1) Austria – A Profitable Location
The success factors: stability, CEE know-how,
and a prosperous market in the heart of Europe
Attractive business environment
ï‚· Austria is the fourth richest country in the EU
ï‚· Above-average purchasing power of Austrian consumers
ï‚· Highly developed infrastructure
ï‚· Efficient public administration
Stability and security
ï‚· Political and social stability
ï‚· Good relations between labor and management
ï‚· Low strike rate
ï‚· High level of personal security
ï‚· Security of energy supply
Tax advantages
ï‚· Low corporate tax rate of 25 percent
ï‚· Attractive group taxation scheme
ï‚· Austrian tax laws allow further reduction of the tax burden
ï‚· No wealth or trade tax
Productivity
ï‚· A top ranking in terms of hourly output per employee
Central location
ï‚· Ideal base for business in Eastern and South Eastern Europe
ï‚· Extensive experience derived from 16,000 joint ventures between
Austrian and Eastern European companies
ï‚· Eastern European coordination center (headquarters) for around
1,000 foreign companies
ï‚· Service providers with extensive East European know-how
ï‚· The best-performing airport in respect to flight connections to
the CEE region
Business-oriented education
ï‚· Practice-oriented learning in technical and business fields
ï‚· High educational expenditures confirm the value placed on
education and training
ï‚· Close cooperation between academic and business communities
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2) Globalized Economy
Austria ranked fourth in the globalization index
Austria ranks among the most highly globalized countries in the world. This is the
conclusion of the KOF Index of Globalization 2016 compiled by the renowned Swiss
Federal Institute of Technology (ETH) in Zurich. The annual index measures the
economic, social and political dimensions of globalization in 192 countries. Austria
rates an impressive fourth behind Ireland, Netherlands and Belgium.
The economic dimension of globalization comprises the extent of cross-border trade,
investment and revenue flows in relation to the gross domestic product as well as the
impact of trade and capital transaction restrictions. The social dimension of globalization
reflects the level of cross-border dissemination of information and ideas, whereas the
political dimension focuses on the strength of political cooperation among the countries.
The m ost highly globalized countries
Index = 100
Netherlands 1
91.70
Ireland 2
91.64
Belgium 3
90.51
Austria 4
89.83
Switzerland 5
87.01
Sweden 8
85.92
Hungary 9
85.78
Czech Republic 17
83.60
France 19
82.61
United Kingdom 20
81.97
Poland 23
79.90
Italy 24
79.59
Germany 27
USA 34
Japan 48
78.24
75.71
67.86
Source: KOF Index of Globalization 2016, ETH Zurich
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3) Vienna ranks among the world’s top 20 globalized cities
The Global Cities Index of the American consulting company A.T. Kearney is an indicator
for the global commitment of large cities, and reflects the worldwide importance of a city.
The 84 most influential cities in the world are evaluated with respect to their economic
activity, human resources, information exchange, cultural experience and political
commitment. The index provides an ideal instrument for companies to select a suitable
business location.
In the latest Global Cities Index 2014, Vienna is rated 16th and is the fifth most important
city in Europe behind London, Paris, Brussels and Madrid. New York has the biggest
global influence of any city in the world.
Among the top 20 cities, seven are in Europe, seven in the Asia-Pacific region and six in
North and South America.
The most important cities in the world
Rank
City
Country
1
New York
USA
2
London
United Kingdom
3
Paris
France
4
Tokyo
Japan
5
Hong Kong
China
11
Brussels
Belgium
15
Madrid
Spain
16
Vienna
Austria
17
Moscow
Russia
19
Berlin
Germany
23
Frankfurt
Germany
26
Amsterdam
Netherlands
31
Zurich
Switzerland
32
Rome
Italy
33
Stockholm
Sweden
43
Copenhagen
Denmark
45
Dublin
Ireland
46
Budapest
Hungary
47
Prague
Czech Republic
60
Warsaw
Poland
Source: A.T. Kearney Global Cities Index 2014
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4) General information
Geographical position
Austria has a total area of 83,872 square kilometers and consists of nine federal provinces:
Vienna (also Austria’s capital), Burgenland, Carinthia, Lower Austria, Salzburg, Styria, Tyrol,
Upper Austria and Vorarlberg.
The country shares its border with eight neighbors: Germany, Czech Republic, Hungary,
Italy, Liechtenstein, Slovakia, Slovenia and Switzerland.
Austria’s geographical location in the heart of Europe provides foreign investors with
bottom-line strategic advantages for their business operations. Due to its unique
geographical position, Austria is an ideal business location – whether as an East-West
interface or as headquarters for a company’s Central and Eastern European business
activities. The geographical proximity to all major CEE cities is an important competitive
advantage: the distance from Vienna to Prague is 299 kilometers, whereas Budapest is
only 266 km away.
Austria offers a top-notch, high-quality network of highways and expressways
spanning more than 2,000 km, as well as six international airports. Vienna International
Airport is one of the most important East-West transportation hubs, providing flight
service to 37 destinations in the CEE region.
Connections between East and West
From Vienna to
Berlin
Brussels
Budapest
Frankfurt
Distance
Flight time
634 km
1:15 hours
1,121 km
1:30 hours
266 km
0:45 hours
720 km
1:50 hours
London
1,570 km
2:00 hours
Moscow
1,950 km
2:50 hours
Prague
299 km
1:00 hours
Rome
1,130 km
1:45 hours
Zurich
757 km
1:25 hours
Due to the fact that Austria is situated along the Danube River, it is easily accessible via
waterway. Because of the Rhine-Main-Danube Canal, the Danube serves as the direct
link between the North Sea and the Black Sea. All four Danube ports in Austria, namely
Vienna, Linz, Enns and Krems, are equipped with the most advanced technical facilities.
The Port of Vienna is the largest inland container port in all of Europe.
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5) Population
Austria has a population of about 8.58 million. The employment rate1) in Austria is
77.8 percent, thus far surpassing the EU-28 average of 75.1 percent.
German is the official language spoken in Austria. However, the Austrians are known
to have excellent foreign language capabilities. A large majority of the country’s
inhabitants speaks English. At the same time, they possess a good command of
Eastern European language skills.
Political system
Austria is a parliamentary republic. Its legislative bodies are the National Council,
the Bundesrat (Upper House) and the provincial diets. The 183 Members of the
National Council and those of the nine provincial governments (one for each
province) are directly elected, and the members of the Bundesrat are elected by
the provincial parliaments.
Six political parties are currently represented in the National Council:
Social Democratic Party of Austria (SPÖ), Austrian People’s Party (ÖVP), Freedom
Party of Austria (FPÖ), the Greens, NEOS (The New Austria) and Team Stronach.
The Chancellor, Vice-chancellor and ministers are responsible for conducting
federal government affairs to the extent that these are not the responsibility of the
Federal President. The provincial governments are the executive arm at provincial
level.
The Austrian President, who has no direct influence on day-to-day political matters,
is elected directly by the population for a six-year term of office.
Austrian law is based on the Federal Constitution of 1920 which enshrines the
division of powers between the legislature, the executive, and the judicial and
administrative systems.
1)
The labor force as a percentage of the entire working age population (aged 20-64)
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6) Economic data of Austria
2013
Real GDP growth rate
(percentage change on
previous year)
Gross domestic product
(at current market prices)
2014
2015 *)
0.3%
0.4%
0.9%
322.88 billion €
329,30 billion € 337,16 billion €
GDP per head of population
(at current market prices)
35,000 €
35,490 €
36,390 €
Gross fixed capital formation
(percentage of GDP)
22.5%
22.4%
22.1%
Employment rate
(proportion of resident population
in gainful employment)
77.2%
77.6%
77.8%
Unemployment rate
5.4%
5.6%
5.7%
Inflation rate
2.1%
1.5%
0.8%
Research and development
expenditures
(percentage of GDP)
2.96%
2.99%
3.01%
Export rate
(as a percentage of GDP)
38.2%
37.9%
37.4%
Sources: Eurostat, European Commission (Ameco database),
Austrian Institute of Economic Research, Statistics Austria (February 2016)
*)
Forecast
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