Political Rights: 1
Civil Liberties: 1
Status: Free
Population: 8,100,000
GNI/Capita: $23,860
Life Expectancy: 79
Religious Groups: Roman Catholic (73.6 percent), Protestant (4.7 percent), Muslim and other (17 percent)
Ethnic Groups: German (88.5 percent), indigenous minorities [includes Croatians, Slovenes, Hungarians, Czechs, Slovaks, Roma] (1.5 percent), recent immigrant groups [includes Turks, Bosnians, Serbs, Croatians] (10 percent)
Capital: Vienna


In 2004, Austria's government pushed economic reforms, which contributed to a modest economic recovery from 2003 but also cost the government somewhat in popularity. The Freedom Party, a far-right party involved as a junior partner in government, continued its moderating trend at the national level, but did poorly in local and European Parliament elections.

Modern Austria emerged at the end of World War I, when the Austro-Hungarian Empire was dismembered. It was voluntarily annexed to Nazi Germany in 1938 and suffered the defeat of Hitler's regime. Postwar Austria, by consent of the World War II Allies, remained neutral between the Cold War blocs. Focusing instead on economic growth, Austria has developed one of the wealthiest economies in Europe.

From 1986 until 2000, the two biggest political parties – the center-left Social Democratic Party of Austria (SPO) and the center-right People's Party of Austria (OVP) – governed together in a grand coalition. Members of the two parties shared in the administration of cabinet ministries as well as in many other government functions. Labor relations were corporatist, with management and unions both represented not only in individual firms' decision making, but also in national policy making.

The election of October 1999 saw the emergence of the first government since 1970 not to include the SPO. Instead, the OVP formed a coalition with the Freedom Party, a far-right nationalist party with vestigial Nazi sympathies. The Freedom Party had grown steadily in the polls as voters became disaffected with the power sharing of the two big parties and the near impossibility of major political change. The Freedom Party won its biggest ever share of the vote, 27 percent, in that election, and was thus included in a coalition with the OVP's Wolfgang Schuessel as chancellor.

The reaction among fellow members of the European Union (EU) was immediate and dramatic. In 2000, the EU officially suspended ties with Austria. Though this move had little practical effect, technically it meant that the other 14 EU countries had to deal with Austria on a bilateral basis rather than through the EU. Moreover, support in Austria for the Freedom Party jumped, as Austrian voters resented the EU's attempts to interfere with the choice they had expressed at the polls. Later in 2000, the EU reinstated Austria.

One effect of the EU sanctions was that Joerg Haider, the Freedom Party's leader, withdrew from that post and contented himself with the governorship of the state of Carinthia. Haider had been both Freedom's biggest vote-winner and the source of its major controversies. For example, he referred to Nazi death camps as "punishment camps" and once told a rally of former SS officers that they were worth "honor and respect," though he also referred to the Nazi regime as a "cruel and brutal dictatorship." With Haider's official withdrawal, Austrian politics returned to near-normality and Freedom was forced to moderate its far-right stances as it dealt with the day-to-day reality of governing.

However, Haider did not remain absent from the national stage for long, and his meddling in a national Freedom Party leadership struggle caused the party to withdraw from the coalition in September 2002. The parliamentary elections of November 2002 saw Freedom's vote share fall from 27 percent in 1999 to 10 percent. In subsequent cabinet negotiations, the Freedom Party rejoined the coalition with the OVP, but this time clearly as the junior partner.

In his second term, Schuessel has sought to tackle several thorny economic issues, including pushing privatizations, trimming pensions, and generally keeping a tight rein on the budget. Economic growth, which was just 0.7 percent in 2003, was forecast to improve somewhat, though not spectacularly, in 2004 as Europe's economies rebounded generally.

Perhaps as a result of the ongoing struggle with these economic issues, the Freedom Party continued to lose support in 2004. Though Haider was reelected governor of Carinthia in a March 2004 state election, the party fared worse in another state election that same day and did especially badly in the European Parliament elections in June. Having captured 23 percent of the vote in those elections in 1999, the Freedom Party received just 6 percent in 2004. The SPO, in opposition at the national level, did best at the European poll, winning 33 percent of the vote, benefiting from a general anti-incumbent trend across Europe.

Relations with the EU remained Austria's most important foreign affairs issue. Austria supported the draft EU constitution signed in June. The enlargement of the EU to former Soviet bloc countries shortly afterward was also particularly important, as Austria borders four of them (the Czech Republic, Slovakia, Hungary, and Slovenia). However, Austria is skeptical about Turkey's application, which it was expected to oppose at the December 2004 EU summit meeting.

Political Rights and Civil Liberties

Austrians can change their government democratically. Perhaps ironically, the participation of the Freedom Party in government emphasized this basic right when other European countries tried in 2000 to induce Austrians to forgo their democratic choice. Though there are competitive political parties and free and fair elections, the traditional practice of grand coalitions in Austria has disillusioned many with the political process. Frustration with the cozy relationship between the OVP and the SPO helped lead to the rise of the Freedom Party as a protest party. However, Freedom's participation in government brought it closer to the mainstream right.

Austria is less corrupt than during the 1980s, when campaign donation laws were tightened somewhat. Austria was ranked 13 out of 146 countries surveyed in the 2004 Transparency International Corruption Perceptions Index.

The media are free, though not highly pluralistic. The end of the monopoly by the state broadcaster ORF has not brought significant competition to the broadcast market, and print media ownership is concentrated in a few hands, particularly the News and the Print-Medien groups. Harassment and libel lawsuits by politicians (notably from the Freedom Party) against investigative and critical journalists have hampered reporters' work. There are no restrictions on Internet access.

Religious freedom is respected in Austria and enshrined in the constitution. However, there are only 12 officially recognized religions, and these have the ability to draw on state funds for religious education. Joining that group of state-recognized religions requires a period of ten years of observation. The Jehovah's Witnesses have complained that this practice violates their freedom of religion, although they are recognized as a "confessional community." Academic freedom is generally respected.

The rights to freedom of assembly and association are protected in the constitution, and trade unions have traditionally been powerful. They not only are free to organize and strike, but have been considered an essential partner in national policy making. Strikes held in May 2003 against the government's controversial pension reforms did not stop those reforms from going through.

The judiciary is independent, and the Constitutional Court examines the compatibility of legislation with the constitution. Austria is a member of the Council of Europe, and its citizens have recourse to the European Court of Human Rights in Strasbourg, France. The quality of prisons and police generally meet high European standards, though isolated incidences of police brutality and harsh prison conditions are reported.

Residents generally are afforded equal protection under the law. However, immigration has fuelled some resentment towards minorities and foreigners – Austria has the highest number of asylum seekers per capita in Europe. Since a tightening in December 2003, the asylum law is among the strictest in the developed world. Under that law, criticized by the UN High Commissioner for Refugees, some asylum seekers could be deported while appeals of their cases are held. New arrivals will be asked for full statements within 72 hours.

A 1979 law guarantees women freedom from discrimination in various areas, especially the workplace. A 1993 law sought to increase women's employment in government agencies where women were underrepresented.

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