The government plans to present the long-awaited Industrial Strategy 2035 in January. One of the topics is competition. “Competition policy with rules and framework conditions is not a contradiction to industrial policy,” said ÖVP Economics Minister Wolfgang Hattmannsdorfer on Tuesday.
If Austria was not “ready to compete,” the country would find itself in a position “that we are not proud of,” said Hattmannsdorfer at a conference of the Federal Competition Authority (BWB) and Wifo. Market power should not be abused and more supply leads to low prices, Hattmannsdorfer made a plea for competition.
Many economists are fundamentally skeptical about interventionist industrial policy, said Wifo boss Gabriel Felbermayr. However, the geopolitical reality has changed dramatically; China and the USA are using economic dependencies on other countries as a means of pressure. Europe and Austria are open to blackmail and have to manage these dependencies.
70 billion euros
The Wifo boss advocates a European industrial policy, a strategy can no longer only be defined nationally and should not be defined too narrowly. Energy prices, bureaucratic burdens, non-wage labor costs and CO are important2-Theme.
Felbermayr estimated the volume of public procurement contracts in Austria at around 70 billion euros annually. You don’t have to immediately declare “Buy Austrian”, but you can use taxpayers’ money more for innovation when purchasing and focus more on economic interests.
ÖGB Federal Managing Director Helene Schuberth spoke out in favor of “strategic contract awarding in the public sector” and a qualification offensive for employees. The central point for the trade unionist is that energy prices are too high.
BWB boss Natalie Harsdorf reported that most complaints about market abuse come from small and medium-sized enterprises (SMEs). Fair competition is not an end in itself, “competition must be based on performance and not on principles”. Competition is unpleasant, “the best thing about a monopoly is the comfortable life,” said German competition expert Justus Haucap, advisor to CDU Federal Minister of Economics Katharina Reiche.
Tobias Schweitzer, AK division manager for economics, sees the railway industry in Austria as a positive example with “huge potential for expansion in the EU”. The domestic railway industry is today “where the car industry was 20 years ago”. A negative example, all experts agreed, was the Western Railway’s order for four Chinese trains. This is not fair competition because China does not allow the import of European trains.