The twin engines of national and global growth propel stock markets.
So if you're counting on booming growth to send emerging-nation stocks back into orbit, think again. The world economy will chug along on fewer cylinders for months to come, economists say.
"For many emerging-market economies, conditions are either depressed or stagnating," says Farid Abolfathi, head of the emerging-markets department for Standard & Poor's DRI, a financial information firm in Lexington, Mass.
His outlook: Latin America and Asia, excluding Japan, look rough through 1999; Latin America won't be ready to rumba until early in the next century; Asia will likely "not be back" until 2002 or 2003.
The one possible bright spot among emerging-market regions: The larger economies of Eastern Europe, including Poland, the Czech Republic, and Hungary. But growth hinges in part on Western Europe, particularly Germany, where Russia's meltdown could prove sticky.
"We see the overall global economy growing only modestly through next year ... under 2 percent," says DRI economist Cynthia Latta.
Even the two titans of world growth - the US and Western Europe - will not see much expansion, she says. Both are expected to turn in "modest" growth.
The US will probably "avoid recession," but there is a possibility of a "mild recession," Ms. Latta says, especially if financial turmoil engulfs Latin America.
"There will be some growth in Latin America, but not much," she says. "There will be no growth in Asia."
A recession in Latin America is now "all but inescapable," agrees Jos Rasco, economist with investment firm Hoenig & Co. in New York.
Brazil holds the linchpin, he says. It is the region's financial and industrial powerhouse. If forced to devalue its currency, he says, Brazil will drag the region into deep recession.
Investment firm Merrill Lynch & Co sees a sharp erosion of investor confidence in Latin America, as it grapples with severe current account deficits, high interest rates, and weak commodity prices. And the most optimistic outlooks call for more of the same.
Merrill Lynch sees the region's prospects for 1999 as "increasingly at risk."
While most Latin American nations will post negative growth through 1999, Chile and Mexico "may escape" the negative column, says Mr. Abolfathi.