To this remonstrance Zavala was constrained to reply that he found all measures vain to repress smuggling whilst such facilities existed for carrying it on and such gains were its result. He was sufficiently advanced to perceive, and sufficiently bold and honest to express his opinion, that a trade so demoralizing to the colonists was only to be stopped in one of two ways; either by throwing open the markets to legitimate trade, whereby the Government would secure the duties, or by driving the Portuguese out of the _Banda Oriental_, or _Uruguay_. Of the two alternatives, the latter best suited the views of the Spanish Government. The Portuguese indeed, not contented with the possession of _Colonia_, had commenced a more important settlement near _Monte Video_. From this place, however, they were dislodged by Zavala, who, by order of his Government, proceeded to establish settlements at that place and at _Maldonado_. [Sidenote: 1726.] Under the above-detailed circumstances of contention between the Crowns of Spain and Portugal, represented by their respective establishments at _Buenos Ayres_ and in _Brazil_, and which were so typical of its future history, was founded the healthy and agreeable city of _Monte Video_. Some families were transported thither from the _Canaries_, whilst others removed to there from _Buenos Ayres_. Large sums of money from the mines of _Potosí_ were sent by the Viceroy to carry on the works; whilst the _Guaranís_ were despatched in numbers from _Paraguay_ to lend their labour to the fortifications. The Portuguese, however, were not dismayed, and laboured, on the other hand, to increase their own establishments, fixing themselves permanently on the _Rio Grande_, from which they carried on the contraband trade with more impunity than ever. The value of this trade is estimated by Dean Funes at two millions of _dollars_ yearly to the Portuguese, being so much loss to Spain. [Sidenote: 1750.] The inevitable consequence of this state of things was fresh antagonism between the two countries, which it was sought to put an end to by a treaty between the two nations concluded in 1750. One of the articles stipulated that Portugal should cede to Spain all of her establishments on the eastern bank of the _Plata_; in return for which she was to receive the seven missionary towns on the _Uruguay_. But, as is told in another chapter of this work, the inhabitants of the _Misiones_ naturally rebelled against the idea of being handed over to a people known to them only by their slave-dealing atrocities; and they made a gallant resistance against the united forces of the two powers, which appeared to enforce the conditions of the treaty. The result was that when two thousand natives had been slaughtered and their settlements reduced to ruins, the Portuguese repudiated the compact, as they could no longer receive their equivalent, and they still therefore retained _Colonia_. [Sidenote: 1776.]