Jordan’s Lower House Monday passed the 2022 general budget with a spending volume of JD12.181 billion, which includes about JD2 billion as Capital expenditures (CapEx).
The country’s economy was significantly impacted by the Covid-19 pandemic, leading to an unprecedented rise in unemployment rates, and a record exacerbation of deficit and indebtedness, amid the worst deflation in decades.
The government is increasing capital spending by 41 percent in both state’s budgets to achieve economic recovery and realize a growth rate of 2.7 percent. JD274 million was allocated for the “Government Action Priorities Program” projects, and JD60 million for the partnership with the private sector, in addition to JD110 million for “governorate councils allocations”, and capital projects that are ongoing or under implementation.
The government’s action prioritizes program for this year includes the implementation of the first phase of the railway project, and the completion of the regional electricity linkages with Egypt, Palestine, Iraq, and Lebanon, development of the Hamza oil field production, and the Risha gas field. The government is also implementing the smart transportation system, while the completion of the national carrier project needs 5 years after the floating of tender this year, according to government projections.
Estimates indicate that the “cumulative deficit” in the two budget laws will reach JD2.4 billion this year, and about JD3.3 billion, excluding external grants, to be covered by borrowing, which will raise the public debt to JD38.8 billion, or 114.7 per cent of GDP.
The budget seeks to increase the coverage of domestic revenues for current expenditures this year to about 88 percent, compared to 74 per cent last year, in an effort to strengthening self-reliance.
The 2022 budget is the last to be issuedafter recent constitutional amendments came into force. The amendments stipulated the submission of the draft budget to the Parliament starting from the 2023 fiscal year within one law, including the budgets of government units.