| Mail Online
There is an 80 per cent chance that the euro will not survive in its current form, a leading think tank has warned.
The financial crisis that has crippled Greece and Ireland will spread to other debt-ridden European countries in the New Year, according to the Centre for Economics and Business Research.
Among those in the firing line will be Italy and Spain – the third and fourth biggest economies in the single currency bloc behind Germany and France.
'We give the euro only a one in five chance of surviving in its present form for 10 years,' says CEBR chief executive Douglas McWilliams.
The hard-hitting report also warns that Britain faces a tough 2011 as austerity measures bite.
'A double dip for the world economy is not likely because of the strength of the emerging economies,' says Mr McWilliams.
'But it is well within the bounds of possibility for the UK.'
An escalation of the eurozone debt crisis would be bad news for Britain because Europe is the UK’s biggest export market.
British taxpayers could also be asked to contribute more to Europe's emergency rescue fund having already pledged £7 billion towards the £72 billion bailout of Ireland.
The CEBR’s top economic prediction for 2011 is 'yet another eurozone crisis in the spring if not before'.
Fears are rising that governments across Europe will struggle to raise the hundreds of billions of euros they need next year because of soaring borrowing costs.
The CEBR reckons Spain and Italy are particularly vulnerable although there are also fears about Portugal, Belgium and even France.
The forecaster warns that the euro could break up next year – although it says this is unlikely given the political will in Berlin and Paris to keep it together.
Mr McWilliams said: 'I suspect that what will break up the euro will be the failure of most of the countries to take the tough medicine necessary to make their economies competitive over the longer term.
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