No action will be taken against a Spanish player accused of racially abusing the England Under-17 international Morgan Gibbs-White during the World Cup final in India last year.

The sport’s world governing body, Fifa, announced it had opened an investigation after Gibbs-White’s England team-mate Rhian Brewster told the Guardian he overheard the player call him a “monkey”.

Fifa issued a statement on Thursday saying it had decided to dismiss all charges “in view of the lack of sufficient evidence that could corroborate the English player’s claim”, and added: “Despite the absence of a sanction, which can only be imposed on the basis of clear evidence, the disciplinary committee would like to restate Fifa’s unequivocal, zero‑tolerance stance against all forms of discrimination, as enshrined in the Fifa statutes.”

In a statement the Kick It Out chairman, Lord Ouseley, said: “The outcome delivered by Fifa is unsatisfactory. It leaves questions unanswered such as how much more evidence is required than two people separately hearing and corroborating the alleged abuse, in order to be acceptable as sufficient? Are they not believed as honest because of who they are? Who are the investigators and who makes such ridiculous decisions?

“Are any of these people from BAME (Black, Asian and Minority Ethnic) backgrounds? Are any of these people competent with the personal experience of having suffered from racial abuse and discrimination?

“Decisions like this, and others recently by Uefa, only give encouragement to those players, and fans, who want to racially abuse and act in discriminatory ways to continue and to do so without punishment.

“There are issues within this situation that must be resolved and we urge the Football Association to follow this up with Fifa and Uefa, as the current handling of discriminatory cases about the alleged treatment of young black players representing their country and clubs is nothing short of a disgrace.”

Speaking to the Guardian in December last year of the Gibbs‑White incident, Brewster said: “Something happened in the box. As Morgan was running away, he [a Spain player] called him a monkey. It was a goal‑kick and I was getting into position. ‘Morgan,’ I said, ‘did you hear that?’ He said: ‘Yeah, yeah, I thought I was the only one.’”

Last month Uefa dismissed an allegation that Brewster was racially abused by the Spartak Moscow player Leonid Mironov during a Uefa Youth League tie in December 2017.