The European Union and Immigration from New Member Countries
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Case Code: ECON017 Case Length: 20 Pages Period: 1945-2005 Pub Date: 2006 Teaching Note: Not Available |
Price: Rs.400 Organization : - Industry : - Countries : EU Countries Themes: - |
Abstract Case Intro 1 Case Intro 2 Excerpts
"The [European] Union has today set itself a new strategic goal for the next decade: to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion."
- Presidency Conclusions, Lisbon European Council, March 2000.
"The 'old' EU owes them [the new members] a welcome. In practical terms, this means that West European politicians should stop exploiting populist resentment of low-wage competition. They should explain to their voters that economic reforms would be necessary even in the absence of enlargement and that, on the whole, the addition of ten new members has been good for the EU economy."
- Katinka Barysch, Chief Economist, Centre for European Reform, 2005.
Introduction
On March 09, 2006, the Spanish Prime Minister, Jose Luis Rodriguez Zapatero (Zapatero), and his Polish counterpart, Kazimierz Marcinkiewicz, announced at a joint press conference that from May 01, 2006, Spain would open up its labor market to workers from Poland and the other seven countries from Central and East Europe (CEE) which had joined the European Union (EU) on May 01, 2004. The announcement was not unexpected as it had been widely anticipated that Spain would favor opening up its labor market to the new members5 of the EU. On February 28, 2006, Portugal had also indicated that it would open up its labor market to the new members from the CEE.
Before that, on February 13, 2006, Finland's Labor Ministry had proposed that restrictions on labor movement from the new EU member countries be lifted. At the time of the 2004 enlargement, the EU had allowed its existing members (the old member states) to impose restrictions on the free movement of labor from the new member states for a transition period extendable up to 2011. Twelve out of the fifteen countries opted for labor restrictions, fearing that there would be a large-scale influx of immigrants from the new member countries chasing jobs and driving down wage rates. Only the UK, Ireland, and Sweden decided to allow the new member countries access to their labor markets. (Refer to Exhibit I for a map of the European Union in 2005).
A year later, these three economies reported that they had not experienced any upheavals or disruptions in their labor markets. Instead, they claimed, the immigrants had helped fuel their economic growth by filling in the gaps in their labor markets - be it in construction, health & hospitality, or in other areas, while making few claims on the welfare system or public services...
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