Headwinds In China Could Spell Disaster For Eurozone Recovery

The eurozone has been slow to recover from its financial crisis, but this year policymakers in the region said they were beginning to see the light at the end of the tunnel. However, the most recent headwinds from China may be enough to derail the region's recovery plans and send EU lawmakers back to the drawing board.

The region has been enjoying several economic tailwinds recently as low oil prices and a weak euro have helped the bloc's exporters ramp up production. Earlier this year, traders were discussing the possibility of dollar/euro parity, but since the slowdown in China, the common currency has shot upward. Much to the dismay of EU policymakers, many have attributed the bloc's forward momentum to the weaker euro and without it, there is some doubt about how the region will fare. Now that the currency is on the rise, the success of the region's austerity efforts and financial reforms will be put to the test.

Another major concern for the eurozone will be its

, which relies heavily on emerging markets and China as customers. Since the financial crisis in 2008, most EU exporters have been focused on cost cutting and building up trade relationships with international economies across the globe. Many of those trade deals were with emerging market economies, which are taking a nosedive in the wake of concerns about China. Now, many worry that China's failure to return to economic stability will become a contagion across emerging markets, which will in turn drag the EU recovery down as well.