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25. 02. 10. - 16:00

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25. 02. 10. - 16:00

Austrian economy to return to positive growth this year

By John Morris

The Austrian economy is ready to bounce back from the global recession with a massive surge in exports, according to the country’s Federal Economic Chamber.

While the financial crisis had a huge effect on markets across the globe, Dr Christoph Leitl, President of the Austrian Federal Economic Chamber, said he fully expects the country’s exports to top 100 billion Euros in the next 12 months.

He confidently predicted: "The Austrian economy will return to positive growth this year."

Observers say new markets and emerging economies teamed with government initiatives will help spark the export industry back to life.

And it is here that Austria – traditionally a strong exporter – expects to make its biggest gains.

The strength of the Euro currency against the dollar and pound over the course of the economic crisis saw many European economies suffer as it became more expensive to buy their exports.

Austria’s exports were slashed by over a fifth in 2009 – dropping to just under 87 billion Euros - in a nation which relies heavily on selling their products abroad.

Half of Austria’s total economy relies on such trade while 50 per cent of all jobs are generated by exports, which is why support packages such as the acclaimed Go-international scheme have helped establish strong links in areas such as trade fairs and exhibitions.

Dr Leitl, 61, said the strength of the Euro had been an "additional obstacle during a time of enormous difficulty" but that Austria was already showing clear signs of progress.

"Austrian products became far more expensive in every market where prices are calculated in dollars.

"As a result, many companies saw their export profit margins dwindle and some even lost customers because they were unable to keep their prices competitive whilst the Euro was so strong against the dollar."

However the downturn – which saw Austria’s overall economy shrink by 3.6 per cent last year – has begun to ease and strong growth should follow in 2010.

Dr Leitl said: "Fortunately, however, we are beginning to see signs that the process of economic turnaround is underway.

"The Austrian economy will return to positive growth this year, and exports will make a significant contribution to this.

"In 2010 we are predicting a 5.5 per cent export growth rate, and the total export volume is once again expected to cross the magical 100 billion Euro threshold."

Dr Leitl said that the Economic Chamber was looking to help companies exploit growing economies and industries to ensure this growth.

He said: "We want to act now to help innovative, export-oriented businesses enter promising new markets where we have identified great business potential.

"So in recent months we have begun to place greater emphasis on several growth markets such as the Far East, South East Asia, the Middle East, South America and certain Commonwealth of Independent States countries.

"But it is not simply a case of identifying the most promising countries or regions — we are also highlighting the sectors which we think will become increasingly important to our companies in the future.

"These include environmental technology, infrastructure, construction, food, energy and the technology sector."

And Dr Leitl said his organisation has developed a range of tools which companies can make use of in their efforts to secure new contracts.

Dr Leitl said: "We have introduced more attractive support packages and comprehensive services to encourage more companies who are new to international business to take the first steps to exporting, as well as to make it easier for companies that are already working abroad to try out new markets.

"There is a danger that companies who fail to seize the opportunities now may find they have missed the boat.

"Of course, doing business abroad is not without risk, but there are so many excellent opportunities all over the world for Austrian companies at the moment, and the potential rewards are high."

And Dr Leitl added that the measures put in place by governments to prevent an even deeper recession can be used to help boost companies’ growth.

He said: "Furthermore, governments around the world have implemented a raft of national economic support programmes.

"This means that there are billions of Euros available to Austrian companies through projects, grants and funding designed to stimulate growth — as long as they are willing to grasp the business opportunities and understand how to make the most of them."

The Austrian Federal Economic Chamber represents more than 400,000 businesses of all sizes which are required by law to become members.

Self-funded by members, it covers sectors across the board including crafts, trades, industry, commerce, banking and insurance, information and consultancy, transport and communication and tourism and leisure.

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