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Wednesday, 9 February, 2000, 18:44 GMT
Boycott fears alarm Austrian business

Austrian tourist promotion Tourist officials say Austria's image could be badly damaged

International anger at the inclusion of the far right Freedom Party in Austria's new government is causing mounting concern amongst Austrian business leaders, who worry about the impact on the nation's economy.

The Prince of Wales' decision to cancel his trip to a British trade fair in Vienna makes him the latest in a series of high profile figures to reconsider their association with Austria.

Stock Stock prices on the Vienna bourse have come under heavy pressure
More and more tourists are cancelling their holidays, prospective investors are looking elsewhere, and even Austria's prestigious arts festivals feel the heat of international displeasure with the new government.

Most concern stems from Austria's exclusion from parts of the EU decision-making process - particularly when decisions affecting the country's economic future are at stake.

Moves to enlarge the union eastwards would open the door to a vast supply of cheap labour right on Austria's doorstep, which could add to pressure on Austrian industry.

As Austria's isolation deepens, share values on Vienna's benchmark ATX index have already taken a hammering.

Failing confidence

The economy is a long way from reaching crisis point but there are increasing fears that damage to Austria's international image could take years to repair.

After all - as any trader worth his bonus will tell you - a political crisis rarely does wonders for confidence in a nation's stockmarket.

Some pressure may be taken off the government by the announcement of what it bills as a radical economic reform programme.

Chancellor Wolfgang Schuessel's plan for more privatisation, tax cuts, and the long term aim of a balanced budget got a warm reception from business leaders when it was announced on Wednesday.

But pressure remains strong outside Austria for formal international sanctions. One area likely to be hit hard is tourism.

Big earner

The rise of Mr Haider's party has sparked growing international alarm
Austria's tourist industry has experienced massive growth over the past few years. Last year it brought in a record $14.2bn in foreign earnings

According to figures from the Austrian central bank, tourist earnings account for a higher proportion of Austria's economic performance than in any other industrialised nation.

Austria's ski industry has been a particular target for those urging sanctions.

Alarmed at the rise of Joerg Haider's anti-immigrant party, Belgium has cancelled a series of contracts with Austrian firms and urged its 350,000 nationals who regularly ski in Austria to find slopes elsewhere.

There are signs of a similar reaction from neighbouring Switzerland and Germany, which together account for the majority of Austria's tourist arrivals. Israeli travel agents have already cancelled large group bookings.

Anti-Haider protest Critics of Mr Haider are calling for formal sanctions to be imposed
With around 14% of the nation's workforce depending on tourism a major international boycott would have far-reaching implications. Shares in tourist-related businesses, such as national carrier Austrian Airlines, have already been showing signs of failing confidence.

For the moment however tourist officials say its is too early to gauge the impact on actual arrivals although they concede there have been "a handful" of cancellations.

"The Austrian welcome definitely hasn't changed" says Oskar Hinteregger, director of the Austrian National Tourist office in the UK.

Nonetheless the ripples surrounding the Freedom Party's rise to power continue to spread.

Cultural boycott

Earlier this week, Gerard Mortier, the Belgian artistic director of the prestigious Salzburg Festival announced that he was quitting his post saying he could not appear to be associated with an administration that includes Mr Haider's party.

I cannot work with people I consider to be fascists
Sylvain Cambreling
Conductor of Germany's Suedwestrundfunk Orchestra
Shortly afterwards Betty Freeman, one of the festivals principle foreign backers announced she would be withdrawing her support.

Other artists and writers have cancelled visits or performances in Austria in protest, adding to a growing cultural boycott.

The French movie legend Catherine Deneuve has said she will not take up an invitation to appear as guest of honour at the glittering Vienna Opera Ball in March.

She is reported to have expressed concerns that her presence at an occasion which Mr Haider is also expected to attend would imply an endorsement of his policies.

Senior European politicians have also said they will decline invitations.

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See also:
09 Feb 00 |  UK
Charles' Austria boycott attacked
08 Feb 00 |  Europe
EU trims meeting amid Austria fears
07 Feb 00 |  Europe
Austria's racial paradox
06 Feb 00 |  Europe
Haider threatens treason inquiry
04 Feb 00 |  Europe
US acts over Austrian far-right
04 Feb 00 |  Europe
Haider: View from the streets
03 Oct 99 |  Europe
Profile: Joerg Haider

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