Brazil is Back.

Latin America's largest corporations make a comeback in 2000 and 2001, with Embraer, P[[tilde]{a}]o de Ac[acute{u}]car and Sadia leading the way.

THE ERJ 145 MAY NEVER BE A HOUSEHOLD NAME, BUT YOU MAY soon ride in the commuter plane--if you haven't already. The jet has single-handedly sent worldwide sales soaring 45% at Brazilian aircraft manufacturer Embraer. That's big news for a company that posted sales of nearly US$1.9 billion in 1999.

More impressive still is the company's stellar showing during a year of tremendous turbulence for just about all its corporate compatriots in Latin America's largest economy.

Brazil's slump helped drag down the LATIN TRADE 100 for the second straight year. with both sales and profits of the top 100 publicly traded companies declining in 1999. Sales fell almost 3% to $228 billion, while profits were down by a fifth, to $14 billion.

Many Brazilian companies took last year's real devaluation on the nose with double-digit declines in sales. But, surprisingly, a corporate comeback in Brazil is already underway and will continue into next year, according to the LATIN TRADE Corporate Forecast of 2000 and 2001 sales for 74 leading Latin American companies.

The survey of analysts at Bear Stearns, J.P. Morgan, Morgan Stanley Dean Witter, Salomon Smith Barney and Santander Investments indicates that retailer P[tilde{a}]o de Ac[acute{u}]car, meat processor Sadia and power company EBE, among other Brazilian companies, will post hefty increases in sales during 2000 and 2001. And the only thing that might clip Embraer's wings would be the loss of controversial subsidies that competitors have claimed are unfair before the World Trade Organization.

Overall, most of the companies poised to show outstanding performances in South America will benefit from improved economic conditions. Chilean energy concern Copec and retailer D&S, for example, are expected to be strong performers this year and next, due in no small measure to the country's recovery from its first recession since 1983.

While Brazil did not slip into deep recession in 1999, as many expected, the economy was flat and almost all of its neighbors posted poor to awful showings.

Big losers last year included Brazil-based food company Santista Alimentos and Chilean energy companies Empresa Nacional de Electricidad and Enersis. Argentine multinational Bunge & Born considered selling Santista after its dismal $115 million losses in 1999 but, in the end, decided to restructure the troubled food processor by sliding some assets to its other food operation Ceval, another big loser in 1999. And, after all the polemics surrounding Spanish concern Endesa's takeover of the Chilean energy sector with control of power distributor Enersis and producer Empresa Nacional de Electricidad, the companies combined to lose almost half a billion dollars ($482 million to be exact) last year.

In 2000 and 2001, the Mexican expansion will continue. Tel[acute{e}]fonos de Mexico, Wal-Mart de M[acute{e}]xico (formerly Cifra) and cement giant Cemex, for example, are absolutely booming with their multibillion-dollar revenues up by a quarter and profits increasing by a third or more. Most Mexican companies are expected to continue to grow, albeit not all such a torrential pace.

At the bottom of the heap with disastrous losses in 1999, construction company Ingenieros Civiles Asociados (ICA) will even see a further decline in 2000.

Some of the outstanding performers in terms of sales owe part of their success to acquisitions. Mexican seed and insurance company Savia's huge 234% leap to $2.7 billion in sales during 1999 stems from consolidating results from insurance company Seguros La Comercial for the first time last year. Grupo Minero de M[acute{e}]xico, which bought U.S. mining concern Asarco in 1999, will see a jump in sales when it reports its first combined results in 2000. Brazilian steel maker Gerdau, thanks to its recent acquisitions of U.S. and Argentine firms, will also present dramatically higher revenues this year, compared to 1999.

For established telecommunications players, the picture is more subdued and they will see only modest growth in 2000 and 2001, according to the LATIN TRADE Corporate Forecast. Sales growth at Telmex will fall from 15% in 2000 to 6,4% in 2001, while that of Telesp will remain about 8% for this year and next. Telefonica and Telecom in Argentina are expected to see little or no revenue growth this year and only a 3% rise in 2001, while Venezuela's Cantv will post a mere 4% increase in 2000 and no change in 2001.