Austria's economy

Austria`s economic fields are widely diverse. Despite the country's small size, business is booming. The sectors of agriculture and tourism highlight Austria's natural beauty. Also, the infrastructure is excellent.

Agriculture and Forestry

About 85 % of Austria’s territory are being used for agriculture (45 %) and forestry (40 %). Austria’s agriculture is made up os rather small plots. With the widening of the EU and increasing competition, the effort is thus to specialise on quality products. Austrian farmers place value on biological agriculture: In the year 2008, 20,000 biological farmers cultivate about 15 % of Austria’s agricultural area.

With the large wooded areas, forestry is a main economic pillar, also fostering other industries, such as wood processing and paper. As a commodity, wood is exported mainly to Southern Europe.

Tourism

Tourism is an important economic branch in Austria. In the year 2004, a value of 21,16 billion euros was created from tourism, corresponding to 9 % of the GDP. Business activity is equally distributed over the two main seasons, summer and winter. Other relevant segments are cultural tourism, city trips, spa, and conventions.

Industry

Austria is home to a modern and efficient industry. State-owned operations have largely been privatised (OMV AG, Voestalpine AG, VA Technologie AG, Steyr Daimler Puch AG, Austria Metall AG). Steyr Daimler Puch was sold to Magna, VA Tech taken over by Siemens AG, and Jenbacher Werke went to General Electric.

Services

In Austria, services make up the largest proportion of the economy, with main contributions from tourism, retail and banks. Austrian banks continue to benefit from the strict Austrian bank secrecy. Bank accounts may not be viewed by authorities without a specific judicial order.

Traffic

Traffic infrastructure is characterised by the country’s location in the Alps and in Central Europe, affecting both road routes as well as railroad. The logistical development of the Alps requires numerous tunnel constructions and bridges that must withstand severe weather extremes. Austria is known as a typical transitional country, where goods are being transported from North to South, and also from East to West following the fall of the iron curtain. Large traffic routes often go through ecologically sensitive areas, meeting resistance from the population.

In order to overcome the balancing act between economy and ecology, measures were taken affecting motor vehicles. Austria’s legislation soon asked for catalysts in each vehicle. Also, some regions allow only low-noise trucking.

Energy supply

Electrical energy is produced mainly from hydro power (almost 60 %). 2 % are wind energy, produced in plants in Austria’s windy East. Nuclear power is banned from production based on the anti-nuclear law. Energy distribution is done by nine federal entities being in direct contact with consumers. In addition, a few smaller utilities are owned by the state.

In terms of gas, Austria depends on foreign suppliers. The gas reserves existent in this country cover only 20 % of the annual consumption rate. Typically, Russia serves as the main gas supplier. Austria was the first Western country to obtain gas from beyond the iron curtain, dating back to 1968. 5 main gas pipelines cross the Austrian territory, delivering gas to large areas in Western and Central Europe.

Oil is important to a large extent from Saudi Arabia. Austria’s only refinery is located in Schwechat, South of Vienna, operated by OMV AG. The world’s largest landlocked refinery is also fed by the trans-Alpine oil line and by a pipeline between the Adriatic Sea and Vienna.

Mining Industry

Over the past decades, the mining industry has lost significance. However, the mining of salt remains important, iron ore, magnesite, tungsten ore, as well as the production of oil and gas. The majority of the 5,000 people employed in the mining industry work in stone pits, gravel pits, and sand pits.

Source: Wikipedia