The European Central Bank (ECB) chief warned the rise of populism throughout the 28-country bloc would lead to “consequences”.
He said: “Political uncertainty is dominant. This year we have suffered a multitude of uncertainties: first there was the slowdown in China and the stagnation of world trade, then the Brexit referendum and the election in the United States.
“In the medium term it is not yet clear what the consequences of past, current and future political uncertainty will be. There will be consequences, that much is certain.”
He said the effects of this uncertainty would worsen depending on how long the EU’s Brexit negotiations carry on for.
Mr Draghi said: “We have to assume [things will deteriorate with Brexit]. A lot depends on the shape of the final agreement and on how long negotiations on the final settlement will take.
“The longer the negotiations take, the longer the uncertainty. It will be more difficult for investors and other economic agents in the UK to make decisions.”
This predictions for more turbulence in Europe follows a similar doom-mongering forecast for Brexit Britain earlier this week.
Mr Draghi urged Theresa May to reveal her Brexit strategy and whinged he did not know what the Government is planning.
The ECB boss told the European Parliament’s economic and monetary affairs committee on Tuesday: “If, in the long run, the risk of a less open UK economy in terms of trade, migration and foreign direct investment were to materialise, there would be a negative impact on innovation and competition and, thus, productivity and potential output.
“Such developments would first and foremost weigh on the UK economy.
“We are looking for a concept by the UK Government where it would share its views and plans with its own citizens, and see what they say about that, before we can actually express our views on this.”