Bilateral relations between Austria and Hong Kong

The relations between Austria and Hong Kong are by tradition good and friendly. Hong Kong, a 'Special Administrative Region of the People's Republic of China', is playing a significant role in many areas due to its autonomous status which is internationally recognized and guaranteed by international and state law according to the principle "one country, two systems". Economic aspects predominates the relations between Hong Kong and Austria: more than 60 Austrian companies have their representative offices and branches in Hong Kong, which indicates the continued importance of Hong Kong as a hub in the south-east Asian region and its perspectives for the Austrian economy.

(Source: Botschaft der Volksrepublik China in der Republik Österreich)

The Economy

Austria, with its well-developed market economy and high standard of living, is closely tied to other EU economies, especially Germany's. The Austrian economy also benefits greatly from strong commercial relations, especially in the banking and insurance sectors, with central, eastern, and southeastern Europe. The economy features a large service sector, a sound industrial sector, and a small, but highly developed agricultural sector. Membership in the EU has drawn an influx of foreign investors attracted by Austria's access to the single European market and proximity to the new EU economies. The outgoing government has successfully pursued a comprehensive economic reform program, aimed at streamlining government and creating a more competitive business environment, further strengthening Austria's attractiveness as an investment location. It has implemented effective pension reforms; however, lower taxes in 2005-06 led to a small budget deficit in 2006. Weak domestic consumption and slow growth in Europe held the economy to growth rates below 3% in 2002-05. Due to higher growth across Europe, Austria grew 3.3 percent in 2006. To meet increased competition - especially from new EU members and Central European countries - Austria will need to continue restructuring, emphasizing knowledge-based sectors of the economy, and encouraging greater labor flexibility and greater labor participation by its aging population.

(Source: The CIA World Factbook)

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