Saturday, November 01, 2008

Look east, Sir Martin Sorrell tells global communications industry

The global communications industry has look east to sustain both their public relations and advertising businesses.

The shift in the balance of economic power to the east is only heightened by what is going on now, says Sir Martin Sorrell, Group Chief Executive Officer of WPP, in interview with The Guardian.

WPP's advertising agency company holdings include the Grey Global Group, Ogilvy & Mather Worldwide, Young & Rubicam, and JWT(formerly known as J. Walter Thompson Co.).

WPP's public relations company holdings including Hill & Knowlton, Ogilvy Public Relations Worldwide , Burson-Marsteller and Cohn & Wolfe.

“Activity in the west - the US and western Europe - is tightening and will tighten further next year,” says Sir Martin.

“The world is not decoupled, so BRICs – Brazil, Russia, India, China - and "Next 11" - Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, South Korea, Turkey and Vietnam - will tighten too. China and India are growing at 10% and we in the west have been struggling to grow at 2% to 3% and will struggle further.

“The point is, even if the BRICs and Next 11 are coupled and are affected by the terrible events of the past year or so and, in particular, the past four or five weeks, these faster growing markets will remain faster growing. Even if China and India ‘collapse’ to 5% or 6%, or 7% or 8% growth, they will still be growing stronger and faster than we are.

“In this connection, it is interesting to note that the World Bank or IMF still forecast 2% to 3% GNP growth for the world next year, with the US and western Europe flat and the BRICs and Next 11 growing at around 6%.

“These thoughts have been confirmed by visits to Brazil and Argentina earlier this month, where it seems that growth next year, stimulated by agrarian-based economies, may be 3%. It could be that the ripples - or should we say waves - of economic distress have not reached these countries yet.

“However, it does seem as though the faster growing economies will continue to be faster growing - particularly when compared with the west.”

Also see:

Slowdown, PR and corporates: Communications giants’ revenues hold the key?

Public relations giant Hill & Knowlton to start operations in India


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