FAMAGUSTA GAZETTE – Austria is projected to enter its third consecutive year of economic contraction in 2025, with the Austrian Institute of Economic Research (WIFO) forecasting a 0.3% decline in GDP.
Recovery is anticipated in 2026, with growth projected at 1.2%. The downturn is attributed to falling industrial production in the euro area and the impact of U.S. tariff hikes on EU exports.
The Institute for Advanced Studies (IHS) predicts a slightly smaller GDP contraction of 0.2% in 2025, followed by 1.1% growth in 2026.
IHS highlights budget consolidation by Austria’s federal government as an additional factor weighing on growth.