Up to four million migrants could reach Europe by the end of next year, the International Monetary Fund has forecast.

The IMF has forecast 1.3 million migrants a year between 2015 and 2017. This is a bigger forecast than those issued previously by the EU.

The forecast came as the fund warned that Europe's capacity to absorb migrants was now in question.

In the short term, the IMF said there would be a "modest" increase in GDP due to the extra state activity to support the migrants and the boost to the labour supply.

But in the long run, it warned, there was a question over whether the influx would boost Europe's economy, depending on how quickly the newcomers integrated.

Refugees

"International experience with economic immigrants suggests that migrants have lower employment rates and wages than natives, though these differences diminish over time.

"Slow integration reflects factors such as lack of language skills and transferable job qualifications, as well as barriers to job search," it said.

Donald Tusk, the European Council president, warned that the EU has just weeks to secure its borders or see the Schengen zone collapse.

"We have no more than two months to get things under control," said Mr Tusk.

"The March European Council (summit) will be the last moment to see if our strategy works. If it doesn't, we will face grave consequences, such as the collapse of Schengen."

Jean-Claude Juncker, the European Commission president, last week said asylum seekers should be allowed to work while their claims are processed for the good of social cohesion.

At present, states can enforce a nine-month ban on work.

It also emerged yesterday that the German government wants the number of migrants coming to the country to fall "significantly" after almost 1.1 million arrived last year.

A spokesman for Chancellor Angela Merkel said the flow of refugees had already slowed this year, but a further reduction was needed.

Steffen Seibert said the experience of wars in the former Yugoslavia in the 1990s showed that many refugees would also return to their home countries once conflicts have ended.

Austria has put a cap on the number of refugees it wants to accept - 37,500 this year and a total of 127,500 through 2019.

Officials said the government would be examining legal options on how it can react if those numbers are exceeded.

Faymann calls the decision an "emergency solution," but says Austria "cannot accept everyone applying for asylum."

Irish Independent