The direct negotiations between Chile and Argentina about the islands and maritime rights in Beagle conflict began after the Queen Elizabeth II of the United Kingdom announced on 2 May 1977 the judgement of the Beagle Channel Arbitration to the governments of both countries. The court ruled that the islands and all adjacent formations belonged to Chile. The direct negotiations finished with the Act of Montevideo on 9 January 1979, where both countries accept the papal mediation after Argentina's call off of the Operation Soberanía. This was the most dangerous phase of the Beagle Conflict and there was a real possibility of open warfare.
Internal politics of both countries Argentina and Chile were both ruled by military governments at the time of the negotiations. The Chilean and Argentine governments shared common interests: internal war against subversion, annihilating the opposition; external war against communism, remaining nonetheless part of the non-aligned movement; modernisation and liberalisation of the economy; a conservative approach towards social and class relations. By the end of 1977, the war against subversion and opposition was substantially over in both countries, as the Operation Condor had lost momentum and détente had improved East-West relations. The two countries maintained good economic relations. But in 1977, the conflict over the Beagle Channel had become the primary foreign policy imperative of both governments.
In 1976, the United States imposed an arms embargo on Chile through the Kennedy Amendment, which was also applied to Argentina in 1978; to counter this, Pinochet tasked Carlos Cardoen with assembling weapons, inventing cluster bombs and motorcycles equipped with four anti-tank rockets, and also turning to the black market.
Chile There was considerable international condemnation of the Chilean Military Regime's human rights record. President Augusto Pinochet enjoyed absolute authority and was largely unaccountable to other elements within the military, the Beagle conflict was a less significant issue and there was a highly unusual dialogue on the subject with the opposition. Eduardo Frei Montalva, leader of the Opposition, backed the policy of the government in this matter:See "El año que vivimos en peligro", Informe Especial, Televisión Nacional de Chile. In Internet youtube:"Se esta alimentando, no por Chile, un conflicto de dramáticas consecuencias"See also Cuadernos de Historia 29 Departamento de Ciencias Históricas Universidad de Chile. Septiembre 2008: pp. 119–55 in Racionalidades de la Guerra y la Paz. Argentina-Chile, 1977–1984, Freddy Timmermann, p. 128 "They, not Chile, are feeding a conflict of dramatic consequences".
The most important negotiation goal of the Chilean government was to negotiate the maritime boundary without land loss.
Argentina
Despite the many violations of human rights in Argentina the junta enjoyed abroad good regards and the human rights commission of the United Nations didn't condemn the Argentine Junta, until 1981.In a bizarre Symbiose, the Argentine and the Sowjet regimes supported mutually. Article of Sofía Lamberto, retrieved on 22. Jule 2011 in Spanish languageEl día en que la URSS apoyó una dictadura anticomunista retrieved on 22. Jule 2011 in Spanish language In 1978 the World Cup Final was held in Argentina and their team won the FIFA World Cup. The Argentine President Jorge Rafael Videla was considered by journalists at the beginning of its government with sympathy:See Berliner Zeitung 5 March 2004 in German language: Man beschrieb den Diktator als korrekt, höflich, puritanisch bis zum Exzess, aus tiefstem Herzen Katholik und zeigte Verständnis "The dictator was described as correctly, politely, puritan in excess, deeply catholic and one showed understanding"
In Argentina, the consequences of the dispute for internal politics were more significant. The conflict became a keyword for the extreme nationalist elements within the military junta that controlled the country until 1983. Among many junta members, a conciliatory approach to Chile came to be regarded as a sign of weakness, giving the dispute far-reaching ramifications at the highest levels of Argentine politics. This ultimately produced an environment in which relatively moderate decision makers assumed a more aggressive posture due to the fear of removal.See Mark Laudy, "The Vatican Mediation", p. 298.
The Argentine Historian Luis Alberto Romero wrote about the Argentine Government::Op. cit. pp. 242–43 «By that time, a bellicose current of opinion had arisen among the military and its friend, an attitude rooted in a strain of Argentine nationalism, which drew substance from strong chauvinistic sentiments. Diverse ancient fantasies in society's historical imaginary – the "patria grande", the "spoliation" that the country had suffered – where added to a new fantasy of "entering the first world" through a "strong" foreign policy. All this combined with the traditional messianic military mentality and the ingenuousness of its strategies which were ignorant of the most elemental facts of international politics. The aggression against Chile, stymied by papal mediation, was transferred to Great Britain …»
Similar arguments appeared in "The New York Times on 31 December 1978":See The New York Times 31 December 1978 «Beagle Channel controversy that has brought the military regimes of Argentina and Chile to the brink of war is an expression of the turbulent revisionism underway in Argentina in reaction to frustrations in national life. Argentine policy is made by military men whose nationalist values are mixed with personal ambitions, phobias against politicians, "progressive" …»
During the crisis the Argentine Government was divided in two groups, hardliners, which pressured for drastic military actions and softliners that struggled to maintain bilateral negotiations.
The Argentine Challenge Argentina took steps to increment the pressure upon Chile:See El belicismo de los dictadores, Clarín, Buenos Aires, Argentina, 20 December 1998 in October 1978 the presidents of Bolivia and Argentina signed a demand for a Bolivian sea entrance,Bolivia lost its coast at Chile in War of the Pacific the Argentine Claims over the Falkland Islands and the Argentine Claims in the Beagle conflict.See article Argentina refuerza militarmente su frontera con Chile in Spanish newspaper El País 27 October 1978: «…En una declaración conjunta, suscrita al finalizar la entrevista de un poco más de cinco horas, ambos mandatarios ratificaron el derecho de una salida al mar para Bolivia, la soberanía de Argentina sobre las islas Malvinas y otros territorios ubicados en el extremo sur de este país.…» the Argentine Armed Forces planned the Operation Soberanía, to occupy the islands, wait for the Chilean Reaction and then reply. Mobilization orders were issued, the navy sailed southwards and the army was deployed to the border.See Television Nacional de Chile, Informe Especial, "El año que vivimos en peligro", in Internet youtube 4000 Chilean Citizens were expelled from Argentina.As denounced by the Chilean Ambassador in the OAS, see Fabio Vio Valdivieso, La mediación de su S.S. el Papa Juan Pablo II p. 111 Blackout drills were conducted in various cities, even if the cities were unreachable for the overaged Chilean Air ForceSee Television Nacional de Chile, Informe Especial, "El año que vivimos en peligro", in Internet youtube abject warmongering: General Luciano Menendez, Chief Commander of the III Argentine Army Corps:See Diario El Centro , Chile also in Diario Página12 «Si nos dejan atacar a los chilotes, los corremos hasta la isla de Pascua, el brindis de fin de año lo hacemos en el Palacio La Moneda y después iremos a mear el champagne en el Pacífico» «If [our government] let us attack the Chileans, we will chase her away up to Easter Island, we will celebrate the New Year's Eve in La Moneda and afterwards we will go for a Champagne-slash to the pacific beach» An Argentine Officer:Cited in the book of Martin Balza, Dejo Constancia: memorias de un general argentino «Cruzaremos los Andes, les comeremos las gallinas y violaremos a las mujeres» «We will cross the Andes, we will eat the chickens and rape the women» the Argentine Borderpolice (Gendarmería) closed the border to Chile several times, a step regarded as preliminary stage to the warSee "Historia general de las relaciones exteriores de la Republica Argentina" in Cema Jorge Videla, President of Argentina threatened war if Chile didn't accept the Argentine Conditions: «Las negociaciones directas constituyen la única vía pacífica para solucionar el conflicto» (Translation: «Direct Negotiations are the only peaceful way out to resolve the conflict»)See Cuestión del Beagle. Negociación directa o diálogo de armas, Juan E. Gugliamelli, Buenos Aires, Argentina, 1978
The Chilean Reaction Chile held the islands de facto at least since 1881 and de jure after the judgement. The Chilean newspaper El Mercurio annotated about the pre-war dispositionSee special edition «20 años del Tratado de Paz y Amistad entre Chile y Argentina» in El Mercurio, Santiago de Chile «A diferencia de Chile, donde preparativos de guerra se hicieron en medio de gran reserva para no alarmar a la población, los argentinos se movilizaron en medio de sonoras concentraciones …» «In difference to Chile, where the preparation of war was inconspicuous in order not to alarm the population, the Argentines mobilized amidst loud demonstrations…».
The Ambassador of the United States of America in Buenos Aires in 1978, Raúl Héctor Castro, described in similar words the situation in Chile:See the interview of M. Aizenk with Ambassador Castro in El papel de la Embajada , Newspaper Clarín, Buenos Aires, Argentina, 20 December 1998 (Source in Spanish Language) M. Aizenk: ¿Y la misma presión que ejercieron ustedes en Buenos Aires la ejercieron en Santiago? R.Castro: No. Yo sentía que en los chilenos había un ambiente más calmado. No había esa decisión de inmediatamente cruzar la frontera. No notaba eso en el ejército chileno M. Aizenk: Did you exert the same pressure in Santiago as in Buenos Aires? R.Castro: No, I found a calmer atmosphere among the Chileans. There was not the resoluteness to cross the border immediately. I didn't see any thing like that in the Chilean Army
The meetings
About the issues of the negotiations see Interests of the Parties
One day after the announcement of the award on 2 May 1977, the Argentine Minister of Foreign Affairs foreshadowed a possible refusal: «…no commitment obliges a country to comply with that which affects its vital interests or that which damages rights of sovereignty…».See Alejandro Luis Corbacho: «Predicting the Probability of War During Brinkmanship Crises: The Beagle and the Malvinas Conflicts»
Frenzied diplomatic activity occurred alongside the military preparations.
On 5 May 1977 the Argentine Government sent to Chile the Chief of Staff (jefe del Estado Mayor Conjunto), Admiral Julio Torti with the proposal for direct discussions regarding the consequences of the arbitral award, particularly the maritime border.
This overture eventually led to two rounds of discussions, held from July 5 to 8 1977 in Buenos Aires and October 17 to 20 1977 in Santiago de Chile.
On 14 June 1977 the Chilean Government issued the decree n°416 over the baselines (See Chilean Baselines Map) complicating the situation still further.
Torti's proposal
On 5 December 1977 Admiral Torti returned to Santiago with a new proposal. The new proposal conceded the Picton, Nueva and Lennox Islands group to Chile, but it called for joint ownership of three other islands to the south that Chile considered unequivocally Chilean: Evout, Barnevelt, and Cape Horn Island. The Torti proposal also provided for a maritime boundary that would extend south for 200 miles along a meridian passing through Cape Horn.