Austria’s location between Western and Eastern Europe ensures the country an important position in international trade. Austria quickly transformed from a predominantly agrarian country into a state with advanced industry and highly developed services. The combination of market principles with a high degree of state control enabled further development of the economy while keeping inflation and unemployment under control.
Agriculture and forestry
Due to the difficult mountain conditions and conservative farmers, Austrian agriculture employs a relatively high proportion of workers (7%). Although only 18% of the country’s surface is under cultivation, intensive modernization and new agricultural methods have made the country 75% self-sufficient in grain and vegetable production. Most of the arable land lies in the lowlands in the east, where sugarcane, maize, barley and wheat are grown together with vegetables. Lower Austria and Burgenland have the largest areas of vineyards, but they are also in Vienna. The value of the production is dominated by animal production with the breeding of cattle for milk and meat on quality pastures and pigs in the east of the country, where it has a rich fodder base. In terms of the proportion of forests in the country, Austria ranks 4th in Europe behind Finland, Sweden and Slovakia. Forests are mostly owned by small producers, but large farms are mostly state-owned. Wood production is particularly important for the production of paper, which is exported in large quantities. Lumber is also exported.
According to Printerhall, Austria has diverse but mostly insufficient mineral resources. The country is the world’s largest producer of magnesite. Mining of graphite, tungsten, kaolin and salt is also important. Mining of iron, lead and zinc ores is declining. Oil and natural gas are also mined in the Vienna basin, but the decisive part of consumption is covered by imports. Mining and energy production are under state control. Almost 3/4 of electricity is produced by hydroelectric plants. It was already decided on the basis of a referendum that the built nuclear power plant would not be started at all. The most important industry is the state-owned but very efficient iron smelting concentrated in Linz. Other centers of steel production are Kapfenberg and Leoben. About half of the annual production of around 3.5 million tons of pig iron and 4.5 million tons of steel is exported. One of the largest aluminum plants in the world is located in Ranshofen near Braunau. The production of mining and metallurgical equipment, construction machinery and purpose-built vehicles, electrical engineering, semiconductors, optics, measuring, communication and regulation technology as well as consumer electronics (Vienna, Salzburg, Villach, Kitzbühl) is significant. This is followed by the chemical industry with important production of fertilizers, plastics and artificial fibers (Linec and Lenzing). Schwechat near Vienna has a large refinery.
Business and finance
Monetary policy is largely controlled by the state; The Austrian National Bank is partly under state control, although other banks and financial institutions are private. The main trading partner is Germany, which accounts for around 40% of foreign trade turnover, followed by Italy and Switzerland. In 1960, Austria became a member of the European Free Trade Association (EFTA) and in 1994 confirmed its accession to the European Union in 1995 by referendum.
Austria has a long-term passive balance of foreign trade, which is balanced by income from tourism. Austria has the highest share of tourism income in gross domestic product of all European countries (8-9%). Around 20 million tourists visit the country every year.
Transport and connections
Even though Austria is conveniently located in the center of Europe, the mountainous terrain prevents the efficient management of long-distance routes. Roads and railways are mainly run through valleys in a west-east direction, so a large number of tunnels and other structures had to be built in the Alps to connect Germany and southern Europe. The most important highway leads from Germany through the Brenner Pass to Italy, another crosses the Tauern through a long tunnel. The railways are state-owned and more than half electrified.
Water transport on the 358 km long section of the Danube also serves as a connection with Germany and the Black Sea. The largest ports are in Vienna and Linz. Austrian Airlines provides connections between the cities of Vienna, Linz, Salzburg, Innsbruck, Graz and Klagenfurt and uses Schwechat International Airport about 19 km south-east of Vienna.
Telecommunications are at a high level. All radio media are operated by the state-owned Austrian Radio Society. Specific broadcast laws prohibit censorship and state interference. About 30 newspapers are published in the country, the most important of which is Neue Kronen Zeitung, which is based in Vienna.
Social care and education
The state provides the entire social welfare system, including unemployment benefits, maternity and old-age pensions. All medical and hospital treatment is paid for from the national health insurance.
Education is free in Austria and support is also provided at higher levels and adult education. The level of education is very high. There are 15 universities, technical and other specialized universities in Austria, including academies for music and art. The University of Vienna was founded in 1365 and is one of the largest in Europe.