Jordanian lower house approves 2024 budget focusing on revenue increase, debt management

Collage: Kazinform

The Lower House of Parliament, in a session attended by Prime Minister Bisher Khasawneh and other members of the government, chaired by Speaker Ahmed Safadi, voted in favor of the 2024 general budget bill, Petra reports.

The 2024 budget draft projects public revenues of JD10.3 billion, an 8.9 percent increase over 2023. It forecasts local revenues to reach JD9.6 billion, marking a 10 percent rise from the previous year's figures.

The proposed budget also envisages increased allocations for servicing the public debt, reflecting the global rise in interest rates driven by the US Federal Reserve's inflation-curbing policy.

Current expenditures are estimated at approximately JD10.6 billion, with capital expenditures projected at around JD1.7 billion, bringing total public expenditures to JD12.37 billion.

According to prior government statements, the 2024 draft budget has successfully reduced the primary deficit for the fourth consecutive year.

The government aims to lower the primary deficit to JD812 million, equating to 2.1 percent of the gross domestic product, compared to 2.6 percent in 2023.

Furthermore, the total public debt, excluding the debts of the Social Security Investment Fund, is expected to decline to 88.3 percent of GDP. This percentage is anticipated to continue its gradual decrease in the forthcoming years, reaching 85.7 percent in 2026.

Finance Minister Muhammad Ississ addressed the parliament following the approval, which was secured with 89 votes.

Ississ emphasized the government's strategic approach to maintaining financial stability and promoting economic growth, focusing on the execution of profound structural reforms rather than short-term measures like increasing tax rates.

He highlighted the government's efforts in avoiding solutions that would have adversely affected the middle class and emphasized the pursuit of tax evaders.

The Minister pointed out the stability of Jordan's public finances, underlining their role in the country's overall stability.

He credited these financial strategies with enabling Jordan to withstand various regional and global economic and political challenges.

Ississ underscored the ambition of the government to exceed its current achievements, emphasizing the importance of self-reliance in planning and decision-making, even amidst challenges such as the pandemic, global and regional conflicts, and contractionary global economic policies.

Addressing the economic challenges faced in preparing the 2024 draft budget, particularly in light of the war on Gaza, Ississ noted the resilience of the national economy, strengthened by structural reforms and sound financial and monetary policies. These reforms, he stated, have helped mitigate inflationary impacts and economic repercussions.

In his address, Ississ detailed the financial policy directions of the 2024 draft budget. These policies are built upon principles including avoiding tax increases, combating tax evasion, raising capital expenditure, enhancing social protection, increasing the share of local revenues to cover current expenditures, and reducing the primary deficit and public debt relative to GDP.

The Minister highlighted Jordan's economic performance in the face of international conflicts and the contractionary policies of major countries. He noted the local inflation rate of approximately 2.08 percent in 2023 and the stability of food prices. The government's tax reforms have led to a significant expansion in local revenues.

Regarding public debt, Ississ noted a gradual decline, with projections indicating it will reach 88.3 percent in 2024, down from 88.8 percent in 2022.

He underscored the transparency and consistency of financial statements and indicators issued by the Ministry of Finance, which align with international accounting standards and have been affirmed by international financial institutions and credit rating agencies.

Ississ concluded by reaffirming the significance of financial and monetary reforms in addressing regional challenges, such as the war on Gaza, and highlighted the government's forward-looking vision in implementing structural reforms essential for maintaining financial and monetary stability.

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