Austria is an investment hub for many of our clients. The country acts as a gateway to the single European market as a member of the EU. Its services industry accounts for two thirds of its GDP, and tourism is the country's fastest-growing sector. Austria's industrial sector is mostly made up of small and medium-sized enterprises, but is a major player on the world stage. We make sure our clients make sound business choices in Austria, using our unique Total Analysis model. We keep them informed of the latest market moves and political developments as part of our 'top-down' and 'bottom-up' perspective. We give further in-depth analysis on six of Austria's most important industries. Combining interactive data and forecasting with our risk-assessed and results-proven analysis gives our clients a winning approach. We help you, as our client, identify the opportunities and risks – making doing business in Austria simple.
Austria Country Risk
Austrian real GDP growth will accelerate in 2016 but economic activity will lag behind regional peers, despite improving external demand from the eurozone.
On the back of the government's tax reform; we expect household consumption growth to accelerate in the quarters ahead, significantly adding to GDP growth.
At a federal level, support for the Freedom Party (FPO) exceeds that of either the SPO or OVP, which we expect to hold throughout 2016. The FPO is now the junior government coalition member in two Austrian states (Burgenland and Upper Austria).
Lacklustre consumer spending could result in a lower negative contribution from imports. This would bolster growth over the year though we do not feel this could...
Austria Industry Coverage (7)
Austria Commercial Banking
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BMI View: Austria's construction industry will register a ninth consecutive year of negative growth in 2016, coming in at -1.0% and a value of USD20.3bn. From 2017 to the end of our forecast period in 2025, we predict muted growth sustained by an improving economy and EU investment into major rail development and residential building. Increasing migration will provide a boost to housing demand and private consumption, but may stoke right-wing anti-immigration sentiment in the populace.
Latest Updates And Structural Trends
Construction and infrastructure industry growth will remain negative in...
Austria Medical Devices
BMI Industry View : The Austrian medical device market is well established, with above average per capita spending at just under USD300. We anticipate that the market will see below average growth within the Western Europe region. In keeping with most developed markets, the main growth drivers in the Austrian market are the increasing health needs of the ageing population and the search for new technologies to improve patient outcomes and increase health service efficiency.
Headline Industry Forecasts
We forecast that the market will grow at a US dollar 2014-2019 CAGR of 2.4%, which will see the market increase from USD2,307.4mn in 2014 to USD2,598.8mn in 2019. The lower dollar growth rate reflects a...
Pharmaceuticals & Healthcare
Austria Pharmaceuticals & Healthcare
BMI View: The Austrian pharmaceutical market, despite its small size in comparison with its EU15 partners, has one of the highest per capita expenditures globally due to its relatively small population, high burden of non-communicable diseases and ageing population. We believe pharmaceutical spending will post modest growth over the medium term as the government links growth in public healthcare expenditure with nominal GDP growth. Overall, we view the Austrian pharmaceutical and healthcare market as relatively stable and insulated from sudden downgrades.
Headline Expenditure Projections
Pharmaceuticals: EUR6.29bn (USD6.97bn) in 2015 to EUR6.48bn (USD6.94bn) in 2016; 3.15% in local currency terms and -0.5% in US dollar terms. Forecasts slightly...
BMI View: Austria's power sector is mature and the domestic grid is extensive, ensuring near universal access to electricity and sufficient supply to meet current consumption demands. As a mature market, where public investment capacity is restricted, there are few development projects in the pipeline meaning total generation is expected to grow only slowly throughout the ten-year forecast to 2025. Consumption is expected to grow more rapidly and towards the end of the forecast period Austria is therefore likely to become a net importer, increasing its reliance on a more integrated European electricity grid.
BMI View : Austria continues to be one of the largest markets for renewable energy in Europe. Continuing low electricity prices however undermine the economic viability of non-hydro renewables projects. In addition, the lack of ambitious long-term renewables targets and the meeting of Austria's 2020 targets before the deadline provide little incentive for stronger renewables support in this unfavourable market climate. This has led to cuts in FiT rates for both solar and wind, meaning our forecasts see only limited growth beyond 2020, with overall non-hydro renewable generation expected to grow by an average of just 3.7% between 2016 and 2025.
BMI View : Consolidation has not led to higher prices, as the no-frills segment continues to dominate. Customers are now accustomed to cheaper prices for good-enough services, and are unlikely to move onto more premium plans unless operators can make the case. This is not only apparent in terms of mobile services, with 3G continuing to dominate, but also in the broadband market, through dedicated mobile broadband and DSL. Investments have been made in VDSL and DOCSIS, but the market's structure towards flexibility also hinders the movement towards convergence.
The mobile market reported its first y-o-y growth in eight quarters in Q315, ending September with 13.12mn subscribers
Dedicated mobile broadband remains the largest component of all broadband connections...