Erdogan is now demanding that the EU immediately hand over three billion euros ($3.4 billion) so that Turkish authorities can spend it as they see fit. The EU insists that the funds be transferred through international aid agencies in accordance with strict rules on how the aid can be spent. This prompted Erdogan to accuse the EU of "mocking the dignity" of the Turkish nation.

"If they make the wrong decision, we will send the refugees." — Burhan Kuzu, senior adviser to Turkish President Recep Tayyip Erdogan.

According to the Telegraph , the EU report adds that as a result of the deal, the Turkish mafia, which traffics vast volumes of drugs, sex slaves, illegal firearms and refugees into Europe, may undergo "direct territorial expansion towards the EU."

"It can be expected that, as soon as Turkish citizens will obtain visa-free entry to the EU, foreign nationals will start trying to obtain Turkish passports ... or use the identities of Turkish citizens, or to obtain by fraud the Turkish citizenship. This possibility may attract not only irregular migrants, but also criminals or terrorists." — Leaked European Commission report, quoted in the Telegraph , May 17, 2016.

The EU-Turkey migrant deal, designed to halt the flow of migrants from Turkey to Greece, is falling apart just two months after it was reached. European officials are now looking for a back-up plan.

The March 18 deal was negotiated in great haste by European leaders desperate to gain control over a migration crisis in which more than one million migrants from Africa, Asia and the Middle East poured into Europe in 2015.

European officials, who appear to have promised Turkey more than they can deliver, are increasingly divided over a crucial part of their end of the bargain: granting visa-free travel to Europe for Turkey's 78 million citizens by the end of June.

At the same time, Turkey is digging in its heels, refusing to implement a key part of its end of the deal: bringing its anti-terrorism laws into line with EU standards so that they cannot be used to detain journalists and academics critical of the government.

A central turning point in the EU-Turkey deal was the May 5 resignation of Turkish Prime Minister Ahmet Davutoglu, who lost a long-running power struggle with Turkish President Recep Tayyip Erdogan. Davutoglu was a key architect of the EU-Turkey deal and was also considered its guarantor.

On May 6, just one day after Davutoglu's resignation, Erdogan warned European leaders that Turkey would not be narrowing its definition of terrorism: "When Turkey is under attack from terrorist organizations and the powers that support them directly, or indirectly, the EU is telling us to change the law on terrorism," Erdogan said in Istanbul. "They say 'I am going to abolish visas and this is the condition.' I am sorry, we are going our way and you go yours."

Erdogan insists that Turkey's anti-terrorism laws are needed to fight Kurdish militants at home and Islamic State jihadists in neighboring Syria and Iraq. Human rights groups counter that Erdogan is becoming increasingly authoritarian and is using the legislation indiscriminately to silence dissent of him and his government.

European officials say that, according to the original deal, visa liberalization for Turkish citizens is conditioned on Turkey amending its anti-terror laws. Erdogan warns that if there is no visa-free travel by the end of June, he will reopen the migration floodgates on July 1. Such a move would allow potentially millions more migrants to pour into Greece.

European officials are now discussing a Plan B. On May 8, the German newspaper Bild reported on a confidential plan to house all migrants arriving from Turkey on Greek islands in the Aegean Sea. Public transportation to and from those islands to the Greek mainland would be cut off in order to prevent migrants from moving into other parts of the European Union.

Migrants would remain on the islands permanently while their asylum applications are being processed. Those whose asylum requests are denied would be deported back to their countries of origin or third countries deemed as "safe."

The plan, which Bild reports is being discussed at the highest echelons of European power, would effectively turn parts of Greece into massive refugee camps for many years to come. It remains unclear whether Greek leaders will have any say in the matter. It is also unclear how Plan B would reduce the number of migrants flowing into Europe.

Thousands of newly arrived migrants, the vast majority of whom are men, crowd the platforms at Vienna West Railway Station on August 15, 2015 -- a common scene in the summer and fall of 2015. (Image source: Bwag/Wikimedia Commons)

Speaking to the BBC News program, "World on the Move," on May 16, Sir Richard Dearlove, the former head of the British intelligence service MI6, warned that the number of migrants coming to Europe during the next five years could run into millions. This, he said, would reshape the continent's geopolitical landscape: "If Europe cannot act together to persuade a significant majority of its citizens that it can gain control of its migratory crisis then the EU will find itself at the mercy of a populist uprising, which is already stirring."

Dearlove also warned against allowing millions of Turks visa-free access to the EU, describing the EU plan as "perverse, like storing gasoline next to the fire we're trying to extinguish."

On May 17, the Telegraph published the details of a leaked report from the European Commission, the powerful administrative arm of the European Union. The report warns that opening Europe's borders to 78 million Turks would increase the risk of terrorist attacks in the European Union. The report states:

"It can be expected that, as soon as Turkish citizens will obtain visa-free entry to the EU, foreign nationals will start trying to obtain Turkish passports in order to pretend to be Turkish citizens and enter the EU visa free, or use the identities of Turkish citizens, or to obtain by fraud the Turkish citizenship. This possibility may attract not only irregular migrants, but also criminals or terrorists."

According to the Telegraph, the report adds that as a result of the deal, the Turkish mafia, which traffics vast volumes of drugs, sex slaves, illegal firearms and refugees into Europe, may undergo "direct territorial expansion towards the EU." The report warns: "Suspect individuals being allowed to travel to the Schengen territory without the need to go through a visa request procedure would have a greater ability to enter the EU without being noticed."

While the EU privately admits that the visa waiver would increase the risk to European security, in public the EU has recommended that the deal be approved.

On May 4, the European Commission announced that Turkey has met most of the 72 "benchmarks of the roadmap" needed to qualify for the visa waiver. The remaining five conditions concern the fight against corruption, judicial cooperation with EU member states, deeper ties with the European law-enforcement agency Europol, data protection and anti-terrorism legislation.

European Commission Vice President Frans Timmermans said:

"Turkey has made impressive progress, particularly in recent weeks, on meeting the benchmarks of its visa liberalization roadmap.... This is why we are putting a proposal on the table which opens the way for the European Parliament and the Member States to decide to lift visa requirements, once the benchmarks have been met."

In order for the visa waiver to take effect, it must be approved by the national parliaments of the EU member states, as well as the European Parliament.

Ahead of a May 18 debate at the European Parliament in Strasbourg over Turkey's progress in fulfilling requirements for visa liberalization, Burhan Kuzu, a senior adviser to Erdogan, warned the European Parliament that it had an "important choice" to make.

In a Twitter message, Kuzu wrote: "If they make the wrong decision, we will send the refugees." In a subsequent telephone interview with Bloomberg, he added: "If Turkey's doors are opened, Europe would be miserable."

Meanwhile, Erdogan has placed yet another obstacle in the way of EU-Turkey deal. He is now demanding that the EU immediately hand over three billion euros ($3.4 billion) promised under the deal so that Turkish authorities can spend it as they see fit.

The EU insists that the funds be transferred through the United Nations and other international aid agencies in accordance with strict rules on how the aid can be spent. That stance has prompted Erdogan to accuse the EU of "mocking the dignity" of the Turkish nation.

On May 10, Erdogan expressed anger at the glacial pace of the EU bureaucracy:

"This country [Turkey] is looking after three million refugees. What did they [the EU] say? We'll give you €3 billion. Well, have they given us any of that money until now? No. They're still stroking the ball around midfield. If you're going to give it, just give it. "These [EU] administrators come here, tour our [refugee] camps, then ask at the same time for more projects. Are you kidding us? What projects? We have 25 camps running. You've seen them. There is no such thing as a project. We've implemented them."

In an interview with the Financial Times, Fuat Oktay, head of Turkey's Disaster and Emergency Management Authority (AFAD), the agency responsible for coordinating the country's refugee response, accused European officials of being fixated on "bureaucracies, rules and procedures" and urged the European Commission to find a way around them.

The European Commission insists that it was made clear from the outset that most of the money must go to aid organizations: "Funding under the Facility for Refugees in Turkey supports refugees in the country. It is funding for refugees and not funding for Turkey."

The migration crisis appears to be having political repercussions for German Chancellor Angela Merkel, a leading proponent of the EU-Turkey deal. According to a new poll published by the German newsmagazine Cicero on May 10, two-thirds (64%) of Germans oppose a fourth term for Merkel, whose term ends in the fall of 2017.

In an interview with Welt am Sonntag, Horst Seehofer, the leader of the Christian Social Union (CSU), the Bavarian sister-party to Merkel's Christian Democrats (CDU), blamed Merkel for enabling Erdogan's blackmail: "I am not against talks with Turkey. But I think it is dangerous to be dependent upon Ankara."

Sahra Wagenknecht of the Left Party accused Merkel of negotiating the EU-Turkey deal without involving her European partners: "The chancellor is responsible for Europe having become vulnerable to blackmail by the authoritarian Turkish regime."

Cem Özdemir, leader of the Greens Party and the son of Turkish immigrants said: "The EU-Turkey deal has made Europe subject to Turkish blackmail. The chancellor bears significant responsibility for this state of affairs."