Emerging Markets / August 24, 2018

Acquisitions, Economics & Agriculture in Austria

Austria is a small, landlocked country located in Central Europe. With a total territory of 83,871 square kilometers, Austria is about the same size as South Carolina. Geographically, the country is mainly dominated by the Alps along the west and south as well as slopes and plains along the north and east. Likewise, the country has a temperate, continental climate with harsh, cold winters. Currently, Austria has a total population of approximately 8.8 million citizens, about 58% of which live in an urban setting, notably the capital city of Vienna with some 1.9 million inhabitants. Currently, Austria’s national annual gross domestic product (GDP) is US$439.6 billion and the country has experienced positive economic growth upwards of 1.1% in recent years. The Austrian economy is divided into 1% agriculture, 29% manufacturing, and 70% services. Similarly, the agriculture industry only utilizes about 39% of the national territory, while another 47% is forested.

Acquisitions, Economics & Agriculture in Austria

In terms of natural resources, Austria has oil, coal, lignite, timber, iron ore, copper, zinc, antimony, magnesite, tungsten, graphite, and salt. Within manufacturing, the national industry is focused on construction, machinery, vehicles, food processing, metals, chemicals, lumber, paper, and electronics. Likewise, a large part of the Austrian economy is driven by tourism and financial services. Meanwhile, the country’s agricultural industry has as main products grains, potatoes, wine, fruit, dairy products, cattle, pigs, poultry, lumber, and other forestry products. Austria is also a producer of agricultural goods, such as pigs; agricultural machinery; and consumer goods, such as soaps and cosmetics. However, Austrian companies operating in these industries have recently found themselves in distress due to financial insolvency and high debt accumulation. This recent dynamic in both Austria and Germany offers investment banks and private equity with management optimization experience the opportunity to acquire these distressed assets and capitalize from this market opening.

In terms of trade, during 2016, Austria imported US$162 billion worth of goods and exported US$146 billion, resulting in a trade deficit of US$16.5 billion. Furthermore, that same year, the country’s main export, representing 4.2% or US$6.2 billion of the country’s total, were packaged medicaments. On the other hand, the country’s main import, representing 6.1% or US$10 billion of all international purchases, were cars. Meanwhile, Austria’s main trading partners are fellow members of the European Union, notably Germany, Italy, France, and the Czech Republic, as well as Switzerland and the United States.

Simultaneously, land distribution in Austria has evolved throughout the last several decades. Back in 1961, permanent pastures and meadows in the country covered 1.8 million hectares, while arable land covered almost 1.7 million hectares and permanent crops covered 65.000. More recently, by 2015, permanent pastures and meadows covered 1.3 million hectares, while arable land represented 1.35 million hectares and permanent crops accounted for 65.500 hectares. Similarly, in 1961, the cereals market in Austria utilized 902.089 hectares of land and yielded almost 2.3 million metric tons annually. Finally, by 2016, the country devoted about 786.927 hectares of land to cereals production and yielded 5.7 million metric tons.

(Read more about Avocado Trade and International Markets)

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