Moving between morning and evening work, Ziad Al-Tawil, 30, spends half his day at work, returns home in the evening carrying bundles of paper documents in his hands, needs to work at home at night, and during the weekend.
Al-Tawil tells Al-Jazeera Net, "My wife and I work day and night, and unfortunately the wages that we get do not cover our expenses and our financial obligations, which forces us to borrow to pay off previous loans, and this is how we live in the cycle of loans and inability to repay, we do not know when we will get out of them."
Al-Tawil's case is not unique to Jordanians.
In fact, many people resemble it, and what added to the difficulties of living for Jordanians was the Corona pandemic, which raised unemployment rates and increased debt.
Al-Tawil’s case is also similar to that of his country’s government. All the plans and strategies that the government put in place to confront the specter of increased indebtedness and the rising budget deficit were unable to do so - according to analysts - until the government found it difficult to borrow from abroad or sell treasury bonds to borrow from within.
A royal decree was issued accepting the resignation of Omar Razzaz's government as a constitutional entitlement after the dissolution of the House of Representatives, and during the tenure of the government that took office in June 2018, the debt increased by 4 billion dinars, and the unemployment rate rose from 19% to 23%;
But it is recorded to her that she opened the file of tax evasion and combating corruption, and provided the necessary support to the sectors and groups affected by the Corona pandemic, in partnership with the private sector.
Decline in the purchasing power of Jordanians, Archives at the beginning of this year (Al-Jazeera)
Shocking numbers
The latest figures from the Jordanian Ministry of Finance showed an increase in the total public debt owed by the Kingdom during the first half of this year by 6.6%, recording 32 billion dinars ($ 45 billion), compared to 30 billion dinars at the end of 2019, and the total Jordanian public debt constitutes a proportion of 101% of GDP.
The high budget deficit and the increase in debt, the Ministry of Finance attributed its causes to the Corona pandemic, expecting the budget deficit to rise to $ 1.8 billion in 2021.
According to the Ministry of Finance statement, the increase in the deficit came as a result of the decline in domestic revenues during the first half by 588 million dinars ($ 829 million), as a result of the closure of the economy and public holidays after mid-March due to the Corona crisis, and the decline in demand for goods in the markets and their closure Except for pressing basic sectors.
Previous strike to protest the income tax law on the agricultural sector (Al-Jazeera - Archive)
Increase the tax burden
“Corona is a major cause of the high deficit and indebtedness, but it is not the only reason,” former Finance Minister Muhammad Abu Hammour told Al-Jazeera Net, adding that the debt before Corona last February was 31 billion.
But the main reason for the increase in indebtedness during the reign of the Razzaz government, which extended for 27 months, according to Abu Hammour, is "the continuous decline in local tax and non-tax revenues, with the expansion of spending, especially current expenditures, in addition to the decline in economic growth in recent years, as a result of the increase in tax burdens on individuals." And companies, especially the new income tax law. "
Abu Hammour recommends that the new government, expected to be formed, should reduce the tax burdens on companies and individuals, leading to increased economic growth, with the need to resolve obstacles to the entry of foreign and Arab investments into the Kingdom, and work to resettle existing local investments for fear of their escape abroad.
Previous strike of livestock breeders to protest the income tax law (Al-Jazeera)
New loans to pay off old ones
The economic analyst, Salama Al-Darawi, told Al-Jazeera Net that the 2020 budget since the beginning of the year was heavily indebted before Corona, and he adds that Corona caused a significant decline in non-tax revenues, which led to an abnormal growth in expenditures for certain sectors such as the health sector, which led to borrowing to finance these expenditures. New sectors, which affected them.
Al-Darawi explains that, until last May, his country's government borrowed more than 1.3 billion dinars ($ 1.9 billion) in internal debt. These loans were divided between current and operational expenses and debts owed by the government to pharmaceutical companies, contractors and others, which were paid.
As for external debt, the government borrowed the largest loan in its history through Eurobonds worth 1.2 billion dinars (1.7 billion dollars), the largest part of which is to pay off a Eurobond loan that is due to be repaid, and the rest are expenses.
Al-Darawi concluded his speech by calling the new government for a real strategy to manage the public debt file with greater care and attention, with the need to review the items of capital expenditures, and to stop spending on items that do not add value to the economy, as there are items that do not generate job opportunities, do not stimulate economic growth, and strengthen partnership Reality between the public and private sectors to advance economic reality.