‘You’re running out of road!’ Eurozone meltdown fears as bloc’s leaders sent huge warning

’s return to the White House – and threat to impose punitive tariffs – pose a threat to the , an economist has claimed, warning continental leaders: “You’re running out of road.”

The incoming US President has previously floated the imposition of tariffs on European car imports, as well as other goods such as wine and cheese, as part of his broader push to address what he views as unfair trade imbalances.

If he goes ahead with his threat, such tariffs could significantly impact key European industries, particularly Germany’s car manufacturing sector, which is vital to its economy and exports.

Such measures could exacerbate , already grappling with slowing growth and inflationary pressures, by weakening industrial output, increasing costs for businesses, and potentially triggering retaliatory measures from the EU, further destabilising transatlantic trade relations.

Writing for the website of Netherlands-based banking corporation , Global Head of Macro Carsten Brzeski said: “Over the last 15 years, Europe has seen too many make-it-or-break-it moments. Think of the sleep-depriving, nerve-wracking weekend meetings of European leaders during the euro crisis.

“But , the pandemic, and the Russian invasion of also saw several make-it-or-break-it moments for Europe.”

One the plus side, Europe was “still there” but whether it was stronger than ever was an “entirely difference story”, Mr Brzeski argued.

He said: “For the first time since the end of the pandemic, Europe is not starting the year with optimism and hope for at least a cyclical recovery.

“Instead, 2025 has started on a weak footing and an eery feeling that growth could disappoint once again.”

The list of potential downside risks was a long one, Mr Brzeski pointed out.

He explained: “The new US administration’s looming tariffs and industrial policies are a short and long-term risk to the eurozone economy. Tax cuts, deregulation, and lower energy prices in the US could cannibalise European growth structurally.”

Additionally the presence of “two relatively lame ducks” in the form of German Chancellor and French President was likely to drag down growth, at least in the first few months, Mr Brzeski claimed.

He said: “’s second term in office comes at a time when the European economy is in a much weaker shape than eight years ago.

“Then, Europe didn’t have a war in its backyard, a competitiveness and energy issue, and China was still a flourishing export destination and not a system rival.

“Europe needs to take back control of its own destiny.”

As a “blueprint”, Mr Brzeski highlighted a report authored by Mario Draghi, former Italian PM and President of the European Central Bank, last year calling for increased investments in infrastructure, digitalisation, education and defence coupled wit reduced bureaucracy.

Mr Brzeski said: “It can’t happen in a few weeks or months.

“But if Europe doesn’t show clear and tangible signs that it’s moving in the right direction, the risk of being stuck in stagnation is high.

“So 2025 really is a make-it-or-break-it moment for Europe. And not like in the old days of last-minute crisis summits.

“The kicked can has finally run out of road. Europe needs to change. And change fast.”