How the Refugee Crisis Will Reshape the EU

How the Refugee Crisis Will Reshape the EU

The arrival in Europe of more than 1 million asylum seekers in 2015 rattled the EU like no crisis before it. The EU’s current institutional and legislative arrangements were clearly not up to dealing with the huge influx of migrants, and the crisis laid bare deep divisions among the member states. Depending on the extent to which the EU can overcome these divisions and improve its policies, the refugee crisis could lead to either more Europe, less Europe, or the emergence of a new core of committed member states.

With a lack of robustness to cope with crisis situations, the Schengen system of open borders turned out to be a fair-weather arrangement. Amidst a massive inflow of refugees, the EU’s Dublin Regulation, which assigns the responsibility for registering and processing asylum applications to the first Schengen country the refugees enter, proved unsustainable. Greece and Italy instead of fulfilling their obligations allowed refugees to move on to wherever they wanted. This imposed an equally unsustainable burden on other member states, where most of the refugees ended up, e.g. Germany, Sweden, Austria, the Benelux (Belgium, the Netherlands and Luxembourg), and Finland.

Similar to the eurozone turmoil, the refugee influx in 2015 quickly became a matter for the European Council, which brings together EU heads of state and government. After much dillydallying, some significant decisions were made. These included a scheme for the relocation of 160,000 refugees from Italy and Greece to other Schengen states, the establishment of processing centres on the EU’s external borders, a complex agreement with Turkey designed to curb the flow of refugees on the Western Balkan route, and commitments to better finance the UN programmes supporting refugees in the Middle East. However, the implementation of most of these decisions made painfully slow progress.

Why the EU has Failed So Far?

Overcoming differences of interests and viewpoints is one of the hallmarks of the EU’s success over past decades. Why did the EU find this task so difficult in the case of the refugee challenge?

One important factor was the historical context. The crisis over Schengen came at a time when solidarity among 28 member states was already at a low point. The eurozone instability had diminished the EU’s self-confidence and the mutual trust among its members. The single currency’s slow economic recovery, the weak political leadership of the EU, and the rise of populist anti-EU parties in many member states resulted in a widespread sense of European malaise and a reassertion of national identities at the cost of support for EU integration.

Against this background, the new heads of EU institutions — Donald Tusk as president of the European Council and Jean-Claude Juncker as president of the European Commission—struggled to establish themselves as credible leaders. However, in the absence of stronger institutional guidance, German Chancellor Angela Merkel continued in the lead role she had assumed in the euro crisis. But the reservations in many capitals about German predominance were reinforced in the refugee crisis. When it came to bailing out Greece or confronting Russia over its annexation of Crimea, Germany was an essential part of any solution and thus capable of a leading role in shaping the EU’s response. But in the refugee crisis, Germany, with by far the largest number of asylum seekers, was the most affected member state and it urgently demanded the solidarity of the rest of the EU. But, Berlin was criticized for creating some of the burden that it wanted to share. The asymmetrical impact of the crisis was itself a big obstacle to a strong and coherent collective response.

The EU states, which were affected by the refugee crisis, fall into three distinct groups. The states of first arrival were keen to overcome the constraints of the Dublin Regulation. The transit countries were tempted to divert the flow of migrants to other nations. The countries where most of the refugees ended up wished to slow down the inflow and called for EU-wide burden-sharing.

Apart from member states’ uneven exposure to the problem, the crisis also revealed an enormous diversity in societal attitudes about migration. The largely globalized societies of Western and Northern Europe, which already hosted large immigrant communities, contrasted with the societies of Central Europe, which had lived in relative isolation over decades and were consequently much less prepared to deal with a large influx of foreigners.

A final reason for the difficulty the EU experienced in handling the refugee crisis lies simply in the enormous political sensitivity of the issue. The EU’s normal practice of defusing political problems through extended technocratic discussions does not work well with issues of great salience to the citizens. And migration certainly belongs to the hottest and most divisive topics on the political agenda. The main crisis managers — the prime ministers and presidents who derive their legitimacy from national elections — naturally approached the issue from the perspective of domestic politics.

A Problem that Won’t Go Away

The EU’s failure to get a grip on the problem is even more serious because the inflow of refugees and migrants will continue for years and probably decades. Despite renewed diplomatic efforts, there is little hope for an early end to the fighting in Syria. With some 4 million Syrian refugees in Jordan, Lebanon and Turkey combined and over 7 million displaced people in Syria as of early 2016, many more are likely to enter Europe. A number of other Middle Eastern countries are facing acute security challenges that could give rise to new refugee flows. More and more Afghans are aiming to leave their increasingly unstable country. Growing migration pressure can also be expected from Africa, which according to UN forecasts will experience a doubling of its population by 2050. These demographic dynamics combined with the economic, political and security challenges facing many African countries could lead to massive flows of refugees and migrants to Europe.

The likely high levels of immigration into the EU in coming years will bring both benefits and challenges. Many economists believe that in view of the low birthrates in the majority of EU countries, a large number of immigrants will be needed to preserve the potential for economic growth and ensure the long-term financing of European welfare systems. At the same time, overly rapid and uncontrolled inflows can overwhelm the host countries’ capacities to integrate the new arrivals, strain those countries’ social and educational services, and give rise to xenophobic and nationalist political backlashes.

For the EU, migration is thus likely to become the ultimate make-or-break issue. And if a stronger and more integrated EU cannot be achieved, then the likely outcome is not stagnation but rather the fragmentation or even the loss of the existing level of integration. So the migration challenge could result in one of three scenarios: a looser union, a regrouping of some member states in a smaller, hardcore Schengen, or a revival of integration in this field.

Scenario One: Toward An Ever-looser Union

The EU might be rapidly moving toward an ever-looser union, in which trust and solidarity among member states are diminished and achievements of past decades are at risk. The danger the EU is currently facing goes well beyond the survival of Schengen. The longstanding mantra that the EU undergoes many crises but always emerges stronger is losing plausibility. There have been many periods of high tensions and stagnation. But this is the first time that new challenges are driving the member states apart.

The refugee crisis is altogether different from the euro crisis; where the EU proved more resilient than many had expected. The euro breakup would have triggered an economic catastrophe that had to be avoided even at the cost of unpopular austerity policies and steps toward greater centralization, the gradual disintegration of Schengen seems comparatively benign. The costs and considerable inconvenience for travellers arising from re-imposed border controls would, for many EU-sceptical citizens, be the lesser evil compared with giving up their sovereignty and accepting large numbers of refugees.

It is, therefore, quite possible that turning Schengen into a more robust and integrated structure that can cope with migration flows would go beyond the capacity of the divided and weakened union of today. Instead, governments would individually try to curb flows of refugees and migrants through various types of restrictions and limitations. The suspension of Schengen would continue and spread. As a result, the burden would shift back to the countries of first arrival, overstretching their administrative capacities and creating massive humanitarian hardship.

The tensions resulting from a chaotic breakdown of the Schengen arrangements would contaminate other areas of the EU. The UK’s continued membership in the Union could become the most prominent collateral damage. To many UK citizens, the EU is of relatively limited salience, whereas migration tops many people’s concerns. In the in-or-out referendum on Britain’s EU membership — to be held by the end of 2017 — a vote to remain in will therefore be much more difficult to achieve if the ballot takes place against the background of the EU’s patent failure to deal with this challenge.

The UK’s departure would be a devastating blow to the EU. But even if this calamity can be avoided, there is another impact of the refugee crisis that is already reshaping European politics. The crisis is sharpening the polarization of the EU’s political landscape between populists and mainstream parties — or between “patriots” and “globalists”. The situation varies from country to country, but in many member states movements on the populist Right and the populist Left are gaining ground.

The EU consequently becomes the target of most anti-establishment movements. If the political centre is more and more hollowed out and increasing numbers of EU-critical politicians take office, the common ground among member states in terms of values and interests will shrink — and with it, countries’ capacity to act in solidarity with each other.

While inability to cope with the migration challenge will certainly weaken the EU, expectations that the bloc will suddenly fall apart like the Soviet Union or Yugoslavia are not plausible. Its solid foundation on economic interests makes the EU’s internal market more resilient than many believe. Even nationalistic politicians rarely demand the introduction of new customs duties on intra-European trade.

However, the disregard for agreed decisions experienced during the refugee crisis is a worrying phenomenon. If this continues and spreads to other areas, the quality of the implementation of EU legislation will suffer, and various parts of EU policies and laws will gradually fall into obsolescence.

Scenario Two: A New Hardcore EU

In mid-November 2015, the Dutch Prime Minister Mark Rutte and Finance Minister Jeroen Dijsselbloem floated the idea of a mini-Schengen consisting of Austria, Belgium, Germany, Luxembourg and the Netherlands. This never became a formal proposal and was probably meant primarily as a warning shot toward the countries in the South and East that were not abiding by the Schengen rules or were showing insufficient solidarity in taking in refugees.

However, the idea did not go away entirely. A number of politicians continued to insist that only countries truly committed to solidarity and faithful to implementing the rules should have a place in Schengen.

The emergence of a coalition of the willing led by Germany and involving the countries named by the Dutch, as well as a few others, could prefigure further initiatives toward a smaller but more integrated zone of passport-free travel.

One curious feature of both the Dutch idea and the coalition of the willing was that they left out France. It is true that Paris takes a much more restrictive attitude toward refugees than Berlin and that France, traditionally protective of its sovereignty, might be reluctant to participate in the far-reaching integration of asylum and immigration policies that a mini-Schengen initiative could entail. At the same time, German-French partnership has always been at the heart of European integration, and the non-participation of France in a core EU grouping could probably happen only if France chose to opt out of such a group.

The new core group could come about as an ad hoc emergency arrangement. Eventually, it could follow the precedent of the original Schengen Agreement, which was concluded in 1985 outside the EU framework by just five countries (Belgium, France, Germany, Luxembourg and the Netherlands). A new treaty drafted by a core group of states would include common rules for securing the mini-Schengen area’s external borders and for dealing with asylum and immigration issues. It would also provide for new common institutions to implement these policies.

Such a development could initially create as much disruption as the gradual disintegration of Schengen described in Scenario One. Most of the countries left out of the new core would resent and resist their exclusion, even though some political groupings would appreciate the recovered sovereignty on migration issues.

However, unlike the wholly negative first scenario of failure and fragmentation, this second scenario involves the positive dynamic of a group of member states committed to finding a common solution to the refugee challenge. Over time, after the initial tensions were overcome, a new equilibrium would emerge.

Scenario Three: Full Schengen Revived

The therapy for restoring the health of the Schengen system is not rocket science. In fact, it was already largely sketched out in the EU decisions and commission proposals of 2015.

Restoring confidence between the countries on the EU’s external borders and the states where most asylum seekers have ended up will be the key political challenge. The central trade-off would consist of ensuring effective control of external borders through renewed national efforts supported by an EU border and coast guard in exchange for a credible mechanism for sharing the burden of hosting refugees. The Dublin Regulation is certainly obsolete, but the notion that refugees can freely choose their state of asylum is equally unsustainable. A new arrangement would probably include a quota system for the distribution of asylum seekers across the EU and could also involve financial burden sharing. Stronger institutions and policies in this area would require considerable additional financial resources.

A fair burden-sharing arrangement would also have to include the Schengen countries that so far have very few asylum seekers, such as the Central European member states. Possibly only the threat of the hardcore scenario — limiting passport-free travel to a smaller group of member states committed to a higher level of solidarity — could finally persuade these countries to come on board. The risk of being relegated to an outer circle of member states and facing the costs and the inconvenience of border controls while others continued to enjoy the benefits of Schengen could be a powerful motive for re-examining the restrictive policies of today.

Intensive engagement with transit countries and the states from which migration flows originate will be crucial for regaining control over the inflow of people. Arrangements for processing asylum applications and bringing successful applicants directly to Europe appear particularly promising. This would also be an effective way to counter the people-smuggling industry. Together with the countries concerned, the EU needs to develop robust policies for returning illegal migrants. This should be complemented by opening up well-managed channels for legal migration. In the longer term, a truly resilient space of passport-free travel has to be based on harmonized asylum and migration policies and supported by effective and well-resourced common institutions.

Irrespective of the survival or non-survival of the Schengen system, it appears highly implausible that uncoordinated action by each individual state will miraculously add up to a positive, comprehensive outcome. There is, therefore, no rational alternative to tackling this issue through collective efforts at the levels of the EU and of the Schengen members. Developing a credible overall strategy for responding to the migration challenge, creating appropriate instruments and mobilizing the necessary resources will require political will and sustained effort. If undertaken successfully, these common efforts could reenergize European integration and have positive spillover effects in other fields.

All this can only happen, however, if member states manage to overcome the divisions that have opened up in recent months and regain confidence in each other as well as in the EU’s collective capacity to confront this challenge. There can be no greater priority for 2016.

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