Austria is grappling with a looming EU deficit procedure due to its rising debt levels.

The country’s deficit is projected to reach 4.1% of GDP in 2024, exceeding the EU’s 3% limit, while its debt-to-GDP ratio is set to surpass 80%, far above the 60% threshold.

The EU’s fiscal rules, suspended during the pandemic, will be reinstated in 2025, prompting Austria to consider significant budget cuts.

Experts suggest savings of up to €18.1 billion by 2031, with options ranging from immediate austerity to gradual reforms.

Economists emphasize the need for a balanced approach, combining spending cuts with investments in future growth.

The upcoming government faces tough decisions to align with EU rules while safeguarding economic stability.