The year 2015 has been a tough year for Europe with the continent facing the biggest refugee crisis since the Second World War. Reports from Europe suggest more than 710,000 refugees have entered the European Union in the year 2015 alone. As the continent braces for winter, this number is expected to go up to 1 million by the end of the year.
The refugee crisis has been a nightmare for European authorities as they ponder on how many refugees they can take and where to settle them. For, months, the world has heard of stories of human suffering and chaos on European borders. Germany offered to take in the 800,000 refugees while the European Union plans to settle the surplus numbers evenly across its 28 member states.
Economists have made assessments of the expected outcome of the refugee crisis and its implications for the European economy. Contrary to expectations, economists predict that the crisis may have a positive impact rather than slow down the economy. Although their assumptions are tied with warnings, they say that immigrants settling in Europe may in the long run aid the continent that is grappling with a waning working population, a declining birth rate and achievable economic growth rates.
Since the economic crisis of 2008, European population growth has fallen to below one percent. Already facing a debt crisis, the only hope for Europe would be a surge in the working population or an increment to the retirement age. According to a Swiss Bank report, the total immigration in the next five years will increase Europe’s population by up to 1.5 percent. Forecasts show that public spending for the asylum seekers may add up 0.3 percentage points to Euro growth by 2016. Also, the Euro potential output growth may be lifted to 1.3 percent over eight years till 2023.