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Alternating Currency Co-owned by Saatchi & Saatchi and Cordiant Communications, Zenith Media has re-examined the advertising outlook in Asia in the post-crash environment. In fact, Zenith has raised its estimate of Asian ad activity for last year by about $300 million before allowing for any currency effects. From an economic point of view, Zenith expects a one-year blip in 1998. The problems in Asia have not knocked the region back in time, derailing the move toward consumer-driven economies. Growth in 1999 and beyond should remain spirited, which is encouraging if results are measured in local currencies. Because of the severe devaluation of many Asian currencies, however, the good results translate poorly when converted to U.S. dollars. According to Zenith's latest estimates, Asian advertising will grow by nearly 30 percent from pre-crisis 1996 to the year 2000 in local-currency terms. But those same projections result in only 4 percent growth when measured using the post-collapse exchange rates. A glimmer of good news: Some non-Asian advertisers are taking advantage of the lower media costs in the region to boost their share of voice and build awareness for the brands in the long term. --Alan Gottesman (westendal pobox.com) is principal of West End Consulting.


THE GOTTESMAN FILE
Growth in Asian advertising will suffer because of the recent swoon in exchange rates. Here's a comparison of how the future might look using pre-crash and post-crash exchange rates.

..........At 1996 rates.....At 1998 rates

.....1996.....$68,071.....$68,071
.....1997.....73,985.....73,985
.....1998.....77,241.....61,975
.....1999.....82,265.....66,003
.....2000.....88,036.....70,623

Source: Zenith Media. Figures in millions of dollars