Öxit: What would it cost Austria if it left the EU?

EU-scepticism, particularly among far-right parties, has been on the rise in Austria. These parties have gained traction in polling intentions, advocating for populist policies such as the people's right to self-determination nationally. 

Austria is among the most EU-sceptical countries, according to a Eurobarometer survey.

Around 22 percent of Austrians think that their country's membership of the EU is 'a bad thing' (EU average: 10 percent). This sentiment is driven by various factors, including concerns about national sovereignty, economic issues, and immigration policies. And 38 percent believe Austria has not benefited from being a member (EU average: 22 percent). 

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Membership of bloc is often blamed for many of Austria's problems, from immigration issues to the ORF contribution fee, even if the EU has nothing to do with the latter. With immigration, the bloc's policies and regulations are used as an excuse by politicians of all political spectrums, many of which seem to imply Austrian regulations would be more strict - if only the EU allowed it.

So many voters seem to favour an Austrian exit from the European Union—or an "ÖXIT," as it is sometimes referred to. But what would happen to Austria's economy if it followed the example of the UK?

ÖXIT an 'expensive affair'

A new analysis by the Austrian Institute of Economic Research (WIFO) shows that leaving the bloc would be more harmful than favourable to the Alpine land. 

The Economic Research Institute calculates that leaving the European Union would potentially de-stabilize Austria's economy, costing between 5.3 and 10.4 percent of its gross domestic product. In absolute figures, the cost of quitting the EU would be between €24 billion and €47 billion per year.

Most of the cost to Austria's economy would come by exiting the single market.

According to the research, the EU's Single Market provides the most significant benefit of being a member of the bloc.

It allows for the free movement of goods, services, capital, and people, fostering economic growth and competition.

According to the analysis, Austria would also lose out economically if it was no longer part of the EU's borderless Schengen zone. 

Austria, is at the centre of the bloc which means goods and people are constantly crossing borders. The reduction of checks on good and passengers is particularly significant to helping create prosperity the report found.

And the research also concluded Austria would lose out if it left the EU's monetary union, which is considered another factor that provides economic stability and facilitating trade.

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Researchers found that leaving the EU would impact Austria economically even more than it did the UK, mainly because the British have a larger domestic market but also because of Austria's geographical location at the heart of Europe.

The study also showed that Austria's membership of the European Union is associated with economic benefits that exceed the net contribution to the EU budget by "at least a factor of 10". 

Some benefits cannot be quantified

The researchers also emphasised that their analysis only provides the 'lower limits' for the actual costs. This is because 'the benefits of EU integration on innovation activity, foreign and security policy or the individual freedom of citizens cannot be precisely quantified', they wrote.

They also mention that the bloc could potentially benefit from policies that remove internal barriers. 

They suggest creating a single market for energy, a capital markets union, or a European infrastructure initiative, which could significantly increase the EU's economic benefits for Austria and potentially boost much-needed economic growth.