In an interview with the Brussels-based Web site EUobserver, Stanislaw Tillich, the Saxon state minister in charge of European affairs, said that his region desperately needs Polish and Czech workers, despite its massive 20 percent unemployment rate.

"Our automobile, IT and health sectors suffer from a shortage of highly qualified employees, whereas Saxony's own unemployed consist mainly of poorly or non- qualified workers," Tillich said.

But due to measures passed by the German government which restrict access for workers from new EU states for up to 7 years, the Saxon government in Dresden is unable to recruit highly-skilled labor in Poland and the Czech Republic.

"While British head-hunters are searching the Polish and Czech labor markets for personnel, we as a region bordering these states cannot do so because of the transitional period imposed by the federal government," Tillich said.

The minister added, "the availability of a skilled labor force is a crucial precondition for companies to invest in our region. The restrictive measures influence negatively upon the competitiveness of Saxony".

Berlin is to blame

During the last decade, Saxony has seen many of its own young, educated workers move away to western Germany because of higher wages and better opportunities. The exodus has led the average age of the Saxon population to increase to 42 years -- the highest in Germany.

Tillich, a member of the conservative Christian Democratic Union (CDU), which is an opposition party on the national level, sharply attacked the German government led by the Social Democratic Chancellor, Gerhard Schröder.

"The federal government should acknowledge the damaging effect of these restrictive measures on Saxony's ability to attract investment," he said. "But instead of modernizing the German economy, the government interferes in new EU member states' affairs by blaming them for having low company tax rates."

Tillich referred to Berlin's repeated criticism, shared by Paris, of the new EU states for dragging away investment to the East by offering very low levels of corporate tax to companies.

Tillich said corporate taxes weren't a government prerogative.

"Company taxes are not part of the EU treaty," he said

Isolated position

Tillich said he hopes that a compulsory EU-wide assessment of the transitional measures for free movement of workers in May 2006 will make the German government change its mind.

"Hopefully the facts will convince the government in Berlin that the measures were wrong. Obviously there has not been a great "flood" of immigrants to the West after enlargement, as some have feared," he said. "On the contrary, car makers in the new states are even recruiting workers in Germany."

But, so far, Saxony is the only German state pleading for an end to the closure of the German labor market. Other CDU-led states support the federal government's position.