Gov’t to increase capital expenditures by 43.6% in 2022 — Finance minister

AMMAN — The government is seeking to accelerate economic growth next year, Finance Minister Mohamad Al-Ississ said on Sunday, noting that capital expenditures in the 2022 general budget will be increased by 43.6 per cent compared with this year's budget.

Speaking during a joint press briefing, with State Minister for Media Affairs Faisal Shboul, Al-Ississ said that the Kingdom managed to reduce the budget’s primary deficit by 2.1 per cent in 2021, compared with 2020.

He also said that the International Monetary Fund has commended Jordan's performance, as the Kingdom has “notably” striked a balance between health and the economy.

There are no plans for partial or blanket lockdowns to curb the COVID-19 pandemic, he said, noting that the cost of the health response to the pandemic is less than the cost of lockdowns, according to the Jordan News Agency, Petra.

The government is determined to follow the principle of self-reliance through covering current expenditures with local revenues, he added, revealing that the self-reliance index in 2020 reached 74 per cent and is to be increased by 88.5 per cent in 2022.

He said that there will be no hikes on taxes in the 2022 budget, stressing that the policy of combating tax and customs evasion has allowed the government to not impose additional taxes.

A total of JD279 million was allocated to the government's priorities programme, he said, highlighting the allocations to combat the coronavirus health crisis, and allocations of JD80 million for youth employment.

Jordan achieved a genuine growth of 2 per cent at the end of 2021, he said, forecasting a 2.7-per cent growth next year  and inflation of 2.5 per cent. 

Al-Ississ added that public sector salaries still account for 66 per cent of the current expenditures, followed by payment of debt service at 15.6 per cent, noting that civil service salaries will reach JD1.922 billion in 2022.

The Finance minister emphasised the government's role to help young people access the labour market and improve the private market’s competitiveness.

Shboul, who is also the government spokesperson, said that the 2022 general budget has come amid exceptional circumstances linked to the impacts of the COVID-19 pandemic.

The 2022 budget marks the beginning of economic recovery, as the national economy has experienced harsh repercussions during the past two years amid the pandemic, he said

“The Kingdom’s economy was affected by the decline of exports and the flow of foreign investments,” Shboul said.

The draft general budget reflects the government’s economic policy for 2022, as well as translates the government’s economic priorities programme for 2021-2023, he added.

Regarding Jordan’s financial obligations as a result of receiving Syrian refugees, the government spokesperson said that Jordan hosts 1.3 million Syrian refugees.

Various countries commend the humanitarian role of Jordan, but the obligations of the international community to the Kingdom are less than the financial burdens sustained by the Treasury, in addition to pressures on the infrastructure, he said.