No-Deal Brexit Could Cost British Fashion Industry $1 Billion, Says BFC

Let’s make a deal.

Summer has officially ended here, and as British Members of Parliament prepare to reconvene in Westminster on Tuesday, Prime Minister Boris Johnson has asked them to work with him — not against him — on getting a better deal out of the European Union ahead of the Oct. 31 Brexit deadline.

In a last-minute news conference outside 10 Downing Street on Monday evening, Johnson made a brief, barnstorming speech, laying out his plans for lavish spending on education, policing, hospitals and infrastructure, and reiterated his campaign promise of taking Britain out of the U.K. by the Oct. 31 deadline “no ifs, ands or buts.”

“Over the last few weeks the chances of a deal with the European Union have been rising,” said Johnson, who has been looking to improve upon his predecessor Theresa May’s unsuccessful Brexit deal. “They can see that we want to leave with a deal, and they can also see that we will leave, come what may.”

Johnson appealed to MPs ahead of a vote in Parliament on Tuesday aimed at stopping a no-deal Brexit, and delaying the deadline by a further three months. Johnson said that no matter what happens this week, or in the weeks to come, Britain will leave the EU by Halloween with no more “pointless” delays.

His ideal scenario is to get better terms from the U.K.’s European partners by Oct. 17-18, when the next EU summit is set to take place. Parliament would then be able to approve the new measures, allowing the U.K. to exit “softly” at the end of October.

Johnson also made clear he has no plans to call an early election to consolidate his power, although if Parliament votes on Tuesday to block a no-deal scenario, Johnson might be forced to go to the polls.

Earlier in the day, the British Fashion Council made its own appeal ahead of MPs’ return to work, laying out the consequences of a no-deal Brexit for the industry.

“The reality that a no deal could still happen continues to have a negative impact on our industry,” said the BFC, quoting U.K. Fashion & Textile Association figures from 2018. The organization estimates that switching from EU trade rules to World Trade Organization (WTO) ones would cost the fashion industry between 850 million pounds and 900 million pounds.

The BFC said it wants the British government to “seek a deal with the EU that would guarantee the healthy and steady growth of the fashion industry, and give access to funding that would help ensure that British designer businesses continue to remain competitive internationally.”

It also wants the government to help fashion businesses navigate global trade challenges post-Brexit, whether or not there is a deal in place.

The BFC said it recently held a seminar for designers specifically about preparing for a no-deal Brexit, helping them to identify the risks and challenges to their business and to prepare for WTO rules in the event of no deal being reached by Oct. 31.

Following Johnson’s short speech, the pound fell by one cent against the dollar to $1.21 due to increased speculation about a snap general election.

Brexit, and in particular the recent uncertainty about whether or not Britain will strike a deal with the EU, has sent the pound to historic lows against the dollar. Before the Brexit referendum in 2016, the exchange rate was $1.48, and after the vote it fell to $1.30.

This story was reported by WWD and originally appeared on WWD.com.

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