[center][b][u]Outbreak of the Paraguayan War[/u][/b][/center]

In the 1860s, the Republic of Paraguay was in a good condition. The government under López was extremely protectionist, and its stable trade, high tariffs, and policy of never accepting overseas loans meant that the nation had avoided the debt faced by other South American nations. Militarily, the Paraguayan army was well trained, and the local Ybycuí foundry supplied high quality munitions and cannons, keeping the Paraguayan army well equipped. Many saw this military build-up as proof of López' expansionist goals. In 1868, the Argentine Republic decided to take action.

Under the command of President Bartolome Mitre himself, who had experience leading troops, the Argentine army crossed the Paraguayan border and marched up the banks of the Paraguay River, making steady but slow progress. When news of the invasion reached Asunción, López was quick to order the mobilisation of the Paraguayan army. The army, under the command of much-acclaimed José E. Díaz, met the Argentine force near the town of Pilar, about mid-way between Corrientes and Formosa. The Paraguayans had numerical superiority, but the Argentinians found support from its navy,which sailed up the Paraguay River in support. The battle raged inconclusively for many hours, until Mitre launched a daring charge into the centre of the Paraguayan position. Initially successful, it brought the Argentinians in reach of Paraguayan cannons, which shelled the Argintinians heavily. Forcing the invaders to retreat, the Paraguayans drove the Argentinians out of Paraguay and back to the city of Corrientes, where the Argentinians dug in. Díaz halted his men before the city, unwilling to press too hard and risk losing the advantage.
(-2,300 regulars to Argentina, -1,700 regulars to Paraguay)

[center][img]http://upload.wikimedia.org/wikipedia/commons/2/21/Trincheracuruzu.jpg[/img]
[i]Paraguayan artillery redoubt[/i][/center]