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Talking Business: The fashion industry should naturally gravitate towards Brexit

Leon Bailey-Green

Over the past few months I’ve read several opinion and news pieces featuring fashion industry leaders lauding the necessity of Britain being in the European Union.

You could be forgiven for thinking the entire rag trade is pretty much in favour of staying in, but I refuse to believe so. An industry with far reaching connections, and ambitions to grab market share in key growth markets; this is a business that should naturally gravitate towards the Brexit message of trading with partners beyond the EU borders.

Along with mobile and social media, international has a been a buzz topic in ecommerce circles for many years. International, at least in the context of the majority of my conversations with retailers, has typically meant the EU and beyond, not just the EU. Even if the fashion industry doesn’t want to embrace Brexit, it is sure embracing its values by recognising there’s a bigger opportunity past the union barrier.

Earlier this week in a piece for Drapers, Frances Corner, head of the London College of Fashion, claimed British fashion is better of in the EU, citing the importance of the movement of people (and therefore ideas), EU funding and the single market.

Let’s take a look at the movement of people. Without getting into a debate on immigration, poll after poll shows the British public thinks it is out of control. This is leading the government to place strict controls on potential talent from outside the EU, as this is the only type of immigration it can control.

Two realities - the EU’s freedom of movement rules and the need to reduce migration to the UK are having the unintended consequence of shutting out talent from beyond the member states. By leaving the EU we would no longer be under the obligations of freedom of movement rules. Industries can then push for talent (from across the EU and further afield) to come in based on what they can do for our economy, and in respect of Frances’s concerns, our creativity.

I understand people worry about the economic impact of Brexit. Of course there will be a short term shock as the economy adjusts and the fashion industry would be affected, but is there really cause for the levels of drama and hysteria from the In campaign? Also, economists are not psychics. We’ve had plenty of shocks to the economy, which few of them saw coming. And we’re not without risk by staying in; economies across the pond have seen better days.

The fashion industry has weathered far worse than anything Brexit could bring, and it’s vital to consider the potential medium to long term benefits too.

It would be in the interest of the EU to work on a favourable trade deal with us. But even if they decide to cut their noses off to spite their faces we would default to WTO (World Trade Organisation) terms. Any impact of these tariffs to the British economy are thought to be worth two thirds of the membership fee we pay to be in the EU anyway. And that’s a worse case scenario - we’re the fifth biggest economy in the world, who wouldn’t want to do a deal with us!

The importance of trading with EU countries can’t be denied, but neither can future ambitions of both the EU project and the British fashion retail industry. Ask yourself, are they aligned?

EU expansion is pointed towards Serbia, Albania, Bosnia-Herzegovina, Montenegro, Kosovo and Macedonia. When I talk to retail leaders about global opportunities, China, India and the Middle East are mentioned. You’ll find plenty of news stories on Drapers reporting fashion retailers keen to grab market share in these places, not so much the aforementioned future EU member states.

If we leave the EU we can do deals with the nations that are key to our future prosperity. The one-size-fits-all approach to international trade deals via the EU does not necessarily work for the British fashion industry. We need to do deals with the countries who are crying out for our brands and their British heritage.

Frances mentioned in her piece a fashion industry initiative which is funded by the EU. Throughout these debates we’ve heard constant industry groups claim that funding would be lost. Let’s remember this is our money. The EU does not produce the bulk of its own revenues, the money awarded to projects which benefit the UK is a return of our fee. Leaving means taking control of how we spend that money on various schemes.

It is valid to say the government of the day may not provide funding in certain areas but once new countries join the union much of the funding we get back will dry up anyway, as those countries will see more money directed towards their development projects.

Europe has economic challenges today and ahead. It’s time to vote Leave, take control and realise what most fashion businesses are doing anyway; going (truly) global.

Leon Bailey-Green specialises in facilitating fashion industry networking

Readers' comments (3)

  • In essence, then, this argument is that Brexit is good for UK fashion, because (a) there will be an economic shock, but it'll be short-term, and more pessimistic forecasts by economists might be mistaken; (b) recruiting from outside the EU will be easier; and (c) accessing markets beyond the EU will be easier.

    It's a point of fact that all of these assumptions are unstable.

    Many readers will be aware of the economic and political warnings from such disparate corners as the Governor of the Bank of England, the IMF, the OECD, and the President of the United States, to name some. Against this landscape, camp Brexit has reassured us that the Governor of the Bank of England is a Goldman Sachs' stooge, the IMF is a mouthpiece for the Treasury, and the US President is a lame duck. We've the author's added reassurance that economists 'aren't psychic' and 'have been wrong before', so we can apparently dismiss their forecasts and focus on Leon's instead.

    What can be asserted without evidence can be dismissed without evidence. Those who wish to leave for ideological reasons can vote to do so; but their commercial and economic case for doing so has been so comprehensively discredited that the argument sounds ever more shrill.

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  • At last someone talking sense. I think you will find that those of us voting to go have actually read as much as possible on this subject whilst the "herd" can't be bothered to do their own research and come to the conclusion we will manage so much better without Brussels

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  • @Anonymous: 'I think you will find that those of us voting to go have actually read as much as possible on this subject...'

    So Brexiteers are a bookish lot, and Remainers 'the herd'? Given my earlier observation that the overwhelming majority of expert opinion rejects the economic case for Brexit, I wonder exactly what texts studious Brexiteers have been poring over. The back catalogue of UKIP manifestos, perhaps? I rather suspect the Brexiteers' canon has been compiled by starting with the conclusion and working back to the evidence.

    Nobody in this industry will benefit from Brexit. Even the threat of an exit has added 11% to our own core production costs due to currency devaluation, mitigated only by a dwindling stable of currency forwards. And worse will come. Those that aren't directly settling non-GBP invoices may not see the effect today, but they will tomorrow – and it'll only get worse. This is only the most basic, palpable effect; the more nuanced economic risks are more dramatic, well-documented, and largely uncontroversial among the economist community. The only certainty we have is guaranteed short-term pain, followed by a roulette wheel over the medium- and long-term economic landscape.

    Major economies, inside or outside the OECD, will not be more interested in nailing trade deals with the UK (GDP less than $3tn) than with the EU (GDP greater than $16tn). What's the timeline for a UK-China trade deal? Bear in mind that a meaningful trade deal with China hasn't been achieved by the US, yet, despite a GDP roughly six times that of the UK.

    The only case for Brexit is a nationalist one. It's fair enough for people to enjoy a bit of national pride and flag waving, but that nationalism does need to embrace the facts that (a) the English are German, and we invaded and settled this island by force; (b) the parliamentary freedoms of which we're so proud were drafted by a French nobleman to limit the powers of a Norman King, and were written in French and Latin, before being translated into English (a germanic language). We're as European as those on the mainland, and if there's a forum available in Brussels to help us Europeans coordinate and standardise regulatory frameworks and trade systems, we really ought to have a seat at the table.

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