2022 general budget not expected to revive economy — experts

(File photo: Ameer Khalifeh/Jordan News)
AMMAN — The general state budget and the budget of government units for the fiscal year 2022, which were approved by the Senate last month, were published in the Official Gazette on Wednesday, showing total public expenditures amounting to JD10.6 billion, the total public revenues amounting to JD8.912 billion, and the expected deficit standing at JD1.7 billion.اضافة اعلان

Economists interviewed by to Jordan News criticized this year’s general budget, saying that it is similar to last year’s, which means it will not help alleviate the declining economic indicators.

They consider it “even worse than those that preceded it”, seeing that it cannot contribute to changing the difficult economic conditions brought about by the COVID-19 pandemic and, more recently, by the Russian-Ukrainian conflict.

Economist Mohammad Al-Bashir described this year’s budget as “rigid” and possibly leading to even “more deficit and dependence on external grants”. The situation will not be helped by the fact that there is decline in financial aid provided to the Kingdom and by the economic crisis caused by the Russian-Ukrainian conflict, he added.

Bashir told Jordan News that the balance of trade is still skewed, with Jordan importing more than it exports, and this year’s budget will not help overturn the economic decline or revive the economy, as hoped.

“What is required of the government at this stage is to address the tax burden, which may lead to a reduction in the cost of goods so that they are able to compete, and we can export our products abroad, which may also contribute to a decrease in unemployment rates”, he added.

Economist Zayan Zawaneh told Jordan News that this year’s budget cannot be expected to contribute to reviving the economy or to the implementation of much-needed mega-projects.

“What is required is a conscious government that knows how to manage economic crises with tact and intelligence,” he said.
...the “huge and frightening rise in oil prices is a very big challenge to the budget”
“We are still suffering from the consequences of the COVID-19 pandemic, nowadays we must brace ourselves to deal with the consequences of the Russian-Ukrainian conflict, and oil prices have started to rise to unexpected levels, so what can the government do now, in the absence of a clear-cut economic plan or real cooperation between the public and private sectors,” he asked.

According to Zawaneh, the “huge and frightening rise in oil prices is a very big challenge to the budget”, and both government and citizens are facing enormous pressures.

The “solution is to think in a flexible manner to come up with real and radical solutions that ensure that the economic burden does not increase”, he said.

Economic expert Fahmi Al-Katout told Jordan News that “the current year’s budget brings nothing new, does not differ from the budgets of previous years, and is not expected to lift the burden on the state, especially with regard to the increasing deficit, which will lead to a higher rate of indebtedness”.

Katout said that “the imposition of indirect taxes that exhausted the industrial and agricultural sector, and the government’s inability to manage the energy file” created imbalances that the government does not seem inclined to address, “which will exacerbate the problems, especially in light of the difficult economic conditions”.

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