A new study into the impact of the branded clothing sector on the European economy is calling for a shift in thinking when it comes to setting out trade policies to include the full breadth of the industry.

The independent report, unveiled today (23 April) by the European Branded Clothing Alliance (EBCA), says trade policies should address the way many businesses operate through global supply networks. In particular, it wants to see rapid removal of tariffs on textile and apparel imports, and flexible Rules of Origin included in free trade agreements.

Prepared by Danish experts Copenhagen Economics and Quartz&Co, the study highlights the often-undocumented value in the shift from low-value manufacturing to high-end production and the importance of jobs in design, marketing, retail and distribution across the EU.

While the European Commission promotes a broadly pro-trade agenda, the EBCA says its members - who include more than 60 European and global retail clothing brands such as Inditex, H&M, Levi Strauss & Co, Gap Inc, Nike and VF Corporation - remain concerned there is still a level of sensitivity and protectionism, which hampers the economic growth of their sector in Europe.

This impacts their ability to create jobs and deliver benefits to European consumers, it adds.

The purpose of the new study is to highlight the economic benefits for Europe of global supply chain models.

"EBCA's members have a strong economic footprint in Europe," said its spokesman Ignacio Sierra Armas, who is also chief corporate officer of Spanish retailer Cortefiel Group.

"But in fact we only represent the tip of the iceberg as far as our sector is concerned. There are hundreds of companies operating similar business models, addingvalue to the European economy, creating jobs, and delivering quality consumer products.

"It is time for European institutions to adapt their trade policies to the realities of our business, and allow us to make an even greater contribution. A European industry which seeks to be competitive on a global scale must leverage its intellectual and creative assets."

Key takeaways highlighted by the study are that the branded clothing sector supports 4m jobs and accounts for 2.4% of EU GDP; it generated value added of EUR300bn across the EU in 2012; 50-80% of the value of clothing products produced abroad and purchased in the EU accrues to the EU; and prices of clothing and footwear have fallen by 27% in the last 15 years.

"This study shows that what our economy needs is more openness and fewer trade barriers. That is how you protect jobs," added Trade Committee member Christofer Fjellner MEP.

The timing of its release comes as the European Parliament and Council consider Commission proposals to reform trade defence legislation.

Within this, there is likely to be considerable debate about how to define the 'community interest' when looking at the impact of imports into the EU, as well as questions about how to balance aggressive trade defence measures with fears of retaliation against the EU and its companies.

It also mirrors many of the themes identified in a study commissioned by the United States Council for International Business (USCIB) on 'American Companies and Global Supply Networks'. 

This research found that the global value chains developed by companies in industries such as the branded clothing business are critical to their competitiveness and ability to drive economic growth and create jobs.

"Companies need to be able to adjust these supply networks to meet consumer demand and the fast-changing global environment marketplace," the USCIB said, adding: "Governments should assist them by developing policies that facilitate the movement of intermediate goods and services across borders."