Austria Economy

Austria's economy is heavily dependent on its strong export business. It's exports which were valued at over US$200 billion in 2006, made up over 60 per cent of the country's GDP. This export business has flourished as it's neighbour Germany has prospered in the past 1-2 years in particular, increasing demand for Austrian good and services.

Austria has also benefited greatly from the EU's eastern expansion over recent years given its position at the revised heart of the EU. It has become an important centre for EU regional trade as well as gaining new export markets. In addition, the new EU countries account for over a third of Austria's foreign direct investment. The challenge going forward is for Austria to maintain its competitiveness in the face of its lower cost, lower tax neighbours to the east.

In the short-term Austria is forecasting further GDP growth, although this is expected to slow from the 2006 levels in excess of 3.0% to approx 2.5% in 2007 (Consensus Economics, April 2007).

Major Austrian industries include construction, machinery, vehicles and parts, food, metals, chemicals, lumber and wood processing, paper and paperboard, communications equipment and tourism. It's natural resources are primarily oil, coal, lignite, timber, iron ore, copper, zinc, antimony, magnesite, tungsten, graphite, salt and hydropower.

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