Compared to the pre-crisis level, an average week in 2019 as a fixed reference period, the GDP gap in calendar week 23 (7 to 13 June 2021) has narrowed by 0.3 percentage points, according to preliminary calculations, thus almost closing (–0.1 percent). Compared to the same week last year, GDP is currently 11.8 percent higher.

With the foreseeable end of the COVID-19 pandemic, the question arises as to how Austrian economic policy can instrumentalise the recovery to direct and facilitate structural change. Against this backdrop, a WIFO study examines economic policy levers to foster investment. Particular attention is paid to digitalisation and green investments.

After the winter season from November 2020 to April 2021 was almost completely cancelled due to lockdown, tourism in Austria is expected to recover in summer 2021 according to current WIFO estimates. For 2021 as a whole, the outlook remains bleak, with around 12 percent fewer overnight stays than in 2020 and demand more than 40 percent lower than in the pre-crisis year of 2019.

"The GDP gap relative to the pre-crisis year 2019 narrowed significantly recently. At the end of May, it amounted to around 1 percent. The pre-crisis level should be reached within the next few months," says Christian Glocker, author of the current WIFO business cycle report.

Sentiment among Austrian companies continued to improve in May. After an increase of 6.2 points, the WIFO Business Climate Index was at 18.0 points (seasonally adjusted). This is the highest value since October 2018. Only in those sectors that continued to be affected by COVID-19 restriction measures the situation assessments remained sceptical. However, economic expectations in all sectors signal optimism. The economy is picking up speed.

Today, 19 May 2021, the Austrian Parliament votes on the EU's own resources decision. A recent article of the WIFO-Monatsberichte (monthly reports) Julia Bachtrögler-Unger, Margit Schratzenstaller and Franz Sinabell describe the changes compared to the previous Multiannual Financial Framework (MFF), the instruments to cope with the COVID-19 crisis and the transformation towards climate neutrality.