Ceepackaging

Countries

Austria

Austria, with its well-developed market economy and high standard of living, is closely tied to other EU economies, especially Germany’s. The Austrian economy also benefits greatly from strong commercial relations, especially in the banking and insurance sectors, with central, eastern, and southeastern Europe. The economy features a large service sector, a sound industrial sector, and a small, but highly developed agricultural sector. Membership in the EU has drawn an influx of foreign investors attracted by Austria’s access to the single European market and proximity to the new EU economies. The current government has successfully pursued a comprehensive economic reform program, aimed at streamlining government, creating a more competitive business environment, further strengthening Austria’s attractiveness as an investment location, pursuing a balanced budget, and implementing effective pension reforms. Weak domestic consumption and slow growth in Europe have held the economy to growth rates of 0.4% in 2002, 1.4% in 2003, 2.4% in 2004, and 1.8% in 2005. To meet increased competition from both EU and Central European countries, particularly the new EU members, Austria will need to continue restructuring, emphasizing knowledge-based sectors of the economy, and encouraging greater labor flexibility and greater labor participation by its aging population.