Public debt, budget deficit increase as foreign reserves remain within safe limits

AMMAN — The Kingdom's total public debt increased by the end of January to some JD27.4 billion, constituting 95.6 per cent of the gross domestic product (GDP), compared with JD27.27 billion that amounted to 95.3 per cent of the GDP in 2017, the Finance Ministry announced on Monday.

The ministry said in its monthly bulletin, cited by the Jordan News Agency, Petra, that the debts of the National Electric Power Company (NEPCO) and the Water Authority of Jordan (WAJ) totalled some JD3.7 billion at the end of the said month.

Updates showed that the net debt by the end of January, compared to the end of 2017, increased by JD355 million, which was allocated for covering the budget deficit and the debts of NEPCO and WAJ that are guaranteed by the central government.

As for the external debt until the end of January, it went up by JD7.8 million to JD11.87 billion, which constitutes 41.4 per cent of the estimated GDP until the end of January.

The ministry also announced that the post-grant budget deficit in January stood at JD42.7 million, compared to a surplus of JD114.3 million registered in the same period of 2017.

Excluding foreign grants, the budget deficit in the first month of 2018 stood at JD52.5 million, compared to registering a JD100 million surplus in January 2017 the ministry stated. 

It attributed the budget deficit increase in January 2018 to disbursing some JD115 million as cash subsidies to citizens in one instalment, instead of 12 monthly payments, to offset the rising prices of bread following the lifting of subsidy. 

Also on Monday, the Central Bank of Jordan (CBJ) said that national economy indicators are positive despite the political unrests in the region, especially in Syria and Iraq, which negatively affected the performance of many important economic sectors.

The CBJ, in a report carried by Petra, noted that the foreign reserves by the end of February this year totalled JD13.9 billion that covers the cost of the Kingdom’s imports of goods and services for 7.7 months.

The CBJ data showed that the total deposits in licensed banks stood at JD33.4 billion by the end of January, compared with JD33.2 billion by the end of 2017.

Accumulative deposits in dinar in January 2018 accounted for JD25.8 billion, compared with JD25.6 billion by the end of 2017, while deposits in foreign currencies reached JD7.7 billion, compared to JD7.6 billion in the same comparison period.

The credit facilities granted by licensed banks amounted to JD25 billion in the first month of 2018, compared with JD24.7 billion by the end of 2017.