2010 Reports

Outward FDI in Austria and its policy context, 2010

Mayer, Susanne; Bellak, Christian

As a latecomer in outward FDI (OFDI), Austria's firms were mostly export-oriented until the mid-1990s. When Austria joined the European Union (EU) in 1995 OFDI started to grow. This process was further stimulated by the effects of the opening up of Eastern European markets. Austria's OFDI stock revealed positive growth rates ever since the 1990s. Still in 2008, Austria's OFDI flows recorded their second largest value in history and pushed the small Austrian economy among the 20 largest foreign investors globally. Yet, a substantial change occurred in 2008, when the growth of its OFDI stock stopped -- mainly due to valuation adjustments in the aftermath of the crisis. Austrian economic policy is conducive to FDI in general and recently the Austrian tax environment has been revised with several measures benefiting Austrian parent companies.