Exclusive IMF Sees Refugee Spending Boosting German GDP Growth by 0.3% in 2017
The record influx of refugees into Germany is accelerating the growth of Europe’s largest economy, according to a study released Wednesday by the International Monetary Fund. The German economy will grow an additional 0.3 percent in 2017, the IMF said, as it spends to house, feed and care for more than 1 million refugees. Only Austria, with an additional 0.5 percent, and Sweden, with 0.4 percent, will get a bigger GDP boost. Economic growth from refugees could contribute an extra 0.5 percent to 1.1 percent to German GDP growth by 2020, the report’s authors concluded. The study assumes that Germany will admit an average of 413,000 refugees per year through 2020. Long-term GDP growth from the refugees will only be guaranteed, the study concluded, if Germany and other European countries quickly integrate them into the workforce. Germany admitted 1.1 million refugees last year, and its chancellor, Angela Merkel, is under political pressure to slow the influx. According to the IMF study, the German government will spend 0.35 percent of GDP this year on refugees. Those fiscal costs trail Sweden, which is spending a full 1 percent of GDP; Denmark, which is spending 0.53 percent; and Finland, which is spending 0.37 percent, on refugees.
01/20/2016 - 03:42 PM