population had grown up as a result of Valdivia’s utilisation as a

dumping-ground for convicts from all the West Coast. Evildoers were

shipped here as a convenient means of obliteration, and a number never

returned north. For thirty years following independence from Spain

Valdivia languished, the forts decaying and the soldiers indifferent.

There was no connection with the rest of Chile except by sea, for the

land of the unsubdued Araucanians lay, a broad belt of forbidden land,

below the populous towns of the Central region.

Corral had twenty-eight houses when the Germans landed; Valdivia’s plaza

was a rubbish-heap, the streets unmade, the one-story houses of mud had

unglazed windows. To add to the troubles of the agent who had brought

the settlers, governmental negotiations for land on which to plant the

colony had not been completed. Vicente Perez Rosales, the agent, tells

in his memoirs that as soon as immigration to the south loomed in view

as a fact, tracts of land that had been wild and valueless suddenly

acquired owners and a price. Enterprising citizens went forth into the

woods, found some ancient Indian who was willing for a consideration to

swear that such and such a tract was his inheritance from his fathers,

and, for another consideration, to sell it.

Chile today and tomorrow · 第 22 / 23 章