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Obverse of 1927 Chilean 5 Peso
Obverse of 1927 Chilean 5 Peso

Reverse of 1927 Chilean 5 Peso
Reverse of 1927 Chilean 5 Peso

A Brief History of Chile

Pre-Colonial History
Prior to the arrival of the Spanish in the Early 16th Century, the area now known as Chile was populated by various Amerindian peoples, including the Incas who dominated the North, and the Mapuches, who dominated the South and Central Parts of Southern Chile, and who matched the Incans in their warlike ferocity and kept them from expanding further south into their territory.

Colonial History
The Spanish began to expand into Chile from Peru in about 1540, and founded the city of Santiago the following year. The Spanish originally expanded into Chile in search of new sources of gold and silver, but were disappointed to discover precious metal deposits were nowhere near as plentiful as those near Potosi. However, Chile contained a lot of rich agricultural land, and farming became an important part of the local economy. The ferocity of the natives and its vulnerability to British and Dutch raids meant that Chile (part of the Spanish Viceroyalty of Peru) was heavily garrisoned and was therefore a net drain on its resources.

Independence
A combination of the weakening of Spanish authority in the wake of Napoleon's invasion and conquest of Spain, as well as long-term widespread dissatisfaction with Spanish colonial authority throughout South and Central America resulted in rebellion throughout the Spanish Americas, and Chile gained its independence in 1818, although the war to throw off the Spanish yolk did not reach a conclusion until 1826. Despite achieving its independence, this war could not really be described as a revolution, as socially and politically, there was little change, and Chile was run as an oligarchy dominated by an aristocratic landowning class. Their dominance was confirmed by a brief Civil War between the Pelucones (oligarchs) and the liberal Pipiolos in which the former won.

Internal and External Wars
In the years and decades following independence, Chile faced conflict both internally and externally. In addition to the 1829 Civil War, Chile fought and won the War of Confederation (1836 -1839), which was aimed at breaking up a confederal union between Peru and Bolivia.
The Mapuch had never been truly pacified by the Spanish during their period of colonial rule, however, a series of campaigns by the Chilean military between 1860 and 1882 finally subjugated them and Chilean Governmental authority was imposed over the whole country.
In 1879, the War of the Pacific broke out between Chile and the Perivian-Bolvian Alliance. Chile's territorial gains as the result of victory saw Bolivia lose its access to the sea and Bolivia has remained landlocked ever since.
In 1891, another Civil War broke out between President Balcameda and the Chilean Congress (a war between the executive and legislative branches of government that was in some ways similar to the conflict between Crown and Parliament in 17th Century England). Chilean Congressional forces eventually emerged victorious, resulting in Balcameda's suicide and the development of a more Parliamentary style of government in Chile. The US had backed Presidential forces during the conflict, and when two US sailors were killed in a brawl whilst on shore leave in Chile (an incident known as the 'Baltimore Incident'), US-Chile relations almost deteriorated to the point of war, until Chile apologised and paid compensation.

20th Century
In 1924, Congressional power broke down and after two military coups, and a presidential election in 1925, a more executive presidential style of government was restored in Chile under President Emiliano Larrain. Larrain's successor, Carlos Ibenez, elected in 1927, adopted an increasingly authoritarian style, imposing censorship, arbitrary arrests and crackdowns on other political parties. Initially popular, Ibenez was forced from office when the economic consequences of the the Great Depression led to a decline in support for his regime.
Juan Montero was subsequently elected president in 1931, but he resigned as president in 1932 following a military coup, which then formed a Junta (a small rulling group/council) and briefly rebranded the country as 'The Socialist Republic of Chile'. This Junta did not enjoy much support however, and an election brought Arturo Alessandri, a former president back to power.

Pinochet
Chile remained a polarised democracy until 1973, when the socialist president Salvadore Allende was overthrown in a military coup by army officers concerned that Allende's socialist economic policies were turning Chile into a banana republic. General Augusto Pinochet, who led the coup that overthrew Allende, ruled Chile as a brutal right-wing dictator until 1990, during which time many political opponents were rounded up, tortured, imprisoned and/or murdered, sometimes secretly. A style of governance that was not untypical in South America at the time. However, Pinochet, seeking to turn Chile from a 'country of proletarians into a country of proprietors' liberalised the economy by introducing free market reforms and a series of privatisations that encouraged foreign investment and ultimately transformed Chile from a country with no foreign currency reserves and a 1000% inflation rate into one of the most prosperous in South America.
Due to poor relations between the Pinochet regime and Argentina, which often detrioriated to the point of near war, Chile provided much covert support to Britain during the Falklands War.

Return to Democracy
In 1989, Patricio Aylwin was elected president following a popular election, and replaced Pinochet as president the following year. Aylwin ruled until 1994. Today, Sebastián Piñera is the incumbent president of Chile.

Chilean Coins
The Spanish introduced coinage into the area when they arrived to colonise the area during the 1540s. Following Chilean independence, Chile retained the Peso (Piece of 8 or 8 Reale) as its unit of currency. This Peso was decimalised in 1851, with coins denominated in Centavos to supplement the Silver Peso.
In 1885, Chile adopted the gold standard and pegged the Peso to the Pound Sterling at 1 Peso = 1s6d. Interestingly, Anglo-Chilean trade links were so close that one Chilean bank even issued notes denominated in 'Libra Esterlina' (Pounds Sterling).
In 1919, the last of the 1 and 2 Centavo coins (copper) were struck. That same year, 5, 10 and 20 Centavos, previously silver denominations, were now struck in cupronickel, as was the 1Peso coin after 1942. Inflation continued to advance, and the last coins of the original Peso, struck in Aluminium, were struck in 1959. In 1975, Chile's original currency was replaced by decree under Pinochet. The new Peso replaced the Escudo (2 Pesos) at 1,000 to 1. Originally, this second Peso was subdivided into 100 Centavos, but by 1983, inflation had rendered the Centavo subdivisions obsolete.
Today, coins of 1, 5, 10, 50, 100, 500 pesos are issued for circulation.

For Sale and Wanted
If you are interested in coins from Chile please see our product index:-
Chilean Coins

Gold Coins
We also have gold coins from Chile on our taxfreegold website:-
Chilean Gold Coins



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