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China’s advertising market is defying the financial crisis but companies are guarding their budgets warily in a clear sign that confidence in a global economic recovery is still lacking.

In the first four months of this year, total advertising expenditure rose 5.8 per cent year on year to Rmb148bn ($21.7bn), according to CTR Media Intelligence, an affiliate of China Central Television (CCTV), the country’s main state broadcaster.

This contrasts with global advertising expenditure, which is forecast to drop by 5.8 per cent this year.

But even though they operate in one of the few bright spots worldwide, companies in the Chinese market are releasing ad funding on a much shorter-term basis than before.

“Between 2005 and 2007, I would have 60-70 per cent visibility before year-end for the next year,” said Eric Cheung, chief financial officer of China Mass Media, an agency that mainly resells advertising time on TV.

“But by the end of 2008 I could only see about 30-35 per cent for this year, and visibility is still poor now for the second half – on average you can only reasonably estimate two months ahead.”

Alfred Tong, chief marketing officer at Vision China Media, the leading mobile TV advertising company in China, is also cautious.

Behind this conservative attitude are fears that the global downturn could still have a worse fall-out in China.

Tian Tao, CTR vice-president, said: “The uncertain trend in China’s ad market comes from the uncertainty over when the global recovery will come.”

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