The new trade data used here document the significance of industrialisation in Argentina, Brazil, Chile and Mexico after 1870. By 1910 Brazil and Mexico, in particular, led most of the poor periphery in Asia, Africa and the Middle East. While some of this impressive industrialisation was due to fast productivity growth in manufacturing, perhaps yielding some catch-up on their competitors in the United States and Europe, this article argues that there were even more powerful forces at work. Much of the industrialisation that occurred in Latin America was due to a cessation in the seven-decade rise in its net barter terms of trade, trends that reversed the deindustrialisation and ‘Dutch Disease’ forces that had dominated Latin America for almost a century. Equally important for Brazil and Mexico was favourable policy in the form of higher effective rates of protection for manufacturing, and a depreciation of the real exchange rate. These policies were missing in Argentina and Chile, and industrialisation suffered there as a consequence. Changing market conditions and policies seem to have been more important than changing fundamentals in accounting for Latin American industrialisation after 1870.