The precious pearl of Brazil

The Minas Gerais region once produced a stream of gold and diamonds, but now the wealth of the region lies in its dazzling architecture

Those who feel that sambas are the highest musical art form and that there is no more appealing sight than the bronzed buttocks of Rio's Copacabana beach, might prefer to keep away from the land-locked state of Minas Gerais. But, for those visitors who are drawn by the diversity of Brazil's landscape and culture, the state has an extraordinary stock of surprises.

Those who feel that sambas are the highest musical art form and that there is no more appealing sight than the bronzed buttocks of Rio's Copacabana beach, might prefer to keep away from the land-locked state of Minas Gerais. But, for those visitors who are drawn by the diversity of Brazil's landscape and culture, the state has an extraordinary stock of surprises.

Take the nature reserve among the mountains of the Caraça, for instance. With characteristic Brazilian panache, a notice at the entrance to Caraça proclaims "You are entering paradise". Once you are inside, that statement is easy to believe. But travel to some of the eminently beautiful towns in the region and you are convinced of it.

At a friendly local hostel, founded in 1775 as a Franciscan friary, a plate of meat is put out on the terrace every evening. Most nights several wolves lope up and carry off the food for a midnight feast.Woken by a racket of birds in the morning, you may see a long-nosed furry racoon snuffling on the terrace.

Take your 4WD along dirt roads to watch green parrots flying above the waterfalls. If you then take the high road, leaving the tropical fervour of the valley, you come to high moors covered with Alpine flowers.

The name Minas Gerais ("General Mines") refers to the history of the region. In the 18th century this small pocket of the giant Portuguese colony produced a torrent of gold, emeralds and diamonds for the kings of Portugal. Prospectors panning silt in the streams still get gold dust and nuggets and produce a respectable 1,000 carats of stones a month. The other day a man found a 35-carat diamond which brought him in a nice six-figure sum, they say.

The high water mark of Minas' mineral wealth is long past, however. At the Passsagem mine, near Mariana, the Cornish-built machinery which once served to extract 35 tons of gold from the earth has lain idle for 15 years. Now only visitors descend into its tunnels.

What the mining industry left behind is magnificent. Forget the dreary abandoned mine workings of Cornwall or California or Australia. This is Brazil, where things are done in style. The former state capital is Ouro Preto, the Rich City of Black Gold, now recognised by UNESCO as a World Heritage Site.

One anonymous writer in 1734 enthused, "Here dwell the best educated men, both lay and ecclesiastic. Here is the seat of all the nobility and the strength of the military. It is, by virtue of its natural position, the head of the whole of America: and by the wealth of its citizens it is the precious pearl of Brazil."

What he failed to recall was the mad chaos of the gold rush 30 years before, when hopeful miners flooded in such numbers that the food supply ran out and hungry men paid 32 drams of gold for a cat or a small dog. Then, when the boom was at its height, miners in the money paid a thousand pieces of silver for a good black trumpeter. And double that for a mulatta prostitute.

Ouro Preto has calmed down since then. Its 18th-century great houses are still there but now, in what was once the governor's palace, is one of the planet's greatest collection of minerals, including a quartz the size of a sumo wrestler.

The riches of the city's baroque and rococo churches are unrivalled. Sao Francisco, for example, was built by Aleijadinho, a crippled mulatto who became Brazil's greatest classical architect. His angels and saints smile out from every corner of a marvellous building.

Yet Ouro Preto, which got its name because some of the earliest nuggets found were covered with a rusty deposit of iron, is not a museum city. It has a good university and a sense of self-respect (although one suspects its inhabitants still mourn the day, one hundred years ago, when the state capital was moved to the new town of Belo Horizonte).

Ouro Preto had been supplying gold to a surprised and delighted monarchy in Lisbon for years, when diamonds were discovered nearby. Legend has it that the local children were playing marbles with the better stones, until a man with experience in the Portuguese settlements in India realised they were diamonds, and quietly started to accumulate a personal stockpile.

In 1726 the governor Dom Lourenço de Almeida discovered the secret. He, too, made sure he bought up as many diamonds as he could from unsuspecting miners, before he informed Lisbon two years later that he was sending back for analysis some "little white stones."

So many stones then tumbled out that the world price fell disastrously and the crown forbade diamond working for years. In the 30 years from 1740, when diamonds were again allowed to be traded, Minas apparently yielded 1,666,569 carats. Though the crown instituted punishments, such as life imprisonment or exile to Angola for black marketeers, such trade was very much larger than the recorded one.

As in many other European colonies, the work was done by slaves. While the slaves did their best to swallow or bury the good stones, one way or another, the masters, according to one English visitor, dined "on a profusion of excellent viands, served up on fine Wedgwood ware."

For years the crown appointed Joao Fernandes de Oliveira as its contractor and he lavished his money and attentions on his mistress Xica da Silva, a former slave. The story goes that, having never seen a sea, she demanded that her lover make one. So he made an artificial lake, complete with a ship with masts, rigging and a crew of ten.

The diamond rush also left the beautiful city of Diamantina, four hours drive to the north of Ouro Preto. Last year it was declared a World Heritage Site and its architecture is, if possible, even more gorgeous than that in the gold capital.

The city is unselfconscious in its beauty and the atmosphere is much more carefree than in Brazil's bigger cities, such as Rio or Sao Paulo. Xica's house survives, overlooking a church whose tower she demanded to have taken down because it spoiled the view.

Now there is a co-ordinated push to popularise the more beautiful part of Minas by reviving traffic along the Royal Road, along which Minas' treasures flowed out to the sea and on to Lisbon. Before long visitors will be able to walk or ride on horseback between Diamantina and Ouro Preto, and the colonial port of Parati, using some of the hotels and pousadas or inns on the way.

A good find in one of the diamond rivers could go a long way to paying for the holiday of some lucky hiker.

British Airways and Varig fly from Gatwick and Heathrow respectively to Rio and Sao Paulo. There are frequent connections to Belo Horizonte, the main gateway to Minas Gerais. Through a specialist agent such as South American Experience (020 7976 5511, www.southamericanexperience.co.uk) or Journey Latin America (020 8747 3108, www.journeylatinamerica.co.uk), you can expect a through fare for around £700 return.

Much better value, if you can travel within the next 10 weeks, is to buy a cheap flight to Rio or Sao Paulo, and add the Varig airpass that allows 30 days of unlimited travel for $450 (about £310). For more information contact the new Brazilian Tourist Office, part of the Brazilian Embassy, at 32 Green Street, London W1Y 4AT (020 7399 9000)