Austria

In 1999 real GDP increased by 2.2%. The unemployment rate fell to 4.4%, which is less than half of the Western European average. At 0.5% the inflation rate was the lowest of all EU countries. In 2000 the upswing that began in the second half of 1999 will be carried on by an initially accelerating export activity and a robustly expanding domestic demand, and economic policy will have a clearly stimulating effect. Real GDP should expand by ca. 3¼%. The sanctions imposed by the governments of the other EU countries because of the inclusion of the FPÖ in the new government are not likely to impede economic growth significantly. (Austria is now benefiting from the higher than average share of imported supplies in its export products.) The situation on the labour market will continue to improve. Employment may increase by about 1¼%, and the unemployment rate could fall to 4%. Consumer prices are likely to rise by 1¾% - a clearly stronger pace than in 1999. In 2001 the upturn will lose some momentum with domestic and foreign demand no longer developing quite as dynamically. Real GDP should grow by almost 3% accompanied by further increases in employment and declines in the unemployment rate. A consumer price increase of 1½% is expected.