FINANCES OF AUSTRIA

Press, Volume LXXXIX, Issue 27097, 21 July 1953, Page 11

FINANCES OF AUSTRIA

BIG RISE SHOWN IN EXPORTS

SERIOUS PROBLEM OF EMPLOYMENT (From a Reuter Correspondent) VIENNA. The volume of Austria’s exports in March reached the highest level since the end of World War 11, exceeding the results in 1937 by 44 per cent., according to the report of the Austrian Institute for Economic on the development of Austrian economy during the last two months. This Institute says that through increased exports of iron, steel, lumber, cellulose, machinery, metal goods, ,and clothing, the value of the Austrian exports -increased from 808,000,000 schillings in February to 976,000,000 schillings in March (£1 equals 90 Austrian schillings). Because imports in the same period increased by only 82,000,000 schillings to 1,107,000,000 schillings, Austria’s foreign trade deficit declined from 217,000,000 schillings in February to 137,000,000 schillings in March, including United States aid shipments. Emphasising that in spite of the considerable increase in the volume of exports their value was still unsatisfactory, the Institute expressed the hope that the recent unification of the foreign currency exchange rate on the basis of 26 schillings to one United States dollar, would give fresh impetus to Austria’s export trade if the Austrian exporters made full use of their increased export opportunities. On the general effects of the recent unification of the exchange rate on the economy, the Institute is optimistic since it experts “the raising of prices started through increased cost of imports to keep within relatively narrow limits.” 'Arguments put forward in support of this belief are the acute marketing crisis in many enterprises as well as the continuing trend of declining world market prices, factors which are regarded as conducive to the maintenance of a reasonably stable price level. Cost of Living

The Austrian Institute for Economic Research emphasised that the rise of import prices, automatically caused by the unification, would hardly affect the cost of living since the Austrian Government had taken measures to peg prices of vital food stuffs as well as public utility rates. The Institute levealed that in April the cost of living index had declined by no less than 1.8 per cent., which was 7.6 per cent, less than in April 1952 owing to price cuts of consumer goods and important food stuffs. It predicted that the new dollar exchange rate would result in a maximum increase of only 1.5 per cent, in the future cost of living.

The rise in import prices, however, the Institute declared, would place a heavy additional burden on the. Austrian budget, since the readjustment of the exchange rate freed the Austrian Government to give an additional 400,000,000 schillings a year in import subsidies. It added that the measure would be fully successful only if any upward trends of prices in Austria were curbed, if exports were increased and if the business world considered this currency measure as final. Much less optimistic was the Institute’s report on the latest development of the Austrian employment situation and of industrial production. In spite of a rapid decline in unemployment since the winter ended, and the growing activity of Austria’s building trade, which provided an additional 50,000 workers with jobs in April, 177,300 jobless were still registered with the Austrian Labour Exchanges at the end of April. This figure exceeded the unemployment rate of April 1952 by 29,900. Number on Pensions

The Institute emphasised the need for urgent measure to reduce the number of jobless, not only because of the social misery resulting from widespread unemployment but also to cover the growing social expenditure caused through the steadily increasing number of pensioners in Austria. At the end of February, it said, some 1,700,000 old-aged people were receiving pensions in Austria—or 150,000 more than the total of persons gainfully employed at that time. Austria’s agricultural production is "relatively high’’ and satisfactory, and the grain and fodder crops are al-. ready growing so well that a good harvest may be expected this year. But industrial production has still hardly recovered from the great decline in 1952 and is still between 8 and 10 per cent, below the 1952 level. The domestic demand remains small and foreign demand is decreasing. •

The chemical industry, several branches of the iron processing industries, and the textile industries are still suffering from considerable sales difficulties. The expected seasonal increase in the production of building materials during the last months has not come up to expectations, and was smaller than in the corresponding periods of 1952 and 1951. Emphasising that Austria’s industrial capacity is, under the present circumstances, not fully employed, the Institute for Economic Research expressed the opinion that there are hardly any indications that the situation will improve in the near future.