Austria has one of the highest standards of living in the world and a highly developed social system. Austrian cities are clean and safe. The pace of life is stimulating, but without the stress present in other industrialized nations. The culture is enriched with magnificent music and art, and the countryside is breathtakingly beautiful. The Austrian people hold fiercely to their own identity. They are an independent, proud people.
For expatriates living in Austria, there is much to see and do. The daily lifestyle is conducive to family life. Visitors will feel welcomed by a people genuinely interested in learning about other cultures.
Since 1955, Austria has been an independent Federal Republic made up of nine Länder, or states. The executive branch consists of a federal president, a largely ceremonial elected position lasting six years (with a maximum of two terms); a federal chancellor, designated by the president and confirmed by the legislature, usually the leader of the party with the majority in the legislature; and the chancellor's cabinet. Legislative power rests with a bicameral Federal Assembly (Bundesversammlung). The Federal Council or Bundesrat has 64 members elected by the states to five- or six-year terms; the National Council or Nationalrat of 183 members, elected for four years by popular vote.
There are currently five major political parties, the Social Democratic Party of Austria (SPOe) controlling 68 council seats.
Geography and post-war international politics have made Austria a bridge between East and West. Many large international corporations, especially those of Central and Eastern Europe, have offices in Vienna, as does the United Nations. A member of the European Union (EU) since 1995, Austria is a willing and eager partner in nurturing European commerce and social solutions. At the same time, it is a natural portal to the emerging strength of the Eastern bloc. EU membership has opened trade to all of Europe.
In early 2000, Austria's relationship with the EU became strained, when a political party many considered to be right-wing extremist (FPO) became a part of the governing coalition. To convey their disapproval, the EU countries imposed diplomatic sanctions against Austria, and countries such as the United States and Israel limited contacts. Sanctions were later lifted, but in 2003 the ruling OVP reinstated ties with the FPO. Eventually the FPO suffered from internal strife that caused many of its members to depart for the newly formed Alliance for the Future of Austria (BZÖ), currently holding a minority 7 council seats.
In December of 2007, Austria and the other EU member states ratified the Lisbon Treaty, providing the members with a legal framework within which to meet the challenges of a changing membership and evolving environment.
The Austrian economy operates on essentially free-enterprise principles, but with a pervasive state presence. Many of the larger enterprises have been government controlled since the early postwar period, when they were nationalized to protect them from being taken over during war reparations. Although state-owned, they have continued to operate as private businesses.
A consensus-seeking approach to most issues - which brings together extremes of left and right, government and private-sector interests, and management and labor to work out compromise solutions - has greatly assisted Austrian achievement. This social partnership has virtually eliminated strikes from the Austrian scene, but it also has had the effect of inhibiting necessary structural changes. Some of the biggest state-owned operations have been slow to deal with over-capacity and inefficiencies. As a result, they have been running at losses, which the government has had to cover with subsidies.
In 2004, the economy grew at nearly 2.5%, with a dip slightly below 2% in 2005 and a rebound to 3.3% 2006. Predictions through 2008 are for growth just under 3%.
In accordance with the guidelines of the EU, the government has made considerable effort to reduce the budget deficit, reform the tax system, and follow the international trend toward deregulation and privatization.