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
Excerpts
The European Community (EC)
After the end of the Second World War, Europe was divided into two opposing blocs - the US-led free-market oriented Western Europe and the Soviet Union-led socialist Central and East Europe. The West European countries, devastated by the war, realized that economic protectionism and chauvinistic nationalism were factors that could lead to war among various nations. Jean Monnet, considered by many as the architect of the European Union, felt that if Europe was to avoid the scourge of destructive wars, the European states must come together. He declared, "There will be no peace in Europe, if the states are reconstituted on the basis of national sovereignty...The European states must constitute themselves into a federation."...
The Collapse of the Socialist Bloc and The Copenhagen Criteria
Meanwhile, the collapse of the socialist bloc in Central and Eastern Europe in 1989-90 released many countries from the control of the Soviet Union. During this period, Poland, Hungary, Bulgaria, Romania, and Czechoslovakia became free of Soviet control. In 1991, the disintegration of the Soviet Union led to the emergence of several new states on the international stage -- the Russian Federation, Lithuania, Latvia, Estonia, Ukraine, Belarus, Moldova, Georgia, Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, and Turkmenistan. Having been severely constrained for decades by centralized planning, many of these newly independent states looked eagerly toward the EC for the development of their economies. It also provided an opportunity for the EC to further the process of European integration...
The Demographic and Economic Profile of The EU
To understand the issue of migration in the EU, it is essential to understand certain important characteristics of the demography and economy of the EU member states. These issues were interlinked, and, individually and in combination, had a significant impact on the growth rates in these countries. The old EU economies, especially, had been struggling with low growth rates for many years. Between 2000 and 2004, the growth rates of GDP of the old EU countries had ranged between 1.0% and 3.8%. (Refer to Exhibit II for growth rates in the EU between 2000 and 2004)...
Immigration in Post Enlargement EU
While other countries imposed various kinds of quotas and restrictions, the UK, Ireland, and Sweden allowed workers from the new member countries access to their labor markets. The UK implemented a Worker Registration Scheme, and required all immigrants from the new member countries to obtain a work permit. Since the accession, till December 31, 2005, nearly 345,000 applicants from the new member countries registered with the Worker Registration Scheme to work in the UK. Of these, around 329,000 applicants were issued worker registration certificates and cards. The Polish were the largest group of all (204,895) followed by the Lithuanians (44,715).
More than 80% of the immigrant workers were aged between 18 and 34. (Refer to Exhibit VIII for details on immigrants to the UK between May 2004 and December 2005)...
Outlook
Though many of the older EU members have imposed restrictions on immigration from the new member states, it is believed that these countries will eventually have to take in an increasing number of immigrants to offset the growing number of vacancies in their labor markets caused by ageing populations and exacerbated by the declining fertility rates in Europe. The Total Fertility Rate in Europe was estimated to be below 1.5 since 1995 through 2003, making an eventual decrease in the EU population inevitable. This decrease in population is expected to have serious consequences for EU's future in terms of growth rates and development...
Exhibits
Exhibit I: Map of European Union in 2005
Exhibit II: Real GDP Growth Rates in the Old and New Member States in %
Exhibit III: Hourly Labor Costs in Industry and Services in 2000 &
Labor Productivity in the EU in 2002
Exhibit IV: Unemployment Rates in Select Old Eu Members
Exhibit V: Economic Indicators of the EU and its member states
Exhibit VI: Area and Population Statistics of the EU and its Member States
Exhibit VII: Unemployment Rates in Select New EU Member States
Exhibit VIII: Nationality of Applicants by Quarter Applied in the UK May 2004 - December 2005
Exhibit IX: Sectors in which Registered Workers are employed in the UK, by Quarter Applied May 2004 - December 2005
Exhibit X: Applications for Tax-funded, Income-related benefits in the UK May 2004 - December 2005
Exhibit XI: GDP Growth Rates of Select EU Member States
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