Uncertainty over trade policy between the UK and the EU has affected a significant number of textile and apparel manufacturers, fashion designers and retailers, according to research by Dr Patrizia Casadei and Professor Simona Iammarino.
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The Brexit shock in the UK's fashion and textile industry (Creative Industries Policy & Evidence Centre)
While the dreaded no-deal scenario did not materialise when the UK left the EU single market and customs union in January 2021, many UK businesses are struggling to deal with the new UK-EU trade agreement, as it involves higher trade costs in the form of non-tariff barriers such as customs procedures, documentation requirements, and regulatory compliance. The UK’s creative industries (CIs), which are mostly represented by micro firms, usually financially constrained and less capable of quickly adjusting to trade shocks, are amongst those sectors most affected by these changes. There are also concerns of a decreased ability to retain foreign creative skilled labour, which constitutes a key driver of growth and innovation in the country. In recent months, for example, there have been growing concerns of a crisis of the UK fashion and textile industry. The EU is by far the largest trade partner for the UK’s CIs and accounts for more than 70% of UK fashion and textile exports. Increased costs, administrative burdens, and delivery delays seem to be now creating severe disruption to the UK-EU trade, with fashion businesses losing EU clients and some planning to establish distribution warehouses and branches in the EU at the expense of UK jobs.
In our research, we show that the uncertainty over trade policy between the UK and EU – which started in the wake of the 2016 referendum – had already affected a significant number... Keep reading on Creative Industries Policy & Evidence Centre.