After the signing of the State Treaty, Austria's foreign policy concerns focused on three issues: South Tirol, European economic integration, and the meaning of neutrality. The status of the ethnically German province of South Tirol had been an Austrian concern ever since the province's transfer to Italy after World War I. Austria hoped that Italy's participation on the losing side of World War II might open the door to the Allied powers awarding the disputed territory to Austria. But the strategic interests of the Western Allies after the war forced Austria to settle for a 1946 agreement in which Italy promised South Tirol autonomous rights.

In 1948, however, Italy undercut the autonomy of the South Tiroleans by expanding the autonomous region to include the entire province of Trentino, the total population of which was two-thirds ethnically Italian. The South Tiroleans appealed to Austria for assistance. The General Assembly of the United Nations (UN) adopted a resolution in 1960 instructing Italy and Austria to enter into negotiations on the issue. Austria's right to intervene on behalf of the South Tiroleans was thus affirmed but brought no results until 1969. In the intervening years, South Tirolean activists undertook a terrorist bombing campaign, which, Italy alleged, Austria facilitated through lax border controls. The 1969 agreement affirmed South Tirol's autonomous rights, including the use of German as the official language. The International Court of Justice at The Hague was given the right to judge disputes over implementation of the pact, and Austria waived its rights to intervene.

Although the OEEC continued to function as a coordinating body for European economic integration after the end of the Marshall Plan in 1952, six of its members sought closer economic integration. In 1957 they formed the European Economic Community (EEC--see Glossary). Because Austria's main trading partners, the Federal Republic of Germany (West Germany) and Italy, belonged to the EEC, Austria would have liked to join that organization. But provisions in the EEC agreement imposed obligations in time of war, which were viewed as inconsistent with Austrian neutrality. Further, EEC membership also raised questions regarding unification with Germany, which was forbidden by the State Treaty. Austria thus joined six other countries in a looser, strictly economic association, the European Free Trade Association (EFTA--see Glossary), established in 1960. This was not an entirely satisfactory solution, and in 1961 Austria sought limited, associated membership in the EEC.

The Soviet Union objected to Austria's association with the EEC as a violation of Austria's neutrality. Austria responded that because its neutrality was a matter of Austrian law, Austria alone had the right to judge what were or were not violations. Nonetheless, Austria proceeded cautiously to avoid needlessly provoking the Soviet Union. EEC members also questioned Austria's membership. Italy blocked Austria's application to the EEC in 1967 because of the dispute over South Tirol. French president Charles de Gaulle was cool toward Austrian membership, both because of his desire to maintain relations with the Soviet Union and because of his concern that it might strengthen West Germany's position to the detriment of that of France. Austria's persistence, the resolution of South Tirol's status, and de Gaulle's retirement, however, paved the way for an agreement between Austria and the EEC in 1972 (see Austria and European Integration , ch. 3).

When Austria adopted a policy of neutrality in 1955, its leaders made it clear that political neutrality did not mean moral neutrality. Austrian sympathies clearly lay with the Western democracies, an attitude that was reinforced by its opposition to the Soviet invasion of Hungary in 1956 and of Czechoslovakia in 1968. Nonetheless, Austria attempted to cultivate good relations with the Soviet bloc countries, which accounted for about one-sixth of Austrian exports in the mid-1960s. Austria thus benefited when détente eased relations between East and West in the late 1960s and early 1970s. Austria's efforts to make itself a bridge between East and West-- an idea the Austrians had proposed as early as 1945--however, remained a largely unfulfilled ambition.

Data as of December 1993