EU member states’ failure to deliver solutions to the migration crisis will have “enormous economic consequences” for the bloc, European Commission president Jean-Claude Juncker has warned, as Austria became the latest country to impose border controls.

Austria’s new restrictions, 10 days after Sweden and Denmark, increases the migration squeeze in Germany, where allies of Chancellor Angela Merkel are demanding a migration “Plan B”.

As hundreds of migrants and refugees continued to arrive in Greece yesterday, Mr Juncker warned that a domino effect of border closures across Europe risked the EU’s passport-free Schengen zone, the euro currency area and the European economy.

“Schengen is one of the biggest achievements of the European integration process . . . whoever kills Schengen carries the internal market to its grave,” said Mr Juncker in Brussels.

“The damage for the European growth perspectives will be enormous . . . the euro [will] make no sense.”

Germany’s finance minister Wolfgang Schäuble shared that grave assessment, warning that Schengen was “close to failing”.

Cap on numbers

Interior minister Johanna Mikl-Leitner declined to specify an upper limit but said “everyone knows it’s not possible” for Austria to accept another 120,000 as in 2015.

“Those above this limit will be brought to transit zones . . . they will not be let into the country.”

From Monday, Austria will no longer admit at its southern border people seeking asylum in Sweden; it will admit those en route to Germany.

Meanwhile, the Department of Justice confirmed that a Syrian family is to arrive in the State from Greece before the end of the month as part of a relocation scheme agreed by the Government last year.

The family will be the first of some 2,600 asylum seekers who are due to come to Ireland under the scheme over the next two years.

Some 176 refugees – 149 Syrians and 27 Iraqis – arrived in Ireland last year under a separate, long-running resettlement scheme in conjunction with the UN refugee agency.

In all, the Government has committed to receiving 4,000 people between now and the end of 2017.

‘Successful integration’

“This would be a number we would be able to look after properly, provide language and training skills as required and help people to integrate and get employment,” she said.

She said language learned was “the basis of successful integration” and would be the Government’s priority.

Days after Germany began returning asylum seekers to Austria, Vienna’s new policy risks chaos at their common border and problems at the Austrian-Slovenian border.

A majority of Germans favour full border controls, piling pressure on Dr Merkel and her liberal migration policy.

Two weeks after Cologne’s New Year’s Eve attacks on women, for which many north African asylum seekers are suspects, her predecessor Gerhard Schröder said Dr Merkel had given the “dangerous” impression that “national borders no longer have meaning”.

“The capacities for admission, care and integration of refugees in Germany are limited; anything else is an illusion,” Mr Schröder told the Handelsblatt business daily”.