Migration Flows: Facts, Fiction and the Politics in Between

The eighth annual Bertelsmann Foundation-Financial Times conference explores migration, an issue of pressing social, economic and political concern on both sides of the Atlantic.

WASHINGTON, DC (April 14, 2016) – The millions of refugees flooding from the Middle East and Africa into Europe present an economic opportunity but also a potential threat to the stability of individual countries and even the entire European Union, according to panelists speaking at the eighth annual Bertelsmann Foundation-Financial Times conference.

“We need to deliver on the very basic elements of security – migration and terrorism – for people to say Europe is a good thing,” said Jeroen Dijsselbloem, Eurogroup president and minister of finance of the Netherlands.

In opening the conference, Aart De Geus, president and CEO of the Bertelsmann Foundation, noted that “migration is here to stay,” urging a shift from temporary accommodations to medium- and long-term policies that reduce strain on host countries and unlock economic growth potential.

8th Annual Bertelsmann Foundation-Financial Times Conference: A Conversation with Jeroen from Bertelsmann Foundation on Vimeo.

Europe may face some major challenges, with high unemployment declining too slowly, but average growth is increasing each year, between 1 percent and 6 percent for every country except Greece, Dijsselbloem said. “Adding to that concern, of course, is the influx of migrants who also have to find work, to participate, and that causes an extra stress on the bottom half of the labor market,” he said.

The migration issue presents enormous short-term challenges in integration and job provision, but also long-term economic opportunities, said Werner Hoyer, president and chairman of the board of directors of the European Investment Bank. Europe has proven able to absorb millions of people in previous periods of war and unrest. “It is politically very, very dangerous territory because the situation can be abused by political forces most of us would not want to see in power,” Hoyer noted.

Indeed, the advanced economies frankly need migrants in order to meet the demands of the labor market, said Kristalina Georgieva, EU commissioner for budget and human resources, noting that in the last 10 years, 47 percent of the entrants in the U.S. market were migrants, as were 70 percent in the EU. Now the task is to provide education and jobs, and to bring the flow of refugees into legal channels.

Between 800,000 and 900,000 of the refugees are school age, said Mehmet Şimşek deputy prime minister of Turkey, which is currently home to more than 3 million refugees.

“We cannot afford to ignore their future. If we do, it becomes a massive threat for global peace,” Şimşek said. “This new generation that has seen such a huge tragedy, if they don’t get access to education and therefore a future, in Turkey or elsewhere, they’re going to be vulnerable to extremist views or organizations.”

Governments’ fiscal expenditures to deal with the refugee influx are mildly expansionary, said Jason Furman, chairman of the White House Council of Economic Advisers. But the long-run impact depends on the country’s success in incorporating people into the labor market, making the most of their skills and investing in the capital stock in order to keep pace with the expanding workforce.

Asked whether U.S. presidential candidate Donald Trump is fueling populist fear, Dijsselbloem said there is a similar debate in Europe. “The common workers, middle class, trying to work hard and build a life, feel threatened by newcomers in society or international trade agreements,” he said. “We really need to make the case that if designed well, negotiated well, integrated well, some of those outside influences are very welcome and could improve our economies.”

World leaders must be brave enough to speak plainly about the impact of violent extremism and climate change, both of which will continue to drive migration, Georgieva said. “We have two options, to close down our borders and create unbelievable instability elsewhere … or to work together so we can absorb the shocks and more importantly fight the root causes of displacement.”

“Migration will be the name of the game for the next 30 years,” Hoyer agreed, warning that a speedy, innovative response is needed to keep ghettos from forming that will isolate migrant communities. “International financial institutions must take a share of the responsibility.”

Participants consistently reiterated the need for a coordinated global solution to the ongoing refugee crisis, with countries working cooperatively across borders.

“Every day grows more and more terrible, frankly,” said Madeleine Albright, chair of the Albright Stonebridge Group, and former U.S. secretary of state, calling it “the great humanitarian crisis of our time.”

Each month, 200,000 migrants pass through Macedonia, which could create potential problems if northern borders are closed, said Zoran Jolevski, minister of defense of Macedonia. “Their goal is to go north in Europe, mainly Germany, Sweden, Poland and Austria. They don’t want to stay at all,” Jolevski said. “We need to have a global approach.”

David Miliband, president and CEO of the International Rescue Committee, said that there remains a strong push that will keep refugees flowing out of the region. “In neighboring states, the squeeze is taking a toll,” Miliband said. “Are the promises of the international community going to come to anything? Refugees are saying, ‘Where is this safe and legal route?’”

There are 50,000 refugees trapped in Greece; Germany’s processing program is still at an early stage; and fewer than 2,000 migrants have been relocated around Europe. “That explains why countries like Macedonia feel they’re being caught in a pincer,” he said, citing an “inadequacy of coordination and absence of responsibilities … It feels like the world is still playing catch up to a crisis that has overwhelmed it.”

A coordinated approach to dealing with the crisis would prevent governments from losing track of migrants and would lessen the skewed incentives that encourage refugees to seek out specific countries because of their strong social welfare programs, said Jolevski.

The problem is that the economics and politics are pulling in opposite directions, Miliband said. “It’s not good enough for those of us who are speaking for an open approach to refugees to have big hearts. There needs to be competence as well as compassion,” he said.

“Those countries which are holding refugees are performing a global public service,” he said. “Unless they’re supported, they won’t be able to continue.”

It’s important to be able to distinguish between refugees who are forced to leave their home countries by violence or persecution, and economic migrants who are merely seeking a better life for their families. “One of the things that has made public policy especially difficult in this area is when the rights of refugees or asylum seekers are confused with the rights of economic migrants,” he said.

Albright expressed concern over NGO reports of human rights violations among those being sent back to Turkey.

The humanitarian sector should shift its focus to where the need is, Miliband added. Much relief is focused on camps, when most refugees aren’t in camps. NGOs often focus on short-term help, when the majority of migrants are displaced for 18 months.

“It’s crunch time for the humanitarian sector to make some reforms,” he said, urging stronger regional institutions. Unfortunately, “the international political system is more divided than any time since the Cold War and maybe less organized than ever.”