Austria’s central bank chief, Robert Holzmann, reassured Europe that there’s no reason to fear an economic disaster if the anti-globalist Freedom Party (FPÖ) leads the government.
Speaking with European media, Holzmann pointed out that while it remains to be seen what policies the new government will pursue, he hasn’t seen anything alarming so far. “I don’t see anything that worries me… and I do not expect it,” he added, specifically addressing the proposed €6.3 billion spending cuts and the effort to bring Austria’s budget deficit below the EU’s 3% limit this year.
The European Union seemed to share Holzmann’s optimism. EU Commission spokesman Balazs Ujvari stated that Austria wouldn’t face an “excessive deficit procedure” for its fiscal slippage last year, effectively endorsing the FPÖ-ÖVP budget proposal.
With the FPÖ emerging as the largest party following the September election, the government has begun to take shape, with leader Herbert Kickl negotiating with the Austrian People’s Party (ÖVP) to form a coalition. While this has raised concerns in Brussels about the FPÖ’s potential alignment with Russia, Holzmann doesn’t believe Austria will veer away from Europe. He clarified, “The FPÖ is not anti-European, but critical of how Europe is being managed today,” emphasizing that such criticism shouldn’t be mistaken for a rejection of European values. He also reminded critics that the FPÖ supported Austria’s European Economic Community membership in the 1960s, a stance that contrasts with the anti-globalist AfD party in Germany.
However, the FPÖ’s platform has raised eyebrows among left-liberals, with calls for limiting immigration, curbing social benefits, and ending military aid to Ukraine. Despite this, Holzmann believes the real threat to Europe lies not in Austria’s government, but in the broader lack of leadership and ideological fragmentation across the continent. He pointed to these challenges as more pressing at a time when European unity is needed most.
On the issue of inflation, Holzmann cautioned that the European Central Bank (ECB) must remain cautious in its approach. With inflation still above the target, particularly due to energy price volatility and rising oil costs, Holzmann warned against rushing into further interest rate cuts. “Cutting interest rates when inflation rises faster than anticipated risks hurting credibility,” he stated, adding that he wasn’t convinced the inflation battle was over yet. “I’m now a bit more skeptical than I was at the beginning of the year,” he admitted, suggesting that persistent inflation risks may complicate the ECB’s policies.
Ultimately, Holzmann’s message is clear: while Europe may face challenges, the economic outlook for Austria under an anti-globalist government isn’t as dire as some might believe. The central bank chief’s position provides a calm counterpoint to the growing anxieties in Brussels and beyond.
