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Soros: European Union in mortal danger

Billionaire financier George Soros has warned that the European Union is in mortal danger of collapse if it doesn't agree a massive cash injection to fix the refugee crisis.

In an essay written for the New York Review of Books, Soros also claimed that a humanitarian catastrophe is unfolding in Greece.

"The asylum seekers are desperate. Legitimate refugees must be offered a reasonable chance to reach their destinations in Europe," the investor wrote in the publication.

"EU leaders need to embrace the idea that effectively addressing the crisis will require "surge" funding, rather than scraping together insufficient funds year after year. Spending a large amount at the outset would allow the EU to respond more effectively to some of the most dangerous consequences of the refugee crisis."

Pushed by civil war and terror and pulled by the promise of a better life, more than a million migrants and refugees fled the Middle East and Africa in 2015 and crossed into Europe.

Now a deal is in place so anyone arriving illegally in Greece will be returned to Turkey if their asylum application is rejected.

In exchange for every person sent back, the EU will resettle one Syrian refugee currently trapped in Turkish camps.


In his essay, Soros said the number of refugees Europe can absorb each year should be between 300,000 and 500,000.

He wrote this sweet-spot number can be accommodated by European countries but will also assure those genuinely seeking asylum that they won't be turned away.

And the financier estimated at least $34 billion (€30 billion) a year will be needed for the EU to carry his plan.

"Thirty billion might sound like an enormous sum, but it is not when viewed in proper perspective. First, we must recognize that a failure to provide the necessary funds would cost the EU even more. There is a real threat that the refugee crisis could cause the collapse of Europe's Schengen system of open internal borders among twenty-six European states," he said.


"When should the triple-A credit of the EU be mobilized if not at a moment when it is in mortal danger?" -George Soros

For ongoing funding, Soros suggested the European Commission's Multiannual Financial Framework, Europe's long term spending plan, should be amended to increase VAT contributions.

But he argued a separate 'surge' funding is needed more urgently to stem the unfolding crisis and claimed existing mechanisms are in place.

Soros said the European Financial Stabilization Mechanism (EFSF) and the Balance of Payments Assistance Facility currently contain $68 billion (€60 billion) of unused funding that Europe should disperse.

The billionaire said these vehicles can be used to leverage Europe's easy credit terms.

"Throughout history, governments have issued bonds in response to national emergencies. That is the case in Europe today. When should the triple-A credit of the EU be mobilized if not at a moment when the European Union is in mortal danger?" Soros said.