Although its only regular armed forces number less 40,000 and treaty limitations hamper its defense industry, neutral Austria, with cooperation from Greece, is building a thriving arms export business in Middle Eastern and other Third World countries.
Sharpshooters' rifles, hunting weapons and handguns made in Austria are now standard equipment with police and security forces from Miami, Fla., to Saudi Arabia and Argentina.
However, the centerpiece of Austria's unpublicized but thriving arms export trade is a series of jeep-like vehicles, armored cars and tanks. Many of these are assembled at a plant in this northern Greek seaport. Trucks and tracked vehicles are shipped by sea directly from Salonika to Middle Eastern and North African ports.
For Greece, a member of NATO even though it has kept out of many of the alliances's military activities since Turkey's 1974 invasion of Cyprus, there is a large bonus in this quiet collaboration with neutral Austria: the Greek armed forces, which have relied mainly on U.S. and French armor until now, are buying an undisclosed number of Austria's rugged, hill-climbing medium-size battle tank, the Kuerassier.
Observers who have witnessed trials of the Kuerassier say it can climb a slope of nearly 75 degrees -- something none of the 50 M60A3 main battle tanks that Chancellor Bruno Kreisky's government purchased from the United States last year can do.
Austria's biggest arms manufacturer, Steyr Daimler Puch, which opperates its Greek subsidiary here as a joint venture, is known around the world for its bicycles, motorcycles and heavy-duty trucks, as well as for its guns, tanks and munitions. Its 17,500 employes devot about one-quarter of their production to military supplies.
Some of Austria's biggest Third World arms deals, both publicized and otherwise, include:
Nearly 400,000 rifle cartridges to Syria in 1977. Israeli supporters raised an outcry in Vienna newspapers and the parliment, forcing the resignation of then Austrian defense minister Karl Luetgendorf. (At about the same time, Kreisky's government began discussions with Israel about a possible purchase of Israel's home-purchased Kfir jet fighter. It has made no decision yet.)
The sale of 120 tank destroyers, the Panzer-jaeger K (a variant of the Kuerassier tank) to Argentina in 1978. Bolivia bought 45, making the Austrian tank the backbone of that small North African country's armored forces.
Saudi Arabian Defense Minister Prince Sultan Recently visited Vienna and placed an order for Austrian handguns worth nearly $70 million for the Saudi armed forces.
Nigeria, black Africa's wealthiest oil state, is installing, with Steyr, a factory for assembly of Kuerassier tanks and other vehicles, ending its reliance on British armor.
Soviet pressure on Austria forced cancellation of a planned major arms export deal with China. The Soviet Union was one of the signatories of the four-power, 1955 Austrian state treaty, guaranteeing the country's neutrality. The treaty specifically forbids joint export deals with West Germany of the sort now under way with Greece at the tank plant here.
Austria justifies its arms exports partly on the need to keep down unemployment at home and partly to aid its balance of payments. In 1955, the year of the state treaty when the Soviet, United States, British and French occupation ended, its military expenditures were only $34 million. By 1979, these had jumped to $762 million, according to the Stockholm International Peace Research Institute.
Johann Ellinger, the press chief of Vienna's Defense Ministry, told the West German news magazine Der Spiegel: "When a small neutral says yes to building up its Army, it must automatically say yes to arms production. When it says yes to arms production, in the same breath it has to say yes to arms exports."
When news of a major tank sale to Chile broke in the Vienna newspapers July, Kreisky explained that the deal -- which like Austrian arms sales required approval by the interior and foreign affairs ministers as well as the Defense Ministry -- was "exclusively for Chile's external defense, not for use in internal troubles."
Therefore, he pointed out, this was not a violation of Austria's neutrality. (After extended debate, however, the Austrian governement decided Aug. 22 not to allow the Chilean deal to go through.)
This official neutrality has given the country, ironically, an involvement in the United Nations peacekeeping forces in the Middle East that has cost several casualties. A 330-man Austrian infantry battalion serves with United Nations forces in Cyprus. A larger battalion of 530 men keeps watch with the U.N. Observer Force along with the Israeli-Syrian cease-fire line in Syria, including ski patrols on snowcapped Mount Hermon.