Europeans arrived in Chile in the 16th century, hoping to discover another Inca empire of fabulous wealth. Called optimistically Otro Peru (Another Peru), the territory inevitably disappointed its newcomers, who found only hostile tribes. Chile followed the Spanish model for much of South America, with Spanish settlers establishing big farming estates called estancias and reducing the natives to serfdom.

Intermarriage between the Europeans and the indigenous peoples forged a strong national identity in Chile that absorbed later immigration from England, Italy, France and Germany without difficulty. The resentment that developed all over the Spanish empire between the South American-born upper classes and the Peninsulares (Spanish-born bureaucrats sent out to rule the colonies) provoked the 19th-century independence movement that swept the continent.

Chile also supported the revolutions led by Simon Bolivar and Jose de San Martin, and, following a military victory against Spanish forces at Chacubo in 1917, the country became independent of the old Spanish empire.

Installed as the countrys first president was Bernardo OHiggins, whose name, like many in Chile, indicates his mixed ancestry. Despite succumbing to pressure from the business community and the Catholic Church, which ultimately resulted in his ouster, OHiggins remains the Chilean founding father and national hero.

Throughout the 19th century, Chile was fortunate in having a comparatively stable government, although one largely controlled by the landowning oligarchy. The country frequently maneuvered to achieve territorial gains at the expense of its neighbors, but continued to pursue a progressive economic policy. Social divisions continued, although not as sharply as in some other South American countries.

In the 20th century, Chile experienced its sharpest political crisis. The passionate social reforms of presidents like Aguirre Cerda (1938-1941) and Eduardo Frei (1964-1970) culminated in 1970 with Salvador Allendes Marxist coalition, whose election victory and subsequent actions triggered 150 percent inflation and economic collapse. The military, led by Colonel Augusto Pinochet, led a coup and deposed Allende, who died under mysterious circumstances.

Pinochet ruled Chile repressively until 1990, when he was ousted by a free election and replaced by the popular President Eduardo Frei. Currently, Chile is booming again.