Emergency workers earlier evacuated some 60 residents of an old people's home in Bensafrim, located some 250 kilometres (150 miles) south of Lisbon, because of the heavy smoke from the fire which was burning on the outskirts of the town.

Plans to evacuate the remaining 2,000 residents of the town, as well as those of the nearby white-walled villages of Odiaxere and Farta Vacas, were put on hold as the immediate danger from the flames appeared to pass, local officials said.

"It is a very complicated situation, the fire is out of control and it is burning along many fronts," the mayor of Bansafrim, Joao Gomes, told private radio TSF.

Firefighters dug ditches and cleared brush from huge areas around the perimeter of the town in order to block the advance of the fire, which has been burning for five days.

Local residents were in some cases using water from the swimming pools of their homes to protect their properties, local television showed.

While the order to evacuate was canceled, many residents of Bensafrim were spending the night on their verandahs or in the streets of the main square where they watched the mountains on the horizon for signs of approaching flames.

"This is a horrible situation, I don't know where to go, the fire could still come this way" one local resident told private television TVI.

The flames were just five kilometres (three miles) north of the restaurants and bars of the port town of Lagos, a popular destination for young tourists from across Europe.

Cars and roofs in the town were coated with ash from the wildfire, private television SIC Noticias reported.

Just to the east of Lagos, near the town of Silves, firefighters were battling several new outbreaks of a blaze that erupted on Tuesday which was also heading towards the southern coast.

Some 450 firefighters equipped with more than 100 firetrucks were at the scene of both fires, with more reinforcement on the way from Lisbon.

Interior Minister Antonio Figueiredo Lopes said firefighters needed to focus all their efforts on the blazes raging across the Algarve, which received nearly half of Portugal's more than 12 million tourists last year.

"All the available means are insufficient and if we do not mobilize more means we will not be able to beat this indomitable enemy," he told reporters.

Firefighters said strong winds and thick smoke, which limited the use of water-dropping aircraft, were complicating the battle against the flames.

Authorities believe both fires burning in the Algarve were started deliberately.

Until Friday the region had escaped the wave of fires that has swept Portugal since the end of July, causing nearly one billion euros (1.1 billion dollars) in damage.

Aside from the toll in lives, the fires have dealt a heavy blow to Portugal's forestry industry, which accounts for 11 percent of the nation's exports.

Forestry officials estimate 215,000 hectares (531,000 acres) of land, an area almost as big as Luxembourg, have been devastated by fire so far this year.

That estimate does not include the Algarve wildfires.

With fires now burning in the Algarve, the fires look set to to deal a blow to the nation's tourism industry, another key sector of the Portuguese economy.

Hotels on the Algarve coast, which receive most of their foreign visitors from Britain and Germany, have suffered a number of cancellations in recent days because of the fires, SIC television reported.

Tourism accounts for eight percent of the country's gross domestic product and employs 10 percent of all workers in Portugal.

TERRA.WIRE