Jordan’s government plans to stimulate its anaemic economy through an aggressive spending boost. In a bid to stave off five years of sub-3% annual GDP growth (see chart), Amman plans to spend a record $13.8bn (JD 9.81) per its draft budget passed this week by the upper house. As a strategy it is not without risks, as the budget will rack up the biggest deficit in the kingdom’s history, $1.76bn, thanks in large part to a 33% hike in capital spending to $2bn.
This marks a divergence from Jordan’s ongoing work with the IMF to reduce deficit spending and transition toward private sector-led development. Jordan’s increasingly worrying economic outlook saw the kingdom turn to the Washington-based development bank for financing in 2016 in return for reforms, but the unpopular measures caused widespread protests in 2018 (MEES, 8 June 2018). (CONTINUED - 567 WORDS)
