Zara owner lays down ethics for Moroccan suppliers

CASABLANCA, June 27 (Reuters) - Moroccan suppliers of Spanish fashion retailer Inditex have one year to meet ethical standards laid out by the country's textile association or lose their contracts, industry executives said on Wednesday. Morocco is the second-biggest supplier to Inditex (ITX.MC), Europe's top fashion retailer with brands including Zara, Massimo Duti and Bershka.

Inditex has shifted some production to China in recent years but Morocco's proximity to Spain allows the firm to get new designs to European stores in a few days, helping it react more quickly to catwalk trends.

Moroccan textile association AMITH's label "Fibre Citoyenne" covers labour laws, social security, safety, minimum working age, working hours and environmental standards.

"Inditex is the Moroccan textile industry's biggest client," said AMITH Chairman Karim Tazi. "We cannot allow it to emerge that one of Inditex's suppliers did not respect this country's social norms."

Under the initiative unveiled by AMITH and Inditex executives in Casablanca on Wednesday, the Moroccan government will finance a programme to help Inditex's Moroccan manufacturers comply with the rules over one year.

Those that fail will lose Inditex as a client.

Most Moroccan textile employees work illegally, receiving wages in cash from firms that keep no records of working hours. Industry observers say that even firms that play by the rules often rely on subcontractors that do not.

That has turned into a competitive disadvantage now that ethically-minded Western shoppers look more than ever at who made their clothes and under what conditions.

At the other end of the scale, firms that act within Moroccan law have complained of being hamstrung by time-consuming administrative procedures and rigid labour rules.

((Reporting by Zakia Abdennebi, writing by Tom Pfeiffer, editing by Tim Dobbyn; +212 3772 6518; fax: +212 3772 2499; thomas.pfeiffer@reuters.com)) Keywords: INDITEX MOROCCO

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