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Austria country brief


Austria's capital Vienna is the base for a number of major international organisations, including the Organization for Security and Cooperation in Europe (OSCE), the International Atomic Energy Agency (IAEA) and the Comprehensive Nuclear-Test-Ban Treaty Organization (CTBTO). The United Nations (UN) has a major centre in Vienna.

Austria is a Federal Republic comprising nine provinces, each with its own provincial assembly and government. Legislative power is vested in a bicameral Federal Assembly. The Lower House, the Nationalrat, has 183 members elected for five-year terms. The Upper House, the Bundesrat, has 62 members elected by the provincial assemblies. Seats are apportioned in relation to the population of each province.

The Head of State, the Federal President, is elected by popular vote for a six-year term and is primarily a ceremonial role. The Federal President appoints the Federal Chancellor (the head of government) and government members. Alexander Van der Bellen, a former Greens leader who ran as an independent, was elected President on 4 December 2016. He replaced Heinz Fischer, who served two terms as Federal President from 2004 until 2016.

In December 2017, the current coalition government between the centre right People's Party (ÖVP), and the right-wing populist Freedom Party of Austria (FPÖ) was sworn in. Sebastian Kurz is the current Federal Chancellor. He replaced Christian Kern of the Social Democratic Party (SPÖ), who served in the role from May 2016. Karin Kneissl (independent but FPÖ-backed) is the Federal Minister for Europe, Integration and Foreign Affairs.

Foreign policy

Austria has been an EU Member State since January 1995 and ratified the EU Lisbon Treaty in 2008. It is committed to strengthening the EU's role as an international actor, supporting measures to deepen the Common Foreign and Security Policy and the interests of South East European countries to integrate with the EU. Austrian Johannes Hahn has been EU Commissioner for European Neighbourhood Policy and Enlargement Negotiations since 2014. Austria will take over the Presidency of the Council of the European Union for a six-month rotation in July 2018. It previously held the Presidency in 1998 and 2006.

While maintaining its neutral status, Austria is engaged in the NATO Partnership for Peace program. Austrian troops are deployed in a range of NATO missions but Austria has no plans to join NATO. Austria was a member of the UN Human Rights Council for the 2011-2014 term. Its last term on the UN Security Council was 2009-10. Austria was the 2017 chair of the OSCE.

Economic overview

Austria is a well-developed market economy with a skilled labour force and high standard of living. It has a population of over 8.8 million. Its economy is closely tied to other EU economies. The EU's eastward expansion and Austria's geographic location make it an attractive hub for regional trade. Austria is one of the leading foreign investors in Central and Eastern European countries. Its economy features a large services sector (e.g. tourism); a sound industrial sector and a small agricultural and forestry sector. Austrian exports of goods and services represented 54 per cent of GDP in 2017.

Aid programming

Austrian Development Cooperation (ADC) strategies and programs are developed by the Federal Ministry for Europe, Integration and Foreign Affairs and implemented through the Austrian Development Agency (ADA). ADC's aims include reducing poverty, conserving natural resources and promoting peace and human security in partner countries across Africa, Asia, South Eastern and Eastern Europe, and the Caribbean. The Austrian Government has committed to achieving the 0.7 per cent ODA/GNI target in its Work Program 2013-18 and has signed the UN 2030 Agenda for Sustainable Development.

Bilateral relations

Austria has had links with Australia since the beginning of European settlement. Austrians visited Australia as members of scientific, diplomatic and religious missions in the late 18th and 19th centuries. Most Austrian migration to Australia took place between the end of World War II and 1960. Today, the relationship is marked by strong people-to-people links with around 42,500 Australians of Austrian ancestry.

Austria is an attractive destination for Australian artists and musicians. In 2017, the Australian Gondwana Indigenous Children's Choir (GICC) performed joint concerts with the Vienna Boys Choir in Vienna with a return visit of the Vienna Boys Choir for performances with the GICC in Cairns and Sydney a few months later. The Australian Chamber Orchestra, conductor Simone Young, the Sydney Theatre Company, Back-to-Back Theatre, the Belvoir Theatre and Indigenous performers such as the Koomurri and Djuki Mala dance groups and didgeridoo player William Barton are some of the many Australian groups and individuals that have performed in Austria.

Australia has a number of bilateral agreements with Austria, including on social security, double taxation, mutual legal assistance, and aviation. In February 2018, a Work and Holiday Visa arrangement entered into effect. Texts of bilateral agreements are available at the AUSTLII website.

Bilateral economic and trade relationship

Two-way trade in goods was valued at $1,671 million in 2017. This included merchandise exports worth $57 million in 2017. Australia's main merchandise exports to Austria were coal, gold coin and legal tender coin, measuring and analysing instruments, and telecom equipment and parts. Australia's merchandise imports from Austria totalled $1,614 million and mainly included arms and ammunition, goods vehicles, medicaments, electric power machinery and parts, and motorcycles and cycles. The primary services trade between Australia and Austria is tourism. In 2017, more than 140,000 Australians visited Austria and 18,200 Austrians visited Australia.

Total Australian investment in Austria was $1.1 billion in 2016. Austrian investment in Australia was $3.6 billion in 2016. Around 130 Austrian companies have production facilities, sales offices and/or representative offices in Australia. Another 800-900 companies maintain regular business contact with Australia. Austrian investment is mainly in the areas of machinery, infrastructure (rail and road), communication systems and the electrical industry.

Some of the larger Austrian firms operating in Australia include Andritz (hydroelectric turbines); Frequentis (public security and air traffic control systems); KapschTrafficCom (traffic management); OMV (gas and oil exploration); Plasser & Theurer; Rhomberg (railway sector); Vamed (hospital management and operations); and Voestalpine (VAE Railway Systems).

Austria's economic potential provides scope for further market opportunities in both goods and services for Australian businesses. Opportunities exist in tourism, biotech, financial services, education, research and innovation, IT, and niche areas of the highly diversified Austrian manufacturing sector.

Australian business operations in Austria include Macquarie Investment Management, IFM Investors, Cochlear and Derma Medical.

In 2010, Macquarie took over an Austrian asset management firm constituting a new hub for the Macquarie Funds Group in Central Europe. In 2015, Macquarie European Infrastructure Fund acquired a 25 per cent stake in Energie Steiermark (ESTAG), Austria's fourth largest energy distribution company.

In 2016, IFM Investors increased their share in the Vienna airport to approximately 39 per cent following their almost 30 per cent airport acquisition in 2014.

The Australian Trade Commission (Austrade) has an office in Frankfurt which covers Austria.

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