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12 Oct, 2022 11:37

EU member sounds alarm over economy

Tough times are ahead as the country’s energy crisis deepens, the Finance Ministry warns
EU member sounds alarm over economy

Austria is facing what may be its worst economic crisis since World War II, the finance minister said on Wednesday during his speech to parliament, while presenting a draft budget.

Magnus Brunner pointed to EU sanctions against Russia as the primary cause of the downturn, and said predicting an end to the crisis is impossible, as the current situation could recur in the coming years.

Brunner noted that Austrian businesses and households are feeling the impact of anti-Russia sanctions. He stressed that calls for lifting the restrictions on Russia are “emotionally understandable,” but there are no guarantees of a return to previous cooperation with Moscow.

Austria, which is heavily dependent on Russian oil and gas, has been resisting the EU’s plans to restrict imports from Moscow. In March, Brussels rolled out a plan to reduce dependence on Russian natural gas by two thirds before the end of the year. The proposal is part of a wider plan to become independent from all Russian fossil fuels “well before 2030.”

The Federation of Austrian Industries earlier warned that the suspension of Russian gas supplies would be “a serious blow” to the welfare of the Austrian people, as it threatens some 300,000 jobs.

According to the federation, almost the entire food industry depends on the supply of the “blue fuel.” 

Meanwhile, soaring energy prices have been driving up inflation in the country. The Austrian government has previously introduced several anti-inflation packages to support households and companies, including increasing social benefits for the unemployed and other vulnerable groups.

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