Dubai will waive bank guarantees required to set up tourism companies as part of an initiative to lower the cost of doing business and to attract investments that align with government initiatives to stimulate the economy. This move will exempt more than 2,000 travel and tour operators from providing bank guarantees worth a total of about US$68 million and free up capital to reinvest in their businesses, according to Dubai's Department of Tourism and Commerce Marketing, aka Dubai Tourism.
"As we head into 2019 with a commitment to significantly boost tourism arrivals in line with our 2022-2025 tourism strategy and vision to make Dubai the world's most visited destination, relaxing regulations in support of the business community, especially supporting startups and small/medium-size enterprises, is fundamental for sustained sector growth," said Dubai Tourism director-general H.E. Helal Saeed Almarri. "Tourism is a strong contributor to Dubai's GDP, and we intend to ensure that we sustainably enhance our economic value and aid the diversification agenda for the wider UAE."
Previously, tourism companies, including inbound and outbound tour operators, were required to furnish a bank guarantee of between US$27,000 and US$163,000 to Dubai Tourism to grant a trade license. Going forward for all new ventures, investors and entrepreneurs will no longer need to provide such guarantees either to open a tourism establishment or to offer specific travel or tour-related services and activities in the emirate.
"As such, this deregulatory measure, delivered with the support of the Department of Economic Development, complements many of our other initiatives to provide much-needed impetus to the industry, based on the landmark economic stimulus initiative launched by the visionary leadership of Dubai earlier this year to make it easier to operate and grow a business in Dubai," said Almarri. "Releasing of the bank guarantees generates an immediate cash injection of nearly a quarter-billion dirhams for travel and tourism-related service providers to invest back into their businesses and truly drive future growth, in addition to being a very positive signal for prospective investors and new ventures to launch tourism projects by taking advantage of the quick and hassle-free processes in place."