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Punta Arenas is the capital city of Magallanes and Antartica Chilena, Chile's southernmost region. The city was formally called Magallanes in 1927, but it was reverted to "Punta Arenas" in 1938. It is the biggest city south of the 46th parallel south, the most populated southernmost city in Chile and the Americas, and the coldest coastal city with more than 100,000 people in Latin America owing to its position. It is also one of the world's most populated locations so far south.

Punta Arenas was one of just two free ports in Chile as of 1977, the other being Iquique in the country's extreme north. (While Punta Arenas is not a "free port," there is a "zona franca" outside the city where certain items can be brought into the nation at a lower tax rate.)

Punta Arenas, located on the Brunswick Peninsula north of the Strait of Magellan, was founded by the Chilean government in 1848 as a small penal colony to maintain authority over the Strait. Punta Arenas expanded in size and prominence during the rest of the 1800s as a result of increased marine traffic and commerce to the west coastlines of South and North America. This phase of expansion was also influenced by waves of European immigrants, primarily from Croatia and Russia, who were drawn to the gold rush and sheep farming boom in the 1880s and early 1900s. The largest sheep enterprise in Chile and Argentina, with 10,000 square kilometers under its control, was located in Punta Arenas, and its owners resided there.

Chile has utilized Punta Arenas as a base to defend its sovereignty claims in the southernmost region of South America since its inception. This resulted in the Strait of Magellan being acknowledged as Chilean territory in the Boundary Treaty of 1881 between Chile and Argentina, among other things. Punta Arenas' geopolitical relevance has remained high in the twentieth and twenty-first century due to its logistical importance in accessing the Antarctic Peninsula.

Since 2017, the city and its surrounding territory have had their own time zone: they utilize summer time all year (UTC3).

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