Across the eight largest ad markets of the US, Canada, France, Germany, Italy, Spain, Japan and the UK, which together accounted for 75% of global adspend in 2003, spend is forecast to grow 3% in 2004 showing the first real growth and strongest forecast since 2000.
Spend is expected to rise to £146bn compared with £140bn in 2002 as the recovery, dominated by the US, gathers pace.
In the US, adspend is forecast to rise by 5.5% to £87.8bn from £83.2bn. However, Western Europe continues to lag behind and is only expected to grow by 2.7% this year from £34.9bn to £35.8bn.
In the UK, TV adspend is forecast to increase by 4.2% as ZenithOptimedia predicts that commercial television will continue to benefit from rapid growth in the penetration of digital television, where households watch more ads.
On a more sour note, ZenithOptimedia said that while publishers continue to invest in newspapers and magazines, the demand for print advertising remains weak.
"New tabloid versions of broadsheet papers seem to be shifting patterns of consumption among existing newspaper readers, but not to be recruiting new readers," the report said.
The agency said it expected to see nominal growth in newspaper and magazine expenditure from 2004 to 2006, but these gains are likely to be wiped out by inflation.
The agency claims that the European Championship football tournament in Portugal will enliven the normally slow summer season.
The star performers in the lastest ZenithOptimedia forecast were outdoor, radio and the internet, which are set to grow 8.9%, 7.2% and 16.9% respectively in 2004.
The forecasts for Europe contrast dramatically with those for Japan. "Amazingly, Japan had the strongest ad markets of any of our eight large markets in 2003" the report said.
ZenithOptimedia claims that 2004 should be even stronger as the financial system strengthens at banks; and growth from information, communications and home electronics categories is renewed as manufacturers develop and market new products. Growth is expected to go up by 2.4% to £19.4bn.
However, the agency has cautioned that real ad growth may slow from 3.2% this year to 2.3% in 2005 and 2006.
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