Austria Country Risk Report

Published 23 June 2015 | Quarterly

  • 32 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
$1,195.00
Austria Country Risk Report

Core Views

  • We continue to forecast subdued but stable growth during 2015-2016. We now expect Austria to lag behind the overall eurozone in 2015 before returning to a similar pace of growth from 2016 onwards.

  • We maintain our view that lower inflation resulting from falling energy prices will bolster consumer spending though this positive effect will be mitigated by a slight rise in unemployment during 2015. We do not expect significant growth momentum to materialise during H115.

  • As external demand and investment pick up, we expect growth to accelerate in 2016 in line with the broader economic pickup in eurozone and Germany.

  • At a federal level, support for the Freedom Party (FPO) is continually on par with that of the SPO-OVP coalition. Given its strong performance in the Styria and Burgenland elections, we expect the FPO party to make further gains in the Upper Austria and Viennese elections in Q3-Q415.

Key Risks To Outlook

  • Lacklustre consumer spending could result in a lower negative contribution from imports. This would bolster growth over the year though we do not feel this could significant deviate from forecasts in 2015.

  • Continually robust support for the far right Freedom Party in 2014 remains a salient political risk consideration.

Macroeconomic Forecasts (Austria 2013-2016)
Indicator 2013 2014 2015f 2016f
BMI/eurostat
Real GDP growth, % y-o-y 0.2 0.3 0.9 1.5
Nominal GDP, EURbn 322.6 329.0 334.8 344.7
Consumer price inflation, % y-o-y, eop 2.0 0.8 1.2 1.7
Exchange rate EUR/USD, eop 0.72 0.83 0.98 0.91
Budget balance, % of GDP -1.3 -2.4 -1.9 -1.2
Current account balance, % of GDP 1.0 0.8 0.8 1.0
Executive Summary
5
Core Views
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Domestic Politics
8
Government To Pursue Tougher Religion And Immigration Policies
8
TABLE: POLITICAL OVERVIEW
8
Chapter 2: Economic Outlook
11
SWOT Analysis
11
BMI Economic Risk Index
11
Economic Activity
12
Growth Ahead: Subdued, But Existent
12
TABLE: Eco nomic Activit y
12
Regional Exchange Rate Policy
13
EUR/USD Parity Is In Sight
13
TABLE: BMI Euro zone Curre ncy Forecasts
13
Regional Monetary Policy
15
ECB QE: Whatever It Takes, For However Long It Takes
15
Regional Economic Outlook
17
Signs Of Life In Eurozone Economy
17
Chapter 3: Operational Risk
21
Operational Risk Index
21
Chapter 4: Key Sectors
23
Telecommunications
23
TABLE: Telecoms Sector - Mobile - Historical Data & Forecasts
24
TABLE: Telecoms Sector - Wireline - Historical Data & Forecasts
25
Other Key Sectors
27
TABLE: Pharma Sector Key Indicators
27
TABLE: Infrastructure Sector Key Indicators
27
TABLE: Autos Sector Key Indicators
27
Chapter 5: BMI Global Macro Outlook
29
Global Outlook
29
Deflationary Pressure
29
Table : Global Assumptio ns
29
Table : Developed States , Real GDP Growt H, %
30
Table : BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
30
Table : Emerging Markets , Real GDP Growth , %
31

The Austria Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Austria. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Austria's economic, political and financial prospects through end-2019, just published by award-winning forecasters, BMI Research.

Key Uses

  • Forecast the pace and stability of Austria's economic and industry growth through end-2019.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Austria's country risks against regional peers using BMI's country comparative Risk Index system.
  • Evaluate external threats to doing business in Austria, including currency volatility, the commodity price boom and protectionist policies.

The Austria Country Risk Report by BMI Research includes three major sections: Economic Outlook, Political Outlook and Key Sector Outlook.

Economic Outlook:

How will the Austria' economic policy-making and performance impact on corporate profitability over 2015-2019?

BMI provides our fully independent 5-year forecasts for Austria through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Austria Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector obligations).
  • Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Austria and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Austria, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Austria over the next 5-years?

BMI's Austria country Risk Index evaluates the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Austria Market - Political Strengths, Weaknesses, Opportunities and Threats facing Austria.
  • Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Austria's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
  • Long-Term Political Outlook BMI examines the structural risks to the stability of Austria’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.

Key Benefits

  • Benchmark Austria's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Key Sector Outlook*

Which industry sectors in Austria will grow fastest, and where are the major investment opportunities in the market?

BMI identifies investment opportunities in Austria's high growth industries including automotives, defence & security, food & drink, freight transport, infrastructure, oil & gas, pharmaceuticals & healthcare and telecommunications & IT.

Key Areas Covered:

  • Market Overview - Size and value of each industry, including recent sector developments and major industry key performance indicators (KPIs) that have impacted company performance.
  • 5-year Industry Forecasts - Forecasts for each year over 2015-2019, using BMI's proprietary industry modelling technique, which incorporates key domestic and international indicators - including economic growth, interest rates, exchange rate outlook, commodity prices and demographic trends - to provide fully integrated forecasts across and within each industry.
  • Demand- and Supply-Side Data/Forecasts - BMI's industry data covers both the output of each industry and the domestic demand, offering clear analysis of anticipated import/export trends, as well as capacity growth within each industry.

Key Benefits

  • Target strategic opportunities in high growth industries, which are benefiting from global mega trends, and thus offer strong investment and growth opportunities.
  • Compare the growth path of different industries to identify which are best placed to benefit from domestic and international economic prospects, and which have historically suffered from volatile growth trends - a key indicator of future risks.

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