Shock for Austrian Foreign Trade: Weak Demand from Abroad Depresses Exports
The Austrian economy is facing a new challenge: exports slumped more sharply in November 2024 than they have for years. In particular, weak demand from Germany and the EU is causing concern - experts are warning of long-term consequences for industry and the labor market.
Weak demand from abroad weighed heavily on Austrian foreign trade. / Picture: © Wikimedia Commons / Petr Štefek / CC BY-SA 3.0 CZ (https://creativecommons.org/licenses/by-sa/3.0/cz/deed.en)
Austria's foreign trade experienced a severe setback in November. Exports fell by 14.7% to 16.32 billion euros compared to the same month last year, while imports fell by 3.9% to 16.51 billion euros. As a result, the trade balance slipped into deficit: 0.19 billion euros more was imported than exported.
Trade with Germany in particular - traditionally Austria's most important trading partner - continues to suffer greatly. According to Statistics Austria, exports to Germany shrank by 3.4 percent. This was the seventh decline in the first eleven months of 2024. At the same time, imports from Germany fell by 3.3% - the ninth negative development in a row. “The ongoing weakness of the German economy and the decline in industrial demand are having a massive impact on Austria's exports. This is a serious problem, especially for an export-dependent country like Austria,” warned Statistics Austria Director General Tobias Thomas.
Gloomy figures for EU trade - third countries also affected
Austria also sold significantly fewer goods to the rest of the EU in November. Exports to the EU fell by 18.1 percent to 11.08 billion euros, while imports fell by only 2.1 percent to 10.82 billion euros.
The situation is even more dramatic for trade with third countries outside the EU. Exports fell by 6.6 percent to 5.24 billion euros, while imports fell by 7.1 percent to 5.69 billion euros. Trade with China was hit particularly hard, with weak demand and restrained industrial production putting Austrian companies under pressure. The USA also imported fewer goods from Austria - a sign that economic momentum is also slowing there.
Experts fear continued weakness
The sharp decline in exports could continue in 2025. According to the economic research institute WIFO, the Austrian economy is only expected to grow by 0.6% this year - one of the lowest growth rates in the entire EU. “The Austrian economy has been in a downturn since the beginning of 2023. Declining exports and the weak willingness of industry to invest are having a significant negative impact on growth,” analyzes the Austrian National Bank (OeNB).
Export-oriented sectors such as mechanical engineering, automotive suppliers, and the chemical industry are particularly affected. The largest absolute decline in exports was recorded for chemical products (down 40.5% to EUR 1.93 billion), followed by machinery and vehicles (down 9.7% to EUR 0.65 billion). In contrast, there was growth in foodstuffs (up 4.4 percent to EUR 0.05 billion) and “other goods” (up 40.2 percent to EUR 0.09 billion). Many companies are struggling with falling orders, which is causing them to cut back on investments. If this trend continues, there is a risk of negative effects on the labor market - particularly in industry.
Calls for countermeasures - government under pressure
Given the alarming trade figures, there are calls for political countermeasures. Harald Mahrer, President of the Austrian Federal Economic Chamber (WKÖ), is calling for targeted relief for companies to strengthen their competitiveness. “Our companies urgently need support. The high tax and duty burden is hampering investment and innovation. Austria must act quickly in order not to fall further behind in international competition,” said Mahrer.
Economics Minister Martin Kocher also announced that he would focus more on opening up new markets outside Europe. In particular, the expansion of trade relations with the USA and Asia could be an opportunity to reduce dependence on Germany and the EU.
Difficult year for Austria's foreign trade
The November figures confirm a worrying trend: Austria's foreign trade and economy are in crisis. Austria's economic experts have been discussing the various internal and external problems in recent months, as Vinodbona.org reports.
Weak demand from Germany and the EU in particular is now putting the domestic export industry under severe pressure from outside. While companies are looking for solutions and politicians are promising relief, uncertainty remains high. If the situation does not stabilize soon, 2025 could be another challenging year for Austria's economy.