Budgetary and Labour Market Policies Facing Major Challenges Despite Faster Growth. Economic Outlook for 1999 to 2001

WIFO is upholding its projections for real GDP growth of 2.2 percent in 1999 and 2.8 percent in 2000. A first outlook into 2001 suggests demand and output may continue rising at an above-average pace of 2¾ percent. Unabated strength of domestic demand should be accompanied by livelier exports and industrial activity. Price stability is set to remain high. The crucial challenges for economic policy will be public sector borrowing and unemployment: on both accounts, the government will, from today's perspective, fail to meet its own targets.