Austria: Investing in Austria
Austria has traditionally attracted a significant amount of FDI owing to its geographical location as an intersection of Eastern and Western Europe. According to UNCTAD's 2024 World Investment Report, FDI to the country totalled only USD 4.6 billion in 2023, down from almost 9.3 billion one year earlier. Inward FDI stock reached USD 226.2 billion in the same year. Data from the National Bank of Austria show that Germany is by far the main investing country (28.3%), ahead of Russia (11.4%), Switzerland (8.3%), the U.S. (6.4%), Italy (6%), and the UAE (3.9%). Overall, the EU accounts for 50.8% of the total investment stock. Investments are mainly oriented towards professional, technical and scientific activities (60.1%), financial intermediation (10.4%), real estate (7.3%), trade (6.5%), chemicals, petroleum products, and pharmaceuticals (2.7%). According to the latest figures from OECD, in the first half of 2024, FDI inflows stood at USD 2.6 billion.
Austria's strengths in terms of FDI attraction include its stable economy, its location at the centre of Europe and its skilled and highly productive workforce. Austria enjoys political stability, well-developed healthcare, telecommunications, and energy infrastructure, and a high standard of living. However, with over 50% of its GDP coming from exports, Austria's economy is strongly interconnected with other EU economies, particularly Germany, its largest trading partner. In order to encourage foreign investment, Austria provides welcoming conditions for foreign companies that want to invest in capital-intensive industries and in research and development, for which considerable tax breaks are available. Financial incentives and business subsidies are provided by Austrian federal, state, and local governments to promote investments and include tax incentives, preferential loans, loan guarantees, and grants. Austria does not discriminate against foreign investors, though businesses must comply with numerous local regulations. While Austrian participation in ownership or management is not required, at least one manager must meet residency and legal requirements. National security restrictions apply to investments in critical sectors, including infrastructure, technology, sensitive information, and media plurality. Government approval is required for foreign acquisitions of a 25% or higher stake, reduced to 10% for sensitive sectors such as military technology, critical energy, digital infrastructure, and medical R&D. Additional reviews apply if stakes exceed 25% or 50%, with the screening process typically lasting two months. Overall, Austria has a good business climate, and it ranks 20th among the 180 economies on the latest Corruption Perception Index and 33rd out of 184 countries on the Index of Economic Freedom.
Foreign Direct Investment | 2020 | 2021 | 2022 |
FDI Inward Flow (million USD) | -9,351 | 13,494 | 1,947 |
FDI Stock (million USD) | 205,762 | 212,889 | 203,974 |
Number of Greenfield Investments* | 96 | 91 | 82 |
Value of Greenfield Investments (million USD) | 1,537 | 2,040 | 3,541 |
Source: UNCTAD, Latest available data
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
Country Comparison For the Protection of Investors | Austria | OECD | United States | Germany |
Index of Transaction Transparency* | 5.0 | 6.5 | 7.0 | 5.0 |
Index of Manager’s Responsibility** | 5.0 | 5.3 | 9.0 | 5.0 |
Index of Shareholders’ Power*** | 7.0 | 7.3 | 9.0 | 5.0 |
Source: Doing Business, Latest available data
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.
Advantages for FDI in Austria:
Austria’s weak points for FDI are:
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Latest Update: February 2025