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April 2004, Volume 11, Number 2

Austria, Slovak Republic

Austria is a country of 8.1 million with a $24,000 per capita GDP; the Slovak Republic has 5.4 million residents and a $4,000 per capita GDP. After May 1, 2004, borders between these formerly distant neighbors will be far more permeable.

Austria recruited guest workers during the 1960s from Yugoslavia and Turkey, halted guest worker recruitment in the 1970s, and dealt with family unification among settled guest workers, asylum seekers, and east-west migration in the 1980s and 1990s. The net migration of foreigners into Austria peaked at 90,000 in the early 1990s, and was 24,000 in 2001. Austria has about 7.4 million Austrian citizens and 760,000 foreigners; 20 percent of the foreigners were born in Austria.

Both the Austrian citizen and foreign populations are growing slightly. There are about 7,500 more deaths than births among Austrians each year, and 6,000 Austrians emigrate, but 30,000 foreigners naturalize. About 60 percent of those naturalizing are from ex-Yugoslavia and Turkey.

The 330,000 foreigners employed in Austria in 2001 were 10.5 percent of total employment; half were from the ex-Yugoslavia, 20 percent were Turks and 11 percent were EU nationals, mostly Germans. Some 111,000 work permits were issued to foreigners in 2001, and 75,000 Austrians are employed in Germany (85 percent) and Switzerland. The unemployment rate of foreigners is about 1.5 times the Austrian rate. Since January 1, 2003, non-EU foreigners with residence permits have been required to speak basic German or pay half of the cost of German language courses.

Immigration is subject to a numerical limit, 8,050 in 2004, and the two major streams of newcomers are further categorized into key employees (2,200) and family reunification (5,500) and then assigned to Austria's nine provinces. There are perhaps 70,000 unauthorized foreigners in Austria. In mid-2002, Austria expanded options for non-EU nationals to be employed for up to 12 months in non-seasonal industries, after which the worker is to return home for at least two months. This new guest worker program is aimed at nationals of EU accession countries. Foreign students were also permitted to work part time.

The number of asylum-seekers has risen sharply in the past few years, to 30,100 in 2001, 39,400 in 2002, and 32,400 in 2003. Some 20 to 25 percent of the asylum applicants are recognized as refugees. Asylum laws were changed effective May 1, 2004 to require an initial decision on applications, which must be made at embassies and airports, within 72 hours of arrival in Austria. In the past, many foreigners applied for asylum in Austria and then continued further west, abandoning their applications.

Immigration and integration have been controversial in Austria, with Joerg Haider and the Freedom Party leading the campaign against more foreigners. It won 42 percent of the vote in the elections of March 2004, and Haider was re-elected governor of Carinthia in March 2004. National support for the Freedom Party dropped from 30 percent in 2002 to 10 percent in 2004.

Slovak Republic. The Slovak Republic has fast economic growth, but the unemployment rate remains 16 percent. There is relatively little emigration and immigration, and most of the movement is between the Czech and Slovak Republics, where there has been free movement since 1992. Some 64,000 Slovak workers were registered as employed in the Czech Republic in 2001, 17,000 in Germany, and 5,000 in Austria.

The Slovak Republic had 8,100 asylum applications in 2001; 5,000 were administratively terminated rather than refused, and 18 foreigners received asylum. New asylum laws in 2002 brought Slovak law and procedures into conformity with EU laws. Illegal migrants tend to enter the Slovak Republic over the Hungarian and Ukrainian borders, and to exit via the Czech and Austrian borders- the Slovak Republic is largely a transit country.

In 2002, new migration laws defined three types of foreigners: tolerated residence for up to six months, temporary residents for one to three years for work or study, and permanent residence for three years followed by unlimited residence. There are about 30,000 foreign residents of the Slovak Republic.

About eight percent of Slovaks are Roma or Gypsies, most of whom are in the eastern and poorer part of the country. In 1999-00, the government announced new measures aimed at reducing discrimination and promoting economic development in areas with Roma, including easing access to education for Roma children, improving living conditions by building 1,000 apartments, and reducing long-term unemployment [There are an estimated seven million to nine million Roma in central Europe, a third in Romania].

In January 2004, Slovak Roma protested cuts in unemployment and welfare benefits that reduced payments from about the minimum wage of $400 a month to $200 a month. The overall unemployment rate is 30 percent in some eastern districts, and some of those whose benefits were cut responded by looting stores. The center-right government of Prime Minister Mikulas Dzurinda said the looting was organized by Roma loan sharks who had made a profitable business of lending money to Roma families in anticipation of their welfare payments.

In 2004, several hundred Slovak Roma traveled by bus to Prague, flew to Helsinki, and applied for asylum. Even though almost all had their applications rejected, including 20 percent who applied and were rejected before in Finland, the E135 a week they received while waiting for decisions on their applications apparently made the trip worthwhile.

Moderate Ivan Gasparovic defeated Vladimir Meciar, the former prime minister who led Slovakia after its split with the Czech Republic in 1993, in presidential elections in April 2004. The current Czech president, Vaclav Klaus, was the prime minister with whom Meciar negotiated the Czechoslovakian divorce.

Slovakia may become the Detroit of Eastern Europe- both Peugeot Citro‰n and the Kia Motors unit of Hyundai Motor are building auto assembly plants in the country. Volkswagen has a plant in Bratislava, and Slovakia could be producing 850,000 cars a year by 2006. Slovakia offered the car-makers free land, worker training and reduced taxes. In 1998, Slovakia introduced a flat tax of 19 percent for corporations and individuals, one of the lowest rates in the EU.