The American customs policy has a negative influence on the European and therefore also on the Austrian economy. According to the Institute for Higher Studies (IHS), however, the effects are currently less dramatic than you might think. Nevertheless, measures are needed to stimulate weak economic growth in Austria.
The prospects of our economy have improved somewhat. However, you are still far removed from a jubilee mood or the growth rates of the Corona crisis. The Institute for Higher Studies (IHS) expects the GDP growth of an average of 0.9 percent per year for the 2025 to 2029. For the euro area you predict plus 1.3 percent – a difference of 0.4 percent. “We are slowly falling back,” warns IHS -Baas Holger Bonin.
American rates remain uncertainty factor
The sudden customs policy of US President Donald Trump burden the Austrian economy, although not (yet) very strong. The current American rates (ten percent to all EU exports, 25 percent on cars and 50 percent on steel or aluminum) are reducing our GDP this year by 0.16 percent. With the surcharge of 30 percent threatened by Trump from 1 August, this would be 0.3 to 0.4 percent points.
Export instead of Tegen-Tariffs
Instead of rates, Bonin argues for export bans or for export tasks, just like China with rare earths. The United States also complies the same, but the income remained in Europe and can flow to the export companies with greatly affected export companies.
Bonin calls for production -offensive
To get ahead again, a production offensive from the government is now needed. You must try to increase the reserves that exist in the country. For example, Bonin mentions a “qualification based on needs” as a successor to the abolished educational leave or the use of employees or unemployed, depending on the training in the “best possible job”.
New technologies (eg AI) should be better integrated on the labor market. This helps with too few employees who are missing due to demographic change (keyword “Baby Boomer Generation”). State financing, in turn, must be granted more efficiently and research should focus more on research.
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.
