Carat downgrades global ad spend

Asia Pacific - Media buying group Carat has revised its forecasts for global advertising expenditure in 2008 and 2009, reducing initial estimates for the Asian region.

Carat's estimates for 2008 have been reduced from 8.8% to 8.2%, while next year's numbers have shrunk from 7.2% to 5.7%.

Carat said China will experience a "significant decline in growth" heading into 2009 when the true picture of the impact of the May earthquake and what will happen to spending post-Olympics becomes clear.

China is expected to slow from 13.2% to 10.9% in what will become the world's third largest advertising market. Growth in China however is still well ahead of predictions for the developed world.

Patrick Stahle (pictured), CEO of Aegis Media Asia Pacific, said despite a slowing of the China market, the emerging middle class will grow at an incredible rate.

"In APAC we see both a faster than global growth and a very fast digital development making the region more important for global advertisers," Stahle said in a statement.

"With China likely to become the second largest advertising market after the United States in 2009, and the Chinese middle class sector growing at an incredible rate, this is bound to place even more focus on China post the Olympics."

Spending on internet advertising will continues to grow ahead of all other sectors, albeit not at the same rate as 2007.

Around the world, the US is predicted to slow to 2.1% from earlier forecast of 3.8%, with newspapers, magazines and radio all having shown declines this year. The US TV market will receive a boost, thanks to the presidential elections and the Olympics.

The UK's overall forecast has been cut from 4.3% to 2.5%, with a downward revision of 1.8% points.