History of Bolivia (1809–1920)

The invasion of the Iberian Peninsula from 1807 to 1808 by Napoleon Bonaparte's forces proved to be critical for the independence struggle in South America, during which the local elites of Upper Peru remained mostly loyal to Spain, supporting Junta Central, a government which ruled in the name of the overthrown king Ferdinand VII of Spain. A number of radical criollos in 1808-10 began a local power struggle. Pedro Domingo Murillo proclaimed an independent state in Upper Peru in the name of king Ferdinand VII. During the following seven years Upper Peru became the battleground between the armed forces of independent United Provinces of the Río de la Plata and royalist troops from Viceroyalty of Peru.

After 1820 the criollos who had formed the Conservative Party supported General Pedro Antonio de Olañeta. During the 1820–1823 liberal revolution in Spain, Olañeta, convinced that revolution threatens the traditional royal authority, refused to join the royalist forces or the rebel armies under the command of Simón Bolívar and Antonio José de Sucre. Olañeta did not relinquish his command even after the Peruvian royalists included him and his forces in the capitulation agreement following their defeat in the Battle of Ayacucho in 1824, the final battle of the wars of independence in Latin America. Olañeta continued his resistance until he was killed by his own men on April 2, 1825.

During the 1829-39 presidency of Marshal Andrés de Santa Cruz, Bolivia enjoyed the most successful period of its early history with great social and economic reforms. Santa Cruz got involved in Peruvian politics and succeeded in unifying Peru and Bolivia into the Peru–Bolivian Confederation.

During the War of the Confederation, Chilean and Peruvian rebel armies were forced sign the peace treaty known as the Paucarpata Treaty, which included their unconditional surrender, but in 1839 Battle of Yungay the army of Confederation was defeated. This was the turning point in Bolivian history; for the next 40 years coups and short-lived regimes dominated Bolivian politics. Plagued by a vicious economic and political crisis, Bolivia's weakness was further demonstrated during the War of the Pacific (1879–1883), when it lost access to the ocean and the nitrate rich fields to Chile.

Increase in the world price of silver brought Bolivia a measure of relative prosperity and political stability in the late 1800s under the Conservative Party. In about 1907 tin replaced silver as the country's most important source of wealth. A succession of Liberal Party governments applied laissez-faire policies throughout the first two decades of the 20th century before the coup of the Republican Party in 1920.