Job losses

The Economics of Xenophobia

bautzen fire-oliver killig-dpa
Onlookers cheered the fire in the building in Bautzen that was intended to house refugees.
  • Why it matters

    Why it matters

    Right-wing violence in eastern Germany threatens to have a serious economic impact on what are already some of Germany’s poorest regions.

  • Facts


    • A series of recent violent incidents has focused attention on xenophobic tendencies in Saxony and other eastern German states.
    • Saxony is Germany’s tenth largest state, with a population of 4.3 million. It has promoted itself heavily as an attractive industrial and commerce location.
    • One in five arson attacks on migrant housing in 2015 took place in Saxony.
  • Audio


  • Pdf

Leading economists are warning of dire economic consequences from the recent wave of anti-foreigner violence in the eastern German state of Saxony, saying the incidents could eventually hurt Germany as a whole.

“Xenophobic violence can cause massive economic damage; it is already hurting the economy of the entire state of Saxony,” Marcel Fratzscher, the president of the German Institute of Economic Research, told Handelsblatt. “Saxony will pay a heavy economic price for the anti-foreigner attitudes of some of its population.”

Last week, in Clausnitz near the Czech border, an angry mob blocked a bus from bringing asylum seekers to a residential center. Police were criticized after manhandling frightened refugees out of the bus. In Bautzen, onlookers cheered as a building intended to house refugees burned to the ground in a suspected arson attack.

The incidents were the latest in a series of violent anti-migrant protests in the eastern state, whose capital is Dresden. In the most serious incident, in August of last year, right-wing radicals laid siege to a building housing migrants, attacking police with stones and fireworks.

The cities of Dresden, Freiberg and Meerane have seen comparable attacks.

While anti-migrant violence has surged across Germany, Saxony seems particularly badly hit. According to the research group Media Service Integration, 20 percent of all attacks in 2015 took place in Saxony, which has a population of 4.3 million.

Want to keep reading?

Subscribe now or log in to read our coverage of Europe’s leading economy.