Central Europe will go through stress tests in 2017

Leaders of Germany and Poland at a press conference in Warsaw
German Chancellor Angela Merkel (L) and Prime Minister of Poland Beata Szydlo; Polish leaders increasingly believe that Germany will become a pivotal ally (source: dpa)
  • Political changes in the West can have far-reaching consequences for Central Europe
  • Germany’s decision to focus further integration on the eurozone may cause the European Union members that have not adopted the common currency to drift away
  • A relative newcomer to capitalism, Central Europe has been hit by a tide of ideological revolution that undermines the role of free markets and free trade

Economically, the next 12-18 months promise to be a buoyant time for the nations of Central Europe. Global manufacturing activity has perked up since the late summer of 2016, providing a strong tailwind for the region – an industrial powerhouse closely connected to German companies. There are, however, some storm clouds looming over the horizon. Central Europe is facing daunting political and economic challenges in the coming years.

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