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Famous for its magnificent mountains, lilting music and glittering cafe society, Austria has always been able to count on its rich history and tradition. For centuries, it has enjoyed an unrivaled cultural position in Europe. In 2002, modern Austria has also assumed a key role in the growing European Union. A prime investment location for international business, Austria boasts economic strength and stability, along with close ties to Central and Eastern European countries that are preparing to join the EU. It stands ready to face the challenges of economic growth and expansion in the 21st century.
Austria's capital, Vienna, has benefited greatly from these reforms and in recent years has become a thriving business location. As the fourth richest region in Europe, Vienna has taken the lead in a number of dominating sectors such as telecommunications, mechanical and steel engineering, electrical and electronic engineering, chemical products and biotechnology. Spearheaded by extremely productive small-to-medium-sized enterprises, Vienna has become a nucleus of the high tech industry in Austria. "Vienna's location policies," said Michael Häupl, mayor of Vienna, "are focused on the industries and economic sectors for which we can provide prime factors and in which we can offer excellent market chances. Vienna and the surrounding region are right in the middle of a breathtaking economic upturn." Not only the Vienna region is enjoying this economic trend. The nine regional provinces that make up Austria are all benefiting from foreign investors launching operations throughout the country. At the same time, the provinces are monitoring the possibility of operating in Central and Eastern European countries while remaining Austrian base. "The widespread interest in Austria as a springboard for companies wishing to expand their activities in central and eastern Europe has led to more than 1,000 international companies selecting Austria as the base for their regional operations," comments Akio Ijuin, the Ambassador of Japan to Austria. Austria's economic upsurge has been influenced by changes in the regional geopolitical balance in the latter part of the 20th Century. Before the fall of the Iron Curtain in 1989, Austria was heavily influenced by the German economy, and the country's growth was hampered by ongoing border restrictions to the east. After the former Soviet Union was dismantled, Austria was ready for business. It has since taken advantage of two very important advantages that have facilitated the country's economical development. First, no western industrial nation can match Austria's geographical proximity to the growth markets on the EU's eastern border. Austria shares 1,250 kilometres of border with the Czech Republic, Slovakia, Hungary and Slovenia - all of which will be joining the EU in the 2004.
To-date, about 85 percent of all new investments made by Austrian companies have been made in regional markets. While this trend looks set to continue, a large number of foreign companies - including Japanese enterprises - have recognised Austria as one of the best locations to serve these new markets. The second clear advantage has been the introduction of the Euro. Since January 1, 2002, 300 million Europeans have adopted the new currency. Of the 12 countries involved, Austria proved to be one of the main beneficiaries. Dr Christoph Leitl, president of the Austrian Economic Chamber, explains that Austria is among the best performers in "Euroland" "The Austrian economy was particularly exposed to drastic exchange rate fluctuations in important export markets such as Italy or Spain. Devaluations in such countries made Austrian companies less competitive as their products became more expensive. Austria lost 1.5 percent GDP growth in 1995/1996 due to exchange rate fluctuations. As a small, export-oriented economy with around two-thirds of foreign trade done with member states of the EU, Austria benefits a great deal from the European monetary union." While the EU is Austria's biggest export market, Japan remains the country's most important trading partner in Asia. The most important Austrian exports to Japan include timber, wood components, electronics and construction materials: for a total of around 879 million dollars (109 billion yen) in 2001. Numerous companies throughout Austria have further cemented the two country's close ties, one prime example being Toyota Frey. The Japanese car manufacturer began focusing on the Austrian car market through Frey in 1971, and today continues to see the business flourish here in Austria. A special event this year has further highlighted mutual understanding and awareness between Austria and Japan. The first ever visit to Austria by Japan's Emperor Akihito and Empress Michiko took place earlier this year. Their visit will undoubtedly raise the already high level of Austrian interest in Japan and promote greater trade and industry collaboration between the two countries. "We must now find ways to increase the growth and potential output of Austria," adds Grasser. "Europe wants to be the most competitive area of the world by 2010, focusing on education, research and development, training and innovation. Within this objective, Austria must strive to become the number one in Europe." Taken as a whole, the Austrian economy looks set to remain both attractive and stable. Favorable economic conditions, good infrastructure and a high quality of life offer foreign investors an attractive site for investment. These strengths will enable the country to maintain its position as a key business location for its growing hinterland.
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Akio Ijuin, the ambassador of Japan to Austria
Investors don't need a microscope to see Austria's advantages. Here, an Austria Mint specialist checks a mold for one of the euro coins.