Political map of South American nations 4 July 1933 (Chaco War): Bolivia and Paraguay were both left land-locked by the 19th century's wars in South America. Having lost substantial territory to their neighbors, their last major dispute was with each other over the semi-arid Chaco - a region rumored to hold significant oil reserves. Following increasingly frequent border clashes, war broke out between the two countries in 1932 (Chaco War).