Core Views Austrian real GDP growth will accelerate in 2016 but economic activity will lag behind regional peers, despite improving external demand from the eurozone. At a federal level, support for the Freedom Party (FPÖ) exceeds that of either the SPÖ or ÖVP, which we expect to hold throughout 2016. The FPÖ is now the junior government coalition member in two Austrian states (Burgenland and Upper Austria).
Table Of Contents
Austria Country Risk Report 2016 Executive Summary 5 Core Views5 Key Risks5 Chapter 1: Economic Outlook 7 SWOT Analysis 7 BMI Economic Risk Index 7 Economic Growth Outlook 8 Road To Recovery Ahead8 Austrian GDP growth will be mainly driven by strong internal demand in the years ahead The government's tax reforms will boost household consumption, while public spending will increase due to higher expenditure on migrants in 2016 and 2017 GDP By Expenditure Outlook 9 TABLE: 10 YEAR GDP FORECAST10 TABLE: PRIVATE CONSUMPTION FORECASTS 10 TABLE: GOVERNMENT CONSUMPTION FORECASTS 10 TABLE: FIXED INVESTMENT FORECASTS 11 TABLE: NET EXPORTS FORECASTS 11 Chapter 2: Political Outlook 13 SWOT Analysis 13 BMI Political Risk Index 13 Domestic Politics 14 Border Controls To Hurt EU And Trade14 Austria's unilateral decision to reinstate border controls along its southern border will put more pressure on the EU to find a common answer to the refugee question Although the policy will bolster the government's short-term approval ratings, we expect Austrian trade to suffer in the quarters ahead TABLE: POLITICAL OVERVIEW14 Chapter 3: Operational Risk 17 SWOT Analysis 17 Operational Risk Index 17 Chapter 4: BMI Global Macro Outlook 19 Global Macro Outlook 19 Tail Risks Mounting Amid Sub-Par Growth19 TABLE: GLOBAL ASSUMPTIONS19 TABLE: DEVELOPED STATES, REAL GDP GROWTH, %20 TABLE: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, 2015 AND 2016 (%) 20 TABLE: EMERGING MARKETS, REAL GDP GROWTH, %21 TABLE: MACROECONOMIC DATA and FORECASTS23