Austria: Economic and Political Outline

Economic Overview

After undergoing the worst recession in its history, in 2010 Austria's economy was been slowly recovering and a stronger recovery followed in 2011 (2.9%). However growth should again slow down markedly in 2012, due to the crisis in the eurozone.

The government has set a goal of reducing the fiscal deficit below 3% of GDP by 2013 and more in subsequent years, in order to bring public debt under 60% of GDP within the next decade. Priority is also given to reducing unemployment, and to support in the research and development and education sectors. In view of the possibility of the eurozone crisis worsening, banks have been asked to increase their capital ratio. Structural reforms are also needed to address the challenges posed by the retirement system, the aging population, inefficient administration and a weak education system.

In terms of per capita income, Austria ranks fourth in the European Union. In spite of the eurozone crisis, employment rate grew in 2011 and the rate of unemployment should remain below 4.5%, one of the lowest in Europe. Although it has decreased, Austria's unemployment rate has not returned to the its 2009 level, before the global financial crisis.

Main Sectors of Industry

Dominating the economy, the tertiary sector contributes around 70% of the GDP and employs two-thirds of the country's active population. Tourism is well developed: nearly 17 million tourists visit Austria annually.

The agricultural sector contributes about 2% of the GDP and employs nearly 6% of the active population. Cattle farming and viticulture are the country's main agricultural activities. Organic agriculture is developing rapidly. It currently represents 10% of the agricultural production. Austria benefits from significant European Union subsidies as provided by the Common Agricultural Policy.

The main industrial sectors are the metalworking industry, electrochemistry and engineering, even though most of the companies in these sectors are relatively small on the international scale. The country has little mineral resources such as iron, lead and copper.

Source: World Bank - Last Available Data.

Indicator of Economic Freedom

Score:

71.9/100

Position:

Mostly free

World Rank:

21/179

Regional Rank:

11/42

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Sources of General Economic Information

Ministries

Federal Ministry of Economy and Labour
Federal Ministry of Finance
Federal Ministry of Agriculture, Forestry, Environment and Water Management
Federal Ministry of Foreign Affairs

Statistical Office

The Austrian Statistical Central Office 

Central Bank

Central Bank of Austria

Stock Exchange

The Vienna Stock Exchange

Other Useful Resources

Austrian Business Agency
Federal Financing Agency

Main Online Newspapers

List of Austrian newspapers online

Economic Portals

Trend Magazin
Industrie Magazin

Political Outline

Type of State

Federal Republic based on parliamentary democracy.

Executive Power

President is the chief of the state and the Federal Chancellor is the head of the government. Chancellor enjoys the executive powers. President is elected by direct popular vote for a six-year term and the Chancellor is traditionally chosen by the President from the majority party in the National Council. Council of Ministers is chosen by the President on the advice of the Chancellor.

Legislative Power

The legislature in Austria is bicameral. The parliament consists of two chambers: National Council (the lower house), its members elected by direct popular vote to serve four-year terms, and Federal Council (the upper house) with its members elected by provincial parliaments to serve five- or six-year terms. President can dissolve the National Council on recommendation of the Chancellor. The Federal Council only reviews legislation passed by the National Council and can delay but not veto its enactment. Most authority, including that of the police, rests with the federal government, but the states have considerable responsibility for welfare matters and local administration.

Main Political Parties

The major political parties in the country are: OVP (the conservative People's Party), SPO (Social Democratic Party), FPO (the right-wing Freedom Party), and the Greens.

OVP finds support from farmers, large and small business owners and some Catholic groups, mostly in the rural regions of Austria; while as the SPO traditionally draws its constituency from blue- and white-collar workers.

Current Political Leaders

President: Heinz FISCHER (since July 2004) – SPO
Chancellor: Werner FAYMANN (since Decemer 2008)
Vice Chancellor:Josef Pröll (since Decembre 2008) - OVP

Next Election Dates

Presidential election: April 2016
National Council election: 2013

Indicator of Freedom of the Press

World Rank:

5/179

Evolution:

2 places up compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).