The UK government has been urged to help nurture the videogames industry over the next 12 months to halt a decline in the gaming development sector.

Dr Richard Wilson, the CEO of Game industry body TIGA, has issued a year-end statement in which he sums up the state of gaming in 2011.

He draws attention to company closures, highlighting the shutting of Bizarre Creations in February, Black Rock in Brighton in July and Codemasters studio in Guildford in September.

Dr Wilson said it coincided with a growing trend for British talent to head abroad for work, citing a survey carried out by TIGA which found that 18 per cent of companies has suffered some level of "brain drain".

He said Britain's economy could be boosted if tax relief and incentives were given to sectors that had the potential for growth.

"The UK is fortunate to have economic sectors with real growth potential: high technology businesses; higher education; and creative industries, including the video games sector," he wrote.

Although large companies and studios have closed, Dr Wilson said this had led to the emergence of many smaller development teams which were pushing the boundaries of innovation.

But he said it was important for such teams to be given a helping hand.

"It is important that, during 2012, we encourage developers to take control and that we reward them. It is crucial that we look at those firms which have already taken steps into self-employment and give them the access to capital so that they can grow. Investment is needed in areas including Dundee, Brighton, Liverpool, Newcastle and Leamington Spa."

Gaming brings more than £1 billion into the UK economy each year. Industry magazine MCV reported recently that retailers have taken in more than £73.9 million in pre-Christmas revenue.