Austria
IT Financing
Executive Summary
Until recently, Austria maintained a minimum presence in the ICT sector, which was reflected in the minimum amount of financial support that the sector received. The country’s newfound focus results from its realization that ICT is imperative in a global marketplace. The following section discusses some of the funding allocations in Austria.
IT Financing
Until recently, ICT
was not a major focus for Austria. The country maintained a minimum level
of activity, which required a minimum amount of funding. It is beginning to
realize, however, that without a strong ICT sector, the country will not be
competitive in the global marketplace. In 2001, Austria spent approximately
$9 million or 7.2 percent of its GDP ($245.3 billion) on ICT (21), which is comparable to Germany’s 7.9 percent in that same
year. The following chart shows ICT spending as a percentage of GDP in 2001.
According to this chart, Austria falls below the world average but is still
considered one of the leading countries.
Source: World Information Technology and Services Alliance, Digital Planet
2002
According to the Organization for Economic Co-operation and Development’s IT Outlook, funding for research and technology has increased in Austria. For instance, the country’s largest source of public funding, the Austrian Industrial Research Promotion Fund (FFF), has increased its funding by 37 percent since 1999 (16).
In order to improve the skills and awareness of its
citizens, Austria has launched several educational programs. By 2006, the Federal
Ministry of Education, Science, and Culture, will spend approximately €
72.7 million on its e-FIT initiative.
The Council overseeing Austria’s Vision 2005: To be the Best Through Innovation has pledged to raise Austria’s R&D quota to at least 2.5 percent (ATS 86 billion) of GDP from its current level of 1.8 percent (ATS 50 billion) by 2005. These funds will support initiatives that improve the quality of Austria’s human capital and will help Austria to pilot and participate in joint international projects.
By improving its competitive position in research and technology, Austria expects to attract more foreign investments (i.e. multi-national companies). In accordance, the country offers such incentives as:
- Optimizing of co-financing (matching funds) with federal states, international institutions and through public-private partnerships
- Establishing and expanding funding for a non-budget financed institution (National Fund, Research Foundation, etc.)
- Earmarking state revenue for research and development
- Tailoring budget financed university research according to economic, social and societal usability
- Significantly increasing the share of money to be obtained through competitive procedures, particularly in the university sector
The country has also increased incentives and support programs for setting
up new businesses, such as tax concessions and authority involvement.