Refugee Crisis Affects Economies

Refugee Crisis Affects Economies

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Refugee crisis affects economies across the world, especially Europe. Millions of migrants are on the move across borders, seeking shelter from war and poverty. These migrants put tremendous pressure on the economies as they need shelter, food and jobs. Europe has been reeling under economic turmoil since 2008. Now refugees put extra burden on the wings of European countries, especially Germany, UK and France.

Greece faced the economic recession at its peak and ironically, it is one among the primary target of refugees from the middle east. But we have to say that there are no easy solutions to the refugee crisis. To handle refugee problem, Germany may need  Ten Billion Euros for 2015, and should be even higher for 2016. German budget surplus rise from 0.3% of GDP to 0.6% of GDP in 2015. European Commission says in its economic forecast that nearly three million refugees and migrants could arrive in Europe by the end of 2017. The influx will increase the EU’s population by 0.4 percent.

But it has some positives too in the long term. GDP boost due to increased government activity, host countries are likely to see lower budget deficits in the long term because of migrants’ contributions, meaning more spare cash will be available to spend on public services.

The presence of refugees compounds the already prevailing economic, environmental, social and political difficulties in these countries. Political leaders across Europe and the U.S. are engaged in passionate, often divisive debates about refugee resettlement. The presence of refugees, and demands on the already severely strained economy, services and infrastructure add to the extreme hardship affecting the local populations. Their negative aspects may be felt long after a refugee problem is solved.

Economic and Social Impacts
  • From the moment of arrival, refugees compete with the local citizens for natural resources such as land, water, housing, food and medical services. Increased demand for food and other commodities can lead to price rises in the market which will stimulate local economic activity, although, again, not benefiting the poorest.
  • Presence of a large migrant population in rural areas means a strain on the local administration.
  • Other countries also force to support with aids for the host countries. So it is a global problem.
  • The economic impact of refugees on host areas, however, is not necessarily negative. An economic stimulus may be generated by the presence of refugees.

 Read More BBC  |  European Economy

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