Austria - Future trends

Forecasts for economic growth in 2001 have been positive. A double-digit growth rate is expected in industrial output, retail trade has grown by 5 percent, and tourism is booming. Gross domestic product is likely to advance by 3.1 percent rather than the predicted 2.8 percent. Interest rates will rise slightly but remain low. Demand for Austrian goods is up, and this makes for full order books in the country's exporting industries. In addition to increased sales abroad, recent tax breaks are being used by private households for additional consumer spending rather than stocking up their savings accounts. Business confidence is buoyant given the competitive position of Austria's industry, strong foreign investment, and good export opportunities. Inflation is expected to remain lower than the EU average. The challenges that face the Austrian economy in the future will be securing the greatest possible congruence of its economic policy with common EU policies, most notably in the fields of trade, agriculture, regional development, taxation, and monetary policy.

On the agricultural side, Austria's organic farming and food industry may serve as an example to the world as an alternative to genetically modified food and hormone-treated cattle and poultry. With its ban on imports of genetically modified food, mostly produced in North America, and the outbreak of mad cow disease in Europe and foot-and-mouth disease worldwide, the already well-established organic farming of Austria is expected to continue to grow, generating record profits. Austria also faces social challenges of containing its right wing nationalists, as manifested by the ultranationalist Freedom Movement Party, and upholding the rights of thousands of non-ethnic Austrian and non-European immigrants who now compose an increasingly larger part of Austrian society.