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A growing political gulf between central Europe and western EU powers represents a far greater risk to the European project than Brexit, according to economists.

A focus on Brexit has led markets and politicians to grow “complacent” about the rise of the far Right and Eurosceptic political movements in Poland, Hungary and Austria, they say.

“The risk of fissures in the European Union, particularly on its eastern flank, are a bigger worry than Brexit. There’s a growing sense that Brexit is an issue that’s manageable,” Chris Beauchamp, chief market analyst of IG Group, said.

Ian Stewart, chief economist at Deloitte, voiced similar concerns for the EU as too much focus is given to “Brexit and protectionism from Trump’s administration”.

Economists may be “too complacent”, he added, about institutional risks for Europe presented by widening divides between some central and eastern governments, and visions such as that expressed by French president Macron of closer political and economic integration.

This comes after Brussels triggered Article 7 against Poland – a punishment that can lead to states being stripped of their voting rights in EU institutions – in response to legal changes in the country, which some say threaten the independence of its judiciary.

Hungary, which opposes efforts to push through the Article 7 process, is likely to face a similar reprimand due to actions in its higher education sector. US midterm elections could also present headaches, should they be mostly won by the Democrats, Mr Beauchamp warned.

Such a swing could jeopardise major construction plans to be announced by the Trump administration in early January, potentially causing market wobbles for major construction firms such as Caterpillar and Ashtead.

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