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Europe integration threatened by potential Brexit, refugee crisis: IMF

Maurice Obstfeld, the International Monetary Fund (IMF)’s new chief economist (Photo by AFP)

The influx of refugees into Europe and the possibility of Britain’s exit from the European Union (EU) – “Brexit” – are threatening economic integration in the continent, the International Monetary Fund (IMF) warns.

“I worry a lot about the strong trend in Europe to pull back from market integration,” Maurice Obstfeld, the IMF’s new chief economist, told AFP in a Tuesday interview.

Obstfeld said one of the main factors exacerbating the trend is “the refugee crisis, where there’s a lot of pressure on open borders and workers’ mobility.”

Europe is facing record refugee arrivals. Thousands of asylum seekers, many of whom from war-ravaged Syria, travel from Turkey to Greece by boat. They then transit from Greece through Macedonia, Serbia, Croatia, and Slovenia to Austria, with the ultimate goal of reaching Germany and other wealthy Western European states.

According to the latest figures released by the International Organization for Migration (IOM), 773,244 refugees have reached Europe’s shores so far this year while a total of 3,423 people have either died or gone missing in their perilous journey to the continent.

A refugee woman bottle-feeds her baby at a camp near the town of Gevgelija, Macedonia, November 9, 2015. (Photo by AFP)

Elsewhere in his remarks, Obstfeld, a former economic adviser to US President Barack Obama, said another influential factor threatening economic integration in Europe is Britain’s possible exit from the EU.

“Another obvious one is Britain wanting to possibly leave the European Union,” he said.

The UK is set to hold a referendum by the end of 2017 on whether to leave the 28-nation EU. British Prime Minister David Cameron recently said he wants the country to stay in, provided that he could secure greater autonomy for the UK.

On Monday, he said he is seeking “a live-and-let-live Europe, a flexible Europe” that lets Britain remain outside of closer political and economic ties binding the eurozone countries.

Obstfeld arrived at the IMF in September to replace French economist, Olivier Blanchard, who had held the job since 2008, throughout the unparalleled financial crises in Europe and the United States.


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