Amman, Nov.21 (Petra) --The Cabinet, led by Prime Minister Jaafar Hassan, has approved the draft general budget law for the fiscal year 2025, setting the stage for its submission to the Parliament in the coming days as mandated by the constitution.

The proposed budget is built on realistic assumptions and aligns with the requirements of the Economic Modernization Vision, allocating necessary funds for major projects such as the National Water Carrier and the railway connecting the Port of Aqaba to mining areas in Shidiya and the Ghor Safi region.

This budget comes amid exceptional regional challenges impacting economic activity, investment climates, and tourism. Achieving the developmental goals outlined in the budget will require concerted government efforts to ensure adequate spending for major developmental and strategic projects, attract foreign investment, and reduce the growth rates of external debt service in the coming years.

The draft law estimates total public expenditures at approximately JD12.511 billion, including current expenditures of about JD11.042 billion and capital expenditures of approximately JD1.469 billion, reflecting a 16.5% increase over the revised estimate for 2024. This increase is intended to cover funding for major projects, build new hospitals and schools, and maintain existing facilities.

Additionally, the proposed budget aims to reduce the primary deficit for 2025 to 2% of GDP, compared to 2.9% in 2024.

It aligns with the roadmap for public sector modernization by allocating necessary funds for the executive program and implementing recent directives regarding public sector employment, while ensuring sufficient provisions for salaries to cover new positions.

The budget’s realism is evident in its attention to enhancing the national economy's growth capacity and job creation, taking into account regional conditions that are expected to improve, positively influencing key economic indicators.

Accordingly, projected public revenues are estimated at around JD10.233 billion, with local revenues estimated at JD9.498 billion and external grants at JD734 million. The budget reflects realistic revenue projections that will aid in better managing the developmental process.

Notably, the draft budget shows an increase in the coverage ratio of local revenues for current expenditures, reaching 86% compared to 81.6% in the revised estimate for 2024. Conversely, the ratio of external grants to total expenditures has decreased to 5.9%, down from 6.3% in 2024, reinforcing a self-reliant approach and reflecting the state’s ongoing efforts in this direction.

The share of external grants in total local revenues has gradually declined since 2004 due to Jordan's commitment to self-reliance, decreasing from approximately 17.22% between 2004-2008 to around 11.18% from 2019-2022.

The budget is based on forecasts of a real economic growth rate of about 2.5% and a nominal growth rate of around 4.9%, while maintaining moderate inflation rates, which will contribute to financial and monetary stability.

On the social protection front, the proposal includes increased allocations for the National Aid Fund and the social safety net to support families in need. It is expected that around 15,000 new families, comprising 90,000 individuals, will benefit from the fund.

The draft law also allocates an additional 50% increase for the Student Support Fund, raising total allocations to JD30 million. This will enable the fund to assist more students, increasing from around 44,000 beneficiaries last year to an expected 53,000.

Furthermore, financial provisions have been earmarked to support strategic food commodities, including household gas cylinders, wheat, and barley, as well as indirect support for essential services in water, electricity, and health sectors.

To empower the Jordanian Armed Forces-Arab Army and security agencies in fulfilling their duties effectively and maintaining their capabilities, the draft law allocates necessary financial resources to meet the essential needs of these vital institutions.

//Petra//WH

21/11/2024 11:09:24