Alok Ray

Politics, economics, and refugees

Alok Ray | Updated on January 22, 2018 Published on September 29, 2015

Future tense With the grim reaper looking on REUTERS

If managed efficiently, Europe can utilise the human influx to power up its economies saddled with an ageing population



Europe is currently going through its biggest humanitarian crisis since World War II . UN figures suggest more than 3,60,000 refugees have crossed the Mediterranean into Europe this year; about 28,000 have perished during transit.

The crisis brought back Germany — which for quite some time was in the news for its ongoing showdown with Greece over bailout plans — in the limelight. Germany now wants to show a human face, after the bad press received for its tough stand against the suffering Greeks.

At the same time, its accommodating stance (as contrasted with countries such as Hungary) for the refugees pouring in from the war-ravaged Syria, Iraq, Libya and Afghanistan is in the long term economic interest of the country facing an ageing and declining population.

The influx of hard-working people with skills should ultimately help sustain economic prosperity as economic theory tells us that the long run economic growth of a country basically depends on the growth of working-age population and technological progress.

One can also argue that Germany’s tough stand against debt forgiveness for Greece was not really contrary to its human face. It was willing to provide equivalent humanitarian aid to Greece, without explicit loan forgiveness, to avoid giving a wrong signal to other indebted Euro nations (namely Spain, Portugal, Italy) in trouble.

Eastern premises

Why is the attitude to refugees different in East Europe? There are several reasons. They are poor relative to the more affluent Western Europe which does not allow them to be so welcoming to the refugees.

Their culture and ethnic composition is more cohesive (relative to Germany, France and other West European countries) which they are not willing to risk by allowing culturally different refugees in large numbers along with fear and suspicion about the radical Muslims (it is difficult to distinguish radicals from others).

The cause of the refugees is not being helped either by the showing of ISIS flag by some among them.

Also, on a moral plane, they can argue that, unlike the US and its Western partners, they were not responsible for creating the mess in West Asia and, hence, they can not be blamed in any way if they refuse to accept refugees in large numbers.

The EU is insisting on a wider distribution of refugees across the European nations, instead of a few countries such as Germany becoming the final destination of the refugees.

But East European countries are in favour of voluntary acceptance, not a compulsory EU-determined quota. Supporters of mandated quota argue that since they have accepted money from richer EU countries, they would have to accept the EU determined quota.

Unexpected fallout

Another problem is that the more affluent Arab countries such as Saudi Arabia, Kuwait, UAE and Qatar are not willing to take in refugees from the war-torn neighbouring countries.

There is little doubt that the ongoing sectarian war in Syria and Iraq is being fuelled by the rival powers Iran and Saudi Arabia, along with help from the US and its western allies on the one side and Russia on the other.

The turmoil in the region was accentuated by the toppling of Saddam Hussein in Iraq and Gaddafi in Libya by the US and its allies. The unfortunate truth is that, though they were dictators, they maintained some stability in the region by their ruthlessness.

With their demise from the scene, the more radical elements such as the ISIS have made use of the vacuum to expand their areas of control with different factions competing with one another in viciousness and brutality against the opponents.

The hapless people caught in the cross fire are forced to live for years in squalid refugee camps in areas bordering Iraq, Syria, Jordan and Lebanon, leaving their homes, livelihood and schools behind.

With no end in sight of the civil war, now they are desperately risking their lives and monetary savings by taking the highly perilous journey (in dingy boats with the help of smugglers) to Europe in search of refugee status and asylum.

The European nations are faced with a dilemma. No doubt this is a humanitarian issue. But if they make it too easy to get asylum, they risk opening the floodgates (encouraging job seekers in addition to genuine refugees) which would turn the initial sympathy into an animosity against the foreigners of a different culture taking away jobs or lowering wages.

A daunting task

Moreover, unless the distribution of refugees across nations is viewed as fair, there is bound to be political opposition to acceptance of more refugees in countries such as Germany, France, Austria and Sweden.

Already, there are indications of that happening. The absorption of the successive waves of refugees by providing shelter, education, healthcare, training and jobs is a daunting task.

Innovative solutions are being talked about like creation of a new country a la Israel for the refugees in some designated areas of Europe and West Asia.

This would keep them isolated from the local population, minimising the risk of racial conflicts. Schools and training centres would be set up to give them education, language and other skills while new industrial units in these areas would provide them jobs.

But the question remains: whether that new country will prosper like Israel (remember Israel was supported by the rich Jews from all over the world) or languish as a refugee ghetto like the Gaza Strip, being a breeding ground for radical terrorists ready to die for bliss in after-life?

The writer is a former Professor of Economics, IIM, Calcutta

Published on September 29, 2015
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