Abu Dhabi: The International Air Transport Association (IATA) will no longer accredit GCC travel agencies unless they provide bank guarantees commensurate with their individual sales revenue.

The decision is expected to result in the shutdown of nearly 20 per cent of travel agencies in the UAE, said Hani Khorsheed, secretary-general for the Gulf Travel and Tourism Association Committee (GTTAC) during an exclusive chat with Gulf News.

"Effective January 1, 2010, travel agencies across the GCC have to submit a bank guarantee to be fully IATA-accredited, and this can range from Dh500,000 to Dh80 million depending on the travel agencies' sales revenue," said Khorsheed.

The GTTAC is a regulatory body, with its headquarters in Abu Dhabi and established by the Abu Dhabi Travel and Tourism Agencies Council (ATTAC), with other GCC founding members including Bahrain, Kuwait, Sharjah and, only recently, Qatar, which verbally approved of joining GTTAC on December 23.

During their initial three-hour meeting which took place on December 19 in the capital city, the GTTAC founding members discussed various challenges facing the travel and tourism industry in the GCC.

The major topic was the need to attract more GCC members, (such as Dubai, Oman and Saudi Arabia) to join the GTTAC, in order to help increase travel and tourism in the region by 2010.

"The travel market in the GCC represents approximately 4 per cent of the GDP of the GCC countries' economy, for that reason the GTTAC stands a very good chance to assist in promoting the travel and tourism industry across the region.

"I will personally pursue all efforts to solidify and sustain the objectives ahead of us," GTTAC chairman and president Nasser Butti Omeir Bin Yousef told Gulf News.

While the GTTAC coordinates with over 1,000 travel agents in the UAE to help increase traffic inflow by taking part in international exhibitions and contacting international tour agencies, they are also trying to help them stay in business.

Low-cost airlines

"Apart from the strict regulations imposed on travel agencies by IATA, the merging of new low-cost web-based airlines has resulted in a loss of business for many travel agencies.

"In the Gulf there are six low-cost airlines that travellers can access on the web," said Khorsheed.

Board members at the GTTAC have agreed to meet every two months to discuss issues regarding the tourism and travel industry in order to come up with a unified decision that will benefit IATA, travel agencies, the national carriers in the GCC and the global distribution companies.

According to the secretary general, the number of passengers in the GCC increased by 10 per cent last year, and regional airlines grew by more than 20 per cent.

"Each member of the committee has been delegated to handle a specific issue being discussed during the meeting. At the end we believe in establishing a transparent dialogue with national airlines and IATA in order to come up with a satisfactory decision," Khorsheed said.