2012 sees fewer state-backed funds

In 2009 and 2011, government-backed investment fund launches spiked due to sluggish economic performance. In 2012, however, the number of taxpayer-backed funds has declined.

Only five funds involving state initiatives launched this year, down from eight in 2009 and seven in 2011. The reasons could be twofold. Either, previous government action has led to the financial services industry to revive and stabilise. However, considering the most recent monetary policy announcements around the world, this option does not seem likely.

Alternatively, a decrease in government-backed funds, could indicate that capital reserves cannot cope any more. Many countries, in Europe and globally, have launched or announced initiatives to jumpstart small business productivity.

Yet, fund launches remain scarce and a recent ECI survey showed that access to financing is one of the prime concerns of SMEs. As the economy remains stuck in crisis, governments will likely need to continue sponsoring businesses.

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