The East African government had formed an idea, and the Foreign Ministry quickly took action, communicating with Chile and Argentina. Argentina's military government rejected East Africa's proposal without hesitation. Thus, East Africa shifted its focus to Chile.
At this time, Chile's political situation was unstable. Affected by the economic crisis, exports of Chilean agricultural and mineral products had plummeted. In particular, the withdrawal of British and American capital had nearly halved the price of nitrate exports, a major source of Chilean income.
Nitrate exports accounted for nearly forty percent of Chile's foreign-exchange earnings and more than half of government revenue. Back when Chile's economy had been at its height, Chilean nitrate had even held eighty percent of the global market share.
During the Great Depression of 1929, Britain and America, previously the main buyers of Chilean nitrate, saw large numbers of related domestic enterprises go bankrupt or cut production because of the crisis. This was one important reason for the reduction in Chilean nitrate exports.
East Africa and Germany had also greatly reduced their imports due to breakthroughs in synthetic nitrates, which was another major reason for the sharp decline in Chilean nitrate exports.
Besides nitrate, Chile's second-largest mineral resource was copper. In 1931, Chile was the world's third-largest copper producer. East Africa ranked first, and the United States second.
Chile's copper mines were mainly controlled by American capital. Although East Africa had attempted in recent years to expand cooperation with Chile in related fields, the results had not been particularly significant.
The reason was simple. One was obstruction from Britain and America. Their historical ties with Chile went back far earlier than East Africa's. Just as Britain had previously dominated Chile's nitrate mines and America dominated the copper sector, the two countries jointly excluded East African capital from entering.