Refugee crisis: EU €3bn deal with Turkey at risk amid differences over who pays

The European Union is scrambling to salvage its €3bn (£2.3bn) deal with Turkey aimed at stemming the flow of refugees into Europe, amid wrangles over who should pay for the fund and questions about whether it will be enough to prevent a new migration crisis this year.

The deal was seen as one of the EU’s key responses to the wave of refugees heading to Europe from Syria, Iraq and other war zones last year. As a major transit country for migrants seeking to reach the EU, Turkey is currently hosting more than 2.2 million refugees. EU states gave initial backing to the aid plan, which is meant to help improve living conditions for refugees, at a special summit with Turkey in November, and at the EU summit last month.

However, EU finance ministers have yet to reach a definitive settlement over the financing of the fund, with Italy blocking the proposed plan that would take €1bn from the EU budget, while national governments would pay for the remaining €2bn. Italy argues instead that the entire €3bn should come from the EU budget.

Turkey’s Prime Minister, Ahmet Davutoglu, will meet the German Chancellor Angela Merkel on Friday to discuss the crisis. “We hope a new resettlement schedule has been declared by Europe – that was their side’s work – and also this financial burden-sharing will be there,” he said in London.

Turkey says it is already spending £5.7bn – far more than the EU has so far pledged in aid – just on its refugee camps, which accommodate 280,000 Syrians. A further two million refugees who live outside them add further to economic and social costs. “You can imagine – 700,000 school-age children are getting education in Turkey,” Mr Davutoglu said. “You can imagine at how much cost. The health system is open to all Syrians without any charge. Universities are open.”

It has also decided to allow all Syrians who cross into Turkey by land the right to work, but not those who arrive by other means with the intention of using Turkey as a transit point to Europe.

But some EU members are concerned about whether Turkey is doing enough to fulfil its side of the deal. Over the Christmas period, there were still more than 2,000 arrivals to the EU per day, according to Frontex, the EU’s border agency. UN figures show the number of refugees arriving in Greece frequently exceeded 3,000 a day this month, and in first 10 days of 2016, the numbers entering the EU were already three times higher than in the entire month of January last year.

“The action plan with Turkey, although promising, is still to bear fruit,” the European Council President Donald Tusk told the European Parliament in Strasbourg. Mr Tusk, who chairs the EU summits, described the refugee crisis as “an existential challenge for the EU” and admitted, “there is a clear delivery deficit on many fronts, from hotspots and security screening in front-line countries to relocation and returns”.

The European Commission President Jean-Claude Juncker echoed him. “Turkey has made the first positive steps in the joint action plan,” he said. “More steps need to be made however, such as the need to reduce the flow of refugees.”

Jeroen Dijsselbloem, the head of eurozone finance ministers, warned last week that the EU had to reach an agreement on the fund swiftly as it continues to tackle the most serious migration crisis in Europe since the Second World War. “On the last and key question of whether Italy has lifted its objections, the answer is still no,” said Mr Dijsselbloem.

Italy’s objections reflect the tensions between Rome and the rest of the EU. The Prime Minister Matteo Renzi lambasted the German Chancellor Angela Merkel at the EU summit last December over EU policies on energy, banking and migration.

At the same time, Italy is currently in talks with the Commission on whether it can be granted more fiscal leeway in its 2016 budget.

Under the Commission’s original deal based on gross national product, Germany was to pay €534m, the UK, €410m, France €386m and Italy €281m. Britain quickly agreed to pay its share but Italy has held back. Germany, which took in more than one million refugees last year, is particularly anxious to ensure that the Turkey deal succeeds and is already pressing for more EU cash for Ankara.