Refugee influx to cost Austria 2.7 bln euros until 2017: central bank

The huge influx of refugees into Austria is to cost all levels of government a total 2.7 billion euros (2.97 billion U.S. dollars) from 2015 to 2017, the National Bank of Austria (OeNB) said on Wednesday.

The central bank gave the figures in a statement after having conducted a simulation on the effects the large influx of people will have on the economy, labor market, and budget.

The situation is a kind of "economic stimulus package," given the newcomers will have a high propensity to consume, which in turn will practically fully finance the deficit created by the government spending, the OeNB said.

As part of its calculations, the OeNB assumed that in the three years in question 80,000, 85,000, and 50,000 refugees will arrive, of whom 47 percent will be granted asylum, making a total of 99,300 people. A further 60,300 will then be able to follow as family reunion laws allow.

About 77 percent of the asylum seekers will be of working age, the OeNB expects, though adding that international experience shows that initially only a relatively small number of accepted asylum seekers can successfully make their way into the workforce within the first few years.

It thus believes economic stimulus effects will depend on how well the newcomers integrate into the workforce, and also the corresponding impact on both the domestic workforce and workers from traditional migration sources such as Eastern European countries. The central bank expects some of the latter will be put off coming to Austria, expecting fewer opportunities to be available for themselves.

Overall, the OeNB said it expects GDP (gross domestic product) growth of 0.7 percent to come about from the refugee influx to 2017, though noted it will be 0.5 percent per capita lower than it otherwise would have without the influx. Endit