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Australian sport has taken a major hit from the global economic meltdown, with almost two-thirds of sponsors either scaling back funds or scrapping deals altogether, according to a survey released on Monday.

The findings by Australian researchers Sweeney Sports paint a grim picture for sports in the country, although a third of the 295 respondents were confident they would secure more funding this year, despite the downturn.

Todd Deacon, Sweeney Sports general manager, said interviews with sponsors, athletes and agents had shown a "troubling trend", particularly for rights holders, or those seeking to secure sponsors.

"Corporate sponsors generally have cut back on sponsorship activities, or are considering it, and rights holders are having a tough time signing new deals," Deacon said in a statement.

"What it's pointing to is a fairly difficult year for 2009."

The survey found that 62 percent of respondents had put a freeze on signing new sponsorship deals, while less than a third said they planned to quit existing agreements. Almost half (48 percent) said they will reduce funding in current deals.

Nearly seven out of 10 said finding new sponsors had become more difficult, while nine percent said contracts had been cancelled earlier than agreed expiry dates.

Seventy-eight percent of sponsors' cutbacks in 2009 will be in sports, the survey said, with 22 percent of companies planning to reduce funding for charities and 17 percent the arts.

However, the report was not entirely pessimistic, with less than a quarter (23 percent) saying the crisis had not affected them and 34 percent expecting an increase in sponsorship income.

(Source: Reuters)