SMEs from East Germany use subsidies more than those in the west

Only 8% of small and medium-sized entities (SMEs) from West Germany draw on subsidies. The situation is different with regard to SMEs from Berlin and the east: for them subsidies are a well-established financing instrument used by 40% of SMEs in the east which is five times as many as in the west. The same applies to long-term bank loans which are drawn on by 48% in the east and by 32% of SMEs in the west.

Unfortunately, to only about one third of German SMEs are the good economic prospects reason to make more investment. This generally applies to all SMEs irrespective of their equity basis. However, the bigger SMEs are, the bigger their propensity to invest, or in other words, the more turnover they generate, the more money they are willing to invest.

These are the findings of a study which is conducted twice a year by the EOS Holding in co-operation with the Heinrich-Heine-university in Dusseldorf. About 200 German companies took part in the latest survey on financing instruments used. GERMAN