Falkland Islands History

History
The Falklands remained uninhabited until the 1764 establishment of Port Louis on East Falkland and the 1766 foundation of Port Egmont on Saunders Island. In 1766, France surrendered its claim on the Falklands to Spain, which renamed the French colony Puerto Soledad the following year. Problems began when Spain discovered and captured Port Egmont in 1770. War was narrowly avoided by its restitution to Britain in 1771.

Both the British and Spanish settlements coexisted in the archipelago until 1774, when Britain's new economic and strategic considerations led it to voluntarily withdraw from the islands. Stanley, as Port Jackson was soon renamed, officially became the seat of government in 1845. Economic growth began only after the Falkland Islands Company, which bought out Lafone's failing enterprise in 1851, successfully introduced Cheviot sheep for wool farming, spurring other farms to follow suit. In 1881, the Falkland Islands became financially independent of Britain. For more than a century, the Falkland Islands Company dominated the trade and employment of the archipelago.

In the first half of the 20th century, the Falklands served an important role in Britain's territorial claims to subantarctic islands and a section of Antarctica. The Falklands governed these territories as the Falkland Islands Dependencies starting in 1908, and retained them until their dissolution in 1985. In April 1982, the disagreement became an armed conflict when Argentina invaded the Falklands and other British territories in the South Atlantic, briefly occupying them until a UK expeditionary force retook the territories in June. Argentina and the UK re-established diplomatic relations in 1990; relations have since deteriorated as neither has agreed on the terms of future sovereignty discussions. Disputes between the governments have led "some analysts to predict a growing conflict of interest between Argentina and Great Britain. This has come about because of the recent expansion of the fishing industry in the waters surrounding the Falklands".