The International Monetary Fund (IMF) stated that Poland’s “limited reliance on exports, flexible exchange rate and contained external and internal balances” allowed the country to avoid a recession this year, reports Meena Thiruvengadam for The Wall Street Journal. The IMF estimated that Poland’s economy may expand 1.1% this year and 1.9% in 2010.

The Organization for Economic Cooperation and Development (OECD) expects the Polish economy to grow 1.4% this year and 2.5% in 2010, according to Warsaw Business Journal. The economy was aided by a sound banking sector, unleveraged private sector, tax cuts as well as  other fiscal measures and infrastructure investments. But activity will remain below potential and the government deficit will greatly distend, says the OECD.

Van Eck announced its intent to launch a Market Vectors Poland ETF (PLND), which is expected to come out later this month, writes Don Dion for TheStreet. The fund will focus on small- and mid-cap companies, with an index made up of stocks that have a market cap of at least $150 million and daily trading averages of a minimum of $1 million. PLND’s most heavily weighted sectors are reported to have allocations of financials at 40%, energy at 14% and industrials at 11% within the fund’s portfolio.

Country-specific ETFs are useful in diversifying an international portfolio, or tracking short-term trends in international economies that would otherwise not be available to an average investor. However, investors should note that narrowly themed and emerging market ETFs have greater volatility.

While there currently isn’t a Poland single-country ETF, there are a selection of emerging market/frontier market ETFs that do have Poland as a large component. These types of region-specific ETFs also have the added benefit of spreading risk between the economic outcomes of countries included in the ETFs. (How to play Poland’s handsome recovery).

For more information on Poland, visit our Poland category.

• Claymore/BNY Mellon Frontier Markets (NYSEArca: FRN): up 55.7% year-to-date; Poland is 15.1%

• SPDR S&P Emerging Europe (NYSEArca: GUR): up 79.1% year-to-date; Poland is 12.2%

• iShares Emerging Markets Eastern Europe Index Fund (NYSEArca: ESR): up 14.7% since inception; Poland is 12.9%

Max Chen contributed to this article.

In Dubai, United Arab Emirates, fighter jets will be the focus at an upcoming airshow as Arab countries update their military might, reports Stefania Bianchi for The Wall Street Journal. According to consultancy Frost & Sullivan, defense spending in the Middle East could go above $100 billion by 2010, or 11% of global arms deals. Many leading arms companies believe the region is the up-and-coming place for defense spending.

Saudi Arabia and the U.A.E. are both using defense deals to offset unemployment and diversify away from their predominantly oil-related economies.

The long-term goals of the Arabian Gulf region will be brought on by robust local economic fundamentals, strong political will, a resourceful business tourism profile, continued healthy regional demand and expanding air access, writes Mohamed Tamer for Global Arab Network.

Tourism is seen as a rising key industry in the region and groups like ADTA, which manages the tourism industry in the Arabian Gulf emirate, are trying to entice travelers to consider the Middle East a must-see locale.

Marriott International (NYSE: MAR) announced the signing of five hotels to the Middle East & Africa Region, according to CNNMoney. Ed Fuller, president & managing director international lodging for Marriott, sees that “the Middle East appears to have weathered the global economic storm” and they “look forward to rising occupancies through the end of this year and into the next.” (Frontier markets the next big thing?)

For more information on the Middle East, visit our Middle East category.

• WisdomTree Middle East Dividend  (NYSEArca: GULF): up 6.1% year-to-date; Qatar is 31.8%, U.A.E. is 18.9%, Egypt is 17.4%, Kuwait is 15.5%, Morocco is 9.7%, Oman is 3.9%, Jordan is 2.9%

• Market Vectors Gulf States (NYSEArca: MES): up 8.9% year-to-date; Kuwait is 47.7%, U.A.E. is 25.5%, Qatar is 18.0%, Oman is 4.0%, Germany is 2.4%, Bahrain is 1.3%, Norway is 1.1%

Max Chen contributed to this article.

How did Indonesia do it?

• Indonesia’s economy grew 4.2% in the third quarter from a year earlier as the economy was bolstered by consumer confidence, increased domestic spending and a stable political climate,  report Aloysius Unditu and Novrida Manurung for Bloomberg. (Why Indonesia may see higher growth).

• Unlike many other Asian countries, Indonesia’s economy was not fettered by the dip in global export demand.

• James Lord, economist at Capital Economics Ltd., sees that the current President’s cabinet includes a team of economists that are “pro-reform technocrats” who will deliver the needed reforms to hit a 7% growth target. President Yudhoyono is trying to expedite infrastructure projects and he has pledged to curb abuses of power in the country. (Why is Indonesia thriving?)

U.S. Treasury Secretary Timothy Geithner, Indonesian finance minister Sri Mulyani Indrawati and Singaporean finance minister Tharman Shanmugaratnam called for flexible global exchange rates, stating that “market-oriented exchange rates in line with economic fundamentals will be essential in assuring the resource and sectoral shifts to match and foster the new patterns of demand,” according to The Wall Street Journal. The ministers also urged countries to focus more on sustaining private demand growth as fiscal measures are lifted.

For more information on Indonesia, visit our Indonesia category.

• Market Vectors Indonesia ETF (NYSEArca: IDX): up 170.9% since the market low

Max Chen contributed to this article.

Many countries that fall under the emerging and or frontier market categories get overlooked, overshadowed by the BRIC wall. Some analysts say if you’re not looking at some other markets, you could be leaving a wide-open hole in your portfolio.

How much should be allocated to your portfolio, though, is a matter of debate.

Alexandria Zendrian for Forbes explains that a 50% emerging markets weight is not recommended, but at least 30% should be international.  The average portfolio has about a 2% allocation to emerging markets, which is underweight considering that two-thirds of the global market cap lies outside the United States. (Why consider frontier markets?)

There are many other economies besides China, Brazil, Russia and India that are emerging, and they have made it through the financial crisis better than most. Eastern Europe is an area that has made it through the banking crisis well, and has overcome a currency problem as well. (Check out other alternative ETFs for BRIC investors).

In fact, eight of the top 10 markets  that have performed well over the past quarter are from Eastern Europe. Those top 10 markets are: Lithuania (up 46%), Serbia (39%), Ukraine (39%), Macedonia (38%), Estonia (37%), Russia (35%), Kazakhstan (34.8%), Vietnam (26%), Cyprus (26%) and Argentina (25%). (What you’re missing when you’re not global).

For more stories about frontier markets or Eastern Europe, visit the category.

Other emerging markets investors can consider include:

• iShares MSCI Emerging Markets Eastern Europe Index Fund (NYSEArca: ESR): up 44% since inception

• Market Vectors Vietnam (NYSEArca:VNM): up 5.7% since inception

• Global X/InterBolsa FTSE Colombia 20 (NYSEArca: GXG): up 90.8% since inception

• Emerging Global Shares DJ Emerging Markets Energy Titans (NYSEArca: EEO): up 12.8% in the last three months

Thailand’s Central Bank kept its benchmark interest rate unchanged, supporting Thailand’s “fragile” economic recovery, reports Suttinee Yuvejwattana for Bloomberg. The government has attempted to revive growth by increasing spending and stimulating consumption. (Hurdles Thailand has to overcome).

Finance Minister Korn Chatikavanij expects GDP to expand by as much as 4% in the last quarter of 2009 on increased government spending and improvements in exports. The ministry projected a 19% drop in exports this year, followed by a 10% rise next year. (Reasons to watch Thailand)

Moody’s kept a negative outlook for Thailand’s credit rating, stating that “political unrest could erupt again.” Protests that ousted the previous regime in 2006 have hurt consumer confidence.

Thailand’s economy is likely to contract 3.5% to 4% year-over-year in the third quarter and is expected to grow 3% to 4% year-over-year in the fourth quarter, writes Orathai Sriring for Forbes. Improvements in the third quarter from the second quarter were attributed to improvements in consumption, investment and exports.

For more information on Thailand, visit our Thailand category.

• iShares MSCI Thailand (NYSEArca: THD): up 62.8% year-to-date

Max Chen contributed to this article.

Although the pace may eventually slow down, Barron’s reports that emerging markets still have room left to grow in the long haul. And for the time being, they may be the place to hide out as developed markets still work toward normalcy. In the near-term, growth rates in developed nations are expected to be lackluster, and much less robust than those in the developing world’s. (What you’re missing when you’re not globally invested).

Countries that are resource rich and developing are stockpiling cash and shoring up their balance sheets for a strong recovery and a growth spurt unlike any seen before. Earnings and  economic activity have been revived. Morgan Stanley feels that earnings in emerging markets have bottomed in the third quarter and they’re now set to climb again. (Why frontier markets could be even bigger).

For more stores about emerging markets, visit our emerging markets category.

There are a variety of ways to play emerging markets. There are broad funds, such as iShares MSCI Emerging Markets (NYSEArca: EEM), Vanguard Emerging Markets (NYSEArca: VWO) and iShares MSCI EAFE Index (NYSEArca: EFA).

There are funds that focus on regions, such as Claymore/BNY Mellon BRIC (NYSEArca: EEB) and BLDRSAsia 50 ADR Index (Nasdaq: ADRA).

Finally, there are single-country funds, such as iShares MSCI Brazil (NYSEArca: EWZ) and Market Vectors Vietnam (NYSEArca: VNM).

Keep in mind that the narrower you get in your exposure to emerging and frontier markets, the higher your risk will be. Be sure to have an entry and exit strategy before you invest. (How to follow trends).

Turkey. Turkey is rapidly developing and there’s no indication that the economy needs aid from the International Monetary Fund (IMF). Growth in the economy could likely accelerate in 2011 after a return to growth in 2010. Turkey’s market index has been driven up by the banking sector, which makes up around 40% of the market. Bank earnings have been bolstered by a series of rate cuts that have reduced interest on customers’ deposits as lending rates remain high. (Does Turkey need more support?)

• iShares MSCI Turkey Invest Mkt Index (NYSEArca: TUR): up 179% since low; up 101.6% year-to-date

Russia. Next year’s growth could top 2% if oil prices stay high. Greater revenues from taxes on energy companies could also ensure this year’s budget deficit is smaller than expected. Economists believe Russia’s GDP growth may gain a foothold as soon as the fourth quarter because of fiscal stimulus. Additionally, the economy will pick up speed once oil prices increase and world economies recover. The Russian economy is dominated by resources and banking. (Russia’s potential stumbling blocks).

• Market Vectors Russia (NYSEArca: RSX): up 161% since low; up 139.5% year-to-date

Brazil. Brazil could sustain average annual economic growth of 5% over the next 10 years. Low inflation and sound fiscal policy have released a tide of investment in Brazil. For now, Brazil’s small-caps are benefiting from the carry trade. Companies are hiring workers to meet growing demand for manufactured goods and new homes. In 2010, Brazil’s economy is expected to grow 4.4%; this year, growth is expected to be around 0.12%. (Seven things to like about Brazil).

• iShares MSCI Brazil Index (NYSEArca: EWZ): up 125% since low; up 114% year-to-date

India. The Indian Prime Minister’s Economic Advisory Council expects the GDP to expand 6.5% to 6.75% in 2009-10, despite a potential decline in agricultural output. Inflationary concerns may be met by tighter monetary and fiscal policies in the coming months. Factors such as capital flows, domestic demand, portfolio flows and a strong savings rate have India in a good position to continue moving forward. (Why India could strengthen).

• WisdomTree India Earnings (NYSEArca: EPI): up 138% since low; up 88.2% year-to-date

Indonesia. A young population and a falling birth rate equate to a surge in the ratio of working population to the number of dependents. Circumspect fiscal policy has left the government with enough cash for infrastructure and public services. Indonesia may enjoy a period of political stability and does not rely too heavily on exports. Declining interest rates have helped boost consumption, which is around 60% of GDP. (Five points in Indonesia’s favor).

• Market Vectors Indonesia ETF (NYSEArca: IDX): up 180% since the low; up 155.6% since Jan. 20 inception

Max Chen contributed to this article.

Over the next three-to-nine months, frontier markets are anticipated to outperform the emerging and developed markets, reports Allen Wan for Bloomberg. The Middle East is in a position to lead the way, since the region has not yet recovered from the global market meltdown, making valuations cheap. The region’s equities are expected to catch up as corporate earnings improve. (Read about five risks to the Middle East economy).

A frontier market is generally a country that is fairly poor. An example is most of Africa. (Four reasons Africa is appealing).

The markets are usually locked up with little or no liquidity, but they can be a good diversification tool for investors. They can be long-term uncorrelated investments and they have enormous potential for growth. There are currently 28 countries listed as frontier markets, reports IS for Intelligent Speculator. (Read about MSCI’s latest review of these markets).

For more stories about frontier markets, visit our frontier market category.

• Claymore/BNY Mellon Frontier Markets (NYSEArca: FRN): up 57.2% year-to-date

• PowerShares MENA Frontier Markets (NYSEArca: PMNA): up 24% year-to-date

• Market Vectors Gulf States (NYSEArca: MES): up 24.9% year-to-date

• WisdomTree Middle East Dividend (NYSEArca: GULF): up 17.4% year-to-date

• SPDR S&P Emerging Middle East & Africa (NYSEArca: GAF): up 49.8% year-to-date

• Market Vectors Africa (NYSEArca: AFK): up 43.5% year-to-date

Many outside of Indonesia don’t realize that the country is actually doing quite well, with a stable government and an economy that has evaded the full force of the global downturn – only China and India are growing faster than Indonesia, according to The Economist.

Still, the country has some problems:

• Indonesia remains prone to sectarian and ethnic violence
• More than 15% of Indonesians live below the poverty line
• Unemployment stands around 8%, but the workforce is growing
• Inequality has widened
• Abusers of power in the former regime are going unpunished; Indonesia is rife with corruption
• Infrastructure is poor, if not non-existent
• Choking smog is being pushed down by El Niño weather, which also highlights the country as the world’s third-largest emitter of carbon

On the other hand, there are some hopeful points about Indonesia:

• A young population and a falling birth rate equates to a surge in the ratio of working population to the number of dependents. More than half of the population is likely to live in urban areas, indicating a boost in consumption.
• Circumspect fiscal policy has left the government with enough cash for infrastructure and public services.
• The re-election of Susilo Bambang Yudhoyono and his running mate voices the people’s need for reform.
• Indonesia may enjoy a period of political stability. The process of democratizing the country is now in full swing.

• Market Vectors Indonesia ETF (NYSEArca: IDX): up163.2% year-to-date

For more information on Indonesia, visit our Indonesia category.

Max Chen contributed to this article.

In general, Latin America has shown remarkable immunity to the latest global credit crunch and market turmoil. Jason Mitchell for Midas Letter reports that the strict macroeconomic policies pursued in Colombia and Peru over the past five years has started to take root, and both could become dominant economies on the world stage.

Nathan Gill for Bloomberg reports that Peru has reached a “point of inflexion” after shrinking more than it has in eight years. Now, resurgent demand could push the growth rate to 3.2% in the second half of 2009. To ensure this growth, the government has implemented a $3 billion stimulus package and cut the key lending rate to 1.25%.

Robert Kozak for The Wall Street Journal reports that Peru’s GDP shrank 1.1% in the second quarter.

Colombia is also one of Latin America’s fastest-growing economies between 2003 and 2008, expanding at an average of 5.4% annually. Much of the growth was spurred by rising demand for commodities, including oil, coal and gold. While some Latin American countries grew faster in this time frame, Colombia managed to stave off inflation.

• iShares MSCI All Peru Capped Index (NYSEArca:EPU) up 32.2% since inception

• Global X/Inter Bolsa FTSE Columbia 20 ETF (NYSEArca: GXG) up 37.2% since inception

• iShares S&P Latin America 40 (NYSEArca: ILF) up 68.2% year-to-date

For more stories about Latin America, visit our Latin America category.