JEDDAH, 5 March 2004 — New licensing rules are set to hit travel agencies, already in disarray over government efforts to Saudize 35 percent of the industry’s staff.

Travel agents told Arab News yesterday they sought immediate intervention of higher authorities including provincial governors, seeking longer grace periods to Saudize jobs after heavy-handed arrests of expatriate employees of travel agencies in Riyadh sent shockwaves through the industry.

“Saudi officials have verbally informed the travel industry of their decision to halt the campaign for the time being,” said Rashid Al-Mugaid, general manager of United Saudi Travel Agents (USTA), here yesterday.

The decision to stop raiding the travel agents has been largely welcomed by the travel industry, said Al-Mugaid, who heads the organization of 17 travel companies that work out training programs for Saudi agents.

Travel industry sources had earlier warned that the abrupt enforcement of Saudization could affect some 2,800 travel companies of the Kingdom, inflicting huge losses.

Under the first phase of the Saudization program, travel agents were to Saudize 35 percent of their staff by Feb. 21, but when the deadline came large numbers of agencies remained closed because they were unable to meet it.

Several expatriate employees of Kanoo Travel in Riyadh were released Tuesday after spending 48 hours in jail and having their heads shaved, apparently because the company had been unable to hire sufficient Saudi staff.

Now the Presidency of Civil Aviation is set to hand over control of the sector to the Supreme Council for Tourism, under a memorandum of understanding the two bodies signed recently.

When that happens, the Billing and Settlement Plan-Saudi Arabia (BSPSA) will be in charge of licensing agents and making sure they meet international standards. Effectively this will mean that travel agencies are policed by the International Air Transport Association (IATA), the body accrediting travel agencies all over the world.

It will mean regular inspections to make sure the agencies are up to international standards. New agencies can apply for IATA approval after a few months of satisfactory performance.

“The BSPSA will also decide what other guarantees” apart from a letter of credit “should be furnished for opening a new travel agency,” a senior industry source told Arab News yesterday.

Saudization will be one focus of such inspections.

But Saudization in the travel trade “is easier said than done,” another senior industry source said. There have been many instances when young Saudis trained and employed by travel agencies left for greener pastures within a few months, very often to get more lucrative jobs in banks and hotels, he said.

“Their training has been a financial burden for travel agencies,” he said. He suggested that each Saudi employed in a travel agency should sign a five-year bond.