Both the Economic Research Institute and the Institute for Advanced Studies expect a decline in gross domestic product across Austria this year. But what does the situation look like for Tyrol in particular?
“The 1.5 percent economic growth forecast at the beginning of the year is unlikely to materialize,” Stefan Garbislander, head of the economic policy, innovation and sustainability department at the Tyrolean Chamber of Commerce, said when asked. Nevertheless, the “Holy Land” will probably leave with a slight gain. “That is currently still in a crystal ball, but I count on one percent,” says Garbislander.
The economic expert predicts that Tyrol could be one of the few, if not the only, states to register growth. While the construction sector, industry and trade weaken, “tourism – and especially accommodation – has provided a catch-up effect after the low point of the corona pandemic. The desire to travel is great, even though some people may be more concerned about their wallets,” says the department head. The reason for the weakness in the construction sector, industry and trade are the well-known problems: interest rate developments caused by the ECB, the new KIM regulation, which makes access to credit more difficult, and inflation are a dangerous mix. In addition to housing, Garbislander also sees the financial and insurance sectors as “beneficiaries” of the crisis, precisely because of the sharp increase in interest rates.
Outlook uncertain due to crisis in the Middle East
Garbislander believes that Tyrol can celebrate full employment in the labor market despite these bleak conditions, because “many companies have lost employees or had to lay off employees in the wake of the pandemic. Now they are happy that they still have them at all and would like to keep them despite a deteriorating situation because they expect more orders again.”
Speaking of more orders, what are the prospects for 2024? “I think the situation is stabilizing and maybe even building some momentum. Interest rates are likely to remain stable for now.” But everything also depends on the new problem area in Israel and the Gaza Strip. “If the situation there continues to deteriorate, oil prices and general inflation could rise again,” Garbislander concludes. In the worst case, full employment would probably be over again.
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.
