/Extended EU border control could cost a fortune

Extended EU border control could cost a fortune

The EU Commission is proposing that member states can extend their ongoing control with borders – despite studies showing that billions of euros are being wasted due to delayed trade because of the border control.

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Time is money. And right now, a lot of both time and money is being lost at borders inside the EU.

Due to the refugee crisis, some member states decided to reintroduce border control last year. According to the original rules of Schengen these states should open their borders again in November this year.

In September, the EU Commission made a proposal that the member states can prolong their border control – despite studies showing that the border control costs billions of euros.

A case study made by German researchers from Center for International Economics has calculated the loss and delayed trade to 12.5 billion euros per year (http://voxeu.org/article/trade-costs-border-controls-schengen-area)

“When trucks are delayed at the borders because of the control, it has a significant impact for the companies that needs the freight and will have to wait. Most of the goods in Europe are transported on the road or by railway and that is why border control accumulates to have such a high effect on the economy,” says Dr. Jasmin Gröschl, a German trade economist and one of the authors behind the case study.

Another case study made for the European Parliament shows that the border control in the EU could cost between 7 and 14 billion euros. This amount is calculated as if all the EU member states reintroduced border control. The report is made by Matthias Luecke from The Kiel Institute for the World Economy and Tim Breemersch and Filip Vanhove from Transport & Mobility Leuven. (http://www.europarl.europa.eu/RegData/etudes/IDAN/2016/578990/IPOL_IDA%282016%29578990_EN.pdf)

Skeptic of extended control

A press release from the EU Commission states that the new proposal of extended border control is meant to “preserve and strengthen” the Schengen-agreement. (http://europa.eu/rapid/press-release_IP-17-3407_en.htm)

However, Jasmin Gröschl fears that the proposal can end up harming the Schengen-agreement in the future.

“If the border control keeps being prolonged, it will affect the Schengen-agreement negatively. And if we don’t have Schengen anymore it will have even more significant consequences for the trade and economy in the EU than the present border control has,” Gröschl says.

That fear is shared by Peter Therkelsen, owner of the Danish truck company H.P. Therkelsen, which transport goods for companies all over Europe.

Although his company hasn’t experienced too many complications or economic loss due to the ongoing border control, he fears that the Schengen-agreement can be endangered due to the Commissions new proposal.

“We risk that the Schengen-agreement breaks down if we keep prolonging the border control, which will create a whole new situation in Europe. It will have huge consequences for trade and by that also my company, Peter Therkelsen says.

If the Schengen agreement ends up collapsing, it will result in a loss of trade worth over 220 billion euros, according to the case study made by Center for International Economics.

These Schengen member states have decided to reintroduce border control (not necessarily on all borders):

  • France
  • Norway
  • Germany
  • Austria
  • Denmark
  • Sweden

Source: The European Commission (https://ec.europa.eu/home-affairs/what-we-do/policies/borders-and-visas/schengen/reintroduction-border-control_en)