(Reuters) – Credit standing company S&P International Rankings has revised Austria’s outlook to optimistic from steady, citing the nation’s bettering vitality provide place and stable budgetary scenario.
“The positive outlook reflects the potential that Austria’s energy supply position improves further while its economy remains robust over the next 24 months,” S&P stated in a press release late on Friday, affirming the nation’s AA+/A-1+ long- and short-term international and native foreign money sovereign credit score scores.
The optimistic outlook additionally mirrored the opportunity of clear and discernible budgetary consolidation, with declining funds deficits, the company added, delivering its view as Austria’s authorities gears up for a normal election on Sept. 29.
S&P stated it thought-about Austria’s economic system to be “broadly resilient”, even when a longstanding take-or-pay contract between Austria’s greatest vitality provider OMV and Russian fuel agency Gazprom (MCX:) ends on the shut of this yr, when the fuel transit contract between Russia and Ukraine is because of expire.
It famous that whereas Austria’s publicity to Russian fuel stays comparatively excessive, at 83% of complete fuel imports as of June, it discovered that the nation had made important progress in diversifying its vitality provides.
Thus, Austria seemed nicely geared up to deal with potential short-term disruptions arising from the top of the transit contract between Ukraine’s Naftogaz and Gazprom, S&P stated.
The ranking company expects Austria to put up a normal authorities deficit of three.0% of gross home product (GDP) this yr, which it forecast would shrink to 2.5% by 2027.
S&P famous that budgetary plans pursued by a brand new authorities after the election may differ from its present forecast, and may must observe a stricter consolidation path to be compliant with the European Union’s fiscal framework.
