A new study suggests that since Brexit complex regulations and red tape at the border have deterred clothing and footwear exports from the UK to Europe. However, beauty and health products, as well as gardening and DIY product exports remain robust.
ADVERTISEMENTThe UK has seen clothing and footwear exports to the EU fall significantly post-Brexit, according to a report by the online marketplace Tradebyte and consultancy Retail Economics. This is mainly due to increasing red tape and stricter border regulations.
Footwear and clothing exports to the EU have dropped more than 50% from 2019 levels, to £2.7 billion (€3.17 billion) in 2023. In comparison, back in 2019, it was £7.4 billion. In turn, this has led to non-food goods exports to the EU single market falling 18%.
This decrease is despite the European e-commerce market being very well developed.
According to the Retail Economics and Tradebyte report, as reported by The Guardian, “Online retail is estimated to add £323 billion of annual sales to EU economies, but additional trade frictions caused by Brexit-related complexities are curtailing this international sales opportunity for UK-based brands and retailers.”
Post Brexit, UK and EU trade has fallen under the Trade and Co-operation Agreement, which enables tariff-free trade, however, does little to lessen trade barriers.
According to the House of Commons, UK exports of goods and services to the EU amounted to about £340 billion in 2022. On the other hand, the UK imported 48% of its total imports from the EU, at around £432 billion in 2022. In the same year, the UK faced a £5 billion trade surplus with non-EU countries, whereas it had a trade deficit with the EU amounting to about £92 billion.
Despite the decline in UK clothing and footwear exports, beauty and health product exports to the EU remain robust. Gardening and DIY products have also seen good export numbers.
Regulation and red tape at the border deterring UK exporters
Although some UK exports to the EU are doing well, overall, since Brexit, trade between the UK and the EU has become much more complicated, due to more complex regulations. Smaller businesses usually face the brunt of this, whereas larger companies often have their own legal teams and experts to help them navigate the regulations.
Since the UK has now left the EU single market, the EU has levied upon UK exports the same checks that any other third-party country is subjected to. This includes things like checking that standards for disease control and food safety are met, as well as ensuring that all relevant taxes such as VAT, tariffs and excise duty are paid.
For apparel exports especially, like clothing and footwear, the EU has very specific laws, such as products needing to meet the requirements of the EU’s General Product Safety Directive.
They also have to ensure that certain chemicals and substances are kept to a minimum level in the products, as well as ensuring that product designs have not breached intellectual property laws. Baby and children’s clothes also usually have to meet more stringent safety standards.
However, the UK has been quite lax about implementing similar measures on imports from the EU, potentially putting itself at a disadvantage.
According to the website, UK in a Changing Europe, “Stricter controls on UK exports to the EU compared to EU imports into the UK has put British domestic industries and suppliers at a disadvantage.
“This is because it creates an uneven playing field for British traders, such as farmers, as they are subject to expensive and time-consuming checks on their exports to the EU, while competing businesses in the EU can export to the UK without similar barriers.”
UK supply chains are also still facing the lingering impact of the pandemic, as well as dealing with the effects of the Russia-Ukraine war, and higher interest rates, impacting export numbers as well.
