From the Super Mario Wiki
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Austria (Deutsch: Österreich) is a country in Central Europe. Mario travels to Austria in the Club Nintendo comic "Sag niemals Holerö!". Originally, he is spending a vacation in Switzerland (a neighboring country of Austria), but at some point, all humans in the country turns into food, most of them cheese. Frightened, he decides to leave the country as quickly as possible, but soon finds that the crew of the American airline that is supposed to bring him back to New York has turned into hot dogs. Now his plan is to go to Germany via Austria and to take a plane from there back home.
Arriving in Austria, Mario and TicToc (a Swiss not turned into cheese) find that the denizens have turned into mozartkugeln, a type of candy typical of Austria. However, they find an Austrian who is still in his normal form: Bomberman. Eager to solve the mystery, the three of them travel on to Germany.
Also, Austria is available as a country to represent in Mario & Sonic at the Olympic Games.