Contract from Marrakesh or Tenerife (7)
I believe the answer is:
shorten
'contract' is the definition.
(I know that contract is a action)
'from marrakesh or tenerife' is the wordplay.
'from' says the answer is hidden in the clue.
'SHORTEN' is hidden within 'marrakesh or tenerife'.
(Other definitions for shorten that I've seen before include "Truncate" , "Put extra fat" , "Curtail" , "Make less long" , "Reduce in length" .)