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Recife , capital of the state of Pernambuco , shares with Sao Luis the distinction of not having been founded by the Portuguese: when they arrived in the 1530s, they settled just to the north, building the beautiful colonial town of Olinda and turning most of the surrounding land over to sugar. A century later, the Dutch, under Maurice of Nassau, took Olinda and burned it down, choosing to build a new capital, Recife, on swampy land to the south, where there was the fine natural harbour which Olinda had lacked. The Dutch, playing to their strengths, drained and reclaimed the low-lying land, and the main evidence of the Dutch presence today is not so much their few surviving churches and forts dotted up and down the coast, as the reclaimed land on which the core of Recife is built. Out of Recife, there are good beaches in both directions. The Portuguese first developed the coastline as far north as the island of Itamaraca , growing sugar cane on every available inch. This erstwhile fishing village still retains its Dutch fort, built to protect the new colonial power's acquisitions, but these days it's a fairly blighted weekenders' resort. Best is the coastal route south , where a succession of small towns and villages interrupts a glorious stretch of palm-fringed beach. Head inland and the scenery changes quickly to the hot, dry and rocky landscape of the sertao. Caruaru is the obvious target, home of the largest market in the Northeast, and close by is Alto do Moura , centre of the highly rated Pernambucan pottery industry. If you plan to go any further inland than this you'll need to prepare well for any kind of extended sertao journey, though it's straightforward enough to reach the twin river towns of Petrolina and Juazeiro .
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