Question

Why did Latin American countries in the latter half of the 19th century enter “neocolonial,” economically dependent relationships with European powers?

Answer 1

The order that took shape in the last decades of the 19th century is frequently referred to as neo-colonial, as a way of indicating that the region's internal and external systems retained general parallels to those of the Iberian colonial period. That is a useful term to a great extent. The area was, as in the colonial period, extremely exposed to outside events and foreign nations. While many Latin American elites took advantage of the new order, they ceded a degree of influence over their countries to the North Atlantic's industrializing economies.

Latin America, as in colonial days, tended to be largely an exporter of raw materials and a manufacturing importer. In fact, social ties had not undergone radical reform, despite certain legislative changes. Broad race and class hierarchies continued to characterize the social ties. Particularly in the countryside the patron figure (boss or ruler) has retained control over both physical resources and lower-status persons.

Communications also improved with the introduction of telegraph lines which had directly connected parts of Latin America to Europe by the 1870s. All the new investments and technology transfers have helped to promote the production and export of the primary products that economies seeking to industrialize. Latin America has gone through a thorough integration into the global economy.

Some regions, such as Cuba with sugar and Central America with coffee, fell into monoculture trends, in which the health of one specific crop depended on a whole national economy. Even where more than one commodity was essential to a region, dependence on such exports made Latin American economies vulnerable to changes in demand and world market prices, as well as local factors that influenced production.