Recycling Textile Waste Can Create Jobs, Unlock Investment, and Boost Competitiveness in Morocco

World Bank Group’s IFC pilot program demonstrates feasibility;
next step is scaling through reforms and investment

Rabat, Morocco, June 9, 2026 — Pilot trials conducted as part of the Morocco Textile Circularity program, led by the World Bank Group’s IFC, show that recycling textile waste in Morocco is technically viable and commercially feasible – and that scaling it could attract US$1.9 billion in additional private investment and generate more than 30,000 jobs, according to the World Bank Group’s Country Private Sector Diagnostic for Morocco.

The pilot program more than doubled original targets: 427 metric tons of textile offcuts were turned into new materials for manufacturing, with a further 2,400 tons committed for recycling. Recycled-content fabric met standard commercial quality benchmarks across all tested parameters and can re-enter the supply chain without compromising performance and quality. A life-cycle analysis also found that using recycled materials can reduce carbon emissions by around 18 percent and water use by over 60 percent compared to conventional production.

A significant share of the economic opportunity would benefit workers at the base of the value chain. Morocco's textile waste collectors currently operate more than 80 percent informally. Research conducted as part of the program found that up to 75 percent of collectors could transition to formal status within five years given the right institutional support, creating a more stable foundation for the circular economy and new economic security for some of Morocco's most vulnerable workers.

"Scaling textile circularity in Morocco will create tens of thousands of jobs and build a globally competitive industry," said David Tinel, IFC’s Regional Manager for the Maghreb. "The proof is in place. Scaling now establishes Morocco at the forefront of sustainable manufacturing for global markets."

Capturing the full opportunity requires targeted policy action. The program's recommendations call for reclassifying factory offcuts as industrial by-products rather than waste; reforming customs rules to allow brands to transfer legal ownership of those materials to local manufacturers; establishing a national traceability platform to meet the EU's incoming Digital Product Passport requirements; and investing in domestic spinning capacity so that recycled fiber no longer needs to be exported for processing before it can be reused locally.

Textile circularity is a timely matter as global buyers – particularly in the European Union, which absorbs 93 percent of Morocco's textile exports – are tightening requirements on sustainability, traceability, and recycled content. The EU's Digital Product Passport enters into force in 2027, and mandatory extended producer responsibility schemes for textiles are expected across all member states by then.

The Morocco Textile Circularity program brought together Morocco's Ministry of Industry, Ministry of Energy Transition, the customs administration, industry federation AMITH, international brands, factories, collectors, and recyclers – the first structured multi-stakeholder platform of its kind in the textile sector. It reflects the World Bank Group's 65-year partnership with Morocco: connecting macro reform with private sector investment and translating policy ambition into growth that works for all Moroccans.