AMMAN — A senior government official has dismissed reports suggesting that the government has recorded the highest borrowing levels, describing such claims as “misleading”.

 

The official, cited by the Jordan new agency, Petra, said that Ministry of Finance figures show that public debt increased by around JD2.7 billion, reaching JD46.8 billion, adding that a closer look at the data reveals that around 58 per cent of the increase, some JD1.5 billion, represents interest payments on domestic and external debt accumulated over previous years.

 

The rise also reflects the settlement of financial obligations, including arrears exceeding JD100 million, as well as tax refunds for previous periods, the unnamed official said, adding that the International Monetary Fund’s (IMF) methodology for assessing government financial performance excludes interest payments.

 

"The remaining JD1.1 billion of the increase includes JD212 million obtained through a concessional loan at a low interest rate, which temporarily raised the debt balance. These funds will be used to repay part of the Eurobonds maturing in January 2026, amounting to some JD710 million," he said.

 

The official also noted that the government borrowed only around JD900 million to cover the budget deficit, part of which was directed towards capital expenditures, a move considered beneficial for long-term economic growth.

 

He stressed that the government remains committed to implementing the General Budget Law, which projects a fiscal deficit of around JD2.3 billion for 2025, in addition to estimated deficits of about JD820 million for the National Electric Power Company and the Water Authority.

 

According to the official, the government has introduced a “qualitative shift” in debt management focused on cost efficiency, long-term sustainability, and innovative financing mechanisms. This approach, he said, has reduced debt service costs on Eurobonds maturing in June 2025 by 40 per cent, saving the Treasury approximately $40 million annually.

 

These savings were achieved by replacing part of the international bonds with concessional financing and low-interest Islamic sukuk, utilising liquidity in Islamic banks and forging partnerships with Arab and international financial institutions, he said, noting that the measures are part of a broader effort to ensure fiscal sustainability while supporting national development priorities.

 

He also referred to the recent expert-level agreement reached with the IMF in October 2025 under the fourth review of the Extended Fund Facility (EFF) and the first review of the Resilience and Sustainability Facility (RSF).

 

"The agreement reiterated the government’s commitment to gradually reducing public debt through fiscal consolidation while maintaining priority social and development spending.

 

The official also expressed confidence in the sustainability of public debt despite its nominal increase, emphasising that the government continues to meet all its financial obligations, an essential indicator of debt soundness.

 

He also stressed the government’s goal of reducing public debt to 80 per cent of GDP by 2028, noting that the general budget reflects the targets set under the fiscal adjustment programme, which he described as “a safe and sustainable path” toward achieving fiscal stability.

 

The official also underlined the importance of assessing government performance in light of broader macroeconomic indicators, which have shown positive trends. He also highlighted that more than 162 economic stimulus measures have been implemented to date, resulting in tangible improvements.

 

Jordan’s GDP grew by 2.8 per cent in the second quarter of 2025, the highest rate since the outbreak of the Gaza war, driven largely by a 7.5 per cent rise in tourism over the past eight months. National exports also increased by 8.0 per cent, while foreign investment surged by 36.6 per cent during the first half of the year.

 

Foreign reserves at the Central Bank reached a record $24 billion, reflecting the strength of economic policies and the effectiveness of government measures, the official added.