Austria's Power Play: Hard Or Soft?

Soft power is a country's ability to shape the preferences of others through appeal and attraction, rather than coercion. It is a relatively new concept, coined by Harvard Professor Joseph S. Nye in 1990. In contrast, hard power is the use of coercion and payment to achieve a country's desired outcomes. While soft power is generally considered less credible and less effective than hard power, it is lower-cost and lower-risk. This raises the question of why certain countries, such as the United States, continue to rely heavily on hard power. This paragraph will explore whether Austria exercises hard or soft power.

Austria's international standing

Austria's interim technocratic government has maintained stability in the aftermath of this scandal, but the long-term impact on domestic and international perceptions of Austrian politics remains to be seen. The country's digital diplomacy efforts have suffered, with online engagement from key political figures tumbling. To restore trust and engagement, the newly-elected government will need to address the resulting cynicism through traditional and digital platforms.

Austria's soft power capabilities contribute to its international standing, as it seeks to shape behaviour and preferences through cultural exchanges, public diplomacy, and the appeal of its values and policies. However, it is important to note that soft power is not always benign, and it can enable the exercise of hard power.

The country's business environment

Austria has a thriving business environment and is considered a highly business-friendly country. It has a high-income economy with a high standard of living and is an OECD member. The country has a strong international trade infrastructure and is a strategic economic player in the EU due to its central location.

Austria has a well-developed transport network, with good road, rail, and waterway connections. The country also boasts a high percentage of renewable energy, with 76.2% of its electricity generated from hydropower and wind power. By 2030, Austria aims to be producing 100% green electricity. The country's energy supply is secure, and its digital infrastructure is advanced, with high internet penetration rates.

Austria's population is ageing, with a median age of 43.8 in 2021 and a population growth rate of 0.3%. The country has a very high level of education, with 86% of adults aged 25-64 having completed secondary education and 34.2% holding a higher education qualification. This contributes to its status as an attractive research location.

Austria's purchasing power is among the highest in Europe, and it is considered a consumer society. However, consumer confidence has declined in recent years, particularly due to the COVID-19 pandemic and the Ukraine war. E-commerce is widespread, with nearly 5 million online shoppers.

The country has a strong export industry, with around a third of its products and services exported to over 200 trading partners. Germany, Italy, and the USA are among its most important export partners. Austrian companies are particularly successful in the technical sector, including vehicle and mechanical engineering, and metalworking.

Austria has a lean bureaucracy, and its administrative procedures are efficient, with many services available online. The country also has a stable political system, with a functioning state ruled by law, quick court decisions, and good payment practices. The "social partnership" system, in which employers' and employees' associations collaborate, helps to prevent strikes and promote reliability and long-term planning for businesses.

Digital diplomacy

Austria has been actively engaging in digital diplomacy, with a focus on tech diplomacy, to enhance its international relations. The country's digital diplomacy efforts have been led by senior diplomat and tech governance expert, Martin Rauchbauer, who served as Austria's first Tech Ambassador to Silicon Valley. Rauchbauer has played a pivotal role in shaping the field of tech diplomacy, engaging in transatlantic tech diplomacy and advocating for digital human rights.

Tech Diplomacy

Tech diplomacy refers to the practice of diplomacy that engages with the private tech sector on digital policy and emerging technology issues. Austria has embraced this approach by establishing Open Austria in Silicon Valley, a platform that fosters collaboration and dialogue between diplomats, civil society, the tech industry, and relevant stakeholders. This initiative underscores Austria's commitment to human rights in the digital age and its belief in the need for digital humanism.

Digital Infrastructure and Online Engagement

Austria boasts a robust digital infrastructure and high internet penetration rates. However, the country's ranking in the Digital sub-index has suffered due to a decline in online engagement with key political figures. The interim government's reduced activity on online platforms has resulted in a poorer performance in digital diplomacy metrics. To improve its standing, Austria must effectively utilise traditional and digital platforms to restore trust and engagement with its citizens.

International Presence

Austria maintains its position as an international hub, hosting the headquarters of several prominent organisations, including the Comprehensive Nuclear-Test-Ban Treaty Organization, International Atomic Energy Agency, Organization for Security and Co-operation in Europe, United Nations Office on Drugs and Crime, and OPEC, all based in Vienna. This international presence further enhances Austria's diplomatic influence.

Future Prospects

Austria's digital diplomacy efforts have positioned it as a bridge builder between nation-states and the global tech industry. By actively engaging with tech companies and relevant stakeholders, Austria is at the forefront of shaping the future of digital governance and policy.

The use of soft power to enable hard power

Soft power is a country's ability to shape the preferences of others through appeal and attraction, rather than coercion. It is a non-coercive way to enact change through culture, political values, and foreign policies. While soft power is often viewed as a alternative to hard power, it can also be used to enable hard power.

Soft power can be used to legitimize the use of hard power. For example, in the context of the War on Terrorism, then US President George W. Bush's statement, "you're either with us or with the terrorists," forced listeners to identify with the United States and helped legitimize the use of violence. Similarly, China's rhetoric of harmony and its attempts to present itself as a peaceful superpower can be seen as a form of soft power that enables its hard power actions, such as its heavy-handed discipline of minorities and dissidents.

Additionally, soft power can create the conditions for the use of hard power. For instance, China's soft power investments in Latin America, particularly in countries like Nicaragua, have paved the way for arms deals, access to natural resources, and infrastructure projects. This soft power approach has allowed China to gain a foothold in the region and potentially exert greater influence in the future.

Furthermore, soft power can be used to build alliances and partnerships that can support hard power actions. For example, the United States' use of soft power through cultural exchanges and public diplomacy initiatives has helped strengthen its relationships with other countries, which can then be leveraged for hard power purposes.

However, it is important to note that the use of soft power to enable hard power is not without its challenges. As Linus Hagström, a Professor of Political Science at the Swedish Defence University, points out, soft power can be dangerous when it creates an "us vs. them" narrative that justifies military violence or aggressive geopolitical actions. Additionally, measuring the success of soft power campaigns can be difficult, as it involves changing attitudes and beliefs, which are complex and dynamic.

In conclusion, while soft power can be a valuable tool for enabling hard power, it should be approached with caution and a thorough understanding of its potential risks and limitations.

Austria's ranking in the Government sub-index

Austria's interim technocratic government has maintained stability in the immediate aftermath of the scandal, but the long-term impact on domestic and international perceptions of Austrian politics remains to be seen. The political shocks may have affected Austrian citizens' trust in their government, but general well-being in the country remains high.

Austria has also maintained its position as an international hub, with the Comprehensive Nuclear-Test-Ban Treaty Organization, International Atomic Energy Agency, Organization for Security and Co-operation in Europe, United Nations Office on Drugs and Crime, and OPEC all headquartered in Vienna.

Frequently asked questions