Growth is Gaining Momentum Owing to Exports, Domestic Demand Remains Sluggish. Medium-term Forecast for the Austrian Economy until 2015

Led by a dynamic export growth real GDP in Austria grew by 2 percent in 2010. Between 2011 until 2015 the Austrian economy is expected to grow by 2.2 percent. The annual growth rate of trend output will average at 1.7 percent in the forecast period, ¼ percentage point below the average of the 10 years before the crisis. The world economy has overcome the cyclical trough sooner than anticipated and expanded by 4.5 percent in 2010. This growth rate is expected to persist during the period from 2011 to 2015. The revival of world trade will cause an increase of Austrian exports by an average of 6.2 percent per year. As import growth is slightly lower at 5.8 percent, net exports will contribute to GDP growth. The pick-up in export activity in 2010 failed to spur investment (–3.1 percent) sufficiently as capacity utilisation remained low at the beginning of the year. Owing to the sustained and dynamic export growth, investment activity is expected to pick up in the forecast period and gross fixed capital formation will expand by an average of 2.9 percent per year.