It is not only the local economic researchers who are lowering their forecasts for the Austrian economy. The European Commission also expects growth to slow this year. The Brussels authorities expect gross domestic product to increase by 3.9 percent in 2022, 0.4 percentage points less than previously estimated. However, the EU commission also cut its figures for 2021: it now assumes economic growth of 4.5 percent, compared to 4.7 percent in February.
The driving forces continue to be “pent-up private consumption, the revival of tourism and the service sector”. However, the Russian invasion of Ukraine is a “headwind for Austria’s export industry,” the EU authority said in its spring forecast. High prices would also put pressure on purchasing power. Overall, this increases the uncertainty of the economic outlook,” said the European Commission.
For the coming year, the European Commission expects GDP growth in Austria of 1.9 percent. This will be determined by private consumption, eco-social tax reform and the implementation of the Austrian economic stimulus program, according to the EU forecast. The European Commission called Austria’s reliance on Russian gas a “downside risk”.
EU growth forecast revised down significantly
The European Commission has revised the European growth forecast much more sharply downwards because of the war in Ukraine: the economy of the EU and the euro countries will only grow by 2.7 percent this year, instead of the previously expected four percent.
According to the report, inflation in Austria will peak at 6.0 percent this year and only gradually decline to 3.0 percent in 2023. In February, the European Commission was still projecting 3.3 percent in 2022 and 2.2 percent in 2023. It is now said that energy prices have risen from already high levels as a result of the war in Ukraine.
Domestic labor market is “robust”
According to the calculations, the government deficit in Austria will fall to 3.1 percent of GDP in 2022 and to 1.5 percent in the coming year. Public debt levels will also continue to decline: after falling to 82.8 percent of GDP in 2021, it is expected to rise to 80.0 percent in 2022 and 77.5 percent in 2023. robust” assessed.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
