Austria's debt exceeds 412 billion euros
Austria has now become a focus of interest for the European Union due to the deterioration of its financial situation, as it faces the risk of undergoing a punitive measure related to the budget deficit. The Eurogroup has demanded that the Austrian government take immediate measures to address the situation, especially in light of the public debt rising to 412.6 billion euros by the end of March, an increase of 18.5 billion euros from the end of 2024.
Data from Statistik Austria showed that the public debt-to-GDP ratio rose from 81.8% to 84.9%, moving away from the European target of only 60%, according to Maastricht criteria. The new government in Austria has made budget reform a top priority, with Finance Minister Markus Hartmann (from the Social Democratic Party SPÖ) stating that "everyone will be affected by the austerity package," indicating that the upcoming measures will not spare anyone, whether from the federal government or the states and municipalities.
A decision is expected to be made regarding the initiation of formal proceedings against Austria due to the deficit at the meeting of the Economic and Financial Affairs Council (ECOFIN) in Brussels on July 8. This is due to the budget deficit reaching 4.7% of GDP last year, with a planned deficit of 4.5% this year, clearly exceeding the European ceiling of 3%.
Austria is not the only country under scrutiny, as the budgets of Finland, Latvia, and Spain have also been examined. In this context, the European group welcomed the submission of Austria's bilateral budget for 2025 and 2026, but emphasized the need for Austria to be prepared to take responsible financial steps, confirming that it will continue to closely monitor the financial situation and enhance political coordination.
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