+++ V.I. (BBG) Schaeuble Warns Schengen Near Collapse as EU Bickers on Refugees

…Quod Erat Demonstrandum…

(BBG – click to see) German Finance Minister Wolfgang Schaeuble warned the Schengen free-movement area is on the verge of collapse as European Union members bicker over how to cope with a record influx of refugees into the region.

Schengen is “close” to failing and the EU would face a “tremendous, enormous” threat if Germany was forced to reintroduce border controls and take measures similar to those in Sweden, Schaeuble told reporters in Brussels after a meeting of EU finance ministers.

“We can only avoid such a development if we solve the problems quicker, through better and more effective protection of the external borders and through more and more intensive support and cooperation,” Schaeuble said. “For that we will need a lot more money.”

The EU says Europeans make over 1.25 billion journeys within the Schengen zone every year, which comprises 26 countries from the Barents Sea to the eastern Mediterranean, including some such as Iceland and Norway that aren’t part of the EU. Its disintegration would send the signal to markets that the European project, including the euro, may be reversible, according to analysts including Wolfango Piccoli, managing director of Teneo Intelligence in London.

Turkey Aid

“Schengen can only work in the long term if we find a united European response to the challenge of migration” and improve protection of the EU’s outer border, German Chancellor Angela Merkel’s chief spokesman Steffen Seibert told reporters in Berlin.

A large number of EU finance ministers on Friday called for the urgent finalization of an agreement from late last year that grants Turkey 3 billion euros ($3.3 billion) in aid for taking in refugees from Syria.

“Time is running out,” Schaeuble said. The EU budget won’t suffice to raise funding for refugee aid in the broader region around Syria and a “coalition of the willing” should fill the gap under informal EU coordination, he said.

European Commission President Jean-Claude Juncker on Friday also highlighted the importance of Schengen for the EU.

“Without the freedom of movement of workers, without the freedom of the citizen to travel, the euro makes no sense,” Juncker said. “What’s the point of having one currency which you can use across the continent if you can’t travel across the continent as we have been able to do up to now?”