Ammon News - Addressing Jordan’s public finance challenges is no longer optional but an urgent national necessity. Public finance forms the foundation for rebuilding trust between citizens and the state and provides a solid base for sustainable economic growth. The royal directives have emphasized the importance of advancing a comprehensive reform program across political, economic, and administrative tracks, reflecting official awareness of the significance of this issue and its impact on state stability and the future.

The Economic Modernization Vision prioritizes raising growth rates and ensuring sustainability, alongside improving living standards and providing employment opportunities. Achieving these goals requires more efficient management of public finance, prioritizing projects with direct impact on citizens’ lives. In this context, assessing the financial impact of public-private partnership projects is crucial to ensure they deliver real economic returns without becoming an additional burden on the treasury.

A national strategy for fiscal reform should focus on several integrated pillars. First, transparent and realistic budgeting that reflects the true deficit and debt, enforcing spending within allocated ceilings across all institutions. Second, rationalizing capital expenditures by prioritizing projects with added economic value (e.g., public transport projects) while halting economically unviable projects. Third, strengthening public-private partnerships so that investment in development projects becomes a shared responsibility, reducing government burdens and increasing growth opportunities.

The strategy must also address chronic imbalances such as untargeted subsidies, medical exemptions, and tax evasion. These require difficult but necessary decisions to put public finance on the right track. It is also important to reconsider the tax structure, reducing reliance on indirect taxes (sales tax) in favor of direct taxes (income tax) to enhance fairness and align with constitutional principles.

Stimulating economic growth represents the primary pathway to sustainably increasing public revenues. Genuine fiscal reform is not limited to controlling expenditures but rather to broadening the income base. This can be achieved by raising aggregate demand particularly through increasing households’ disposable income, which leads to higher private consumption and greater production activity. It also requires stimulating both public and private investment to ensure a stronger flow of capital into productive sectors. Enhancing the efficiency of capital spending is among the most effective tools for stimulation, by directing resources toward projects with high economic impact on employment and growth. Moreover, expanding exports serves as a key driver for broadening economic activity and strengthening foreign exchange reserves, which in turn positively affects tax revenues and financial stability. Through these integrated policies, the economy can move from stagnation to a dynamic growth path capable of generating sustainable revenues and alleviating pressure on public finances.

Challenges extend beyond finance: negative public sentiment has reduced trust in economic achievements, high household debt has weakened purchasing power, and high production, energy, transport, and financing costs have limited competitiveness. Bureaucracy and complex regulations also impede investment and restrict the business environment. Addressing these challenges is essential for successful fiscal reform, as any financial policy requires a strong economic base.

Prioritizing grant- or concessional loan-funded projects in budgeting and enhancing institutional relations between the Ministry of Planning and the private sector to highlight investment opportunities are critical. Giving priority to Jordanian companies in implementing funded projects whenever possible is equally important.

Success requires strong political will, courageous decisions, and building societal consensus that fiscal reform is not merely an economic measure but a national path to protect the country’s future. Sound public finance is not just an accounting tool; it expresses the state’s ability to manage resources efficiently and direct them toward real development. If Jordan adopts and implements a comprehensive national strategy, it will lay the foundation for a strong economy capable of meeting challenges and fulfilling citizens’ aspirations for a better life and a more stable future.