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Austria Country Risk Report Q4 2018

Austria Country Risk Report Q4 2018

Key View:

The Austrian economy will outperform eurozone averages over the coming years, following a prolonged period of underperformance in previous years.

Growth will be broad based. The labour market is showing signs of improvement which will support household consumption, stronger regional economic activity will boost exports, and fixed investment will rebound on the back of favourable financing conditions and a stronger demand picture.

The Austrian economy will continue to benefit from strong growth trajectories across Central and Eastern Europe (CEE) to which it has strong trade and invest-ment ties.

Austria's next government will likely be a right-wing coalition government between the centre-right People's Party (ÖVP) and the far-right Freedom Party (FPÖ). This will result in Austria acting as an impediment to further eurozone integration and becoming somewhat more ideologically aligned with eurosceptic countries in eastern Europe such as Poland, Hungary and the Czech Republic.

Key Risks

Skilled-labour shortages will continue to persist in the years ahead, which will continue to slow Austrian economic growth.

Wage growth will remain under pressure due to competition from cheaper labour coming in from Central & Eastern Europe.

Austria remains highly dependent on Germany for growth, to which over one-third of its exports go. An economic slowdown in Germany would derail Austria's economic recovery.


Executive Summary
Core Views
Key Risks
Country Risk Summary
Economic Risk Index
Political Risk Index
SWOT
Economic – SWOT Analysis
Political – SWOT Analysis
Economic Outlook
Economic Growth Outlook
Weaker Austrian Growth Ahead
GDP By Expenditure Outlook
TABLE: PRIVATE CONSUMPTION FORECASTS
TABLE: GOVERNMENT CONSUMPTION FORECASTS
TABLE: FIXED INVESTMENT FORECASTS
TABLE: NET EXPORTS FORECASTS
TABLE: 10-YEAR GDP FORECAST
Outlook On External Position
TABLE: CURRENT ACCOUNT BALANCE FORECASTS
TABLE: CAPITAL AND FINANCIAL ACCOUNT BALANCE
TABLE: TOP FIVE IMPORTS IN 2015
TABLE: TOP FIVE EXPORTS IN 2015
Monetary Policy
Eurozone Inflation Will Struggle To Stay At 2.0% ECB Target
Structural Fiscal Position
TABLE: FISCAL AND PUBLIC DEBT FORECASTS
TABLE: MAIN REVENUE AND EXPENDITURE CATEGORIES
Currency Forecast
EUR: Gradual Appreciation Amidst End Of QE
TABLE: EUROZONE CURRENCY FORECAST
Austria Country Risk Q4 2018Contents10-Year Forecast
The Austrian Economy To 2027
Three Major Headwinds To Growth
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Political Outlook
Domestic Politics
Brexit Will Be The Key Test Of Austria's EU Presidency
TABLE: POLITICAL OVERVIEW
Long-Term Political Outlook
Populism Gaining Ground
Global Macro Outlook
Strong Growth, But Greater Headwinds Too
TABLE: GLOBAL MACROECONOMIC FORECASTS
TABLE: DEVELOPED STATES, REAL GDP GROWTH, % y-o-y
TABLE: EMERGING MARKETS, REAL GDP GROWTH, % y-o-y
Index Tables
TABLE: AUSTRIA – MACROECONOMIC DATA AND FORECASTS

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