Stopping the spinning

ure to come up with a comprehensive strategy by then could spawn further problems, such as the end of the Schengen agreement, a pact that allows borderless travel between 26 European countries.

Lagarde said that from a personal point of view, this is “a bit of amake-or-break” moment for the Schengen agreement.

But if Europe can find a good way to manage the flow of refugees and migrants, the region can actually benefit economically from the new pool of labor. The IMF has said eurozone economic growth could rise by 0.2 percentage points, as much as 0.5 percent in countries such as Germany and Sweden.

Exit fear

Another concern vexing leaders in Davos all week has been Britain’s future in the EU.

Britain is the EU’s second-largest economy but has, as British finance minister George Osborne said, a “different relationship” to the bloc than the others. It’s not part of the Schengen agreement and doesn’t use the euro.

The Conservative government has promised a referendum on whether Britain should leave the EU by the end of 2017. But it has shownawillingness to hold it earlier, possibly this summer, if a deal reforming its relationship with the EU is agreed upon at a summit in February.

Osborne said there is “goodwill” to get a deal.

Osborne pointed to the EU’s history of securing deals at the last minute, as it has many times on Greece’s crisis.