The Austrian economy is in good shape despite a rise in public spending due to the coronavirus pandemic, the International Monetary Fund (IMF) said on Tuesday.
According to the IMF, Austria is in no need to implement austerity measures as the phase-out of the COVID-19 support measures and anticipated economic growth are sufficient to ensure long-term budgetary stability. However, recovery is expected to take longer than in other EU countries, the international organisation estimated.
The budget deficit is expected to return to its pre-pandemic levels in the medium-term with new debts averaging about 1% and overall public debt reaching 80% – which is way below the EU average.
However, Austria also faces a series of challenges like the introduction of a CO2 tax and the economy’s digitalisation, said IMF representative Jeffery Franks.
While Franks stressed the importance of a CO2 tax in guaranteeing a smooth green transition and ensuring Austria is a forerunner in the global economy, he also emphasised the need for it to step up investment in public infrastructure – like broadband expansion and the integration of digital technologies in the labour market. (Oliver Noyan | EURACTIV.de)