Amman, Oct. 30 (Petra) - Prime Minister Jafar Hassan on Thursday issued Budget Circular No. 14 for the 2026 fiscal year, launching the government’s budget preparation process and directing ministries and state institutions to begin drafting the General Budget Law and the system of formation for ministries, departments, and public entities.

The circular underscores the government’s intent to table the 2026 budget before Parliament by the end of November within the constitutional deadline and to secure its passage before year-end, enabling capital projects to commence at the start of the fiscal year for the first time.

Speaking during a Cabinet session held in the capital on Wednesday, Hassan reaffirmed that early budget approval is essential to avoid delays in executing capital expenditures and to sustain the momentum of ongoing reforms.

Anchored in Royal directives, the circular positions fiscal policy within Jordan’s comprehensive reform framework, spanning the political, economic, and administrative tracks. It calls for aligning fiscal and monetary priorities with the second implementation phase of the Economic Modernization Vision and the Public Sector Modernization Roadmap (2026–2029), both aimed at achieving inclusive, sustainable growth and improving the quality of public services.

The circular reiterates the government’s commitment to the National Financial and Economic Reform Program, emphasizing continued fiscal consolidation, public debt reduction to targeted thresholds, and the acceleration of structural reforms. These include enhancing the efficiency of public spending, deepening revenue administration reforms, strengthening the investment climate, and expanding digital transformation and social protection systems.

Despite persistent regional volatility, the document highlights that prudent macro-fiscal management has reinforced Jordan’s economic resilience sustaining GDP growth, stabilizing inflation, preserving the Kingdom’s sovereign credit ratings, and maintaining the fiscal deficit within manageable bounds.

For the 2026 fiscal framework, the government will pursue a dual objective: increasing productive capital outlays to stimulate economic activity, while maintaining current expenditure growth broadly in line with nominal GDP. Aggregate expenditure ceilings and sectoral allocations including for governorates have been set to safeguard fiscal discipline and optimize resource allocation.

The circular prioritizes the rollout of projects under the Economic Modernization Vision and the Public Sector Modernization Program, focusing on infrastructure, energy, transport, and water projects with high growth multipliers. It calls for greater private-sector participation through public–private partnerships (PPPs), particularly in strategic sectors such as healthcare, logistics, and renewable energy.

On the social front, ministries are instructed to direct resources toward improving education outcomes, expanding healthcare coverage, advancing digital governance, and integrating gender-responsive and climate-resilient planning within budget frameworks.

The macroeconomic assumptions underpinning the 2026 budget project real GDP growth of 2.9%, with nominal growth of 5.4% and inflation contained at 2.2%. Exports are expected to expand by 4.3% next year, while imports are projected to rise by 7.5%. The current account deficit is forecast to narrow progressively from 5.8% of GDP in 2026 to 5.2% by 2028, reflecting improved external balances and sustained export performance.

The fiscal baseline assumes continued reduction in the primary deficit and a gradual decline in public debt ratios, aided by disciplined expenditure management and improved domestic revenue mobilization. The circular also envisages the annual natural increase in wages and pensions, preservation of subsidies on essential goods such as bread and cooking gas, and steady financing conditions supported by Jordan’s stable credit outlook.

Ministries and government units have been directed to submit detailed budget proposals for 2026–2028 to the General Budget Department by November 9, 2025. These submissions must conform to their assigned spending ceilings and adopt performance-based budgeting principles, including measurable outcome indicators aligned with national reform priorities, gender equality, and climate adaptation targets.

Hassan underscored the need for enhanced fiscal governance, greater expenditure efficiency, and closer alignment between institutional strategies and national policy objectives. He also called for stronger accountability mechanisms through quarterly performance reviews, continuous evaluation of government programs, and integration of sustainability metrics within sectoral plans.

//Petra// AA