It is believed that the Algarve Bishop, who was based in Silves, took the initiative to found Ferragudo. Around 1520, Portugal was a world power through explorations and conquests. The gold, slave and spice trade flourished. The city of Silves was not doing well however. The river was increasingly harder to navigate and the living environment was deplorable with deadly diseases. Vila Nova de Portimão at the mouth of the river had largely taken over the trading function. With Ferragudo, Silves wanted to offer its citizens a healthy living environment and, above all, also gain influence at the mouth of the river. But Bishop Dom Fernando Coutinho, we now know, also had a self-interest. He led a frivolous life. For example, he had at least six children with different women and then a country residence is useful.

It seems plausible that Queen Dona Leonor did the bishop a favour to build a walled settlement on this site. Her brother King Manuel also contributed to this by ratifying her decree of 21 August 1520 after two months. How this came about becomes clear when we look further into the history of the royal family and the voyages of discovery.

Leonor and her brother simultaneously Queen and King
Marriages within and between the various royal houses in Europe were strategically arranged at the time. For example, 15-year-old crown prince João was coupled to his 12-year-old niece Leonor at the Portuguese court, and their child Afonso was born five years later, thus ensuring the continuity of the monarchy for the time being. But it would all turn out differently than expected. About ten years after they were married, João and Leonor became king and queen and Silves and Faro were allocated to Leonor to allow her an independent income. They lived in the heyday of Portugal when the money-consuming explorations along the African coast began to pay off with the gold and slave trade. But then in 1491, crown prince Afonso died after a horseback riding incident when he was sixteen years, just a year after he married the Spanish royal Isabelle. The question was who was to become heir to the throne. Leonor preferred her younger brother Manuel who was also a full cousin of the king. However, João was not so keen on his in-laws after an older brother of Leonor had plotted to kill the king a few years earlier. King João found out and single-handedly strangled Leonor’s brother. As usual in those circles, João had an illegitimate son and pushed him forward as crown prince. The Pope in Rome finally decided that Manuel would become heir to the throne. It was not long before he actually became King of Portugal and the Algarve. In 1495, King João is poisoned and dies while visiting Alvor. His heir to the throne Manuel becomes king and Leonor remains queen. A very special situation. She will remain so after Manuel marries the Spanish Isabelle, the widow of Leonor’s son. Also very special.

A world deal for the future bishop of the Algarve
When João was king, the search for the origin of precious spices had already progressed to the southern tip of Africa. Attracted by the success, the Italian explorer Christopher Columbus came to Lisbon with the idea of sailing to India via the uncertain west. He demanded that he would become governor of the new colonies to be discovered and that he should receive a tenth of the future commercial value. King João thought Columbus’s package of requirements was too much and sent him away. Maddened by jealousy of the Portuguese successes, the royal family in Spain eagerly accepted his demands and in 1492 Columbus discovered new land. He arrived on an island near the Bahamas in the middle of America. With both Portugal and Spain conquering the world, the Pope had to decide who was entitled to what. The stakes were high and there was heavy negotiation. Negotiations were conducted on behalf of Portugal by the later Bishop of the Algarve, Dom Ferdinand Coutinho. And he did it well! The result was a line of demarcation between the Portuguese Cape Verde Islands and the Spanish Bahamas. This line is indicated on the world map from 1502. The land east of the line was for Portugal and west for Spain. 5 years later, Portugal discovered the coast of Brazil to the east of the negotiated demarcation line. It looks like luck, but historians suspect Portugal has had prior knowledge of this. King João did not live to see the desired purpose of the voyages of discovery, reaching the distant India that was then seen as the source of the most valuable spices. Vasco da Gama reached the coast of India in 1498, after which many trade missions would follow. The voyages continued to India, where the spices really came from, and to China. Lisbon became the global trade centre , where merchants came from all over the world.

1520, a great year for Ferragudo
In the year Ferragudo was founded, the Portuguese Fernão de Magalhães discovered a passage from the Atlantic to the Pacific in South America and 2 years later the first voyage round the world was completed. In 1520, the Belém Tower was also finished, the symbol of Portuguese greatness. Queen Dona Leonor was the richest woman in Europe and very concerned with the less fortunate. She founded ´Santa Casa de Misericordia´ (Holy House of Mercy) to help and care for the poor, sick, disabled and neglected children. It still exists and has the exclusive right to operate games of chance that generate a lot of money for charities. Ferragudo’s ‘birth’ dates from this special time and it seems to have been established as a royal favour to Dom Fernando Coutinho, the Bishop of the Algarve.