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Austria: Political earthquake continues – ING

Inga Fechner, economist at ING, points out that today marks the first time since 1945 that a motion of no confidence against the government in Austria was successful as the country’s political scandal has spread widely.

Key Quotes

“Last week’s release of a video of ex-vice-chancellor Heinz-Christian Strache, showing him talking about public contracts for campaign-support, has led to the resignation of Strache, snap elections in September, the dismissal of FPÖ’s interior minister Herbert Kickl, the subsequent resignation of all FPÖ government members, and last but not least a successful motion of no confidence against Chancellor Sebastian Kurz and the ÖVP’s government members.”

“While the scandal seems to have left its mark on Kurz’ former junior coalition partner, the FPÖ, it has strengthened the ÖVP. Apart from these outcomes, Austria’s election results are in line with the results on the European level with the Social Democrats (SPÖ) posting losses, while the Greens, who are currently unrepresented in the Austrian Parliament, and Liberals (NEOS) gained support.”

“President Alexander Van der Bellen will designate an interim government, which will run the government’s day-to-day business until after September’s snap elections. It will also be responsible for all upcoming EU decisions, including the election of the new European Commission president. This technocrat government will not take any new initiatives in the few remaining months before the election, however.”

“Regarding coalition possibilities after the September election, we would not yet exclude any combination.”

“With more than three months to go, it is too early to call the outcome, but as we have learned over the years, Austrian politics never ceases to amaze.”



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