The European Union’s refugee crisis

Migrants could provide lift to economy

A migrant camp in Calais, France. In a forecast, EU officials predicted that the three million migrants expected over the next three years would provide a small net gain to the European economy by 2017.
A migrant camp in Calais, France. In a forecast, EU officials predicted that the three million migrants expected over the next three years would provide a small net gain to the European economy by 2017.PHOTO: AGENCE FRANCE-PRESSE

Two institutional forecasters have come up with different projections on the economic impact of hundreds of thousands of migrants and refugees in Europe. But the contradiction was not as stark as it may seem. They were looking at different types of countries on the migrant route.

BRUSSELS • European Union officials have put a positive economic spin on the bloc's refugee crisis.

In a forecast, officials predicted that the three million migrants expected over the next three years would provide at least a small lift - a net gain of perhaps a quarter of 1 per cent to the European economy by 2017.

With that prediction, the European Commission, the bloc's executive arm, used one of its periodic economic forecasts to wade into one of the most divisive issues Europe has faced in decades: migration.

The arrival this year of large numbers of people from Syria and other war-torn countries has driven a wedge between countries like Germany, which have sought a more accommodating stance, and those like Hungary, which want far tighter border controls.

The commission, in its autumn economic forecast, said "the arrival of large numbers of asylum seekers" would require increases in public spending to manage the influx - spending that would provide a stimulus to the European economy.

There would also be an additional positive impact from the increase in workers, "provided the right policies are in place to facilitate access to the labour market", the commission said in a news release.

The projections in Thursday's report support a statement made in September by the commission's president, Mr Jean-Claude Juncker, that migration could be an antidote to looming labour woes in Europe, where an ageing population threatens economic growth. Migration should be a "well-managed resource" rather than a problem, Mr Juncker said in his State of the Union address to the European Parliament.

Mr Pierre Moscovici, the EU's Commissioner for Economic and Financial Affairs, told a news conference shortly after the numbers were made public that migration would have only a "weak" impact on growth, but one that would be "positive for the EU as a whole". The forecasts still needed to be checked over the coming months, he said.

But the initial estimate "challenges some of our misconceptions" about migration, he said, apparently referring to the idea that asylum seekers would add an economic burden.

The commission expects asylum seekers this year to add about one million people to the European Union's population, which stood at 508.2 million in January.

An additional 1.5 million will enter next year, and then a half- million more in 2017, the commission predicted. The total would increase in the European Union's population by 0.4 per cent "at most", assuming that some asylum applications are rejected, the commission said.

NEW YORK TIMES

A version of this article appeared in the print edition of The Straits Times on November 07, 2015, with the headline 'Migrants could provide lift to economy'. Print Edition | Subscribe