Ad spending may have slowed some in the U.S., but around the world it's growing at a healthy pace, and even that healthy pace appears to be picking up.

In a report out today, ZenithOptimedia bumped up its forecast for global ad spending growth this year to 5.5 percent, up from the 5.2 percent it forecast back in March.

“It’s a fairly good year for global growth, fairly stable and relatively strong,” says Jonathan Barnard, head of publications at ZenithOptimedia. "Next year will be even better. It’ll be a good year because of the Olympics and the presidential elections. We have upgraded all regions except the Americas, which are down slightly.”

In its report, Zenith trimmed U.S. ad spending growth slightly to 3.3 percent, down from 3.4 percent in March, citing continued weakness in network TV and trade magazines. This follows last week's reduced U.S. spending forecast from Universal McCann's Robert Coen, who reduced spending estimates to 3.1 percent this year, down from 4.8 in December.

At the same time, Coen trimmed his global projections, to 4.2 percent from 5.3 percent.

Clearly, ZenithOptimedia is more optimistic. It's also bumped up expectations for 2008, to 6.4 percent spending growth from the 6.2 percent it forecast in March, and it sees 2009 coming in at 5.4 percent versus 5.0 percent.
 
In all, ZenithOptimedia is forecasting two years – 2007 and 2009 – in which ad spending growth on a global level will be slightly above the 10-year trend of 5.1 percent. However, thanks to the Olympics, the presidential elections and the World Cup, 2008 is expected to be much stronger.

Looking at what is driving ZenithOptimedia’s global growth upgrades shows faster-than-expected growth in Western Europe, particularly in Britain and Germany.

In fact, growth in Western Europe is expected to be faster than in the U.S. from 2007 to 2009. This comes after nine years in which Western Europe has grown at a slower pace than the U.S.

“The Euro zone economy seems to be at a slightly different point in the economic cycle than the U.S. It is still recovering,” explains Barnard.

Another factor in the upgraded global forecast is that Central and Eastern Europe, where growth has been slowing, is now expected to see that growth ease at a slightly slower pace.

The forecast shows that the Americas are the only region in the world where growth is slowing. Latin America is growing slightly slower than expected thanks to a softening of exports and domestic demand in Mexico.

In the U.S., Barnard believes the slowdown in growth is due to the country’s position in the economic cycle.

“The U.S. has had a few years of strong growth and it now seems to be moderating slightly,” says Barnard. “We are forecasting 3.3 percent this year in the U.S. That’s slightly below the long-term average, but it is still growth.”

Ad spending in the U.S. has grown at a rate of 5.2 percent a year on average over the past 10 years, according to Barnard.

Another interesting factor in ZenithOptimedia’s global forecast is the continued upward march of China, which is growing at a double pace.

ZenithOptimedia forecasts that China will overtake Italy to become the world’s fifth-largest ad market this year. Ten years ago, China was 10 places lower down the rankings than it is now. And in 2005 it was only the seventh-largest ad economy.