Title: Background Note: Austria
PA
Source: Office of Public Communication, Bureau of Public
Affairs
Description: Historical, Political and Economic Overviews of the
Countries of the World
Date: Oct, 15 199210/15/92
Category: Country Data
Region: Europe
Country: Austria
Subject: Travel, History, International Organizations,
Trade/Economics, Military Affairs, Cultural Exchange,
State Department
[TEXT]
Official Name:
Republic of Austria
PROFILE
Geography
Area:
83,857 sq. km. (32,377 sq. mi.); slightly smaller
than Maine.
Cities:
Capital--Vienna (pop. 1.7 million). Other cities--
Graz, Linz, Salzburg, Innsbruck.
Terrain:
Mountainous and hilly.
Climate:
Continental temperate.
People
Nationality:
Noun and adjective--Austrian(s).
Population (1991):
7.8 million.
Annual growth rate:
1.2%.
Ethnic groups:
German 98%, Croatian, Slovene.
Religion:
Roman Catholic 89%.
Language:
German 98%.
Education:
Years compulsory--9. Attendance--95%.
Literacy--98%.
Health:
Infant mortality rate--8/1,000. Life expectancy--
72 yrs. men, 79 yrs. women.
Work force (3.4 million):
Industry and commerce--35%.
Agriculture and forestry--7%.
Government
Type:
Parliamentary democracy.
Constitution:
1920 (reinstated December 1945).
Branches:
Executive--Federal President (chief of state),
chancellor (head of government), cabinet. Legislative--bicameral
Federal Assembly (parliament). Judicial--Constitutional Court,
Administrative Court, Supreme Court.
Political parties (in parliament):
Social Democratic Party,
People's Party, Freedom Party, Green-Alternative Movement
(environmental party).
Suffrage:
Universal over 19.
Administrative subdivisions:
Nine Laender (provinces).
Defense (est.):
1% of GDP.
Flag:
Three horizontal bands--red, white, and red; flag
may also have the national emblem, a black eagle, centered in the
white band.
Economy
GDP (1991):
$163 billion.
Per capita income (1991):
$20,820.
Natural resources:
Iron ore, crude oil, natural gas, timber,
tungsten, magnesite, lignite, cement.
Agriculture (3.3% of 1991 GDP):
Products--livestock,
forest products, grains, sugar beets, potatoes.
Industry (40% of 1991 GDP):
Types--iron and steel,
chemicals, capital equipment, consumer goods.
Services:
58% of 1990 GDP.
Trade (1991):
Exports--$41 billion: iron and steel
products, timber, paper, textiles, electro-technical machinery,
construction and industrial machinery, chemical products. Imports-
-$51 billion: machinery, vehicles, chemicals, iron and steel, metal
goods, fuels, raw materials, foodstuffs.
Principal partners
--European Community, European Free
Trade Association, United States
Exchange rate (1991 avg.):
11 Austrian schillings=US$1.
PEOPLE
Austrians are a homogenous people; 98% are native German speakers.
Only two significant minority groups exist--about 15,000 Slovenes
in Carinthia (south-central Austria) and some 18,000 Croatians in
Burgenland (on the Hungarian border). The Slovenes form a closely
knit community. Although their rights are protected by law and
respected in practice, there has been some controversy over the use
of the Slovenian language in schools where there is a Slovene
majority.
The present boundaries of Austria--once the center of the empire
which was the second largest state in Europe--were established in
accordance with the Treaty of St. Germain in 1919. Many Austrians,
particularly near Vienna, still have relatives in Czechoslovakia and
Hungary.
About 89% of all Austrians are Roman Catholic. The church abstains
from political activity; however, lay Catholic organizations are
aligned with the conservative People's Party. The Social Democratic
Party long ago shed its anti-clerical stance. A small Protestant
minority is located mainly in Vienna, and in the Carinthian Mountains
and Burgenland.
HISTORY
The Austrian Empire played a decisive role in Central European
history. It occupied a strategic position astride the
southeastern approaches to Western Europe and the north-south
routes between Germany and Italy. Although present-day Austria is
only a tiny remnant of the old empire, it still occupies this strategic
position.
Soon after the Republic of Austria was established at the end of
World War I, it not only had to redesign a government meant to rule a
great empire into one that would govern only 6 million citizens but
also faced catastrophic inflation. In the early 1930s, worldwide
depression and unemployment added to these strains and shattered
traditional Austrian society. These economic and political
conditions led in 1933 to a dictatorship under Engelbert Dollfuss. In
February 1934, civil war broke out, and the Social Democratic Party
was suppressed. In July, the National Socialists attempted
unsuccessfully to seize power and assassinated Dollfuss. In March
1938, Austria was incorporated into the German Reich through the
Anschluss.
At the Moscow conference in 1943, the Allies declared their
intention to liberate Austria and reconstitute it as a free and
independent state. In April 1945, both East and West forces
liberated the country.
Subsequently, Austria was divided into zones of occupation similar
to Germany's. A Socialist elder statesman, Dr. Karl Renner,
successfully organized an Austrian administration.
General elections were held in November 1945, and the conservative
People's Party obtained 50% of the vote and 85 seats in the National
Council (lower house of the parliament). The Socialists won 45% and
76 seats, and the Communists won 5% and 4 seats. The ensuing
three-party government held office until 1947, when the
Communists left the government. During that year, the People's
Party and the Socialists formed a coalition that governed until 1966.
Under the 1945 Potsdam agreements, the Soviets took control of
German assets in their zone of occupation. These included
manufacturing plants, constituting 7% of all Austrian industry; oil
resources, which accounted for 95% of the nation's oil production;
and refineries, which accounted for about 80% of Austria's refinery
capacity. These properties were returned to Austria under the
Austrian State Treaty, signed at Vienna on May 15, 1955. The treaty
came into effect on July 27 of that year.
Under its provisions, all occupation forces were withdrawn by
October 25, 1955. Austria became free and independent for the first
time since 1938.
GOVERNMENT
The Austrian president convenes and discontinues parliamentary
sessions and, subject to certain conditions, can dissolve parliament.
However, no Austrian president has dissolved parliament in the
Second Republic. The custom is for parliament, itself, to enact a
law calling new elections. The president requests a party leader,
usually the leader of the strongest party, to form a government.
Upon the recommendation of the federal chancellor, the president
also appoints cabinet ministers. No one can become a member of
the government without the approval of the president.
The Federal Assembly (parliament) is composed of two houses--the
National Council (Nationalrat), or lower house, and the Federal
Council (Bundesrat), or upper house. Virtually all legislative
authority is concentrated in the National Council. Its 183 members
are elected for a maximum 4-year term from nine electoral
districts, according to a complicated system of proportional
representation. The National Council may dissolve itself by a simple
majority vote or it may be dissolved by the president on the
recommendation of the chancellor. The Federal Council consists of
63 members elected by the legislatures of the nine provinces for 4-
to 6-year terms. Seats are allocated on the basis of population,
with each province guaranteed at least three. The Federal Council is
restricted to reviewing legislation passed by the National Council,
and has only delaying, not absolute veto, powers.
The highest courts of Austria's independent judiciary are the
Constitutional Court, which has jurisdiction over constitutional
matters; the Administrative Court, which handles bureaucratic
disputes; and the Supreme Court, for civil and criminal cases. Cases
in the Administrative and Supreme Courts concerning constitutional
issues can be appealed to the Constitutional Court. Justices of the
three courts are appointed by the president for specific terms.
Austria's nine Laender (provinces) are headed by governors elected
by the provincial legislatures. Although most authority, including
police, rests with the federal government, the provinces have
considerable responsibility for welfare matters and supervision of
local administration. Strong provincial and local loyalties are based
on tradition and history.
Principal Government Officials:
Federal President--Thomas Klestil
Federal Chancellor--Franz Vranitzky
Vice Chancellor--Gerhard Busek
Foreign Minister--Aolis Moch
Ambassador to the United States--Friedrich Hoess
Ambassador to the United Nations--Peter Hohenfellner
Austria maintains an embassy in the United States at 3524
International Court, NW, Washington, DC 20008 (tel. 202-895-
6700). Consulates general are located in New York, Chicago, and Los
Angeles, with honorary consulates in Atlanta, Boston, Buffalo,
Cleveland, Denver, Detroit, Honolulu, Houston, Miami, New Orleans,
Newark, Philadelphia, San Francisco, San Juan, Seattle, and St. Paul.
POLITICAL CONDITIONS
Since World War II, Austria has enjoyed political stability. The two
major parties--People's Party and Social Democrats--which formed
the governing coalition during the period 1947-66, have the support
of about 75% of the electorate. Extremist parties of the right and
left have had virtually no influence on government policy and usually
receive less than 1% of the vote.
The Socialist Party, renamed the Social Democratic Party in June
1991, traditionally draws its constituency from blue- and white-
collar workers, so that much of its strength lies in the urban and
industrialized areas. In the past, the party advocated heavy state
involvement in Austria's key industries, the extension of social
security benefits, and a full-employment policy. In the mid-1980s,
the party began to swing toward free market-oriented economic
policies and balancing the federal budget, and is now working to
bring the country into the European Community (EC).
The People's Party's traditional constituency has been among liberal
farmers, big and small businesses, and lay Catholic groups. Its
centers of strength are the rural regions of Austria. In economic
matters, the party advocates conservative financial policies and
privatization of much of Austria's nationalized industry.
The Freedom Party has been a small- to medium-sized right leaning
party that attracts those who desire no association with the two
major parties. Recently, the party's mixture of populism and anti-
establishment themes have won increased support. In provincial
elections in Vienna in 1991 the Freedom Party displaced the People's
Party to move into second position in city government. Nationally it
attracts approximately 15% of the vote.
The most recent Austrian parliamentary elections were held in
October 1990 and produced a Socialist/People's Party coalition
government. In these elections, the Social Democratic Party under
its popular chairman, Chancellor Franz Vranitzky, maintained its
43% plurality from 1986. The People's Party, however, dropped from
41% to 32% of the vote. The Freedom Party, under Joerg Haider,
substantially increased its share of the electorate from 10% to 17%.
Because of the new voting patterns, the new government included a
larger number of Socialist cabinet members.
ECONOMY
Austria has a social market economy in which the government plays
an important role. Many of the country's largest firms were
nationalized in the early post-war period to protect them from
Soviet takeover as war reparations. Currently, these state-owned
corporations are intended to operate largely as private businesses,
and a number are being wholly or partially privatized. The
government operates various state monopolies, utilities, and
services. Austrian industry, banking, transportation, services, and
commercial facilities are well developed.
Although the nationalized industries, which include several iron and
steel works and chemical plants, are large industrial enterprises
employing thousands of people, most industrial and commercial
enterprises are smaller.
Austrian farms, like those of other West European mountainous
countries, are small and fragmented. Their products are relatively
expensive. Although Austrian farmers provide about 80% of domestic
food requirements, the agricultural contribution to gross domestic
product (GDP) has declined since 1950 to about 3.5%.
Austria has achieved sustained economic growth in the post-war
period. During the 1950s, the average annual growth rate was more
than 5% in real terms and averaged about 4.5% through most of the
1960s. Austria's economy through 1979 grew by 4.7% but began to
taper off in 1980. The growth rate during the past decade was still
one of the highest in the West. GDP increased by 3% in real terms in
1985. After a short fall to 1.2% in 1986, Austria's percentage
growth climbed to a healthy 4.6% in 1990 but fell to 3% in 1991.
Future GDP growth is expected to be about 3% through 1996, and then
to remain slightly above the 2.2% growth expected for Europe. The
Central Bank's hard schilling policy has helped to keep "imported"
inflation to a minimum--3.2% in 1985, and 1.4% in 1987. In recent
years, inflation has remained relatively stable. Prices rose 3.3% in
both 1990 and 1991. Inflation is anticipated at 3%-4% for the next
several years.
The reduction in the trade deficit, the traditional surplus in
services, and high revenues from transit trade have resulted in a $1
billion schilling current account surplus for 1990. Unemployment in
Austria remained at 4.5% in 1983-84 but increased slightly to 4.8%
in 1985. Unemployment reached 5.2% and remained above the 5%
level through the end of the decade. Levels have increased to 5.4% in
1990 and 5.8% in 1991 and are expected to rise slightly over the
next few years.
Austria has a strong labor movement. The Austrian Trade Union
Federation (ATUF) comprises constituent unions with a total
membership of more than 1.6 million, representing almost two-
thirds of the country's wage and salary earners. Since 1945, the
ATUF has followed moderate policies and generally has cooperated
with industry and government anti-inflationary measures in what is
known as Austria's "social partnership."
Exports of goods and services account for more than 40% of GDP.
Austria's main trading partners are members of the European
Community (EC), which accounted for 66% of Austrian merchandise
exports and 68% of its imports in 1991. Since July 1, 1977, the
exchange of nearly all industrial goods between Austria and the
EC has been free from tariff barriers. In order to share in the
benefits of the EC's internal market, Austria applied to join in July
1989.
Membership in the European Free Trade Association (EFTA), once an
important element in Austrian foreign trade, has lost much of its
glamor since Austria and its EFTA partners concluded bilateral free
trade agreements with the EC. In 1991, EFTA countries accounted
for 7% of Austrian imports and 5% of exports.
Total trade with the United States in 1991 reached $3.2 billion.
Imports from the United States amounted to $2 billion, constituting
a US market share in Austria of 3.5%. Austrian exports to the United
States in 1991 were $1.2 billion or 3% of total Austrian exports. As
a rule, Austria has experienced deficits in its merchandise trade,
offset somewhat by earnings from tourism and by long-term private
capital.
FOREIGN RELATIONS
The 1955 Austrian State Treaty ended the four-power occupation
and recognized Austria as an independent and sovereign state. In
October 1955, the Federal Assembly passed a constitutional law in
which "Austria declares of her own free will her perpetual
neutrality." The second section of this law stated that "in all future
times Austria will not join any military alliances and will not
permit the establishment of any foreign military bases on her
territory." In line with its desire to join the European Community,
and with the demise of the Warsaw Pact, Austria has begun
reassessing its definition of its neutrality.
Austria shapes its foreign policy on the basis of neutrality.
Austrian leaders also emphasize the unique role the country plays as
a link between East and West and as a moderator between the
industrialized and developing countries. Austria is active in the
United Nations and in UN peacekeeping efforts. It attaches great
importance to participation in the Organization for Economic
Cooperation and Development and other international economic
organizations, and has played an active role in the Conference on
Security and Cooperation in Europe (CSCE).
Vienna is headquarters of the International Atomic Energy Agency
and the UN Industrial Development Organization. Other international
organizations based in Vienna include the Organization of Petroleum
Exporting Countries and its Fund for International Development, and
the International Institute for Applied Systems Analysis. Vienna
hosted the mutual and balanced force reduction talks, which resulted
in the November 1990 signing of the Treaty on Conventional Armed
Forces in Europe. In 1986, Vienna hosted the follow-up meeting of
the CSCE.
Austria traditionally has been active in what the Austrians call
"bridge building to the East," involving increasing contacts at all
levels with Eastern Europe and the states of the former Soviet
Union. Austrians maintain a constant exchange of business
representatives, political leaders, students, cultural groups, and
tourists, with the countries of Central and Eastern Europe. As a
result, Austrian companies are very active in investing and trading
with the countries of Central and Eastern Europe. In addition, the
Austrian Government and various Austrian organizations provide
assistance and training to support the changes underway in the
region. They believe also that their country, as gateway to the
Danube River basin, is uniquely qualified for this role.
US-AUSTRIAN RELATIONS
Austria's political leaders and people recognize and appreciate the
essential role played by US economic assistance through the
Marshall Plan in the rehabilitation of their country after World War
II, and by the United States in promoting the conclusion of the
Austrian State Treaty. It is in the interest of the United States
that:
-- The present friendly relations be maintained and strengthened;
-- Austria remain free and independent; and
-- Its political and economic stability be maintained.
Principal US Officials:
Ambassador--Roy Michael Huffington
Deputy Chief of Mission--James W. Swihart
Counselor for Political Affairs--Alfreda E. Meyers
Counselor for Economic Affairs--Edward B. O'Donnell
Counselor Public Affairs (USIS)--Craig B. Springer
Counselor for Commercial Affairs--Benjamin N. Brown
Counselor for Administrative Affairs--Warren P. Nixon
Counselor for Agricultural Affairs--Robert J. Svec
Consul General--Mary McAteer-LeLaumier
Defense and Army Attache--Col. Peter S. Hoffman, USA
Consul General, Salzburg--Maryanne H. Martinez
The US embassy in Austria is located at Boltzmanngasse 16, Vienna
1091 tel. (43) (1) 313-39 [After office hours: (43) (1) 319-5523].
The US Consulate General in Salzburg is located at 51 Giselakai,
5020 Salzburg tel. (43) (662) 28-6-01.
TRAVEL NOTES
Climate and clothing:
Vienna's climate is similar to that
of the northeastern US; clothing needs and tastes are about the
same. Wear sweaters and light woolens during possible cool spells
in summer.
Health:
Local pharmacies are well stocked, and hospitals
are adequate. The US embassy can provide a list of English-speaking
physicians and dentists in Vienna. Community health and sanitation
are similar to that in the United States; the Viennese are proud of
their city's water, piped in from mountain springs.
Telecommunications:
Telegraph and telephone services are
efficient. Vienna is 6 hours ahead of eastern standard time.
Transportation:
Public transportation in Vienna and other
cities via bus, streetcar, and subway is good. Taxis are available 24
hours a day at stands throughout Vienna. Roads are good, though
occasionally steep on alpine passes. Highways connect Vienna with
Graz, Salzburg, Innsbruck, and the German border. The Austrian
State Railway provides service throughout the country and
connections to Eastern and Western Europe.
Tourist attractions:
Austria has a number of widely
differing tourist areas: Vienna and Salzburg; the lake and mountain
district of the Salzkammergut; the Danube Valley, known for its
vineyards, castles, and monasteries; Burgenland, the easternmost
province, centering on the Lake Neusiedler Lake; Carinthia and the
Alpine Provinces, for hunting, fishing, and skiing.
Further Information
Available from the Superintendent of Documents, US Government
Printing Office, Washington, DC 20402:
Key Officers of Foreign Service Posts (Guide for Business
Representatives). Revised biannually.
For information on economic trends, commercial development,
production, trade regulations, and tariff rates, contact the Austrian
desk, IEP/EUR/OWE, Room 3411, International Trade Administration,
US Department of Commerce, Washington, DC 20230, (tel. 202-377-
2435.)
HOW TO ORDER BACKGROUND NOTES IN PAPER
Published by the United States Department of State -- Bureau of
Public Affairs Office of Public Communication
Washington, DC -- October 1992
Department of State Publication 7955
Background Notes Series -- This material is in the public domain
and may be reprinted without permission; citation of this source is
appreciated.
For sale by the Superintendent of Documents, US Government
Printing Office, Washington, DC 20402. (###)