Germany's interior minister has vowed to crack down on right-wing activists and racists after two nights of clashes between protesters and police outside a refugee shelter in an eastern town near Dresden.

Police on Sunday set up a security zone around the shelter, an empty hardware store in Heidenau, and Sigmar Gabriel, the country's vice chancellor, was expected to visit the town on Monday.

On Saturday, about 200 right-wing activists, many of whom were drunk, had thrown fireworks and bottles at police, the Reuters news agency reported. Some shouted "Heil Hitler".

A day earlier, at least 31 police officers were hurt in violent protests against the asylum seekers.

Condemning the attacks, Interior Minster Thomas de Maiziere, said: "At the same time as we see a wave of people wanting to help, we have a rise in hate, insults and violence against asylum seekers.

"That is obscene and unworthy of our country. Anyone who acts like that faces the full force of the law."

Zero tolerance

As Europe struggles with an influx of refugees fleeing war in countries such as Syria and Iraq, German politicians are worried about the financial and social effects on their country, the EU's biggest recipient of refugees.

Germany, which has relatively liberal asylum laws, expects the number of refugees to quadruple this year to 800,000.

Chancellor Angela Merkel says it is the biggest issue the EU faces, tougher even than the Greek debt crisis.

Justice Minister Heiko Maas responded to the Heidenau riot by saying there was zero tolerance for xenophobia or racism.

In the first half of the year alone, about 150 arson or other attacks were recorded on refugee shelters.

Some of Merkel's ruling party want to curb benefits for asylum seekers and for other EU states to take up more of the burden.

De Maiziere said the EU had to agree on a list of countries of "safe origin" to make it easier to deport refugees, including nations trying to join the bloc and some African states.

More than one third of asylum seekers in Germany are from southeastern European countries such as Albania and Serbia.

Gabriel said the EU's passport-free Schengen zone could be at risk if the impression arose that only Sweden, Austria and Germany accept large numbers of refugees.

Some politicians have demanded more money for localities to spend on housing, care and education for refugees. Others want faster processing of applications from an average eight months.

Source: Agencies