AUSTRIA S OPPORTUNITIES

(1)

OPPORTUNITIES

IN THE

(2)

A U S S E N W I R T S C H A F T A U S T R I A

In recent years, Austrian exports have become an unparalleled success story. The key factors for success are innovative entrepreneurs and employees who see globalisation as an opportunity and challenge. The foundations for this are the qualifications acquired by young people during their education or training. This is because it is our present-day students who, in the foreseeable future, will be decisive for the success of Austrian companies in the world markets and will therefore secure our level of prosperity, business location and workplaces. We hope you have a great time and much success when dealing with the exciting and future-oriented topic “Austria’s Opportunities in the World Markets”.

Dr. Reinhold Mitterlehner Federal Minister of Economy,

Family and Youth

Dr. Christoph Leitl President of the Austrian Federal Economic Chamber

Austrian Museum for Social and Economic Affairs Vogelsanggasse 36, A 1050 Vienna

Tel.: +43 (0)1-545 25 51, fax: +43 (0)1-545 25 51-55

[email protected], www.wirtschaftsmuseum.at ISBN, 13: 978-3-902856-14-2

Commissioned by the Austrian Federal Economic Chamber Educational Policy Department, Dr. Michael Landertshammer, Wiedner Hauptstraße 63, A 1045 Vienna

Tel.: +43 (0)5 90 900,

[email protected], www.wko.at/bildung Producer: agensketterl Druckerei GmbH, Kreuzbrunn 19, A-3001 Mauerbach

(3)

International organisations: OECD, IMF, IBRD, GATT, WTO; international treaties

Population _{Social partners}

WKO, BAK, ÖGB, LK Companies Federal Government European Central Bank Oesterreichische Nationalbank

THE PRINCIPLES OF AUSTRIAN

ECONOMIC POLICY

Every national economy pursues different key economic policy objectives. Foreign trade balance means that payments for imports are covered over a longer period by revenues from exports.

The “magic polygon”

Foreign trade balance Economic growth High employment level Monetary stability Equitable distribution of income and wealth Quality of life Environment

• BAK – Austrian Federal Chamber of Labour • GATT – General Agreement on Tariffs and Trade • IBRD – International Bank for Reconstruction

and Development

• IMF – International Monetary Fund

• LK – Austrian Chamber of Agriculture

• OECD – Organisation for Economic Co-operation

and Development

• ÖGB – Austrian Trade Union Federation • WKO – Austrian Federal Economic Chamber • WTO – World Trade Organization

(4)

AUSTRIA’S

EXPORTS AND IMPORTS

For many years Austria’s foreign trade has been characterised by increasing volumes of exports and imports of goods. The 2009 global economic crisis was overcome in 2011 when the pre-crisis level was reached.

For many years, a surplus of billions of euro has been achieved in the current account — this is the sum total of all exports and imports of goods, exports and imports of services, income streams and transfer payments to and from other countries.

Exports and imports of goods from 2001 until 2011

Current account balances from 2001 until 2011 in billion euro in billion euro 120 130 2011 2010 2001 2002 2003 2004 2005 2006 2007 2008 2009 110 100 90 80 70 60 50 40 30 20 10 0 –1.8

Source: OeNB, WKO.

Source: OeNB, WIFO, WKO.

2011 2010 2001 2002 2003 2004 2005 2006 2007 2008 2009 5.9 3.8 Excess Deficit Imports of goods Exports of goods 7.6 13.8 9.6 7.5 1.7 9.7 5.2 5.3 A U S S E N W I R T S C H A F T A U S T R I A

(5)

AUSTRIA’S

IMPORTS AND EXPORTS OF GOODS

The qualitative structure of Austrian exports is improving continuously. In 2011, machinery and transport equipment worth more than 46 billion euro as well as manufactured products and miscellaneous manufactured articles of some 43 billion euro were exported.

Imports and exports of goods in 2011 in billion euro

Imports and exports by product groups in 2011 in % of total imports and total exports

, 0.4 1.8 0.7 1.5 0.9 0.2 5.2 11.5 12.8 23.4 37.8 5.7 13.8 12.3 16.4 31.8 Animal and vegetable oils, fats

Beverages and tobacco Food products Miscellaneous manufactured articles Chemicals and related products Manufactured products Machinery and transport equipment Products, not classified elsewhere Total imports 100% Total exports 100% 3.4 12.0 Fuels, energy Source: WKO. 3.3 5.1 Crude materials 131.0 billion € 121.8 billion € = 10 billion ¤

Imports

Exports

(6)

AUSTRIA’S IMPORTS AND EXPORTS

OF SERvICES

In 2011, business services – above all in the areas of transit trade, technology, research and development – generated a surplus of well over 6 billion euro.

But, like in the past, an even larger surplus was generated by the travel industry. In tourism, the difference between revenues and expenses has been between 6 and 7 billion euro for years.

Imports and exports of services in 2011 in billion euro

Imports and exports by service areas in 2011 in % of total imports and total exports

, 3.4 0.5 1.0 2.6 0.3 1.3 2.8 4.2 34.6 21.9 24.8 2.3 4.2 23.7 29.6 32.5 Recreation and culture

Royalties and licence fees

Communications services Computer and information services Transport Other business services Tourist traffic

Government services Total exports: 100%

Source: OeNB, Statistics Austria, WKO. Total imports: 100% 1.9Construction services1.3 1.5 2.5 Insurance services 1.0 Financial services 2.1 30.3 billion ¤ 44.0 billion ¤ = 10 billion ¤

Imports

Exports

(7)

AUSTRIA’S EXPORTS AS A DRIvING

FORCE OF ECONOMIC GROWTH

The share of goods exports in the Austrian gross domestic product is more than 40 percent and the share of exports of goods and services some 57 percent. This means that the export industry is a central pillar of the economy. It makes the economy grow and thus helps preserve existing jobs as well as create new ones, above all in export-oriented sectors and companies.

Labour force1)_{in Austria}

in 1,000

Austria’s export rates from 2001 - 2011

2010 2011 4,144 3,928 3,711 2011 2001 2001 2002 2003 2004 2005 2006 2006 2007 2008 2009 60 50 40 30 20 10 0 Source: OeNB.

Exports of goods in % of the GDP Exports of services in % of the GDP

Exports of goods and services in % of the GDP

Source: Statistics Austria – 1) _{Definition according to the labour force concept. Registered unemployed persons have been excluded.}

100,000 women 100,000 men

(8)

GO INTERNATIONAL

Increasing worldwide networks between markets make international

qualifications more and more important. International education programmes help young people complete part of their training and gather professional experience abroad. Relevant information can be obtained from the Association to Promote the International Exchange of Apprentices, Young Workers and

Trainers of the Economy (IFA) — www.ifa.or.at and from the Austrian Agency for International Cooperation in Education and Research (OEAD)

— www.oead.at.

How can young people have international experiences? EU education programmes

Learning Studying Working

YOUTH www.youth4europe.de COMENIUS www.lebenslanges-lernen.at LEONARDO www.leonardodavinci.at GRUNDTVIG www.lebenslanges-lernen.at ERASMUS www.erasmus.at SOKRATES www.sokrates.at ERASMUS MUNDUS eacea.ec.europa.eu/ erasmus_mundus/

CEEPUS joint study www.ceepus.info AUPAIR www.au-pair4you.at EURES www.ams.or.at/eures.html LEONARDO www.leonardodavinci.at GRUNDTVIG www.lebenslanges-lernen.at Programmes by fields of study Business, Economics and Social Sciences

Medicine Law Technology and Natural Sciences Veterinary Medicine AIESEC www.aiesec.org AMSA www.amsa.at/ AMSA ELSA www.elsa-austria.org IAESTE www.iaeste.at IVSA www.ivsa.org

(9)

THE AUSTRIAN FEDERAL ECONOMIC CHAMBER

AND ITS SUPPORT OF INTERNATIONALISATION

Many Austrian companies use the services of the worldwide approximately 120 offices of the Austrian Foreign Trade Organisation, which acts abroad as ADVANTAGE AUSTRIA with the global website www.advantageaustria.org. This international arm of the Austrian Federal Economic Chamber supports, advises and assists Austrian companies in all issues related to foreign trade. More information can be found at www.wko.at/awo.

Activity areas of the Austrian Federal Economic Chamber

WKO

Austrian Federal Economic Chamber

AW

The Austrian Trade Promotion Organisation AW information Publications about business opportunities, market reports, worldwide marketing of Austrian companies AW coaching Individual support of Austrian companies in Austria and abroad

AW events

Events in Austria and abroad

Advice and support for

Procurement transactions in foreign markets Export of services Export of

goods Foreign investments

Innovation and technology transfer 120 Foreign Trade offices

worldwide

(10)

A U S S E N W I R T S C H A F T A U S T R I A Belgium, Luxembourg Romania Sweden Bulgaria Denmark Finland Greece Baltic countries Portugal Republic of Ireland Malta, Cyprus

AUSTRIA’S FOREIGN TRADE

WITH THE EUROPEAN UNION

Traditionally Austria’s most important trading partners are mainly its neighbouring countries, above all Germany.

High growth rates can be registered for Austrian trade with Central and Eastern European states, many of which have joined the European Union since 2004.

Austria’s foreign trade in 2011 in % of the total trade in goods

Source: WKO. Germany Italy France Czech Republic Hungary United Kingdom Poland Slovakia Slovenia Netherlands Spain 31.2 38.2 7.7 6.5 4.1 2.9 3.9 3.7 3.1 2.8 2.9 1.5 2.8 1.9 2.0 2.5 1.9 1.2 1.6 2.8 1.6 1.5 1.5 1.8 1.5 0.9 1.2 1.1 0.5 0.3 0.5 0.4 0.4 0.4 0.4 0.1 0.3 0.1 0.3 0.4 0.2 0.4 0.1 0.1 Exports Imports

(11)

AUSTRIA’S FOREIGN TRADE

BY REGIONS AND ECONOMIC AREAS

Austria’s foreign trade in 2011 in %

Total exports of goods 121.8 billion €

Total imports of goods 131.0 billion €

Source: Statistics Austria, WKO. • ASEAN – Association of Southeast Asian Nations: Brunei, Indonesia, Cambodia, Laos, Malaysia, Myanmar,

Philippines, Singapore, Thailand, Vietnam

• EFTA – European Free Trade Association: Iceland, Liechtenstein, Norway, Switzerland

• CIS – Commonwealth of Independent States: Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan, Belarus

• NAFTA – North American Free Trade Agreement: Canada, Mexico, United States

EU 71.4 69.7 1.1 1.2 1.2 1.7 0.6 4.4 3.5 EFTA 5.7 0 5 NAFTA 3.3 6.2 China, India, Japan, South Korea 5.6 3.8 Other countries 5.0 7.2 1.4 0.9

Some seventy percent of Austria’s foreign trade is with the European Union. Other large economic areas, such as China and India, are becoming increasingly important however. Five percent of all Austrian exports go to the US, despite the “strong” euro.

6.0 ASEAN Africa Australia, Oceania 0.1 CIS Central and South America

(12)

THE IMPACT OF EXCHANGE RATES

ON FOREIGN TRADE

If the euro loses in value against other currencies, Austrian goods become cheaper for non-euro countries. Austria can export more but its imports become more expensive. If the euro gains in value, the opposite occurs. Independent of these developments, quality and cost efficiency constitute key factors for the success of the export industry.

Exchange rate development of US dollar / euro (ECU) from 1980 until 2012

Source: ECB, OeNB.

0.5 1980 1985 1990 1995 2000 2005 2010 12 0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1 euro = 1 US dollar

For one euro you get more than one US dollar.

(13)

NEW MARKETS FOR AUSTRIA’S EXPORTS

Whereas exports to the traditional partner countries have been declining slightly in recent years, exports to other regions are showing strong growth. This applies not only to Central and Eastern Europe but also to states overseas in particular. Brazil, Russia, India, China, Turkey and other states are the most promising markets of the Austrian export industry.

The BRIC states

Source: IMF, OECD, Statistics Austria, World Bank, WKO – 1)_{China without Hong Kong,}2)_{at current prices.}

Brazil Russia Brazil Russia India China Population in 2011

Gross domestic product per inhabitant2)

Change in real GDP from 2001 until 2011 in %

Austrian exports in million euro

=100 million India China 1,000 800 600 400 200 0 15 12 9 6 3 0 -3 -6 -9 Brazil 194,930,000 3,562 2,351 521 1,159 9,188 9,334 998 3,889 1,206,920,000 142,410,000 1,348,120,000 2000 2003 2008 2001 2002 2004 2005 2006 2007 2009 2005 2010 2011 2011 India 291 310 968 655 973 2,936 116 257 818 490 1,293 2,919 2001 = 500¤ 2011 = 500¤ Russia China1)

(14)

THE ECONOMIC LOCATION

OF AUSTRIA

The decision of investors to set up new companies in Austria, or to keep or expand existing companies, thus securing jobs in this country, is based on many considerations.

Among other factors, a country’s innovation climate plays a major role in such decisions.

Austria’s locational advantages

Dir

ect inv

es

tments

Willingnes

s t

o inv

es

t

Innovations —

research and development

Social partnership — consensus-oriented resolution

of industrial conflict

Proximity to the Eastern European market — geographical

position in Central Europe

Social and political stability — system of economic promotion —

fiscal framework conditions

Infrastructure, quality of life, economic situation, environment, security, education and training,

(15)

Portugal Czech Republic Spain Italy Hungary Lithuania Poland Bulgaria Greece Latvia Malta Slovakia Romania Cyprus

RESEARCH

AND DEvELOPMENT

Intensive research and development activities as well as resulting innovative products and production processes are the prerequisite for the competitiveness of Austrian companies in a global economy. They form the basis for successful exports, economic growth and high employment levels in a national economy.

Expenses for research and development in Austria from 2001 until 2011 in % of the GDP

Expenses for research and development in the EU in 2010 in % of the GDP

Source: OeNB.

Source: Eurostat – * data from 2007.

2011 2012 2010 2002 2003 2004 2005 2006 2007 2008 2009 3.9 3.4 3.1 2.8 2.8 2.3 2.1 2.0 2.0 1.8 1.8 1.8 1.6 1.6 Finland Sweden Denmark Germany Austria France Slovenia Belgium EU-27 United Kingdom Ireland Netherlands Estonia Luxembourg 1.6 1.6 1.4 1.3 1.2 0.8 0.7 0.6 0.6 0.6 0.6 0.6* 0.5 0.5 2.1 2.2 2.2 2.5 _2.4 2.5 2.7 2.7 2.8 2.7 2.8

(16)

CAREER OPPORTUNITIES

IN THE EXPORT INDUSTRY

The numerous Austrian companies which are represented in international markets with their products secure existing jobs and create new ones. Excellent career opportunities are opened up in the export industry for people with specialist competence and the corresponding personality profile.

Career opportunities due to ...

… a pronounced personality profile regarding • mobility • creativity • innovation • responsibility • intercultural understanding • adaptability … high specialist competence in

• the export industry • languages

• information technology • communications technology • marketing

• academic areas

… foreign and professional experience as well as additional qualifications • pupils’ exchange programmes, such as Leonardo

• students’ exchange programmes, such as Erasmus

• studies abroad, work placements • temporary work at companies

… initial and continuing education and training – lifelong learning

• Economic Promotion Institute (WIFI) WIFI offers:

language courses, seminars, management programmes, in-company training, diploma courses for exports, marketing and sales www.wifi.at