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Lower Austria Industry: High energy prices weaken exports and competitiveness

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Lower Austria Industry: High energy prices weaken exports and competitiveness

WKNÖ President Ecker and WKNÖ Industry Division Chairman Schwarzl warn of “braking the entire business location” – call for “energy supply security at competitive prices”

St. Pölten (OTS) – “The high energy prices weaken our competitiveness and are a brake on our entire business location,” warn Wolfgang Ecker, President of the Lower Austrian Chamber of Commerce (WKNÖ) and WKNÖ Industry Division Chairman Helmut Schwarzl. This is proven by a new WIFO study with a focus on industry. According to this, employment in industry in Lower Austria would have been 2.2 percent higher and industrial production 2.9 percent higher without the recent crisis-ridden energy price increases than in the WIFO reference scenario with the known development of energy prices. The challenging situation becomes even clearer when the energy prices from 2018 are used as a reference value: Here the decline in production in Lower Austria is 6.2 percent, with energy costs remaining high. “The high energy prices affect our exports and cost us market share in international goods traffic,” emphasizes Schwarzl. “Of course, this affects the energy-intensive industry in particular, but it applies to practically our entire production economy.”

It is usually not possible for companies to pass on the costs

Passing on the domestic energy costs, which are high by international comparison, via prices is only possible to a limited extent or not at all. An Economica study presented by WKNÖ recently showed that energy costs for Lower Austrian companies rose by more than 57 percent between December 2020 and December 2022 alone – and only around half of the companies were able to pass on their cost increases to the market. Other factors such as agricultural or producer prices have also risen massively.

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High energy costs also affect investments

“The international competitiveness impaired by the energy costs is also having an effect on other domestic sectors,” warns WKNÖ Industry Division Chairman Schwarzl. “Because the cost pressure is also putting pressure on the investment opportunities for industrial companies and thus on orders for other Lower Austrian companies.” A clear decline in domestic investments is already noticeable, with expansion investments being particularly hard hit. Lower Austria’s industry can still score with its high quality and reliability. “But even the best quality will eventually reach its limits in competition if you can’t keep up with the price due to your own cost pressure,” warns Schwarzl and, on behalf of the Lower Austrian industry, urges “security of energy supply at competitive costs”.

Package of measures for energy, liquidity and secure supply chains

Against this background, WKNÖ President Ecker calls for a bundle of measures to ease the pressure on companies and to strengthen competitiveness and thus the location again. These include in particular:

Promote work more positively, including by expanding tax exemptions for overtime, encouraging older workers to work longer, and encouraging transitions from part-time to full-time

More flexible financing to cushion short-term liquidity bottlenecks and to promote investments.

Supply chains designed to increase location independence and protect security of supply.

A more resilient energy supply and further strengthened sustainable energy sources.

A competitiveness that no longer suffers from the Austrian gold plating of already strict EU regulations.

Questions & contact:

Economic Chamber of Lower Austria, Communications Department,
Wirtschaftskammer-Platz 1, 3100 St. Pölten
+43 2742 851-14100
[email protected]

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