Under President Sarmiento, between 1868-74, Argentina promoted schools, universities, railways and communications. In 1902, the disputed region of Patagonia was awarded to Argentina by international arbitration. The country developed to become the foremost economic power of South America.

In Peru, following a civil war between 1842-5, Marshal Ramon Castilla becomes dictator. Peru and Bolivia are defeated by Chile in the 1879-83 "Nitrate War", fought over valuable mineral deposits. As a result of the war, Bolivia lost the province of Atacama and access to the Pacific Ocean.

Colombia is plagued by constant civil wars between supporters of a unitary or centralized form of government and a mixed group of opponents, including federalists, liberals and clerics. In 1858, the federalists win and Colombia is recreated with a new constitution based on a confederation of eight states. In 1903, American pressure forced Colombia to give up Panama, which became a virtual colony of the United States.

The European powers enacted a naval blockade against Venezuela in 1902, in protest against the violation of the rights of foreigners in Venezuela by the ruler, President Castros (Castros was in power between 1899 and 1908).