Austria’s competing power second-best in Eurozone

Austria has the second-best competitive edge in the Eurozone, a leading think tank has claimed.The Brussels-based Lisbon Council announced today (Mon) that Germany (8.5 points) had the greatest competitiveness among the 16 European union (EU) member states which have adopted the Euro as their sole currency.Austria garnered 8.3 points in the study to come second ahead of the Netherlands and Slovakia which claimed eight points each.Germany is the EU’s biggest economy. The country has been the most important export/import partner of Austria for decades. The state of the Austrian economy is strongly dependant the condition of Germany’s, which is currently recovering faster from the crisis than initially expected.Lisbon Council also said Austria (7.8 points) did best in the Eurozone as far as employment, productivity and efficiency are regarded. The think tank said the Netherlands were in second place in this regard with 7.3 points. Germany (6.8) makes third place ahead of Luxembourg (6) and Malta (5.8).Austria (7.3 points) comes third in the think tank’s estimation of the 16 countries’ debt rates. Germany (8.7) has been found to be the model pupil in this regard, with the Netherlands coming in second (7.7).Austria and Germany share fourth place in the Lisbon Council’s financial sustainability research with six points each. Luxembourg bagged seven points, while Finland and Slovakia claimed 6.5 points each.The think tank investigated 15 individual indicators for its study which Austria finishes in second behind Germany.The body warned debt-ridden Ireland and Greece were “harming the Eurozone’s credibility”. It also appealed to Germany and Austria to raise their efforts to increase domestic demand for their products and services.These announcements come after Eurostat, the European Commission’s (EC) statistics body, said Austria had the lowest jobless rate among the 27 EU states with 4.3 per cent ahead of the Netherlands (4.5 per cent) in August. It also announced that the average unemployment rate of the EU-27 was 9.6 per cent that month.Meanwhile, economists and opposition politicians have attacked the Austrian government over its budget plans for the next three years.The Social Democrats (SPÖ) and the conservative People’s Party (ÖVP) announced on Saturday it would increase tobacco and mineral oil taxation rates. The coalition also introduced plans to reduce traffic infrastructure investments.The budget deficit soared from 0.4 per cent in 2008 to 3.9 per cent of the gross domestic product (GDP) the following year. The coalition hopes the measures it agreed on during a two-day summit in Bad Loipersdorf, Styria, would ensure it falls to below three per cent by 2013.Institute of Higher Studies (IHS) chief Bernhard Felderer said he welcomed the prospect of a budget deficit below three per cent, but warned the austerity package would not help diminishing the state debt.Margit Schratzenstaller of the Institute for Economic Research (Wifo) appealed to the SPÖ and ÖVP to reform the tax system to take some pressure of labourers and the middle class.Greens MP Werner Kogler said: “It’s a mystery to me why the government delayed the presentation of its plans considering this ‘mini package’ of reforms.”Referring to plans to slash family subsidies, FPÖ general secretary Harald Kickl said the ÖVP must stop labelling itself as “family party”. Kickl also hit out at the SPÖ by calling the party of Chancellor Werner Faymann a “protector of the super-rich”.Josef Bucher, head of the Alliance for the Future of Austria (BZÖ), said his party planned to introduce several motions of censure in parliament in a reaction to its state budget plans. The right-winger claimed the announcements of the SPÖ and ÖVP indicated that the middle class will have to bear the brunt.