The International Monetary Fund warned Europe of the economic challenge of the refugee crisis and urged it to work harder to assimilate migrants.
"The tide of refugees is presenting major challenges to the absorptive capacity of European Union labor markets and testing political systems," the IMF said in its updated global economic outlook.
"Policy actions to support the integration of migrants into the labor force are critical to allay concerns about social exclusion and long-term fiscal costs."
Such efforts could "unlock the potential long-term economic benefits of the refugee inflow," the IMF added.
More than one million refugees flocked to Europe last year, most from war-torn Syria.