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Spending on global advertising will grow 6.7 per cent in 2008, up from 5.3 per cent this year, due to the Beijing Olympic Games and U.S. Presidential election, a forecast released on Monday said.

Media planning and buying firm ZenithOptimedia said advertising spend should also be boosted by the Euro 2008 soccer tournament and a strong performance by developing markets, offsetting any slowdown caused by the credit squeeze or a housing downturn in the United States.

The report said it also expected China to overtake Germany to become the fourth-largest ad market in the world by 2010, with Russia tipped to move from 14th position to sixth.

In terms of the medium, spending on the Internet is forecast to grow 69 per cent over the next three years, taking an 11.5 per cent share of total ad spend and overtaking magazines to become the world's third-largest ad medium.

“While the credit squeeze is dampening economic growth around the world, we do not expect the ad market to follow suit,” the report said. “Unlike in the periods leading up to the last two ad recessions, advertisers have not been increasing their budgets faster than warranted by economic growth.”

The report said a housing downturn and credit squeeze would certainly hit property and finance advertising in advanced economies like the United States but the overall spend would be boosted next year by the “quadrennial events.”

“The ad market will be boosted by $6-billion (U.S.) in spending ... (with) $3-billion from the Olympics, $2-billion from the Presidential and congressional elections in the U.S., and $1-billion from the European football tournament Euro 2008.

“The quadrennial accounts for almost all of the acceleration in 2008: without it, growth would remain flat at 5.4 per cent.”

The report also said weakness in developed markets no longer resulted in a global downturn as developing markets have taken over as the biggest contributors to adspend growth.

“Between 2007 and 2010 we forecast developing markets to add an extra $49.5 billion to the world ad market, while the developed (North America, Western Europe and Japan) markets add $37.5 billion,” it said.

The report said the fastest growing ad markets were Kazakhstan, Belarus, Serbia and Egypt.

In terms of adspend by medium, the Internet was tipped to nearly double its share of global spend between 2006 and 2010 at the expense of most of the other media.

“Internet advertising already takes over 15 per cent of adspend in four markets (Denmark, Norway, Sweden and the UK). By 2010 we forecast the Internet to take more than 20 per cent in the same four markets and more than 15 per cent of adspend in 10,” the report said.