Latin American Capital Markets

410 HANNES TAKACS AND KINGA KORCSMAROSTable 12-9 | Market CapitalizationMarketAverage marketcapitalization per companyNeuer Markt 88NASDAQ Europe 54Nouveau Marche 44Nordic Growth Market 29AIM 7(not considering companies with a market capitalization of at least 10 times higherthan the median) total market capitalization in 2001, Neuer Markt took first place with29 billion euro; followed by Nouveau Marche, with 7 billion euro; Nordic Growth Marketand NASDAQ Europe, each with 3 billion euro; and AIM, with 2 billion euro(Grant Thornton 2002). The average market capitalization in 2001 per company ispresented in table 12-9 (Grant Thornton 2002).In spite of the fact that NASDAQ has a very high market capitalization, its liquidity(turnover of shares as a percentage of total market capitalization) is not somuch different from that of some of the new markets in Europe that are considerablysmaller Nuovo Mercato and techMARK proved to be the most liquid new marketsin the past few years (GrantThornton 2002).Conclusion and RecommendationsThe chapter has shown that there are a wide variety of perspectives on the overallrole of SMEs in economic growth. SMEs are usually seen as the key to job creation,and therefore high emphasis is placed on policies that promote entrepreneurship andcompetitiveness and enhance SME access to finance.In order to analyze the role of capital markets in SME financing, it is necessaryto look at the broader issue of the factors affecting SME access to finance.Therefore,a more holistic perspective, which includes an examination of the relevance ofother financing instruments, would appear insightful.The key policy conclusion of thechapter pertains to the differential financing needs and capacities of SMEs along theirlife cycle.The challenges SMEs face depend on the stage in their growth. For the specificcase of capital markets, there is no firm indication that dynamic capital marketswould not be the most appropriate mechanism to support SME access to capital. ItCopyright © by the Inter-American Development Bank. All rights reserved.For more information visit our website: www.iadb.org/pub