Lithuanian entrepreneurs wishing to expand their company often look into opening a new branch abroad or into relocating to an entirely different country. A relocation can offer various strategic and economic advantages. For example, an international presence develops new markets. It also raises a company’s image and revenue. Austria, and more specifically the Vienna Region, is a promising business location with excellent economic opportunities. Lithuanian companies in Austria can benefit from a number of advantages – you will find some of them outlined below.
Strong business relations
Austria and Lithuania already enjoy excellent business connections. In 2019, the reciprocal exchange of goods and services exceeded EUR 1 billion for the first time. With a record volume totaling EUR 1.35 billion in 2021, Lithuania remains the most important of the three Baltic trading partners. (Source: WKO https://www.wko.at/service/aussenwirtschaft/litauen-wirtschaftsbericht.pdf)
According to Statistics Austria, exports of goods from Austria to Lithuania rose to EUR 341.6 million in 2021. Purchases from Lithuania also increased strongly to EUR 333.48 million.
Lithuania regularly runs a large surplus in trade in services. Austrian imports of services imports from Lithuania reached EUR 613 million in 2021 while Austrian services exports amounted to EUR 65 million. In both directions, transport services are in the first place.
Both countries enjoy a well-developed public transport network. Austrian and Lithuanian entrepreneurs share similar values when it comes to business relationships. Reliability and accuracy are good bases for lasting cooperation. In both countries, English is taught as a foreign language in school and spoken by most people. All of these factors facilitate the process of moving a Lithuanian company to Austria.
With 9 million inhabitants, Austria’s population is considerably bigger than that of Lithuania (2,8 million inhabitants). As a small national economy, Lithuania is highly dependent on the international economic climate. The Lithuanian economy is strongly export-oriented – exports account for over 80% of Lithuania’s GDP. In Austria, they account for about 56 %. The gross domestic product and the gross national product as well as the average income are much higher in Austria than in Lithuania. Lithuania’s economy is dominated by the tertiary sector, which generates about two-thirds of GDP. The manufacturing sector accounts for one-fifth of GDP, construction 7.3%, and agriculture and forestry 3.6%.
Lithuania’s foreign trade is dominated by trade with the EU countries. Hence, the economic development in these countries has a direct impact on the Lithuanian economy. In 2021 67.4% of imports came from the EU, and on the export side, the EU share was 57.7%. In addition, Russia has so far remained Lithuania’s most important trading partner, exports to Russia amounted to 10.8% in 2021. This is likely going to change with the Ukraine conflict and sanctions against Russia.
Life expectancy is lower in Lithuania than in Austria, where no population group is growing as strongly as the 50+ generation. Most Austrians over the age of 50 have a stable income and a stable family situation. They can now afford things for which they lacked time or money earlier in life and want to enjoy the prosperity they have achieved. Creating offers specifically for this target group is quite a successful business strategy – the “silver market” is a strong market of the future. (Source: www.wko.at)
Finding skilled staff
The Lithuanian labor market faces a shortage of skilled workers. Many Lithuanians have either moved to large cities or emigrated altogether (United Kingdom, Ireland, Norway). This trend has been halted, but the lack of skilled labor is putting pressure on productivity. Moreover, there isn’t enough practice-oriented vocational training.
In contrast, Austria is an immigration country – the population is rising. The Vienna Region is home to 18 universities, 10 universities of applied sciences, and 7 teacher education colleges. Motivated and excellently trained people graduate from these educational facilities. Based on Statistik Austria, the total enrolment amounts to over 210.000 students, 29% of who are international students. The Vienna Region attracts people from all over the world who bring their skills and talents with them. Lithuanian companies in Austria will find a much larger pool of potential employees here which is a great benefit for any business endeavor.
Research and Development
In view of the increasing pressure on competitiveness, the leap into more technology-intensive production is crucial for Lithuania. There is also a need for action to increase the research and development rate. Austria is very advanced in these aspects. The Vienna Region has an excellent educational system and a strong focus on research and development. Actually, Austria is amongst the EU leaders in this area, spending more than 3% of its GDP on research and development. In Lithuania, it is only 1,2% (Source: www.wko.at)
The Vienna Region is on a high-tech evolution course, encouraging innovation and the increasing use of AI. Recognized research facilities continuously design ways to increase effectiveness and productivity. On top of that, the necessary human resources and skills are available to implement new technologies. This future-oriented thinking makes the Vienna Region a very important business location that Lithuanian companies in Austria can benefit from.
Location and infrastructure
Lithuania’s geopolitical situation is currently causing uncertainty among investors to some extent. The Vienna Region is less directly affected by the consequences of the Ukraine war. It enjoys a very stable political and geopolitical situation in the center of Europe. Vienna, Lower Austria, and Burgenland, which form the Vienna Region, hold a veritable pole position. From here, companies can access to the expanding markets in Central and Eastern Europe. The excellent infrastructure is extensive and reliable. There is a network of motorways, an international airport, major railway terminals for regional and international rail travel, and freight transport down the Danube. Direct connections to major European capitals open up many new business markets.
Grants and subsidies
The Vienna Region is a hub for start-ups and new businesses. Establishing a new company or a production site is encouraged by government grants and subsidies. For Lithuanian companies in Austria, an extensive system of public funding and early-stage investments is available. Each of the three states – Vienna, Lower Austria, and Burgenland – has its own business agencies that assist entrepreneurs in setting up their companies. They provide all the important information on jump-start programs, business grants, and accelerators.
Made in Austria
Austria has an excellent international reputation. The country is valued for its music and art, historic buildings, and its cultural activities. It is also known for precision, accuracy, and top-notch quality. “Made in Austria” signals reliability and generates trust.
Naturally, more and more international companies are discovering the Vienna Region and its many advantages for their business. Ex-pats can look forward to a high quality of life, personal safety, low crime rates, excellent health care, clean air and water, lots of leisure activities, childcare benefits, and a great schooling system.
The Vienna Region is a prime choice when considering a company relocation or an international production facility. Lithuanian companies in Austria will enjoy many benefits and advantages – especially in the Vienna Region.
Let me give you five reasons why you should set up your headquarters in the Vienna Region:
- it is part of the 4th richest country of the European Union
- a high quality of life at affordable prices
- Excellent, highly-developed infrastructure
- highly qualified workforce
- outstanding spending capacity of customers
- home to many international companies, universities as well as research facilities
- direct access to South East and Eastern Europe
- high level of personal security, political stability and legal certainty
- an international as well as cosmopolitan region due to a population with migration background
What a founder-friendly location needs is a focus on the global market. Austria’s location in particular makes it an ideal hub for the international start-up scene in Central and Eastern Europe.
Follow our social media profiles for more infos about our region.
Would you like to find out more about the Vienna Region?
Visit our blog or our other social media channels. Here you will find the symphony of opportunities in the Vienna Region.