Advertising industry expects healthy growth in spending

Dubai: Advertising spending in the region is expected to grow at a healthy double-digit rate despite the global financial turmoil that is likely to cause some slowdown in the Middle East, top industry executives said on Wednesday.

Joseph Ghossoub, President and CEO of The Holding Group (THG), a leading advertising company, said ad spending in the UAE has grown about 15 to 25 per cent annually in the last three years and such growth will continue.

"Hopefully we will continue to grow at that rate," he said.

Rapid economic growth in countries such as the UAE is providing a big boost to the sector within the Middle East, while companies in the US and Europe are likely to cut down their budgets for marketing and promotion.

Ghossoub said the UAE leads the region in advertising spending due to strong growth in the real estate, tourism and financial sectors. This year's figure is expected to be Dh2.5 billion.

Asked about a slowdown in the property sector that has driven revenues of the print media to record levels in recent years, he said: "I see a bit of slowdown initially, but it will pick up gradually."

Charles Courtier, CEO of Mediaedge:cia (MEC), a global media agency, said the Middle East, along with China, India and Russia, "represents a hugely important growth market" amid recessionary trends in the West.

He said 2009 will see a drop in advertising as this year's spending was spurred by the Beijing Olympics, European football and US elections.

"It [ad spending] will go down for the next 12 months due to financial chaos." He added that there are no big events in 2009 to support the industry.

This will also affect the Middle East, but the impact will be in the form of the growth rate changing to "fast" from "very fast", Courtier said.