The European Union is pursuing reforms aimed at expanding economic and monetary integration and strengthening defense, in an effort led by French President Emmanuel Macron. German Chancellor Angela Merkel was widely viewed as partnering his efforts.
However, the two leaders' plans have been handed a blow by Merkel's unconvincing win at Sunday's election, according to Mark McFarland, chief Asia economist at Union Bancaire Privée, a Swiss private bank.
"I think what you've got now as a result of the election is the likelihood [Merkel] doesn't survive four years," McFarland told CNBC's "Capital Connection" on Tuesday, referring to the chancellor's election term.
Furthermore, Merkel will find it increasingly difficult to implement consistent policies as "she is ultimately answering to a broader coalition of political opinion, and she has the opposition harking at her in the Bundestag on a regular basis," he added.
Ultimately, those factors would undermine Germany and France's vision for the euro zone project, McFarland said.
Sunday's election saw a surge in voter support for the Alternative for Germany party , which openly opposes immigration and participation in the euro zone. Votes for the AfD increased 7.9 percentage points from the previous election in 2013 to reach 13.3 percent of the total — the largest rise among all of the country's political parties.
The strong showing means that a populist, far-right party will enter Germany's parliament for the first time in around 70 years.