Subchapters:
- Business Relationships
- Foreign direct investment
- FTAs and Treaties
- Development Cooperation
- Prospective fields of study (MOP)
Business relations
Trade relations with the EU
Austrian foreign trade is traditionally focused on Europe and constitutes an extremely important factor in the domestic economy. EU member states have the largest share of Austria’s trade exchange, Germany has long been the most important trading partner. Thanks to its central location, Austria offers ideal conditions for establishing business relations with Eastern and Southeastern Europe and is also an important investor in Central and Southeastern Europe.
- Allcountrylist: Overview of major industries in Austria, including mining, construction, transportation, tourism, and foreign trade.
| 2017 | 2018 | 2019 | 2020 | 2021 | |
| Exports from the EU (million EUR) | 101,850.3 | 107,352.5 | 107 308.3 | 101,817.9 | ON |
| Imports into the EU (million EUR) | 117,745.3 | 124,276.1 | 125,719.6 | 116,065.9 | ON |
| Balance with the EU (million EUR) | 15,895.0 | 16,923.6 | 17,411.3 | 14,248.0 | ON |
Source: European Commission
Trade relations with the Czech Republic
Austria has long been one of the important and traditional trade partners of the Czech Republic. Economic relations began to develop successfully already in the 1990s, mainly thanks to the influx of Austrian investments into the Czech Republic. Austria ranks 5th among the most important destinations for Czech exports. Major export goods include motor vehicles, electrical equipment and appliances, machinery and raw timber. The Czech Republic is also an important trade partner for Austria, even the least important among the countries of Central and Eastern Europe. Austria is also one of the largest investors in the Czech Republic.
| 2017 | 2018 | 2019 | 2020 | 2021 | |
| Exports from the Czech Republic (billion CZK) | 119.6 | 196.3 | 196.4 | 184.6 | 220.2 |
| Imports to the Czech Republic (billion CZK) | 187 | 118 | 115.2 | 106.2 | 129.2 |
| Balance with the Czech Republic (billion CZK) | 67 | 78.3 | 81.2 | 78.1 | 91 |
Source: CZSO
Trade relations with countries outside the EU
The strength of the Austrian economy is given by the industrial tradition, tourism and foreign trade. The dominant trading partner is Germany, which is also the main investor in Austria, followed by Russia with EUR 2billion. Austria, on the other hand, is an important investor in the countries of Central and South-Eastern Europe. China is one of Austria’s most important trading partners in Asia. A significant increase in exports was reported by the pharmaceutical products and passenger car sectors. In terms of exports, China is the tenth most important outlet for Austria. Austria’s trade relations with the states of North America – the USA and Canada – are traditionally strong.
| 2017 | 2018 | 2019 | 2020 | 2021 | |
| Exports from countries outside the EU (million EUR) | 40,941.2 | 49,076.30 | 51,280.20 | 46,470.10 | 53,045.10 |
| Imports to countries outside the EU (million EUR) | 31,590.4 | 40,431.8 | 31,312.0 | 30,354.3 | ON |
| Balance with non-EU countries (million EUR) | 9,350.9 | 9,312.7 | 13,257.8 | 11,681.9 | ON |
Source: EIU, Eurostat
Foreign direct investment
After a significant decline in both active and passive FDI in 2020, the Austrian National Bank (Österreichische Nationalbank, OeNB) shows a significant recovery in 2021. The upward trend is more strongly reflected in active FDI. The total state of active Austrian FDI reached EUR 21billion in 2021 (2020: EUR 19billion), passive FDI was EUR 17billion (2020: EUR 16billion). Germany was the largest investor in 2021 with EUR 50.9 billion. In 2nd position was Russia (2 billion EUR), followed by the USA (1billion EUR). By sector, the provision of services (EUR 9billion) leads by far in passive FDI, followed by finance and insurance (EUR 2billion) and trade (EUR 19.4 billion). The Foreign FDI Control Act of 2020 means effective control of FDI, but also a large increase in approval procedures. Monitoring is subject to, among others, healthcare, energy,
FDI of the Czech Republic in Austria is generally at a low level, but in 2021 it showed a significant increase. Their total balance was EUR 937 million (2020: EUR 468 million). The Czech Republic thus records the most dynamic development among the Visegrad Four. Investments by Czech companies are directed, for example, into commercial real estate (CPI-Immofinanz group, ZDR Investments).
FTAs and treaties
Treaties with the EU
Since January 1, 1995, Austria has been a member of the European Union (EU).
Contracts with the Czech Republic
80 bilateral agreements were signed between the Czech Republic and Austria regulating economic, social and cultural relations or the issue of common state borders (tourist trails, etc.). In the economic and trade area, the most important concluded agreements are the agreement on the avoidance of double taxation and the prevention of tax evasion in the field of income and property taxes (2012), the agreement on the employment of citizens in border areas (2005) and the agreement on the mutual protection and promotion of investments (1991).. The complete list of basic bilateral contractual documents between the Czech Republic and Austria can be found here: List of valid international agreements.
Developmental cooperation
Austria is not a recipient of development aid and is a net payer within the EU budget. Development cooperation is an important part of foreign policy in Austria, its goals, principles and principles, as well as the coordinating role of the Federal Ministry of Foreign Affairs, are enshrined in Act No. 65/2003 BGBl. As part of its coordinating role, the Ministry processes strategies and prepares three-year programs (the current program for the years 2019-2021, the program for the period 2022-2024 has not yet been approved). Austria has so far provided EUR 42 million in immediate aid to Ukraine. It is also responsible for the implementation of multilateral development cooperation programs. The Austrian Development Agency (ADA) is responsible for the implementation of bilateral programs and projects, which also cooperates with the Czech Development Agency (ČRA) on certain projects.
As part of development cooperation, Austria adapts its projects and programs to local conditions and coordinates them with local partners. The selected priority countries and regions are divided into three categories:
- The poorest developing countries: fighting poverty, especially in Africa – Burkina Faso, Mali, Niger, Mauritania, Ethiopia, Uganda, Mozambique and Bhutan
- South Eastern Europe / South Caucasus: sustainable economic development – Kosovo, Albania, Moldova, Georgia, Armenia
- Crisis regions and unstable states: peace and security, stability and reconstruction, building structures – Palestine, Afghanistan
In addition to cooperation with governments, ADA also focuses on partnerships with the non-governmental sector and the private sector, or companies from the countries of the European Economic Area or Switzerland. Czech companies can thus participate in long-term and sustainable projects of ADA partner countries and take advantage of various forms of support – from feasibility studies to business partnerships. The rules for cooperation with companies can be found on the official ADA website: www.entwicklung.at/akteure/unternehmen or www.entwicklung.at/akteure/unternehmen/wirtschaftspartnerschaften.
Prospective fields of study (MOP)
Austria is one of the most developed and richest countries in the world, and the Austrian market offers Czech exporters a wide range of opportunities, especially in the areas of innovative and advanced technologies and in perspective sectors such as energy and clean technologies, ICT, electrical engineering, transport and healthcare.
Transport industry, infrastructure and mobility
Austria is one of the leading European investors in the construction of roads and highways. The federal states neighboring the Czech Republic – Lower and Upper Austria – have a budget of CZK billion for 2022 intended for road construction and increasing the attractiveness of public transport. ASFiNAG continuously issues tenders in these areas. In connection with Austria’s climate commitments and following the Austrian Mobility Plan 2030, there is increasing pressure to reduce greenhouse gas emissions, which is already being reflected in the transport sector. At the same time, the demand for vehicles with an alternative drive is growing. Opportunities are offered in the field of research, development and optimization of electric components of e-vehicles and especially in the innovative solution of charging station infrastructure.
Energy industry
In 2021, the Renewable Energy Sources Act (EAG) entered into force in Austria, which is supposed to create the conditions for the fulfillment of the Austrian government’s goal of covering 100% of electricity consumption from RES by 2030. Solar and wind power plants are to have the main share in the increase in energy from RES. In total, CZK 25 billion will be invested annually in the expansion of RES. The Austrian government will further invest in the use of green gas and hydrogen, which should contribute to the decarbonisation and greening of industry. Opportunities for Czech companies are offered in the areas of investment in transmission systems, ensuring the construction of distribution networks and the construction of an efficient energy storage system. Other opportunities will arise in the field of waste processing, air cleanliness control, energy efficiency, in the production of hydro and wind energy, biomass, in the supply of steam and water turbines,
ICT
The Austrian software industry is one of the few sectors of the economy that is benefiting from the COVID-19 pandemic. This sector achieved a profit of CZK 64billion in 2021, which represents 7.4% of Austria’s GDP. Innovation and economic growth are supported by federal ministries, state agencies, the Austrian Chamber of Commerce (WKO) and the Länder in a number of key digitization projects. In the form of the KMU Digital 3.0 program, CZK 364.72 million is available to small and medium-sized enterprises in the period 2021-2023. Czech companies are offered opportunities in the field of blockchain applications and other decentralized approaches to increase network security, and there will also be a demand for integration and harmonization of processes with the aim of increasing cyber security. When it comes to modernizing IT infrastructure, many projects will involve making existing applications available for the cloud.
Construction industry
The Austrian construction industry was able to cope with the effects of the Covid-19 crisis relatively well – in 2021 an increase of 5.4% was recorded in real construction investments compared to 2020. The latest forecasts for 2022 show an increase especially in building construction (2.8% ) and in housing construction (2.2%). The perspective will be the construction of climate-friendly architecture and professional rehabilitation of buildings subsidized by the state and federal states of Austria. In 2021, the Federal Ministry for Climate Protection (BMK) initiated a nationwide building renovation offensive with a funding volume of CZK 15.81 billion until the end of 2022. More than half of all public contracts related to construction work are tendered by the federal states and municipalities based on the principle of the best offer (the so-called Bestbieterprinzip) thus creates opportunities for Czech companies, e.g. in a number of subcontracts.
Healthcare and pharmaceutical industry
The pandemic created the conditions for Austria to become an important pharmaceutical location and gradually become independent in the production of pharmaceutical products. According to the federal government, the decisive factors for achieving the set goals will be investments in technology, digitization and production capacities. In 2019 alone, the Austrian pharmaceutical industry produced products worth approximately CZK 75 billion. As part of the declared regionalization, the Austrian government wants to achieve greater self-sufficiency not only in the production of medicines. In the field of health care, there may be an interesting demand for Czech companies, for example, for IT solutions – applications for monitoring patients in the home, including the use of sensor technology. The Life Science Austria (LISA) program supports international innovative companies that develop and market new products and services.
Rail and rail transport
The Austrian federal government has agreed to increase the budget of the ÖBB railway infrastructure framework plan by CZK 17.1 billion. In the period 2022-2027, a record 443 billion CZK will be invested in the modernization and construction of the railway network, another 95 billion CZK is earmarked for maintenance. There are many different opportunities for Czech companies to participate in the implementation of the Austrian government’s ambitious plan, which is not only intended to strengthen, speed up and make passenger and freight rail transport more attractive, but also to become an important part of the fight against climate change. The main four points of the framework program include the strengthening of railway transport in urban agglomerations, the expansion of infrastructure for freight transport, the electrification of railway lines and digitalisation.
