Austria is threatened with more expensive loans because of its continued heavy dependence on Russian gas. Ratings agency Fitch confirmed Friday night’s second-highest rating of “AA+”, but with a lingering negative outlook. Austria is still “exposed to significant and long-term risks associated with Russian gas imports,” the credit watchdog warned.
In particular, Fitch fears negative tax consequences from ending the long-term gas supply contracts. These risks are all the greater because Austria already has a high public debt and the current credit rating leaves little room “to absorb further shocks”.
‘Government lacks clear strategy’
The turquoise-green government “lacks a clear strategy for achieving the national and EU target of ending dependence on Russian gas by 2027, and how to align that with the long-term contract with Gazprom, which runs until 2040.”.
The rating agency, headquartered in New York, lowered Austria’s credit outlook from stable to negative last October, citing its heavy dependence on Russian gas. Fitch is a bit more optimistic about the economic outlook for this year than in the fall. Economic growth is 0.4 percent, which is partly due to falling energy prices and improvements in the chain.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
