Exports of UK clothing to the EU are plummeting as Brexit redtape discourages exporters

According to a recent study, UK exports of footwear and clothing to the EU are down since the Brexit. This is due to complex regulations at the border and the red tape that has been imposed.

According to Retail Economics and Tradebyte, the online marketplace and consultancy Retail Economics, exports of non-food products to EU member countries fell by 18% between 2019 and 2023.

According to the report, British retailers and brands have seen their sales into the EU plummet in recent years despite the thriving European ecommerce market.

Only DIY and gardening and health and beauty were able to offset some of the decline in clothing and footwear.

Small and medium businesses were among the worst hit, as they faced a greater burden of red tape relative to multinational companies.

Richard Lim, the head of Retail Economic and one of the authors of the report, explained that a part of the decline was due to the change in trade routes. UK firms who previously repackaged goods from Asia to sell in the EU, have now reorganised supply chains by setting up offices within the single market in order to bypass border restrictions.

Red tape, however, has forced many UK-based apparel producers to relocate their manufacturing to another EU country at the cost of UK skills and jobs.

Lim explained that in one case, a sock maker in Leicester who declined to name himself, had moved production to Italy. This marked the end of more than 100-years of manufacturing in East Midlands.

According to the authors, the UK has not benefited from the boom in sales of online goods in the EU.

The report stated that “Online retail sales are estimated to increase by £323bn annually to EU economies. However, additional trade frictions due to Brexit-related complications are curtailing the international sales opportunities for UK-based retailers and brands.”

Lim stated: “It’s a huge opportunity that UK brands are not grabbing.”

The spike in inflation last year, which increased the price of export goods, has he said softened the decline in trade value with the EU.

Separately, a report released on Tuesday by UK In A Changing Europe revealed that services exports have increased by almost 30% since February 2020.

The analysis of official statistics showed that UK services had not only recovered quickly after the pandemic but had also exceeded the pre-pandemic level by the second half of 2022.

This growth was driven by “a boom” in UK business services. This sector includes legal services, consulting, and transportation equipment, including cars, to become the UK’s biggest export sector.

Over the period of 2020-2023, UK exports of service remained stable while France and Germany’s services exports declined.

The report stated that it was unclear why UK service firms increased their sales when they had been largely unaffected Brexit rule changes.

Rain Newton-Smith is the head of CBI. She said that there was a need to review UK’s trade relationship. She also presented the wishlist of the business lobby group ahead of the general election on 4 July.

Newton-Smith said that a “bold” pitch should be made to international investors, and that Britain and the EU could use 2026 as a time for a review of trade agreements.

She told Bloomberg, “That’s when we will think about what we can do to improve and minimize some of the trading frictions which are impacting our business.”

Keir starmer, the Labour leader, has stated that he would align himself with the EU in regards to food and agricultural products should he become prime minister. He has, however, ruled out joining the Single Market and allowing free movement between Britain an the EU.